American International Group (AIG) has reported a net income of $654m, or $0.75 per diluted share, for the first quarter of 2019, a 43% decrease compared to $938m, or $1.01 per diluted share, for the same quarter of 2018.
Image: The AIG Towers of Los Angeles. Photo: courtesy of HanSangYoon/Wikipedia.org.
AIG reported its first quarter adjusted after-tax income of $1.4bn, or $1.58 per diluted share, compared to $963m, or $1.04 per diluted share, for the corresponding period last year.
The insurance major’s total consolidated net investment income increased to $3.9bn in the quarter, compared to $3.3bn in the first quarter of 2018 owing to favorable market performance.
In its general insurance business, AIG’s gross premiums written increased by 11% to $10.2bn in the first quarter of 2019, compared to $9.2bn reported in the same quarter in the previous year.
The general insurance business had a first quarter adjusted pre-tax income of $1.3bn, which includes $179m of underwriting income and $1.1bn net investment income.
The unit registered a combined ratio of 97.4 and an accident year combined ratio, as adjusted, of 96.1, owing to improvements to underwriting fundamentals, reinsurance steps and continued expense discipline.
AIG’s life and retirement unit reported an increase of 4% in its adjusted pre-tax income of $924m in the first of 2019, compared to $892m in the same quarter in the previous year.
The company attributed the growth to favorable impact of equity market performance and its move to tighten credit spreads which impacted net investment income returns favorably along with other factors.
Its premiums and deposits in the life and retirement business dropped by 6% in the first of 2019 to $8.35bn, compared to $8.86bn in the same quarter of 2018.
AIG president and CEO Brian Duperreault said: “Our first quarter results represented strong performance, particularly in General Insurance, reflecting significant foundational work throughout 2018 to position AIG for sustainable, profitable growth. General Insurance achieved an underwriting profit driven by underwriting and expense discipline, improved business mix and reinsurance actions.
“We achieved an underwriting profit on a calendar year and accident year basis in the first quarter and we expect that to continue for the full year. Life and Retirement delivered solid performance, benefiting from diversification of product and distribution channels.”