What happened to the Insurance Australia (ASX:IAG) share price in 2021?

The 2021 year had its lows, but the new year brings hope.

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The Insurance Australia Group Ltd (ASX: IAG) share price had a rough year in 2021.

Shares in the company fell from $4.70 to $4.26 during the year, a 9% fall.  In contrast, the S&P/ASX 200 Index (ASX: XJO) gained around 13%

Let’s take a look at how the year played out for the insurance group.

Tough end to the year

The IAG share price was up and down like a rollercoaster in 2021 before a huge slump at the end of the year.

In an early high for the company, IAG shares soared 8% between market close on 8 February and 11 February. Strong financial results were received well by investors, with the company reporting a 3.8% rise in gross written premiums. Insurance profit also surged by 33.1% due to a low level of claims.

However, shares in the company then fell dramatically by nearly 15% between market close on 11 February and 10 March. Shares crashed on 9 March before being put in a trading halt. Media speculation on exposure to the Greensill collapse weighed on investors minds. However,  IAG informed the ASX it had “no net insurance exposure to trade credit policies including those sold through BCC to Greensill entities”.

The company’s share price then recovered this loss, soaring more than 15% between 10 March and 8 June. Several new leadership changes were announced by the CEO.

In August, the IAG share gained on the back of a major board reshuffle and positive FY21 results. Between 4 August and 12 August, the company’s shares gained 12%. The company saw a 3.8% increase in its gross written premium to roughly $12.1 million.

September saw the ING share price plummet nearly 12% between 6 September and 24 September. Investors reacted to news CMC Hospitality had filed an application to start Federal court proceedings against the company. This hit the share price hard.

Then between 11 October and 17 November, the share price took another massive hit amid news ASIC had taken IAG subsidiary Insurance Australia limited to court. Severe storm and hail activity also negatively impacted the company’s claim costs, further driving down the share price.

Share price recap

The IAG share price performed roughly 22% worse than the benchmark ASX index in 2021. On a positive note, the new year is starting well for the company, with shares up 4.23% so far this year.

Shares in the company are down 1.33% in the past month.

The company has a market capitalisation of about $10.9 billion based on the current share price.

The Motley Fool Australia's parent company Motley Fool Holdings Inc. has no position in any of the stocks mentioned. The Motley Fool Australia owns and has recommended Insurance Australia Group Limited. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson.

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