Fourth quarter 2022 net income attributable to American International Group common shareholders fell to $264 million from about $3.7 billion the year prior, but the insurer’s general insurance business ended the year with “the strongest underwriting results the business has ever achieved,” said CEO Peter Zaffino.
AIG’s adjusted after-tax income was about $1.3 billion in the fourth quarter compared with about $1 billion for the last three months of 2021.
But focusing on the general insurance segment, underwriting income jumped 27% in the fourth quarter to $635 million from $499 million in Q4 2021. For the second straight year, underwriting profit in general insurance improved $1 billion, Zaffino added in a statement.
“Improvement in general insurance continued through portfolio optimization, prudent risk selection and limit reduction of over $1.2 trillion since 2018,” Zaffino said. “Our strong momentum continued through the complex January 1 reinsurance renewal season, where the quality of our portfolio enabled us to secure treaties on favorable terms in a very challenging market.”
The Q4 combined ratio in general insurance was 89.9, an improvement of 2.5 points from the same period the prior year. Catastrophe losses during Q4 were $235 million, primarily from Winter Storm Elliot. Q4 net premiums written (NPW) for the segment fell 6% to about $5.6 billion. Personal lines NPW fell 14% due in part to AIG’s repositioning of its Private Client Group business. The personal lines business in North America reported a combined ratio of 102.5.
The day before releasing its earnings, AIG announced it plans to partner with Stone Capital to form an independent managing general agency for its high net worth business.
Commercial lines NPW saw growth in North America of 3% but a decline of 8% in International. Each region recorded profitable combined ratios of 84.4 and 89.4, respectively.
Quarterly results also included favorable prior-year development of $151 million, net of reinsurance.
Topics Profit Loss Underwriting AIG
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