The Insurance Australia Group Ltd (ASX: IAG) share price has been struggling over the last week. Unfortunately, it hasn't been helped by a significant announcement.
On Friday, IAG announced it was being taken to Federal Court. The Australian Securities and Investments Commission (ASIC) had launched civil proceedings against the company.
The IAG share price closed on Monday at $4.90 a share. That's 0.41% lower than it was at its previous close and 8.4% less than it was a week ago.
Let's take a closer look at the news that's driven IAG's stock on the ASX over the last 7 days.
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The week that's been for IAG
The IAG share price had a rough week during which it announced the ASIC charges.
ASIC is alleging the company engaged in misleading and deceptive conduct. The allegations stem from IAG's subsidiary, Insurance Australia Limited's practice of increasing premiums while adding loyalty and 'no claim benefit' discounts. As a result, some customers were allegedly not given the total discount they were promised.
Insurance Australia Limited issues insurance through many brands. In this case, NRMA insurance customers were affected.
ASIC claims that at least 596,000 NRMA home, motor, caravan, and boat insurance customers were affected by the practice from March 2014 until September 2019.
It claims customers missed out on discounts totalling more than $60 million.
IAG found the practice during a review and reported itself to ASIC before engaging in a remediation program. So far, the company has compensated more than 80% of affected customers.
The IAG share price fell 3% on Friday.
IAG share price snapshot
Despite his week's dip, IAG's shares have been performing well on the ASX lately.
They are currently 3.9% higher than they were at the start of 2021. They have also gained around 2% since this time last year.
