- Net income per diluted share was $1.74 and adjusted
after-tax income* (AATI) per diluted share was $1.77
- General Insurance underwriting income increased 19%
year-over-year to $596 million, or 67% on a comparable
basis*†
- General Insurance adjusted pre-tax income (APTI) increased
9% year-over-year to $1.4 billion, or 27% on a comparable
basis†
- General Insurance combined ratio improved 2.1 points from
the prior year quarter to 89.8%; Accident year combined ratio, as
adjusted* (AYCR) improved 0.3 points from the prior year quarter to
88.4%, or 1.6 points on a comparable basis†
- As a result of the 2023 divestitures, General Insurance net
premiums written (NPW) of $4.5 billion decreased 35% on a reported
basis, but increased on a comparable basis† with 4% growth in North
America Commercial
- Executed nearly $3 billion of capital management actions in
the first quarter, including returning $2.4 billion to shareholders
through $1.7 billion of common stock repurchases, $250 million of
dividends and the redemption of $500 million of preferred stock,
and the repayment of $459 million of aggregate principal amount of
maturing debt
- Return on common equity (ROCE) was 10.8% and adjusted ROCE*
was 9.3%; adjusted ROCE was 13.3% for General Insurance and 11.9%
for Life and Retirement
- On April 30, AIG’s Board of Directors declared a cash
dividend of $0.40 per share on AIG common stock, an 11% increase
from prior quarterly dividends, marking the second consecutive year
of 10%+ dividend increases
- AIG Board of Directors also increased the share repurchase
authorization to $10.0 billion effective May 1
American International Group, Inc. (NYSE: AIG) today reported
financial results for the first quarter ended March 31, 2024.
AIG Chairman & Chief Executive Officer Peter Zaffino said:
“AIG began 2024 with very strong momentum in delivering on our
strategic and operational progress while achieving exceptional
financial results, reflecting the foundational capabilities we have
cultivated over the last several years. In addition to outstanding
profitability, this quarter was highlighted by the significant
capital management actions we completed, placing AIG in a position
of strength ahead of Corebridge Financial’s deconsolidation from
AIG.
“General Insurance had another quarter of impressive Commercial
Lines profitability benefiting from continued strong underwriting
performance and low levels of catastrophe losses as we continue to
manage volatility in our results. The combined ratio of 89.8%
improved 2.1 points year-over-year, or 3.8 points on a comparable
basis†. The accident year combined ratio, as adjusted, of 88.4%
improved 0.3 points year-over-year, or 1.6 points on a comparable
basis†. In Global Commercial Lines, the combined ratio of 85.8%
improved 3.4 points year-over-year, and the accident year combined
ratio, as adjusted, was 84.4%.
“As a result of the 2023 divested businesses and changes in
reinsurance structures, General Insurance net premiums written
decreased 35% year-over-year, but increased on a comparable basis†.
Growth rates in the quarter were impacted by changes in reinsurance
structures which should provide benefits in the remainder of the
year. Global Commercial Lines pricing, which includes rate and
exposure, increased 6% excluding Workers’ Compensation and was
ahead of loss cost trend. Excluding Workers’ Compensation, North
America Commercial Lines pricing increased 7% while International
pricing increased 5%, both slightly ahead of loss cost trend.
Overall market conditions remain favorable and we continue to
execute our strategy of successfully deploying capital organically
in markets where we see the most attractive risk-adjusted returns.
In this environment, disciplined underwriting is increasingly
critical and the strength and depth of the underwriting talent we
have built at AIG will enable us to continue to drive profitable
growth.
“Life & Retirement’s solid financial results benefited from
higher base portfolio spread income and strong sales with total
premiums and deposits* of $10.7 billion for the first quarter of
2024 and were among the highest results in the past decade. In
April, Corebridge Financial (Corebridge) closed the sale of AIG
Life to Aviva plc for £453 million ($569 million), solidifying
their U.S. focus. On April 30, the Corebridge Board of Directors
also authorized an additional $2 billion of share repurchases
following active share repurchases year to date.
“While reducing our ownership stake in Corebridge remains a top
priority in 2024, we continue to diligently execute on our capital
management strategy. In the first quarter, we executed nearly $3
billion of capital management actions, including returning $2.4
billion to AIG shareholders through $1.7 billion of common stock
repurchases, $250 million of common and preferred dividends and
redeeming $500 million of preferred stock as well as retiring $459
million in maturing debt. The AIG Board of Directors approved an
increase to the share repurchase authorization up to $10.0 billion
effective May 1 as well as an 11% increase in our quarterly common
stock dividend to $0.40 per share, representing a greater than 10%
increase in the quarterly dividend for the second consecutive
year.
“Throughout 2024, we expect to continue to build on our momentum
as we execute AIG Next, deconsolidate Corebridge and deliver
underwriting excellence and profitable growth, further enhancing
value to AIG shareholders and positioning AIG for the future. I am
very pleased with the progress we have made with AIG Next, which
will create a less complex and more effective company with the
appropriate infrastructure and improved capabilities. AIG Next will
deliver savings and efficiencies that further position us to
accelerate profitability and achieve an adjusted ROCE in excess of
10%.
“Against the backdrop of an uncertain and increasingly complex
global risk landscape, AIG continues to serve our clients, partners
and stakeholders with the unwavering commitment and distinct
expertise that distinguishes us in the industry thanks to the
dedication and teamwork of our colleagues around the world.”
* Refers to financial measure not calculated in accordance with
generally accepted accounting principles (non-GAAP); definitions of
non-GAAP measures and reconciliations to their closest GAAP
measures can be found in this news release under the heading
Comment on Regulation G and Non-GAAP Financial Measures. †
Premiums on a comparable basis reflects year-over-year comparison
on a constant dollar basis adjusted for the sale of Crop Risk
Services and the sale of Validus Re in 2023 and 2024. APTI,
underwriting income and ratios on a comparable basis reflects
year-over-year comparison adjusted for the sale of Crop Risk
Services and the sale of Validus Re in 2023 and 2024. Refer to
pages 19 to 20 for more detail.
For the first quarter of 2024, net income attributable to AIG
common shareholders was $1.2 billion, or $1.74 per diluted common
share, compared to $23 million, or $0.03 per diluted common share,
in the prior year quarter. The increase was primarily driven by net
realized gains on Fortitude Re funds withheld embedded derivative,
compared to net realized losses in the prior year quarter.
AATI was $1.2 billion, or $1.77 per diluted common share, for
the first quarter of 2024, flat compared to $1.2 billion, or $1.63
per diluted common share, in the prior year quarter, reflecting
higher underwriting income and net investment income in General
Insurance and improved results in AIG Other Operations excluding
Corebridge, mostly offset by a 20% decrease in Corebridge’s
earnings included in AATI due to the reduction in AIG ownership
over the last year.
Total net investment income for the first quarter of 2024 was
$3.9 billion, an increase of 11% from $3.5 billion in the prior
year quarter, primarily driven by higher income from fixed maturity
securities and loans due to higher reinvestment rates, partially
offset by lower alternative investment returns and lower income on
Fortitude Re funds withheld assets. Total net investment income on
an APTI basis* was $3.5 billion, an increase of 13% from the prior
year quarter, reflecting higher reinvestment rates, partially
offset by lower alternative investment returns. In General
Insurance, net investment income was up 2% from the prior year
quarter, overcoming the headwind associated with the sale of
Validus which produced $31 million in net investment income in the
prior year quarter. Excluding Validus results from the first
quarter of 2023, net investment income was up about 7% with a 9%
increase in fixed maturities and loans from higher reinvestment
rates over the prior year quarter.
Book value per common share was $64.66 as of March 31, 2024, a
decrease of 1% from December 31, 2023 and an increase of 10% from
March 31, 2023. The decrease from December 31, 2023 was primarily
driven by an increase in accumulated other comprehensive loss
(AOCL) due to higher interest rates and the increase from March 31,
2023 was driven by a decrease in AOCL due to lower interest rates
and credit spreads as well as the net impact of share repurchases.
Adjusted book value per common share* was $77.79, an increase of 1%
from December 31, 2023 and an increase of 3% from March 31, 2023,
both reflecting the aggregate impact of net income, offset by
dividends and share repurchases.
In the first quarter of 2024, AIG returned $2.4 billion to AIG
shareholders through $1.7 billion of common stock repurchases of
approximately 23 million shares, $250 million of common and
preferred dividends and the redemption of $500 million of preferred
stock. AIG also repaid $459 million aggregate principal amount of
maturing debt. AIG parent liquidity was $5.1 billion as of March
31, 2024. Total debt and preferred stock to total capital at March
31, 2024 was 28.1%, down from 28.5% at December 31, 2023, primarily
driven by debt repayment and the preferred stock redemption. Total
debt and preferred stock to total capital, excluding AOCL adjusted
for cumulative unrealized gains and losses related to Fortitude Re
funds withheld assets*, was 23.6% at March 31, 2024, down from
24.3% at December 31, 2023.
On April 30, 2024, the AIG Board of Directors declared a
quarterly cash dividend on AIG common stock of $0.40 per share. The
dividend is payable on June 28, 2024 to stockholders of record at
the close of business on June 14, 2024.
On March 15, 2024, AIG redeemed all 20,000 outstanding shares of
AIG Series A 5.85% Non-Cumulative Perpetual Preferred Stock (Series
A Preferred Stock) originally issued on March 14, 2019 and all
20,000,000 of the corresponding depositary shares. The redemption
price of Series A Preferred Stock was $25,000 per share (equivalent
to $25.00 per depositary share) for an aggregate redemption price
of $500 million, paid in cash.
FINANCIAL SUMMARY
Three Months Ended
March 31,
($ in millions, except per common share
amounts)
2023
2024
Net income attributable to AIG common
shareholders
$
23
$
1,194
Net income per diluted share attributable
to AIG common shareholders
$
0.03
$
1.74
Net investment income
$
3,533
$
3,904
Net investment income, APTI basis
$
3,075
$
3,468
Adjusted pre-tax income (loss)
$
1,643
$
1,941
General Insurance
1,248
1,358
Life and Retirement
886
991
Other Operations
(491
)
(408
)
Noncontrolling interests
$
117
$
(384
)
Noncontrolling interests, AATI basis
$
(125
)
$
(293
)
Adjusted after-tax income attributable to
AIG common shareholders
$
1,211
$
1,216
Adjusted after-tax income per diluted
share attributable to AIG common shareholders
$
1.63
$
1.77
Weighted average common shares outstanding
- diluted (in millions)
744.1
688.0
Return on common equity
0.2
%
10.8
%
Adjusted return on common equity
8.7
%
9.3
%
Book value per common share
$
58.87
$
64.66
Adjusted book value per common share
$
75.87
$
77.79
Common shares outstanding (in
millions)
727.6
671.0
GENERAL INSURANCE
Three Months Ended March
31,
($ in millions)
2023
2024
Change
Gross premiums written
$
12,028
$
9,156
(24
)%
Net premiums written
$
6,965
$
4,512
(35
)%
North America
3,680
1,334
(64
)
North America Commercial Lines
3,367
1,033
(69
)
North America Personal Insurance
313
301
(4
)
International
3,285
3,178
(3
)
International Commercial Lines
1,996
1,939
(3
)
International Personal Insurance
1,289
1,239
(4
)
Underwriting income (loss)
$
502
$
596
19
%
North America
299
224
(25
)
North America Commercial Lines
331
236
(29
)
North America Personal Insurance
(32
)
(12
)
63
International
203
372
83
International Commercial Lines
155
330
113
International Personal Insurance
48
42
(13
)
Net investment income, APTI basis
$
746
$
762
2
%
Adjusted pre-tax income
$
1,248
$
1,358
9
%
Return on adjusted segment common
equity
11.6
%
13.3
%
1.7
pts
Underwriting ratios:
North America Combined Ratio (CR)
90.0
91.1
1.1
pts
North America Commercial Lines CR
87.1
88.1
1.0
North America Personal Insurance CR
107.9
102.3
(5.6
)
International CR
93.8
88.7
(5.1
)
International Commercial Lines CR
91.9
83.6
(8.3
)
International Personal Insurance CR
96.4
96.7
0.3
General Insurance (GI) CR
91.9
89.8
(2.1
)
GI Loss ratio
59.9
58.0
(1.9
) pts
Less: impact on loss ratio
Catastrophe losses and reinstatement
premiums
(4.2
)
(1.9
)
2.3
Prior year development, net of reinsurance
and prior year premiums
1.0
0.5
(0.5
)
GI Accident year loss ratio, as
adjusted
56.7
56.6
(0.1
)
GI Expense ratio
32.0
31.8
(0.2
)
GI Accident year combined ratio, as
adjusted
88.7
88.4
(0.3
)
Accident year combined ratio, as adjusted
(AYCR):
North America AYCR
88.7
88.4
(0.3
) pts
North America Commercial Lines AYCR
85.7
85.9
0.2
North America Personal Insurance AYCR
107.6
97.7
(9.9
)
International AYCR
88.7
88.4
(0.3
)
International Commercial Lines AYCR
83.7
83.0
(0.7
)
International Personal Insurance AYCR
95.9
96.8
0.9
Three Months Ended March
31,
2023
2024
Change
Comparable Basis Underwriting
ratios†:
North America Commercial Lines CR
88.9
88.1
(0.8
) pts
International Commercial Lines CR
92.7
83.4
(9.3
)
General Insurance (GI) CR
93.5
89.7
(3.8
)
GI Accident year combined ratio, as
adjusted
90.0
88.4
(1.6
)
North America Commercial Lines AYCR
87.7
85.9
(1.8
)
International Commercial Lines AYCR
84.2
82.8
(1.4
)
General Insurance
- General Insurance APTI of $1.4 billion increased $110 million
from the prior year quarter, primarily driven by higher
underwriting and net investment income.
- First quarter 2024 NPW of $4.5 billion declined 35% from the
prior year quarter on a reported basis, but increased on a
comparable basis†, with 1% growth in Commercial Lines and Personal
Insurance relatively flat. North America Commercial Lines NPW
declined 69% from the prior year quarter, but grew 4% on a
comparable basis†, reflecting continued rate increases, higher
renewal retentions and strong new business production in Lexington,
Casualty and Captive Solutions, partially offset by Financial Lines
reflecting continued underwriting discipline and change in
reinsurance structure. International Commercial Lines NPW declined
3% from the prior year quarter, or 1% on a comparable basis†,
attributable to a decrease in Global Specialty and Financial Lines,
partially offset by an increase in Property, Talbot and Casualty,
due to continued rate increases, higher renewal retention, strong
new business production as well as reflecting changes in
reinsurance. North America Personal Insurance NPW declined 4% from
the prior year quarter, primarily driven by High Net Worth,
resulting from change in reinsurance. International Personal
Insurance NPW also declined 4% from the prior year quarter, but
increased 1% on a comparable basis†, largely driven by an increase
in Personal Auto and Individual Travel, partially offset by
Accident & Health.
- First quarter 2024 underwriting income increased $94 million
from the prior year quarter to $596 million and included $106
million of total catastrophe-related charges, representing 1.9 loss
ratio points, compared to $264 million, representing 4.2 loss ratio
points, in the prior year quarter. First quarter 2024 also included
favorable prior year development (PYD), net of reinsurance, of $34
million, consisting entirely of the adverse development cover (ADC)
amortization, compared to favorable PYD, net of reinsurance, of $68
million in the prior year quarter. Consistent with our reserve
review schedule, we did not conduct detailed valuation reviews
(DVRs) in the first quarter, resulting in no favorable or adverse
PYD from DVRs in the first quarter of 2024. The amortization of ADC
totaled $34 million in the first quarter 2024, down from $41
million in the first quarter 2023 due to the annual update in
amortization schedule.
- The combined ratio improved 2.1 points from the prior year
quarter to 89.8%, largely driven by a 1.9 point decrease in the
loss ratio to 58.0%. The AYCR improved 0.3 points from the prior
year quarter to 88.4%, primarily driven by a 0.2 point decrease in
expense ratio to 31.8%, attributable to an improvement in
acquisition ratio, partially offset by an increase in general
operating expense (GOE) ratio. On a comparable basis†, the combined
ratio improved 3.8 points and the AYCR improved 1.6 points from the
prior year quarter.
- The North America Commercial Lines combined ratio increased 1.0
point from the prior year quarter to 88.1% and the AYCR increased
0.2 points to 85.9%. The increase was driven by a higher loss ratio
reflecting changes in business mix, resulting from the 2023
divestitures, and lower favorable PYD, net of reinsurance,
partially offset by an improvement in expense ratio reflecting
lower acquisition ratio. On a comparable basis†, the combined ratio
improved 0.8 points and the AYCR improved 1.8 points from the prior
year quarter.
- International Commercial Lines combined ratio improved 8.3
points from the prior year quarter to 83.6% and the AYCR improved
0.7 points to 83.0%. The improvement was mostly driven by a
decrease in loss ratio, reflecting lower catastrophe losses and
favorable development in PYD, net of reinsurance, compared to
unfavorable development in the prior year quarter, as well as a 0.4
point improvement in expense ratio to 29.5%. On a comparable
basis†, the combined ratio improved 9.3 points and the AYCR
improved 1.4 points from the prior year quarter.
- The North America Personal Insurance combined ratio improved
5.6 points from the prior year quarter to 102.3% and the AYCR
improved 9.9 points to 97.7%. The improvement was driven by lower
accident year loss ratio, as adjusted* (AYLR) and GOE ratios
reflecting changes in business mix, which were partially offset by
a higher catastrophe loss ratio and an unfavorable development in
PYD, net of reinsurance.
- The International Personal Insurance combined ratio increased
0.3 points from the prior year quarter to 96.7% and the AYCR
increased 0.9 points to 96.8%. The increase was driven by higher
expense ratio as a result of the impact of lower earned premiums,
partially offset by an improvement in AYLR and lower catastrophe
loss ratio.
- General Insurance net investment income on an APTI basis was
$762 million, an increase of 2% from the prior year quarter driven
by higher reinvestment rates from fixed maturity securities and
loans, partially offset by lower alternative investment returns,
particularly private equity, and a reduction in assets due to the
2023 divested businesses. Excluding Validus results from the first
quarter of 2023, net investment income was up about 7% from the
prior year quarter.
LIFE AND RETIREMENT
Three Months Ended
March 31,
($ in millions, except as indicated)
2023
2024
Change
Adjusted pre-tax income
$
886
$
991
12
%
Individual Retirement
533
622
17
Group Retirement
187
199
6
Life Insurance
82
58
(29
)
Institutional Markets
84
112
33
Premiums and fees
$
2,899
$
3,076
6
%
Individual Retirement
252
232
(8
)
Group Retirement
106
112
6
Life Insurance
917
888
(3
)
Institutional Markets
1,624
1,844
14
Premiums and deposits
$
10,448
$
10,671
2
%
Individual Retirement
4,883
4,861
—
Group Retirement
2,246
2,054
(9
)
Life Insurance
1,156
1,170
1
Institutional Markets
2,163
2,586
20
Net flows
$
(156
)
$
(2,405
)
NM
%
Individual Retirement
663
(514
)
NM
Group Retirement
(819
)
(1,891
)
(131
)
Net investment income, APTI basis
$
2,277
$
2,645
16
%
Return on adjusted segment common
equity
10.7
%
11.9
%
1.2
pts
Life and Retirement
- L&R results are presented before the impact of Other
Operations and non-controlling interests on AIG’s AATI. L&R’s
contribution to AATI declined by approximately $100 million from
the prior year quarter.
- L&R APTI increased $105 million from the prior year quarter
to $991 million. The increase was primarily due to higher base
portfolio spread income, fee income and expense efficiencies,
partially offset by non-recurring reinsurance adjustments in the
Life insurance business.
- Premiums increased 7% from the prior year quarter to $2.4
billion and premiums and deposits* increased 2% to $10.7 billion.
Fixed Annuities sales for the quarter were up 16% from the prior
year quarter and Institutional Markets sales were up 20%, driven by
a higher volume of transactional business, including $1.8 billion
of pension risk transfer transactions, partially offset by lower
sales of Variable and Fixed Index Annuities.
- Net investment income on an APTI basis was $2.6 billion, an
increase of 16% from the prior year quarter, driven by higher
income from fixed maturity securities and loans, partially offset
by lower alternative investment income.
OTHER OPERATIONS
Three Months Ended
March 31,
($ in millions)
2023
2024
Change
Corporate and Other
$
(270
)
$
(194
)
28
%
Corebridge, Inc.
(200
)
(174
)
13
Consolidation and eliminations - other
(21
)
(40
)
(90
)
Adjusted pre-tax loss
$
(491
)
$
(408
)
17
%
Other Operations
- Corporate and Other adjusted pre-tax loss (APTL), excluding
Corebridge, improved $76 million from the prior year quarter,
primarily due to higher income on parent short-term investments,
lower GOE driven by expense savings, and lower AIG interest
expenses driven by debt reduction over the last year.
- Corebridge Other Operations APTL improved $26 million from the
prior year quarter. This was driven by a decrease in alternative
investment income, more than offset by an increase in consolidation
and eliminations associated with consolidated investment
entities.
CONFERENCE CALL
AIG will host a conference call tomorrow, Thursday, May 2, 2024
at 8:30 a.m. ET to review these results. The call is open to the
public and can be accessed via a live, listen-only webcast in the
Investors section of www.aig.com. A replay will be available after
the call at the same location.
# # #
Additional supplementary financial data is available in the
Investors section at www.aig.com.
Certain statements in this press release and other publicly
available documents may include, and members of AIG management may
from time to time make and discuss, statements which, to the extent
they are not statements of historical or present fact, may
constitute “forward-looking statements” within the meaning of the
U.S. Private Securities Litigation Reform Act of 1995. These
forward-looking statements are intended to provide management’s
current expectations or plans for AIG’s future operating and
financial performance, based on assumptions currently believed to
be valid and accurate. Forward-looking statements are often
preceded by, followed by or include words such as “will,”
“believe,” “anticipate,” “expect,” “expectations,” “intend,”
“plan,” “strategy,” “prospects,” “project,” “anticipate,” “should,”
“guidance,” “outlook,” “confident,” “focused on achieving,” “view,”
“target,” “goal,” “estimate” and other words of similar meaning in
connection with a discussion of future operating or financial
performance. These statements may include, among other things,
projections, goals and assumptions that relate to future actions,
prospective services or products, future performance or results of
current and anticipated services or products, sales efforts,
expense reduction efforts, the outcome of contingencies such as
legal proceedings, anticipated organizational, business or
regulatory changes, such as the separation of the Life and
Retirement business from AIG, the effect of catastrophic events,
both natural and man-made, and macroeconomic and/or geopolitical
events, anticipated dispositions, monetization and/or acquisitions
of businesses or assets, the successful integration of acquired
businesses, management succession and retention plans, exposure to
risk, trends in operations and financial results, and other
statements that are not historical facts.
All forward-looking statements involve risks, uncertainties and
other factors that may cause AIG’s actual results and financial
condition to differ, possibly materially, from the results and
financial condition expressed or implied in the forward-looking
statements. Factors that could cause AIG’s actual results to
differ, possibly materially, from those in specific projections,
goals, assumptions and other forward-looking statements include,
without limitation:
- the impact of adverse developments affecting economic
conditions in the markets in which AIG and its businesses operate
in the U.S. and globally, including adverse developments related to
financial market conditions, macroeconomic trends, fluctuations in
interest rates and foreign currency exchange rates, inflationary
pressures, including social inflation, pressures on the commercial
real estate market, an economic slowdown or recession, any
potential U.S. federal government shutdown and geopolitical events
or conflicts, including the conflict between Russia and Ukraine and
the conflict in Israel and the surrounding areas;
- occurrence of catastrophic events, both natural and man-made,
including the effects of climate change, geopolitical events and
conflicts and civil unrest;
- disruptions in the availability or accessibility of AIG's or a
third party’s information technology systems, including hardware
and software, infrastructure or networks, and the inability to
safeguard the confidentiality and integrity of customer, employee
or company data due to cyberattacks, data security breaches, or
infrastructure vulnerabilities;
- AIG’s ability to successfully dispose of, monetize and/or
acquire businesses or assets or successfully integrate acquired
businesses, and the anticipated benefits thereof;
- AIG's ability to realize expected strategic, financial,
operational or other benefits from the separation of Corebridge as
well as AIG’s equity market exposure to Corebridge;
- AIG's ability to effectively implement restructuring
initiatives and potential cost-savings opportunities;
- AIG's ability to effectively implement technological
advancements, including the use of artificial intelligence (AI),
and respond to competitors' AI and other technology
initiatives;
- the effectiveness of strategies to retain and recruit key
personnel and to implement effective succession plans;
- concentrations in AIG’s investment portfolios;
- AIG’s reliance on third-party investment managers;
- changes in the valuation of AIG’s investments;
- AIG’s reliance on third parties to provide certain business and
administrative services;
- availability of adequate reinsurance or access to reinsurance
on acceptable terms;
- concentrations of AIG’s insurance, reinsurance and other risk
exposures;
- nonperformance or defaults by counterparties, including
Fortitude Reinsurance Company Ltd. (Fortitude Re);
- AIG's ability to adequately assess risk and estimate related
losses as well as the effectiveness of AIG’s enterprise risk
management policies and procedures, including with respect to
business continuity and disaster recovery plans;
- difficulty in marketing and distributing products through
current and future distribution channels;
- actions by rating agencies with respect to AIG’s credit and
financial strength ratings as well as those of its businesses and
subsidiaries;
- changes to sources of or access to liquidity;
- changes in judgments concerning the recognition of deferred tax
assets and the impairment of goodwill;
- changes in judgments or assumptions concerning insurance
underwriting and insurance liabilities;
- changes in accounting principles and financial reporting
requirements;
- the effects of sanctions, including those related to the
conflict between Russia and Ukraine, and the failure to comply with
those sanctions;
- the effects of changes in laws and regulations, including those
relating to the regulation of insurance, in the U.S. and other
countries in which AIG and its businesses operate;
- changes to tax laws in the U.S. and other countries in which
AIG and its businesses operate;
- the outcome of significant legal, regulatory or governmental
proceedings;
- AIG’s ability to effectively execute on sustainability targets
and standards;
- AIG’s ability to address evolving stakeholder expectations and
regulatory requirements with respect to environmental, social and
governance matters;
- the impact of epidemics, pandemics and other public health
crises and responses thereto; and
- such other factors discussed in Part I, Item 2. Management’s
Discussions and Analysis of Financial Condition and Results of
Operations (MD&A) in AIG’s Quarterly Report on Form 10-Q for
the quarterly period ended March 31, 2024 (which will be filed with
the Securities and Exchange Commission) (SEC), and Part I, Item 1A.
Risk Factors and Part II, Item 7. MD&A in AIG’s Annual Report
on Form 10-K for the year ended December 31, 2023.
Forward-looking statements speak only as of the date of this
press release, or in the case of any document incorporated by
reference, the date of that document. AIG is not under any
obligation to publicly update or revise any forward-looking
statements, whether as a result of new information, future events
or otherwise, except as required by applicable law. Additional
information as to factors that may cause actual results to differ
materially from those expressed or implied in any forward-looking
statements is disclosed from time to time in our filings with the
SEC.
# # #
COMMENT ON REGULATION G AND NON-GAAP FINANCIAL
MEASURES
Throughout this press release, including the financial
highlights, AIG presents its financial condition and results of
operations in the way it believes will be most meaningful and
representative of its business results. Some of the measurements
AIG uses are “Non-GAAP financial measures” under SEC rules and
regulations. GAAP is the acronym for generally accepted accounting
principles in the United States. The non-GAAP financial measures
AIG presents are listed below and may not be comparable to
similarly-named measures reported by other companies. The
reconciliations of such measures to the most comparable GAAP
measures in accordance with Regulation G are included within the
relevant tables attached to this news release or in the First
Quarter 2024 Financial Supplement available in the Investors
section of AIG’s website, www.aig.com.
Unless otherwise mentioned or unless the context indicates
otherwise, we use the terms “AIG,” “we,” “us” and “our” to refer to
American International Group, Inc., a Delaware corporation, and its
consolidated subsidiaries.
AIG uses the following operating performance measures because
AIG believes they enhance the understanding of the underlying
profitability of continuing operations and trends of AIG’s business
segments. AIG believes they also allow for more meaningful
comparisons with AIG’s insurance competitors. When AIG uses these
measures, reconciliations to the most comparable GAAP measure are
provided on a consolidated basis.
Book value per common share, excluding accumulated other
comprehensive income (loss) (AOCI) adjusted for the cumulative
unrealized gains and losses related to Fortitude Re funds withheld
assets and deferred tax assets (DTA) (Adjusted book value per
common share) is used to show the amount of our net worth on a
per-common share basis after eliminating items that can fluctuate
significantly from period to period, including changes in fair
value (1) of AIG’s available for sale securities portfolio, (2) of
market risk benefits attributable to our own credit risk and (3)
due to discount rates used to measure traditional and limited
payment long-duration insurance contracts, foreign currency
translation adjustments and U.S. tax attribute deferred tax assets.
This measure also eliminates the asymmetrical impact resulting from
changes in fair value of our available for sale securities
portfolio wherein there is largely no offsetting impact for certain
related insurance liabilities. In addition, we adjust for the
cumulative unrealized gains and losses related to Fortitude Re
funds withheld assets held by AIG in support of Fortitude Re’s
reinsurance obligations to AIG post deconsolidation of Fortitude Re
(Fortitude Re funds withheld assets) since these fair value
movements are economically transferred to Fortitude Re. We exclude
deferred tax assets representing U.S. tax attributes related to net
operating loss carryforwards and foreign tax credits as they have
not yet been utilized. Amounts for interim periods are estimates
based on projections of full-year attribute utilization. As net
operating loss carryforwards and foreign tax credits are utilized,
the portion of the DTA utilized is included in these book value per
common share metrics. Adjusted book value per common share is
derived by dividing total AIG common shareholders’ equity,
excluding AOCI adjusted for the cumulative unrealized gains and
losses related to Fortitude Re funds withheld assets, and DTA
(Adjusted common shareholders’ equity), by total common
shares outstanding.
Total debt and preferred stock to total capital ratio
excluding AOCI adjusted for the cumulative unrealized gains and
losses related to Fortitude Re funds withheld assets is used to
show the AIG’s debt leverage adjusted for AOCI and for the
cumulative unrealized gains and losses related to Fortitude Re
funds withheld assets. We believe this measure is useful to
investors because it eliminates items that can fluctuate
significantly from period to period, including changes in fair
value (1) of AIG’s available for sale securities portfolio, (2) of
market risk benefits attributable to our own credit risk and (3)
due to discount rates used to measure traditional and limited
payment long-duration insurance contracts and foreign currency
translation adjustments. This measure also eliminates the
asymmetrical impact resulting from changes in fair value of our
available for sale securities portfolio wherein there is largely no
offsetting impact for certain related insurance liabilities. In
addition, we adjust for the cumulative unrealized gains and losses
related to Fortitude Re funds withheld assets since these fair
value movements are economically transferred to Fortitude Re.
AIG Return on Common Equity (ROCE) – Adjusted After-tax
Income Excluding AOCI adjusted for the cumulative unrealized gains
and losses related to Fortitude Re funds withheld assets and DTA
(Adjusted return on common equity) is used to show the rate of
return on common shareholders’ equity. We believe this measure is
useful to investors because it eliminates items that can fluctuate
significantly from period to period, including changes in fair
value (1) of AIG’s available for sale securities portfolio, (2) of
market risk benefits attributable to our own credit risk and (3)
due to discount rates used to measure traditional and limited
payment long-duration insurance contracts, foreign currency
translation adjustments and U.S. tax attribute deferred tax assets.
This measure also eliminates the asymmetrical impact resulting from
changes in fair value of our available for sale securities
portfolio wherein there is largely no offsetting impact for certain
related insurance liabilities. In addition, we adjust for the
cumulative unrealized gains and losses related to Fortitude Re
funds withheld assets since these fair value movements are
economically transferred to Fortitude Re. We exclude deferred tax
assets representing U.S. tax attributes related to net operating
loss carryforwards and foreign tax credits as they have not yet
been utilized. Amounts for interim periods are estimates based on
projections of full-year attribute utilization. As net operating
loss carryforwards and foreign tax credits are utilized, the
portion of the DTA utilized is included in Adjusted Return on
Common Equity. Adjusted Return on Common Equity is derived by
dividing actual or annualized adjusted after-tax income
attributable to AIG common shareholders by average Adjusted Common
Shareholders’ Equity.
General Insurance and Life and Retirement Adjusted Segment
Common Equity is based on segment equity adjusted for the
attribution of debt and preferred stock (Segment Common Equity) and
is consistent with AIG’s Adjusted Common Shareholders’ Equity
definition.
General Insurance and Life and Retirement Return on Adjusted
Segment Common Equity – Adjusted After-tax Income (Return on
adjusted segment common equity) is used to show the rate of
return on Adjusted Segment Common Equity. Return on Adjusted
Segment Common Equity is derived by dividing actual or annualized
Adjusted After-tax Income by Average Adjusted Segment Common
Equity.
Adjusted After-tax Income Attributable to General Insurance
and Life and Retirement is derived by subtracting attributed
interest expense, income tax expense and attributed dividends on
preferred stock from APTI. Attributed debt and the related interest
expense and dividends on preferred stock are calculated based on
our internal allocation model. Tax expense or benefit is calculated
based on an internal attribution methodology that considers among
other things the taxing jurisdiction in which the segments conduct
business, as well as the deductibility of expenses in those
jurisdictions.
Adjusted revenues exclude Net realized gains (losses),
income from non-operating litigation settlements (included in Other
income for GAAP purposes), changes in fair value of securities used
to hedge guaranteed living benefits (included in Net investment
income for GAAP purposes) and income from elimination of the
International reporting lag. Adjusted revenues is a GAAP measure
for our segments.
Adjusted Pre-tax Income (APTI) is derived by excluding
the items set forth below from income from continuing operations
before income tax. This definition is consistent across our
segments. These items generally fall into one or more of the
following broad categories: legacy matters having no relevance to
our current businesses or operating performance; adjustments to
enhance transparency to the underlying economics of transactions;
and measures that we believe to be common to the industry. APTI is
a GAAP measure for our segments. Excluded items include the
following:
- changes in fair value of securities used to hedge guaranteed
living benefits;
- net change in market risk benefits (MRBs);
- changes in benefit reserves related to net realized gains and
losses;
- changes in the fair value of equity securities;
- net investment income on Fortitude Re funds withheld
assets;
- following deconsolidation of Fortitude Re, net realized gains
and losses on Fortitude Re funds withheld assets;
- loss (gain) on extinguishment of debt;
- all net realized gains and losses except earned income
(periodic settlements and changes in settlement accruals) on
derivative instruments used for non-qualifying (economic) hedging
or for asset replication. Earned income on such economic hedges is
reclassified from net realized gains and losses to specific APTI
line items based on the economic risk being hedged (e.g. net
investment income and interest credited to policyholder account
balances);
- income or loss from discontinued operations;
- net loss reserve discount benefit (charge);
- pension expense related to lump sum payments to former
employees;
- net gain or loss on divestitures and other;
- non-operating litigation reserves and settlements;
- restructuring and other costs related to initiatives designed
to reduce operating expenses, improve efficiency and simplify our
organization;
- the portion of favorable or unfavorable prior year reserve
development for which we have ceded the risk under retroactive
reinsurance agreements and related changes in amortization of the
deferred gain;
- integration and transaction costs associated with acquiring or
divesting businesses;
- losses from the impairment of goodwill;
- non-recurring costs associated with the implementation of
non-ordinary course legal or regulatory changes or changes to
accounting principles; and
- income from elimination of the international reporting
lag.
Adjusted After-tax Income attributable to AIG common
shareholders (AATI) is derived by excluding the tax effected
APTI adjustments described above, dividends on preferred stock and
preferred stock redemption premiums, noncontrolling interest on net
realized gains (losses), other non-operating expenses and the
following tax items from net income attributable to AIG:
- deferred income tax valuation allowance releases and
charges;
- changes in uncertain tax positions and other tax items related
to legacy matters having no relevance to our current businesses or
operating performance; and
- net tax charge related to the enactment of the Tax Cuts and
Jobs Act.
See page 16 for the reconciliation of Net income attributable to
AIG to Adjusted After-tax Income Attributable to AIG.
Ratios: We, along with most property and casualty
insurance companies, use the loss ratio, the expense ratio and the
combined ratio as measures of underwriting performance. These
ratios are relative measurements that describe, for every $100 of
net premiums earned, the amount of losses and loss adjustment
expenses (which for General Insurance excludes net loss reserve
discount), and the amount of other underwriting expenses that would
be incurred. A combined ratio of less than 100 indicates
underwriting income and a combined ratio of over 100 indicates an
underwriting loss. Our ratios are calculated using the relevant
segment information calculated under GAAP, and thus may not be
comparable to similar ratios calculated for regulatory reporting
purposes. The underwriting environment varies across countries and
products, as does the degree of litigation activity, all of which
affect such ratios. In addition, investment returns, local taxes,
cost of capital, regulation, product type and competition can have
an effect on pricing and consequently on profitability as reflected
in underwriting income and associated ratios.
Accident year loss and Accident year combined ratios, as
adjusted (Accident year loss ratio, ex-CAT and Accident year
combined ratio, ex-CAT): both the accident year loss and
accident year combined ratios, as adjusted, exclude catastrophe
losses (CATs) and related reinstatement premiums, prior year
development, net of premium adjustments, and the impact of reserve
discounting. Natural catastrophe losses are generally weather or
seismic events, in each case, having a net impact on AIG in excess
of $10 million and man-made catastrophe losses, such as terrorism
and civil disorders that exceed the $10 million threshold. We
believe that as adjusted ratios are meaningful measures of our
underwriting results on an ongoing basis as they exclude
catastrophes and the impact of reserve discounting which are
outside of management’s control. We also exclude prior year
development to provide transparency related to current accident
year results.
Underwriting ratios are computed as
follows:
- Loss ratio = Loss and loss adjustment expenses incurred ÷ Net
premiums earned (NPE)
- Acquisition ratio = Total acquisition expenses ÷ NPE
- General operating expense ratio = General operating expenses ÷
NPE
- Expense ratio = Acquisition ratio + General operating expense
ratio
- Combined ratio = Loss ratio + Expense ratio
- CATs and reinstatement premiums ratio = [Loss and loss
adjustment expenses incurred – (CATs)] ÷ [NPE +/(-) Reinstatement
premiums related to catastrophes] – Loss ratio
- Accident year loss ratio, as adjusted (AYLR ex-CAT) = [Loss and
loss adjustment expenses incurred – CATs – PYD] ÷ [NPE +/(-)
Reinstatement premiums related to catastrophes +/(-) Prior year
premiums + Adjustment for ceded premium under reinsurance contracts
related to prior accident years]
- Accident year combined ratio, as adjusted (AYCR ex-CAT) = AYLR
ex-CAT + Expense ratio
- Prior year development net of reinsurance and prior year
premiums ratio = [Loss and loss adjustment expenses incurred – CATs
– PYD] ÷ [NPE +/(-) Reinstatement premiums related to catastrophes
+/(-) Prior year premiums] – Loss ratio – CATs and reinstatement
premiums ratio.
Premiums and deposits: includes direct and assumed
amounts received and earned on traditional life insurance policies,
group benefit policies and life‑contingent payout annuities, as
well as deposits received on universal life, investment‑type
annuity contracts, Federal Home Loan Bank funding agreements and
mutual funds. We believe the measure of premiums and deposits is
useful in understanding customer demand for our products, evolving
product trends and our sales performance period over period.
Results from discontinued operations are excluded from all of
these measures.
# # #
American International Group, Inc. (NYSE: AIG) is a leading
global insurance organization. AIG provides insurance solutions
that help businesses and individuals in approximately 190 countries
and jurisdictions protect their assets and manage risks through AIG
operations and network partners.
AIG is the marketing name for the worldwide operations of
American International Group, Inc. All products and services are
written or provided by subsidiaries or affiliates of American
International Group, Inc. Products or services may not be available
in all countries and jurisdictions, and coverage is subject to
underwriting requirements and actual policy language. Non-insurance
products and services may be provided by independent third parties.
Certain property casualty coverages may be provided by a surplus
lines insurer. Surplus lines insurers do not generally participate
in state guaranty funds, and insureds are therefore not protected
by such funds.
American International Group,
Inc.
Selected Financial Data and
Non-GAAP Reconciliation
($ in millions, except per
common share data)
Reconciliations of Adjusted Pre-tax and
After-tax Income
Three Months Ended March
31,
2023
2024
Total Tax
Non-
Total Tax
Non-
(Benefit)
controlling
After
(Benefits)
controlling
After
Pre-tax
Charge
Interests(d)
Tax
Pre-tax
Charge
Interests(d)
Tax
Pre-tax income (loss)/net income
(loss), including noncontrolling interests
$
(231
)
$
(144
)
$
—
$
(87
)
$
2,051
$
451
$
—
$
1,600
Noncontrolling interests
117
117
(384
)
(384
)
Pre-tax income (loss)/net income
attributable to AIG
(231
)
(144
)
117
30
2,051
451
(384
)
1,216
Dividends on preferred stock and preferred
stock redemption premiums
7
22
Net income attributable to AIG common
shareholders
23
1,194
Adjustments:
Changes in uncertain tax positions and
other tax adjustments
22
—
(22
)
14
—
(14
)
Deferred income tax valuation allowance
charges
(19
)
—
19
(12
)
—
12
Changes in fair value of securities used
to hedge guaranteed living benefits
3
1
—
2
2
—
—
2
Change in market risk benefit, net(a)
196
41
—
155
(369
)
(78
)
—
(291
)
Changes in benefit reserves related to net
realized gains (losses)
(6
)
(1
)
—
(5
)
(2
)
—
—
(2
)
Changes in the fair value of equity
securities
(51
)
(11
)
—
(40
)
(99
)
(21
)
—
(78
)
Loss on extinguishment of debt and
preferred stock redemption premiums
—
—
—
—
—
—
—
15
Net investment income on Fortitude Re
funds withheld assets
(446
)
(94
)
—
(352
)
(369
)
(77
)
—
(292
)
Net realized losses on Fortitude Re funds
withheld assets
31
7
—
24
179
38
—
141
Net realized gains on Fortitude Re funds
withheld embedded derivative
1,165
245
—
920
(13
)
(3
)
—
(10
)
Net realized losses(b)
766
208
—
558
307
60
—
247
Loss from discontinued operations
—
—
Net (gain) loss on divestitures and
other
2
—
—
2
(6
)
(1
)
—
(5
)
Non-operating litigation reserves and
settlements
(1
)
—
—
(1
)
—
—
—
—
Unfavorable (favorable) prior year
development and related amortization changes ceded under
retroactive reinsurance agreements
(19
)
(4
)
—
(15
)
2
—
—
2
Net loss reserve discount charge
64
13
—
51
76
16
—
60
Pension expense related to a one-time lump
sum payment to former employees
—
—
—
—
—
—
—
—
Integration and transaction costs
associated with acquiring or divesting businesses
52
11
—
41
64
13
—
51
Restructuring and other costs
117
25
—
92
114
24
—
90
Non-recurring costs related to regulatory
or accounting changes
13
3
—
10
4
1
—
3
Net impact from elimination of
international reporting lag(c)
(12
)
(3
)
—
(9
)
—
—
—
—
Noncontrolling interests(d)
(242
)
(242
)
91
91
Adjusted pre-tax income/Adjusted
after-tax income attributable to AIG common shareholders
$
1,643
$
300
$
(125
)
$
1,211
$
1,941
$
425
$
(293
)
$
1,216
(a)
Includes realized gains and losses on
certain derivative instruments used for non-qualifying (economic)
hedging.
(b)
Includes all net realized gains and losses
except earned income (periodic settlements and changes in
settlement accruals) on derivative instruments used for
non-qualifying (economic) hedging or for asset replication and net
realized gains and losses on Fortitude Re funds withheld
assets.
(c)
Effective in the quarter ended December
31, 2022, the foreign property and casualty subsidiaries report on
a calendar year ending December 31. We determined that the effect
of not retroactively applying this change was immaterial to our
Consolidated Financial Statements for the current and prior
periods. Therefore, we reported the cumulative effect of the change
in accounting principle within the Consolidated Statements of
Income (Loss) for the year ended December 31, 2022 and did not
retrospectively apply the effects of this change to prior
periods.
(d)
Includes the portion of equity interest of
non-operating income of Corebridge and consolidated investment
entities that AIG does not own.
American International Group,
Inc.
Selected Financial Data and
Non-GAAP Reconciliation (continued)
($ in millions, except per
common share data)
Summary of Key Financial
Metrics
Three Months Ended March 31,
Earnings per common share:
2023
2024
% Inc. (Dec.)
Basic
Income from continuing operations
$
0.03
$
1.75
NM
%
Income from discontinued operations
—
—
NM
Net income attributable to AIG common
shareholders
$
0.03
$
1.75
NM
Diluted
Income from continuing operations
0.03
$
1.74
NM
Income from discontinued operations
—
—
NM
Net income attributable to AIG common
shareholders
$
0.03
$
1.74
NM
Adjusted after-tax income attributable
to AIG common shareholders per diluted share
$
1.63
$
1.77
8.6
%
Weighted average shares
outstanding:
Basic
738.7
682.6
Diluted
744.1
688.0
Reconciliation of Book Value per Common
Share
As of period
end:
March 31, 2023
December 31, 2023
March 31, 2024
Total AIG shareholders' equity
$
43,317
$
45,351
$
43,385
Less: Preferred equity
485
485
—
Total AIG common shareholders' equity
(a)
42,832
44,866
43,385
Less: Deferred tax assets (DTA)*
4,543
4,313
4,153
Less: Accumulated other comprehensive
income (AOCI)
(19,329
)
(14,037
)
(14,869
)
Add: Cumulative unrealized gains and
losses related to Fortitude Re Funds withheld assets
(2,418
)
(1,791
)
(1,904
)
Subtotal: AOCI plus cumulative unrealized
gains and losses related to Fortitude Re funds withheld assets
(16,911
)
(12,246
)
(12,965
)
Total adjusted common shareholders' equity
(b)
$
55,200
$
52,799
$
52,197
Total common shares outstanding
(d)
727.6
688.8
671.0
As of period
end:
March 31, 2023
% Inc. (Dec.)
December 31, 2023
% Inc. (Dec.)
March 31, 2024
Book value per common share (a÷d)
$
58.87
9.8
%
$
65.14
(0.7
)%
$
64.66
Adjusted book value per common share
(b÷d)
75.87
2.5
76.65
1.5
77.79
American International Group,
Inc.
Selected Financial Data and
Non-GAAP Reconciliation (continued)
($ in millions, except per
common share data)
Reconciliation of Return On Common
Equity
Three Months Ended
March 31,
2023
2024
Actual or annualized net income (loss)
attributable to AIG common shareholders (a)
$
92
$
4,776
Actual or annualized adjusted after-tax
income attributable to AIG common shareholders (b)
$
4,844
$
4,864
Average AIG Common Shareholders' equity
(c)
$
41,659
$
44,126
Less: Average DTA*
4,531
4,233
Less: Average AOCI
(20,973
)
(14,453
)
Add: Average cumulative unrealized gains
and losses related to Fortitude Re funds withheld assets
(2,640
)
(1,848
)
Subtotal: AOCI plus cumulative unrealized
gains and losses related to Fortitude Re funds withheld assets
(18,333
)
(12,605
)
Average adjusted common shareholders'
equity (d)
$
55,461
$
52,498
ROCE (a÷c)
0.2
%
10.8
%
Adjusted return on common equity (b÷d)
8.7
%
9.3
%
* Represents deferred tax assets only
related to U.S. net operating loss and foreign tax credit
carryforwards on a U.S. GAAP basis and excludes other balance sheet
deferred tax assets and liabilities.
Reconciliation of Net Investment
Income
Three Months Ended
March 31,
2023
2024
Net Investment Income per Consolidated
Statements of Operations
$
3,533
$
3,904
Changes in fair value of securities used
to hedge guaranteed living benefits
(13
)
(17
)
Changes in the fair value of equity
securities
(51
)
(99
)
Net investment income on Fortitude Re
funds withheld assets
(446
)
(369
)
Net realized gains (losses) related to
economic hedges and other
53
49
Net impact from elimination of
International reporting lag
(1
)
—
Total Net Investment Income - APTI
Basis
$
3,075
$
3,468
General Insurance Net Investment
Income, APTI basis
$
746
$
762
Validus Re impact
(31
)
—
General Insurance Net Investment
Income, APTI basis, excluding Validus Re
$
715
$
762
American International Group,
Inc.
Selected Financial Data and
Non-GAAP Reconciliation (continued)
($ in millions, except per
common share data)
Reconciliation of Net Premiums Written
- Comparable Basis
Three Months Ended March 31,
2024
North
Global -
Global -
America -
International -
General
Commercial
Personal
Commercial
Commercial
Personal
Insurance
Lines
Insurance
Lines
Lines
Insurance
Change in net premiums written
Increase (decrease) as reported in U.S.
dollars
(35.2
)%
(44.6
)%
(3.9
)%
(69.3
)%
(2.9
)%
(3.9
)%
Foreign exchange effect
0.4
(0.1
)
3.6
—
(0.3
)
4.5
Validus Re
29.0
38.6
—
67.1
2.2
—
Crop Risk Services
6.2
6.9
—
6.6
—
—
Increase (decrease) on comparable
basis
0.4
%
0.8
%
(0.3
)%
4.4
%
(1.0
)%
0.6
%
Reconciliations of Accident Year Loss
and Accident Year Combined Ratios, as Adjusted
Three Months Ended
March 31,
2023
2024
Total General
Insurance
Combined ratio
91.9
89.8
Catastrophe losses and reinstatement
premiums
(4.2
)
(1.9
)
Prior year development, net of reinsurance
and prior year premiums
1.0
0.5
Accident year combined ratio, as
adjusted
88.7
88.4
Crop Risk Services and Validus Re
impact
1.3
—
Accident year combined ratio, as adjusted,
comparable basis
90.0
88.4
Combined ratio
91.9
89.8
Crop Risk Services and Validus Re
impact
1.6
(0.1
)
Combined ratio, comparable basis
93.5
89.7
North
America
Combined ratio
90.0
91.1
Catastrophe losses and reinstatement
premiums
(3.9
)
(3.6
)
Prior year development, net of reinsurance
and prior year premiums
2.6
0.9
Accident year combined ratio, as
adjusted
88.7
88.4
North America -
Commercial Lines
Combined ratio
87.1
88.1
Catastrophe losses and reinstatement
premiums
(4.1
)
(3.6
)
Prior year development, net of reinsurance
and prior year premiums
2.7
1.4
Accident year combined ratio, as
adjusted
85.7
85.9
Crop Risk Services and Validus Re
impact
2.0
—
Accident year combined ratio, as adjusted,
comparable basis
87.7
85.9
Combined ratio
87.1
88.1
Crop Risk Services and Validus Re
impact
1.8
—
Combined ratio, comparable basis
88.9
88.1
North America -
Personal Insurance
Loss ratio
56.4
58.2
Catastrophe losses and reinstatement
premiums
(2.7
)
(3.9
)
Prior year development, net of reinsurance
and prior year premiums
2.4
(0.7
)
Accident year loss ratio, as adjusted
56.1
53.6
Combined ratio
107.9
102.3
Catastrophe losses and reinstatement
premiums
(2.7
)
(3.9
)
Prior year development, net of reinsurance
and prior year premiums
2.4
(0.7
)
Accident year combined ratio, as
adjusted
107.6
97.7
American International Group,
Inc.
Selected Financial Data and
Non-GAAP Reconciliation (continued)
($ in millions, except per
common share data)
Reconciliations of Accident Year Loss
and Accident Year Combined Ratios, as Adjusted
Three Months Ended
March 31,
2023
2024
International
Combined ratio
93.8
88.7
Catastrophe losses and reinstatement
premiums
(4.5
)
(0.4
)
Prior year development, net of reinsurance
and prior year premiums
(0.6
)
0.1
Accident year combined ratio, as
adjusted
88.7
88.4
International -
Commercial Lines
Combined ratio
91.9
83.6
Catastrophe losses and reinstatement
premiums
(6.9
)
(0.7
)
Prior year development, net of reinsurance
and prior year premiums
(1.3
)
0.1
Accident year combined ratio, as
adjusted
83.7
83.0
Crop Risk Services and Validus Re
impact
0.5
(0.2
)
Accident year combined ratio, as adjusted,
comparable basis
84.2
82.8
Combined ratio
91.9
83.6
Crop Risk Services and Validus Re
impact
0.8
(0.2
)
Combined ratio, comparable basis
92.7
83.4
International -
Personal Insurance
Loss ratio
55.4
54.4
Catastrophe losses and reinstatement
premiums
(1.1
)
—
Prior year development, net of reinsurance
and prior year premiums
0.6
0.1
Accident year loss ratio, as adjusted
54.9
54.5
Combined ratio
96.4
96.7
Catastrophe losses and reinstatement
premiums
(1.1
)
—
Prior year development, net of reinsurance
and prior year premiums
0.6
0.1
Accident year combined ratio, as
adjusted
95.9
96.8
Global -
Commercial Insurance
Combined ratio
89.2
85.8
Catastrophe losses and reinstatement
premiums
(5.3
)
(2.1
)
Prior year development, net of reinsurance
and prior year premiums
1.0
0.7
Accident year combined ratio, as
adjusted
84.9
84.4
Reconciliation of General Insurance
Underwriting Income
Three Months Ended
March 31,
2023
2024
Underwriting income, as
reported
$
502
$
596
Crop Risk Services and Validus Re
(145
)
—
Underwriting income, comparable
basis
$
357
$
596
Reconciliation of General Insurance
Adjusted Pre-tax Income
Three Months Ended
March 31,
2023
2024
Adjusted Pre-tax income, as
reported
$
1,248
$
1,358
Crop Risk Services and Validus Re
(176
)
—
Adjusted Pre-tax income, comparable
basis
$
1,072
$
1,358
American International Group,
Inc.
Selected Financial Data and
Non-GAAP Reconciliation (continued)
($ in millions, except per
common share data)
Reconciliation of General Insurance
Return on Adjusted Segment Common Equity
Three Months Ended
March 31,
2023
2024
Adjusted pre-tax income
$
1,248
$
1,358
Interest expense on attributed financial
debt
126
117
Adjusted pre-tax income including
attributed interest expense
1,122
1,241
Income tax expense
252
290
Adjusted after-tax income
870
951
Dividends declared on preferred stock
3
3
Adjusted after-tax income attributable
to common shareholders
$
867
$
948
Ending adjusted segment common
equity
$
29,543
$
29,101
Average adjusted segment common
equity
$
29,936
$
28,584
Return on adjusted segment common
equity
11.6
%
13.3
%
Total segment shareholder’s equity
$
24,522
$
24,709
Less: Preferred equity
211
—
Total segment common equity
24,311
24,709
Less: Accumulated other comprehensive
income (AOCI)
(5,821
)
(4,980
)
Add: Cumulative unrealized gains and
losses related to Fortitude Re funds withheld assets
(589
)
(588
)
Subtotal: AOCI plus cumulative unrealized
gains and losses related to Fortitude Re funds withheld assets
(5,232
)
(4,392
)
Total adjusted segment common equity
$
29,543
$
29,101
Reconciliation of Life and Retirement
Return on Adjusted Segment Common Equity
Three Months Ended
March 31,
2023
2024
Adjusted pre-tax income
$
886
$
991
Interest expense on attributed financial
debt
115
114
Adjusted pre-tax income including
attributed interest expense
771
877
Income tax expense
154
179
Adjusted after-tax income
617
698
Dividends declared on preferred stock
2
2
Adjusted after-tax income attributable
to common shareholders
$
615
$
696
Ending adjusted segment common
equity
$
22,945
$
23,628
Average adjusted segment common
equity
$
23,062
$
23,418
Return on adjusted segment common
equity
10.7
%
11.9
%
Total segment shareholder’s equity
$
10,689
$
10,748
Less: Preferred equity
161
—
Total segment common equity
10,528
10,748
Less: Accumulated other comprehensive
income (AOCI)
(14,246
)
(14,196
)
Add: Cumulative unrealized gains and
losses related to Fortitude Re funds withheld assets
(1,829
)
(1,316
)
Subtotal: AOCI plus cumulative unrealized
gains and losses related to Fortitude Re funds withheld assets
(12,417
)
(12,880
)
Total adjusted segment common equity
$
22,945
$
23,628
American International Group,
Inc.
Selected Financial Data and
Non-GAAP Reconciliation (continued)
($ in millions, except per
common share data)
Reconciliations of Premiums and
Deposits
Three Months Ended
March 31,
2023
2024
Individual
Retirement:
Premiums
$
78
$
41
Deposits
4,807
4,822
Other
(2
)
(2
)
Premiums and deposits
$
4,883
$
4,861
Group
Retirement:
Premiums
$
6
$
5
Deposits
2,240
2,049
Other
—
—
Premiums and deposits
$
2,246
$
2,054
Life
Insurance:
Premiums
$
542
$
520
Deposits
398
393
Other
216
257
Premiums and deposits
$
1,156
$
1,170
Institutional
Markets:
Premiums
$
1,575
$
1,796
Deposits
581
781
Other
7
9
Premiums and deposits
$
2,163
$
2,586
Total Life and
Retirement:
Premiums
$
2,201
$
2,362
Deposits
8,026
8,045
Other
221
264
Premiums and deposits
$
10,448
$
10,671
Reconciliation of Total Debt and
Preferred Stock to Total Capital Ratio
Three Months Ended
Three Months Ended
December 31, 2023
March 31, 2024
Hybrid - debt securities / Total
capital
2.8
%
2.9
%
Financial debt and debt held for sale /
Total capital
25.0
25.2
Total debt / Total capital
27.8
28.1
Preferred stock / Total capital
0.7
—
Total debt and preferred stock / Total
capital (incl. AOCI)
28.5
28.1
AOCI Impact
(4.2
)
(4.5
)
Total debt and preferred stock / Total
capital (ex. AOCI)
24.3
%
23.6
%
View source
version on businesswire.com: https://www.businesswire.com/news/home/20240501926715/en/
Quentin McMillan (Investors): quentin.mcmillan@aig.com
Claire Talcott (Media): claire.talcott@aig.com
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