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AAP
AAP
National
Neve Brissenden

Illegal algorithm costs Insurance Australia $40 million

Insurance Australia Limited, wholly owned by IAG, has been ordered to pay $40 million penalties. (Mick Tsikas/AAP PHOTOS) (AAP)

Australia's largest insurance company has been hit with the largest-ever penalty imposed by the courts against an insurer for failing to give promised discounts to NRMA customers.

The Federal Court has ordered Insurance Australia Limited to pay $40 million after finding the company, wholly owned by ASX-listed Insurance Australia Group, made false or misleading representations to more than 600,000 customers between March 2014 and September 2019.

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