Insurance Australia Group (IAG) is facing renewed market speculation after reports suggested it may sell a major division valued at more than $4 billion.
According to a February 10 report by S&P Capital IQ, sources believe investment bank Barrenjoey is positioning itself for a potential role in selling IAG’s intermediated insurance business. The division mainly includes the CGU brand. In the year to June 30, the intermediated division generated about $4.6 billion in gross written premiums and delivered roughly $328 million in insurance profit, making it one of IAG’s larger operating segments by premium volume.
The speculation follows IAG’s decision last year to separate the intermediated unit from the rest of the group, a move market observers say can make a business easier to divest.
IAG has denied that the division is up for sale or that it has formally hired an investment bank.
The intermediated business sells mainly commercial insurance through brokers rather than directly to customers and includes brands such as CGU and WFI. In October 2025, the Federal Court approved the transfer of about 920,000 commercial policies within the division to CGU Australia, marking a significant internal restructure of the unit.
Sources also note that the intermediated business operates with lower earnings margins compared with other parts of IAG. They say that to lift earnings, the division would likely need to expand its broker network.
Any potential divestment would involve a business that accounts for roughly a quarter of IAG’s total gross written premium, based on the group’s reported annual premium base of about $17 billion.
