IAG CEO Nick Hawkins says the Middle East conflict has added to inflationary pressure, especially in property lines.

“I think the challenge is around property … inflation which has been sticky and just hasn’t gone away,” he told last week’s investor day.

“Pre-Middle East, [we’re] still there, building costs and claims, the cost of rebuilds for us, but I think it’s not unique to the insurance industry … And I think the Middle East is going to make that go longer, that inflationary pressure.

“That’s what we’re experiencing, that inflationary pressure … it’s not coming off on property classes.”

Mr Hawkins also outlined the company’s new growth targets at the investor day.

IAG aims to have more than 11 million customers and gross written premium of at least $25 billion by 2030.

Its retail insurance division has about 6.7 million customers, generating $10 billion in GWP, and the aim by 2030 is to lift that to 8 million customers and $15 billion GWP.

Investment bank Jefferies says in a note the targets “are ambitious but not aggressive”.

IAG also shared updates on its use of artificial intelligence.

“Our efforts are now more directed at the processes that will improve the customer experience, our claims and sales and service, as we continue to transform our business for the future,” Mr Hawkins said. “Of course, AI is going to be a huge part of our transformation ... going forward.”

The Jefferies note says IAG’s “AI integration and adoption are significant. With extensive, complex workflows, assisted by large data sets, the insurance industry is widely viewed as one with a lot to gain from AI. This is reflected in IAG’s rapid adoption rate.”