For the full year 2019, AIG had a net income attributable to shareholders of $3.32bn or $3.74 per share
The AIG Towers of Los Angeles. (Credit: HanSangYoon/Wikipedia.org)
American International Group (AIG) has reported a net income attributable to shareholders of $922m, or $1.03 per diluted share, for the first quarter of 2019, compared to net loss of $622m, or $0.70 per diluted share, for the same quarter of 2018.
The insurance major said that the improvement in the Q4 2019 net income was mainly because of the favourable impact of actions taken in general insurance underwriting and reinsurance. It was also driven by a favorable pre-tax net prior year loss reserve development of $153m compared to unfavorable net prior year pre-tax loss reserve development of $365m in Q4 2018.
The improvement was also due to a $385m reduction in pre-tax net catastrophe losses in comparison to the year before quarter along with a pre-tax $833m increase in net investment income compared to Q4 2018.
In the general insurance business, AIG reported $778m in the adjusted pre-tax income for Q4 2019 compared to a loss of $722m made in the prior-year quarter. The gross premiums written came down by 5% in the reported quarter from $7.7bn in Q4 2018 to $7.3bn.
In the life and retirement business, the adjusted pre-tax income for Q4 2019 was up by 35% to $839m compared to $623m in Q4 2018. This was mainly driven by better individual and group retirement results, said the insurance company.
AIG FY 2019 results
For the full year 2019, AIG had a net income attributable to shareholders of $3.32bn or $3.74 per share, compared to a net loss of $6m or $0.01 per share. The insurer attributed the improvement mainly to lowered pre-tax net catastrophe losses of $1.7bn compared to the prior year and other factors.
AIG CEO Brian Duperreault said: “The improvement in our financial performance over the course of last year was broad-based, with contributions from all of our segments, but most notable was the return to underwriting profitability in General Insurance.
“The full year combined ratio was 99.6% and the accident year combined ratio, as adjusted, was 96.0%. Life & Retirement also delivered solid results in the face of continued headwinds from low interest rates and tightening credit spreads.”
Recently, AIG signed a deal worth about $1.8bn to sell a stake of 76.6% in its legacy insurance business Fortitude Re to The Carlyle Group and T&D Holdings. The deal, which is subject to regulatory approvals, is scheduled to be wrapped up in mid-2020.