Market Overview

AIG Reports Third Quarter 2019 Results

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  • Net income attributable to AIG common shareholders was $648 million, or $0.72 per diluted common share, for the third quarter of 2019, compared to a net loss attributable to AIG common shareholders of $1.3 billion, or $1.41 per common share, in the prior-year quarter.
  • Adjusted after-tax income attributable to AIG common shareholders* was $505 million, or $0.56 per diluted common share, for the third quarter of 2019, compared to an adjusted after-tax loss attributable to AIG common shareholders of $301 million, or $0.34 per common share, in the prior-year quarter.
  • General Insurance posted a combined ratio of 103.7 and an accident year combined ratio, as adjusted*, of 95.9, improved compared to 124.4 and 99.4, respectively, in the prior-year quarter, driven by lower catastrophe losses, continued underwriting actions, reinsurance and expense discipline.
  • Life and Retirement reported adjusted pre-tax income of $646 million compared to $713 million in the prior-year quarter, which included a charge for the annual actuarial assumption update in each quarter.
  • Total consolidated net investment income was $3.4 billion in the third quarter of 2019, essentially flat to the prior-year quarter, reflecting higher interest and dividends and other investment income partially offset by lower alternative investment returns.
  • Net pre-tax catastrophe losses of $511 million ($404 million after-tax or $0.45 per diluted share) compared to $1.6 billion ($1.3 billion after-tax or $1.45 per share) in the prior-year quarter.
  • Net favorable prior year loss reserve development, net of reinsurance, of $4 million compared to net unfavorable prior year loss reserve development, net of reinsurance, of $170 million in the prior-year quarter.
  • Annual actuarial assumption update charge of $173 million compared to $103 million in the prior-year quarter.

American International Group, Inc. (NYSE:AIG) today reported net income attributable to AIG common shareholders of $648 million, or $0.72 per diluted common share, for the third quarter of 2019, compared to a net loss attributable to AIG common shareholders of $1.3 billion, or $1.41 per common share, in the prior-year quarter. The improvement was primarily due to pre-tax net realized capital gains of $929 million compared to pre-tax net realized capital losses of $511 million in the prior-year quarter and a reduction in pre-tax net catastrophe losses of $1.1 billion compared to the prior-year quarter. Adjusted after-tax income attributable to AIG common shareholders was $505 million, or $0.56 per diluted common share, for the third quarter of 2019, compared to an adjusted after-tax loss attributable to AIG common shareholders of $301 million, or $0.34 per common share, in the prior-year quarter. The improvement was primarily due to lower catastrophe losses compared to the prior-year quarter.

Brian Duperreault, AIG's President and Chief Executive Officer, said: "Our results this quarter reflect the significant, ongoing work across the company to lay a foundation for long-term, sustainable and profitable growth. Results are in line with our expectations, particularly in General Insurance, which demonstrated a significant improvement over the prior-year quarter driven by our focus on underwriting excellence, expense discipline and enhanced reinsurance strategy. Life and Retirement continued to produce solid results despite ongoing headwinds from the sustained low interest rate environment. This business remains on track to deliver double-digit returns for the full year.

"As we approach 2020, we remain confident we will deliver underwriting profitability for the full year 2019 and deliver double-digit ROCE by the end of 2021. We still have much work ahead of us, but we are well on our way to positioning AIG as a leading global insurance company," Mr. Duperreault added.

THIRD QUARTER FINANCIAL SUMMARY*

 

Three Months Ended

September 30,

($ in millions, except per common share amounts)

2019

2018

Net income (loss) attributable to AIG common shareholders

$

 

648

 

$

 

(1,259

)

Net income (loss) per diluted share attributable to AIG common shareholders (a)

$

 

0.72

 

$

 

(1.41

)

 

 

 

 

 

Weighted average common shares outstanding - diluted (a)

 

895.8

 

 

895.2

 

 

 

 

 

 

Adjusted pre-tax income (loss):

 

 

 

 

General Insurance

$

 

507

 

$

 

(825

)

Life and Retirement

 

646

 

 

713

 

Other Operations

 

(500

)

 

(388

)

Legacy

 

93

 

 

84

 

Total

$

 

746

 

$

 

(416

)

 

 

 

 

 

Adjusted after-tax income (loss) attributable to AIG common shareholders

$

 

505

 

$

 

(301

)

Adjusted after-tax income (loss) per diluted share attributable to AIG common shareholders (a)

$

 

0.56

 

$

 

(0.34

)

 

 

 

 

 

Return on common equity

 

4.0

 

%

(8.4

)

%

Adjusted return on common equity*

 

4.1

 

%

(2.4

)

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