Insurance Australia Group H1 falls 11 pct, beats forecast

SYDNEY Feb 23 (Reuters) - Insurance Australia Group , the country's top car and home insurer, reported an 11 pct drop in first-half net profit, with general insurance profit eroded after reinsurance costs rose on the back of record disaster claims in 2011.

IAG said first half-net profit was A$144 million ($153.2 million) compared with A$161 million a year ago and an average forecast of A$119 million according to Thomson Reuters I/B/E/S.

IAG, which dominates the Australian market along with QBE Insurance and Suncorp, saw unprecedented claims in 2011 from floods and storms in Australia and earthquakes in New Zealand. Those claims forced it to raise reinsurance cover to A$4.7 billion from A$4.1 billion a year ago.

The insurer said earlier that a hailstorm in the state of Victoria on Christmas Day would push up the cost of natural peril claims well above its allowance for the first-half.

IAG recorded an interim dividend of 5 cents. ($1 = 0.9402 Australian dollars) (Reporting by Amy Pyett; Editing by John Mair)