Insurance Australia Group share price lower after proceedings were filed against it

The Insurance Australia Group Ltd (ASX: IAG) share price has dropped lower in early trade after announcing that it has been made aware of a representative proceeding filed by Johnson Winter & Slattery in the Federal Court of Australia against it.

At the time of writing the insurance giant’s shares are down 0.5% to $7.55.

What has happened?

According to the announcement, a representative proceeding has been filed by Johnson Winter & Slattery in the Federal Court against it and its subsidiary, Swann Insurance, on behalf of Jones Asirifi-Otchere.

The company provided no further details and will update the market as and when it receives more information and as appropriate.

At this stage it is unclear what the proceeding relates to, but is presumably related to motorcycle insurance or finance given Swann Insurance’s inclusion.

Swann is a subsidiary of Insurance Australia and a specialist in motorcycle insurance. It divested its motor dealer, finance broker, and fleet network operations at the beginning of August 2016 and ceased participation in the motorcycle dealer channel from July 2017.

What now?

As details of the proceeding are limited at best, shareholders will need to be patient with this one. Though, they can take heart from the relatively small decline in its share price today, especially given how the market is down by a similar amount.

This could be a sign that investors are not overly worried by the news and it is business as usual.

Should you invest?

Whilst insurance shares like Insurance Australia, QBE Insurance Group Ltd (ASX: QBE), and Suncorp Group Ltd (ASX: SUN) are attractive for their generous dividend yields, I’m not a big fan of them due to their inconsistent performances over the last decade.

While things may be better over the next decade, I intend to focus on opportunities elsewhere on the market.

These dividend shares, for example, could provide superior returns for investors over the long term.

NEW! Top 3 Dividend Bets for 2019

With interest rates likely to stay at rock bottom for months (or YEARS) to come, income-minded investors have nowhere to turn… except dividend shares. That’s why The Motley Fool’s top analysts have just prepared a brand-new report, laying out their top 3 dividend bets for 2019.

Hint: These are 3 shares you’ve probably never come across before.

They’re not the banks. Not Woolies or Wesfarmers or any of the “usual suspects.”

We think these 3 shares offer solid growth prospects over the next 12 months. The first two currently offer fat, fully franked yields. The last is a surprising REIT offering you the benefits of being a landlord with none of the hassle! You’ll discover all three names and codes in “The Motley Fool’s Top 3 Dividend Shares for 2019.”

Even better, your copy is free when you click the link below. Fair warning: This report is brand new and may not be available forever. Click the link below to be among the first investors to get access to this timely, important new research!

The names of these top 3 dividend bets are all included. But you will have to hurry. Depending on demand – and how quickly the share prices of these companies move – we may be forced to remove this report.

Click here to claim your free copy right now!

More reading

Motley Fool contributor James Mickleboro has no position in any of the stocks mentioned. The Motley Fool Australia owns shares of Insurance Australia Group Limited. We Fools may not all hold the same opinions, but we all believe that considering a diverse range of insights makes us better investors. The Motley Fool has a disclosure policy. This article contains general investment advice only (under AFSL 400691). Authorised by Scott Phillips.

The Motley Fool’s purpose is to help the world invest, better. Click here now for your free subscription to Take Stock, The Motley Fool’s free investing newsletter. Packed with stock ideas and investing advice, it is essential reading for anyone looking to build and grow their wealth in the years ahead. This article contains general investment advice only (under AFSL 400691). Authorised by Bruce Jackson. 2019

Source link Finance News Australia

Enter your Email Address

Leave a Reply

Your email address will not be published. Required fields are marked *

Social Media Auto Publish Powered By :