American International Group’s General Insurance, or property/casualty business, saw double-digit premium growth and substantially higher net income in Q3 along with lower catastrophe losses.
AIG produced $1.7 billion in net income during the quarter, which compares with $281 million in the 2020 third quarter.
“AIG’s performance in the third quarter and through the first nine months of the year validates the strategy we have been executing over the last few years,” AIG President and CEO Peter Zaffino said.
Zaffino said the General Insurance results demonstrate an underwriting discipline that is “now embedded” in AIG’s culture and the benefits of its “volatility reduction efforts through a well-articulated risk appetite and reinsurance program that performed well.”
General Insurance net premiums written grew by 11%, driven by commercial lines growth of 17%, which included 18% growth in North America and 15% growth in International.
The quarter saw underwriting profitability, with a combined ratio of 99.7 inclusive of catastrophe losses, and 90.5, as adjusted, which represents a 2.8 point improvement from the combined ratio, as adjusted, in the third quarter of 2020.
AIG reported $20 million in underwriting gain, versus a $423 million underwriting loss in the same, year-ago period. In the U.S. and internationally, commercial lines losses grew, but personal insurance was profitable.
The underwriting results included $628 million of catastrophe losses, predominantly from Hurricane Ida and U.K. and European floods, compared to $790 million in the prior year quarter, which included $185 million of estimated COVID-19 losses.
North America Personal Insurance net premiums written growth of 11% reflected increases in the travel and warranty business driven by increased consumer spending, partially offset by lower Private Client Group (PCG) business due to underwriting actions taken to improve portfolio mix and rate adequacy. International Personal Insurance net premiums written decreased 3% compared to the prior year quarter.
Zaffino said that AIG remains on course in its effort to separate its Life and Retirement program from the company. AIG recently sold a 9.9% equity stake in its Life and Retirement arm for $2.2 billion, and said a planned IPO for the business remains on track for 2022.
Consolidated net investment income for Q3 was $3.7 billion, versus $3.8 billion in the previous year’s quarter.
Source: AIG
Topics AIG
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