The Insurance Australia Group Ltd (ASX: IAG) share price is marching higher today.
Shares in the S&P/ASX 200 Index (ASX: XJO) insurance company closed yesterday trading for $8.50. In morning trade on Wednesday, shares are changing hands for $8.65 apiece, up 1.8%.
For some context, the ASX 200 is down 0.1% at this same time.
This outperformance follows the release of IAG's full-year FY 2025 results.
Here are the highlights.
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IAG share price lifts on results
Investors are bidding up the IAG share price after the company reported a 51.3% year-on-year increase in net profit after tax (NPAT) to $1.36 billion. IAG's FY 2025 insurance profit of $1.74 billion was up 21.2% from FY 2024.
Gross written premium also showed growth, up 4.3% year on year to $17.11 billion. The insurance giant's net earned premium increased by 8.0% to $9.98 billion.
This led management to declare a final dividend of 19 cents per share, 40% franked. That's up 11.8% from last year's final dividend. And it brings the full-year passive income payout to 31 cents per share, up 14.8% from FY 2024.
At the current IAG share price, this sees the ASX 200 stock trading on a partly franked dividend yield (part trailing, part pending) of 3.6%.
If you'd like to bank the final IAG dividend, you'll need to own shares at market close on 20 August. IAG stock trades ex-dividend on 21 August. You can then expect to receive that passive income payout on 18 September.
Over the 12-month period, IAG paid out $10.2 billion in claims to help its customers recover from unexpected losses.
The company reported a strong capital position, with a Common Equity Tier 1 (CET1) capital of $3.94 billion, up 17% from FY 2024.
What did management say?
Commenting on the results helping boost the IAG share price today, CEO Nick Hawkins said, "We had strong momentum through FY25 and supported our customers when they needed us most."
Hawkins added:
IAG's financial outcomes this year are a result of the positive financial and operational performance of all our divisions supported by favourable natural perils and investment markets.
We have migrated over five million policies onto our Enterprise Platform that supports our retail businesses. The platform delivers best-in-class technology for underwriting expertise, policies, pricing and claims, significantly improving our customers' experience.
What's next for the IAG share price?
Looking to what could impact the IAG share price in the year ahead, Hawkins said, "We have successfully set our business for growth, investing to create a scalable business which enables us to grow quickly and efficiently."
IAG provided FY 2026 guidance for GWP growth of "low-to-mid single digit".
Reported insurance profit is forecast to be in the range of $1.45 billion and $1.65 billion, which the company said roughly equates to a reported insurance margin of 14.0% to 16.0%.
IAG added that it's FY 2026 guidance does not include the benefit of its RACQI and RACI acquisitions (two Aussie-based Royal Automobile Club insurance businesses). The RACQI acquisition is expected to complete on 1 September, which the company said will result in GWP growth increasing to approximately 10%.
With today's intraday boost factored in, the IAG share price is up 19.1% since this time last year, not including those dividends.
