Dec 8 (Reuters) - Insurance Australia Group Ltd IAG.AX :
* IAG (LON:ICAG) IMPROVES CAPITAL EFFICIENCY AND REDUCES EARNINGS VOLATILITY
* ENTERED INTO THREE AGREEMENTS TO QUOTA SHARE A COMBINED 12.5% OF ITS CONSOLIDATED BUSINESS FROM 1 JANUARY 2018
* INSURANCE AUSTRALIA GROUP - FROM 1 JAN 2018, REINSURERS TO RECEIVE COMBINED 12.5% OF CO'S CONSOLIDATED GROSS EARNED PREMIUM
* DEAL WITH REINSURERS MUNICH RE, SWISS RE AND HANNOVER RE COVER IAG'S BUSINESS IN AUSTRALIA, NEW ZEALAND AND THAILAND
* IAG WILL RECEIVE AN EXCHANGE COMMISSION WHICH RECOGNISES VALUE OF ACCESSING IAG'S STRONG CORE FRANCHISE
* INSURANCE AUSTRALIA GROUP -AGREEMENTS EXPECTED TO DELIVER REDUCTION IN REGULATORY CAPITAL REQUIREMENT OF ABOUT $435 MILLION,OVER A 3-YEAR PERIOD
* DEALS BROADLY NEUTRAL EPS AND ROE EFFECTS, PRIOR TO CONSIDERATION OF POTENTIAL CAPITAL MANAGEMENT IMPACTS
* COMBINED 12.5% QUOTA SHARE AGREEMENTS WILL HAVE NO EFFECT ON 1H18 RESULTS FOR SIX MONTHS ENDED 31 DECEMBER 2017
* CO HAS RAISED ITS FY18 REPORTED INSURANCE MARGIN GUIDANCE BY 125 BASIS POINTS, TO 13.75% - 15.75%
* FY18 NATURAL PERILS ALLOWANCE REDUCES TO $627 MILLION
* INTENDS TO MAINTAIN ITS CET1 RATIO WITHIN ITS TARGETED BENCHMARK RANGE
* DEALS EXPECTED TO RESULT IN IAG'S INSURANCE PROFIT BEING BROADLY UNCHANGED
* DEALS ANTICIPATED TO ENHANCE IAG'S REPORTED INSURANCE MARGIN BY APPROXIMATELY 250 BASIS POINTS PER ANNUM.
* DEALS HAVE AN AVERAGE INITIAL PERIOD OF MORE THAN FIVE YEARS.