AIG Reports First Quarter 2023 Results
-
General Insurance delivered underwriting income of
$502 million 6% year-over-year or11% on a constant dollar basis and adjusted for the International lag elimination* -
General Insurance combined ratio of
91.9% improved 1.0 point from the prior year quarter and adjusted accident year combined ratio* (AYCR) of88.7% improved 0.8 point from the prior year quarter, marking the fifth consecutive year of margin improvement - Life and Retirement reported a strong quarter with continued sales momentum and a 60-basis point improvement in base investment yield year-over-year
-
Net income per diluted common share was
$0.03 $5.04 $1.63 9% compared to$1.49 -
AIG repurchased
$603 million $241 million -
The AIG Board of Directors declared a cash dividend of
$0.36 12.5% increase from prior quarterly dividends, commencing with the second quarter dividend, payable on June 30, 2023
FIRST QUARTER 2023 NOTEWORTHY ITEMS
-
General Insurance adjusted pre-tax income (APTI) increased
$37 million $1.2 billion -
Life and Retirement APTI decreased
$48 million $886 million -
Net income attributable to AIG common shareholders was
$23 million $0.03 $4.2 billion $5.04 -
AATI was
$1.21 billion $1.63 $1.49 10% reduction in weighted average diluted shares outstanding as well as better underwriting results and higher net investment income. -
Return on common equity (ROCE) and adjusted ROCE* were
0.2% and8.7% , respectively, on an annualized basis. Adjusted ROCE for General Insurance was11.6% and for Life and Retirement10.7% , both on an annualized basis. -
As of March 31, 2023, book value per common share was
$58.87 7% compared to$55.15 $75.87 $75.90
* 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.
AIG Chairman & Chief Executive Officer Peter Zaffino said: “AIG successfully navigated a complex environment to produce excellent first quarter results that demonstrate our ability to deliver high-quality outcomes for stakeholders, grow our business, manage volatility, and improve profitability. We also continue to execute on achieving underwriting and operational excellence, and capital and investment management strategies.
“General Insurance net premiums written increased
“Improvement in our combined ratios and underwriting profitability continued. The combined ratio was
“Our Life and Retirement business (known as Corebridge Financial, Inc.) had a very strong quarter reflecting its market-leading position and promising future as a standalone company. Premiums grew
“Net investment income was
“We continued to execute on our capital management strategy, maintaining strong insurance subsidiary capital and parent liquidity. During the first quarter, we returned
“In addition, the AIG Board of Directors approved a
“The environment we operate in is continually shifting and remains volatile and unpredictable. I am very proud of how our colleagues remain focused on and dedicated to making significant progress on our journey to become a top performing company, despite challenging external factors. Our first quarter results demonstrate the resilience of AIG and our steadfast commitment to long-term value creation for our shareholders and other stakeholders.”
For the first quarter of 2023, pre-tax loss from continuing operations was
AATI was
Total consolidated net investment income for the first quarter of 2023 was
As of March 31, 2023, AIG’s total invested assets, excluding Fortitude Re funds withheld assets, was
On January 1, 2023, AIG adopted the new accounting standard for Targeted Improvements to the Accounting for Long-Duration Contracts (the standard or LDTI), with a transition date of January 1, 2021. AIG adopted the standard using the modified retrospective transition method relating to liabilities for traditional and limited payment contracts and deferred policy acquisition costs. AIG also adopted the standard in relation to market risk benefits on a full retrospective basis. The previously reported 2021 and 2022 financial results have been recast for LDTI related changes. This resulted in a cumulative increase in AIG common shareholders' equity of
Book value per common share was
For the first quarter of 2023, AIG repurchased
The AIG Board of Directors declared a quarterly cash dividend on AIG common stock of
The AIG Board of Directors also declared a quarterly cash dividend of
FINANCIAL SUMMARY
|
|
Three Months Ended
|
||||
|
|
|||||
($ in millions, except per common share amounts) |
|
2022 |
|
2023 |
||
Net income attributable to AIG common shareholders |
$ |
4,166 |
|
$ |
23 |
|
Net income per diluted share attributable to AIG common shareholders |
$ |
5.04 |
|
$ |
0.03 |
|
|
|
|
|
|
||
Adjusted pre-tax income (loss) |
$ |
1,724 |
|
$ |
1,643 |
|
General Insurance |
|
1,211 |
|
|
1,248 |
|
Life and Retirement |
|
934 |
|
|
886 |
|
Other Operations |
|
(421 |
) |
|
(491 |
) |
|
|
|
|
|
||
Net investment income |
$ |
3,237 |
|
$ |
3,533 |
|
Net investment income, APTI basis |
|
2,998 |
|
|
3,075 |
|
|
|
|
|
|
||
Adjusted after-tax income attributable to AIG common shareholders |
$ |
1,228 |
|
$ |
1,211 |
|
Adjusted after-tax income per diluted share attributable to AIG common shareholders |
$ |
1.49 |
|
$ |
1.63 |
|
|
|
|
|
|
||
Weighted average common shares outstanding - diluted (in millions) |
|
826.0 |
|
|
744.1 |
|
|
|
|
|
|
||
Return on common equity |
|
27.4 |
|
% |
0.2 |
|
Adjusted return on common equity |
|
8.5 |
|
% |
8.7 |
|
|
|
|
|
|
||
Book value per common share |
$ |
69.95 |
|
$ |
58.87 |
|
Adjusted book value per common share |
$ |
72.62 |
|
$ |
75.87 |
|
|
|
|
|
|
||
Common shares outstanding (in millions) |
|
800.2 |
|
|
727.6 |
|
GENERAL INSURANCE
|
|
Three Months Ended March 31, |
|
|
|||||||
($ in millions) |
|
2022 |
|
|
2023 |
|
Change |
|
|||
Gross premiums written |
$ |
11,512 |
|
|
$ |
12,028 |
|
|
4 |
|
% |
|
|
|
|
|
|
|
|
|
|||
Net premiums written |
$ |
6,633 |
|
|
$ |
6,965 |
|
|
5 |
|
% |
|
|
3,151 |
|
|
|
3,680 |
|
|
17 |
|
|
North America Commercial Lines |
|
2,952 |
|
|
|
3,367 |
|
|
14 |
|
|
North America Personal Insurance |
|
199 |
|
|
|
313 |
|
|
57 |
|
|
International |
|
3,482 |
|
|
|
3,285 |
|
|
(6 |
) |
|
International Commercial Lines |
|
2,085 |
|
|
|
1,996 |
|
|
(4 |
) |
|
International Personal Insurance |
|
1,397 |
|
|
|
1,289 |
|
|
(8 |
) |
|
|
|
|
|
|
|
|
|
|
|||
Underwriting income (loss) |
$ |
446 |
|
|
$ |
502 |
|
|
13 |
|
% |
|
|
256 |
|
|
|
299 |
|
|
17 |
|
|
North America Commercial Lines |
|
267 |
|
|
|
331 |
|
|
24 |
|
|
North America Personal Insurance |
|
(11 |
) |
|
|
(32 |
) |
|
(191 |
) |
|
International |
|
190 |
|
|
|
203 |
|
|
7 |
|
|
International Commercial Lines |
|
125 |
|
|
|
155 |
|
|
24 |
|
|
International Personal Insurance |
|
65 |
|
|
|
48 |
|
|
(26 |
) |
|
|
|
|
|
|
|
|
|
|
|||
Net investment income, APTI basis |
$ |
765 |
|
|
$ |
746 |
|
|
(2 |
) |
% |
Adjusted pre-tax income |
$ |
1,211 |
|
|
$ |
1,248 |
|
|
3 |
|
% |
Return on adjusted segment common equity |
|
12.3 |
|
% |
|
11.6 |
|
% |
(0.7 |
) |
pts |
|
|
|
|
|
|
|
|
|
|||
Underwriting ratios: |
|
|
|
|
|
|
|
|
|||
North America Combined Ratio (CR) |
|
90.8 |
|
|
|
90.0 |
|
|
(0.8 |
) |
pts |
North America Commercial Lines CR |
|
88.8 |
|
|
|
87.1 |
|
|
(1.7 |
) |
|
North America Personal Insurance CR |
|
102.6 |
|
|
|
107.9 |
|
|
5.3 |
|
|
International CR |
|
94.5 |
|
|
|
93.8 |
|
|
(0.7 |
) |
|
International Commercial Lines CR |
|
93.6 |
|
|
|
91.9 |
|
|
(1.7 |
) |
|
International Personal Insurance CR |
|
95.7 |
|
|
|
96.4 |
|
|
0.7 |
|
|
General Insurance (GI) CR |
|
92.9 |
|
|
|
91.9 |
|
|
(1.0 |
) |
|
|
|
|
|
|
|
|
|
|
|||
GI Loss ratio |
|
60.9 |
|
|
|
59.9 |
|
|
(1.0 |
) |
pts |
Less: impact on loss ratio |
|
|
|
|
|
|
|
|
|||
Catastrophe losses and reinstatement premiums |
|
(4.5 |
) |
|
|
(4.2 |
) |
|
0.3 |
|
|
Prior year development, net of reinsurance and prior year premiums |
|
1.1 |
|
|
|
1.0 |
|
|
(0.1 |
) |
|
GI Accident year loss ratio, as adjusted |
|
57.5 |
|
|
|
56.7 |
|
|
(0.8 |
) |
|
GI Expense ratio |
|
32.0 |
|
|
|
32.0 |
|
|
— |
|
|
GI Accident year combined ratio, as adjusted |
|
89.5 |
|
|
|
88.7 |
|
|
(0.8 |
) |
|
|
|
|
|
|
|
|
|
|
|||
Accident year combined ratio, as adjusted (AYCR): |
|
|
|
|
|
|
|
|
|||
North America AYCR |
|
90.6 |
|
|
|
88.7 |
|
|
(1.9 |
) |
pts |
North America Commercial Lines AYCR |
|
88.1 |
|
|
|
85.7 |
|
|
(2.4 |
) |
|
North America Personal Insurance AYCR |
|
105.2 |
|
|
|
107.6 |
|
|
2.4 |
|
|
International AYCR |
|
88.6 |
|
|
|
88.7 |
|
|
0.1 |
|
|
International Commercial Lines AYCR |
|
83.5 |
|
|
|
83.7 |
|
|
0.2 |
|
|
International Personal Insurance AYCR |
|
95.2 |
|
|
|
95.9 |
|
|
0.7 |
|
|
General Insurance
-
First quarter 2023 NPW of
$7.0 billion 5% from the prior year quarter, which had International reported on a one month lag and included the impact of a weaker US dollar compared to first quarter 2022. On a constant dollar basis and adjusted for the lag elimination, NPW increased10% , driven by solid North America Commercial Lines growth of15% attributed to strong new business levels and higher retention on renewals as well as International Commercial Lines growth of6% . Commercial Lines NPW growth benefited from higher renewal premium rates in most lines, particularly in Validus Re andLexington , offset in part by a decline in Financial Lines due to lower premium rates and reduced capital markets activities. Personal Insurance NPW grew6% on a constant dollar basis and adjusted for the lag elimination, primarily driven by lower quota share cession in North America Personal Lines, partially offset by the non-renewal of a contract in International Accident & Health. -
First quarter 2023 APTI increased by
$37 million $1.2 billion $56 million $502 million $264 million $126 million New Zealand , compared to$288 million $116 million North America and$148 million $68 million $93 million -
The combined ratio improved 1.0 point from the prior year quarter to
91.9% . The AYCR improved 0.8 point from the prior year quarter to88.7% , driven by a 0.8 point decrease in the accident year loss ratio, as adjusted* to56.7% , reflecting continued earned-in rate exceeding loss cost trends in Commercial Lines. The expense ratio was flat at32.0% . -
Global Commercial Lines underwriting results continued to improve. The combined ratios for North America Commercial Lines and International Commercial Lines each improved 1.7 points to
87.1% and91.9% , respectively, compared to the prior year quarter. The AYCR for North America Commercial Lines improved 2.4 points to85.7% , and for International Commercial Lines increased by 0.2 point to83.7% , driven by higher assumed allocation expenses, compared to the prior year quarter. -
Global Personal Insurance underwriting income was lower, reflecting a mix shift in premiums and lower premiums earned compared to the prior year quarter. The North America Personal Insurance combined ratio of
107.9% and AYCR of107.6% , increased 5.3 points and 2.4 points, respectively, compared to the prior year quarter, driven by higher catastrophe losses from FebruaryU.S. winter storms and a higher acquisition ratio due to changes in business mix and reinsurance structure. The International Personal Insurance combined ratio of96.4% and AYCR of95.9% , each had an increase of 0.7 point, from the prior year quarter, due to changes in business mix and an increase in general operating expense ratio attributable to the decline in premiums earned. -
General Insurance return on adjusted segment common equity for the first quarter was
11.6% on an annualized basis, compared with12.3% in the prior year quarter.
LIFE AND RETIREMENT
|
|
Three Months Ended |
|
|
|
||||||
|
|
March 31, |
|
|
|
||||||
($ in millions, except as indicated) |
|
2022 |
|
|
|
2023 |
|
|
Change |
|
|
Adjusted pre-tax income (loss) |
$ |
934 |
|
|
$ |
886 |
|
|
(5 |
) |
% |
Individual Retirement |
|
466 |
|
|
|
533 |
|
|
14 |
|
|
Group Retirement |
|
241 |
|
|
|
187 |
|
|
(22 |
) |
|
Life Insurance |
|
113 |
|
|
|
82 |
|
|
(27 |
) |
|
Institutional Markets |
|
114 |
|
|
|
84 |
|
|
(26 |
) |
|
|
|
|
|
|
|
|
|
|
|||
Premiums and fees |
$ |
1,579 |
|
|
$ |
2,899 |
|
|
84 |
|
% |
Individual Retirement |
|
241 |
|
|
|
252 |
|
|
5 |
|
|
Group Retirement |
|
122 |
|
|
|
106 |
|
|
(13 |
) |
|
Life Insurance |
|
931 |
|
|
|
917 |
|
|
(2 |
) |
|
Institutional Markets |
|
285 |
|
|
|
1,624 |
|
|
470 |
|
|
|
|
|
|
|
|
|
|
|
|||
Premiums and deposits |
$ |
7,265 |
|
|
$ |
10,448 |
|
|
44 |
|
% |
Individual Retirement |
|
3,881 |
|
|
|
4,883 |
|
|
26 |
|
|
Group Retirement |
|
1,888 |
|
|
|
2,246 |
|
|
19 |
|
|
Life Insurance |
|
1,169 |
|
|
|
1,156 |
|
|
(1 |
) |
|
Institutional Markets |
|
327 |
|
|
|
2,163 |
|
|
NM |
|
|
|
|
|
|
|
|
|
|
|
|||
Net flows |
$ |
55 |
|
|
$ |
(156 |
) |
|
NM |
|
% |
Individual Retirement |
|
874 |
|
|
|
663 |
|
|
(24 |
) |
|
Group Retirement |
|
(819 |
) |
|
|
(819 |
) |
|
— |
|
|
|
|
|
|
|
|
|
|
|
|||
Net investment income, APTI basis |
$ |
2,129 |
|
|
$ |
2,277 |
|
|
7 |
|
% |
Return on adjusted segment common equity |
|
12.2 |
|
% |
|
10.7 |
|
% |
(1.5 |
) |
pts |
Life and Retirement
-
Life and Retirement reported APTI of
$886 million 5% from$934 million -
Premiums increased to
$2.2 billion $0.8 billion 44% to$10.4 billion $7.3 billion $1.5 billion $500 million $1.3 billion $542 million -
The capital position of the business remains healthy with a Risk-Based Capital (RBC) ratio in the
410% -420% range, above our target levels. -
Life and Retirement return on adjusted segment common equity for the first quarter was
10.7% on an annualized basis, compared with12.2% in the prior year quarter.
OTHER OPERATIONS
|
|
Three Months Ended |
|
|
|
||||||
|
|
March 31, |
|
|
|
||||||
($ in millions) |
|
2022 |
|
|
2023 |
|
Change |
|
|||
Corporate and Other |
$ |
(547 |
) |
|
$ |
(435 |
) |
|
20 |
|
% |
Asset Management Group |
|
259 |
|
|
|
1 |
|
|
(100 |
) |
|
Adjusted pre-tax loss before consolidation and eliminations |
|
(288 |
) |
|
|
(434 |
) |
|
(51 |
) |
|
Consolidation and eliminations |
|
(133 |
) |
|
|
(57 |
) |
|
57 |
|
|
Adjusted pre-tax loss |
$ |
(421 |
) |
|
$ |
(491 |
) |
|
(17 |
) |
% |
Other Operations
-
Other Operations adjusted pre-tax loss (APTL) of
$491 million $70 million -
Before consolidation and eliminations, APTL deteriorated by
$146 million -
Corporate general operating expenses decreased
$27 million $29 million $56 million -
Consolidation and elimination activities decreased to
$(57) million
CONFERENCE CALL
AIG will host a conference call tomorrow, Friday, May 5, 2023 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
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, recent stress in the banking sector, fluctuations in interest rates and foreign currency exchange rates, inflationary pressures, pressures on the commercial real estate market, an economic slowdown or recession, uncertainty regarding theU.S. federal government’s debt limit, and geopolitical events or conflicts, including the conflict betweenRussia andUkraine ; - 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 realize expected strategic, financial, operational or other benefits from the separation of Corebridge as well as AIG’s equity market exposure to Corebridge;
- the effectiveness of strategies to retain and recruit key personnel and to implement effective succession plans;
- AIG’s ability to successfully dispose of, monetize and/or acquire businesses or assets or successfully integrate acquired businesses;
- 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);
- changes in judgments concerning potential cost-saving opportunities;
- AIG's ability to effectively implement changes under AIG 200, including the ability to realize cost savings;
- 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 andUkraine 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;
- the impact of COVID-19 and its variants or other pandemics and responses thereto;
- AIG’s ability to effectively execute on sustainability targets and standards, and AIG’s ability to address evolving stakeholder expectations with respect to environmental, social and governance matters; and
- such other factors discussed in Part I, Item 2. Management’s Discussion 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, 2023 (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 Annual Report on Form 10-K for the year ended December 31, 2022.
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
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
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
Book Value per Common Share, Excluding Goodwill, Value of Business Acquired (VOBA), Value of Distribution Channel Acquired (VODA), Other Intangible Assets, AOCI adjusted for the cumulative unrealized gains and losses related to Fortitude Re funds withheld assets, and Deferred Tax Assets (DTA) (Adjusted Tangible Book Value per Common Share) is used to provide more accurate measure of the realizable value of shareholder on a per-common share basis. Adjusted Tangible Book Value per Common Share is derived by dividing Total AIG common shareholders’ equity, excluding intangible assets, AOCI adjusted for the cumulative unrealized gains and losses related to Fortitude Re funds withheld assets, and DTA (Adjusted Tangible Common Shareholders’ Equity), by total common shares outstanding.
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
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, 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 15 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
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
Underwriting ratios are computed as follows:
a. |
Loss ratio = Loss and loss adjustment expenses incurred ÷ Net premiums earned (NPE) |
|
b. |
Acquisition ratio = Total acquisition expenses ÷ NPE |
|
c. |
General operating expense ratio = General operating expenses ÷ NPE |
|
d. |
Expense ratio = Acquisition ratio + General operating expense ratio |
|
e. |
Combined ratio = Loss ratio + Expense ratio |
|
f. |
CATs and reinstatement premiums = [Loss and loss adjustment expenses incurred – (CATs)] ÷ [NPE +/(-) Reinstatement premiums related to catastrophes] – Loss ratio |
|
g. |
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] |
|
h. |
Accident year combined ratio, as adjusted (AYCR ex-CAT) = AYLR ex-CAT + Expense ratio |
|
i. |
Prior year development net of reinsurance and prior year premiums = [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. (AIG) is a leading global insurance organization. AIG member companies offer insurance solutions that help businesses and individuals in approximately 70 countries and jurisdictions protect their assets and manage risks. AIG common stock is listed on the New York Stock Exchange.
Additional information about AIG can be found at www.aig.com | YouTube: www.youtube.com/aig | Twitter: @AIGinsurance www.twitter.com/AIGinsurance | LinkedIn: www.linkedin.com/company/aig. These references with additional information about AIG have been provided as a convenience, and the information contained on such websites is not incorporated by reference into this press release.
AIG is the marketing name for the worldwide property-casualty, life and retirement, and general insurance operations of American International Group, Inc.. For additional information, please visit our website at www.aig.com. 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, |
||||||||||||||||||||||||
|
2022 |
|
2023 |
||||||||||||||||||||||
|
|
|
|
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 |
$ |
5,714 |
|
$ |
1,154 |
|
$ |
— |
|
$ |
4,560 |
|
|
$ |
(231 |
) |
$ |
(144 |
) |
$ |
— |
|
$ |
(87 |
) |
Noncontrolling interests |
|
|
|
|
|
(387 |
) |
|
(387 |
) |
|
|
|
|
|
|
117 |
|
|
117 |
|
||||
Pre-tax income (loss)/net income attributable to AIG |
|
5,714 |
|
|
1,154 |
|
|
(387 |
) |
|
4,173 |
|
|
|
(231 |
) |
|
(144 |
) |
|
117 |
|
|
30 |
|
Dividends on preferred stock |
|
|
|
|
|
|
|
7 |
|
|
|
|
|
|
|
|
|
7 |
|
||||||
Net income attributable to AIG common shareholders |
|
|
|
|
|
|
|
4,166 |
|
|
|
|
|
|
|
|
|
23 |
|
||||||
Adjustments: |
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||
Changes in uncertain tax positions and other tax adjustments |
|
|
|
91 |
|
|
— |
|
|
(91 |
) |
|
|
|
|
22 |
|
|
— |
|
|
(22 |
) |
||
Deferred income tax valuation allowance (releases) charges |
|
|
|
6 |
|
|
— |
|
|
(6 |
) |
|
|
|
|
(19 |
) |
|
— |
|
|
19 |
|
||
Changes in fair value of securities used to hedge guaranteed living benefits |
|
(13 |
) |
|
(3 |
) |
|
— |
|
|
(10 |
) |
|
|
3 |
|
|
1 |
|
|
— |
|
|
2 |
|
Change in market risk benefit, net(a) |
|
(233 |
) |
|
(49 |
) |
|
— |
|
|
(184 |
) |
|
|
196 |
|
|
41 |
|
|
— |
|
|
155 |
|
Changes in benefit reserves related to net realized gains (losses) |
|
(2 |
) |
|
— |
|
|
— |
|
|
(2 |
) |
|
|
(6 |
) |
|
(1 |
) |
|
— |
|
|
(5 |
) |
Changes in the fair value of equity securities |
|
27 |
|
|
6 |
|
|
— |
|
|
21 |
|
|
|
(51 |
) |
|
(11 |
) |
|
— |
|
|
(40 |
) |
Net investment income on Fortitude Re funds withheld assets |
|
(291 |
) |
|
(61 |
) |
|
— |
|
|
(230 |
) |
|
|
(446 |
) |
|
(94 |
) |
|
— |
|
|
(352 |
) |
Net realized (gains) losses on Fortitude Re funds withheld assets |
|
140 |
|
|
29 |
|
|
— |
|
|
111 |
|
|
|
31 |
|
|
7 |
|
|
— |
|
|
24 |
|
Net realized (gains) losses on Fortitude Re funds withheld embedded derivative |
|
(3,318 |
) |
|
(697 |
) |
|
— |
|
|
(2,621 |
) |
|
|
1,165 |
|
|
245 |
|
|
— |
|
|
920 |
|
Net realized (gains) losses(b) |
|
(349 |
) |
|
(105 |
) |
|
— |
|
|
(244 |
) |
|
|
766 |
|
|
208 |
|
|
— |
|
|
558 |
|
Net (gain) loss on divestitures and other |
|
(40 |
) |
|
(9 |
) |
|
— |
|
|
(31 |
) |
|
|
2 |
|
|
— |
|
|
— |
|
|
2 |
|
Non-operating litigation reserves and settlements |
|
(34 |
) |
|
(7 |
) |
|
— |
|
|
(27 |
) |
|
|
(1 |
) |
|
— |
|
|
— |
|
|
(1 |
) |
Favorable prior year development and related amortization changes ceded under retroactive reinsurance agreements |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
|
(19 |
) |
|
(4 |
) |
|
— |
|
|
(15 |
) |
Net loss reserve discount (benefit) charge |
|
(20 |
) |
|
(5 |
) |
|
— |
|
|
(15 |
) |
|
|
64 |
|
|
13 |
|
|
— |
|
|
51 |
|
Integration and transaction costs associated with acquiring or divesting businesses |
|
46 |
|
|
10 |
|
|
— |
|
|
36 |
|
|
|
52 |
|
|
11 |
|
|
— |
|
|
41 |
|
Restructuring and other costs |
|
93 |
|
|
19 |
|
|
— |
|
|
74 |
|
|
|
117 |
|
|
25 |
|
|
— |
|
|
92 |
|
Non-recurring costs related to regulatory or accounting changes |
|
4 |
|
|
1 |
|
|
— |
|
|
3 |
|
|
|
13 |
|
|
3 |
|
|
— |
|
|
10 |
|
Net impact from elimination of international reporting lag(c) |
|
— |
|
|
— |
|
|
— |
|
|
— |
|
|
|
(12 |
) |
|
(3 |
) |
|
— |
|
|
(9 |
) |
Noncontrolling interests(d) |
|
|
|
|
|
278 |
|
|
278 |
|
|
|
|
|
|
|
(242 |
) |
|
(242 |
) |
||||
Adjusted pre-tax income/Adjusted after-tax income attributable to AIG common shareholders |
$ |
1,724 |
|
$ |
380 |
|
$ |
(109 |
) |
$ |
1,228 |
|
|
$ |
1,643 |
|
$ |
300 |
|
$ |
(125 |
) |
$ |
1,211 |
|
(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: |
|
2022 |
|
2023 |
% Inc. (Dec.) |
|
|||
Basic |
|
|
|
|
|
|
|||
Income from continuing operations |
$ |
5.10 |
$ |
0.03 |
(99.4 |
) |
% |
||
Income from discontinued operations |
|
— |
|
|
— |
|
NM |
|
|
Net income attributable to AIG common shareholders |
$ |
5.10 |
|
$ |
0.03 |
|
(99.4 |
) |
|
Diluted |
|
|
|
|
|
|
|||
Income from continuing operations |
|
5.04 |
|
$ |
0.03 |
|
(99.4 |
) |
|
Income from discontinued operations |
|
— |
|
|
— |
|
NM |
|
|
Net income attributable to AIG common shareholders |
$ |
5.04 |
|
$ |
0.03 |
|
(99.4 |
) |
|
Adjusted after-tax income attributable to AIG common shareholders per diluted share |
$ |
1.49 |
|
$ |
1.63 |
|
9.4 |
|
% |
Weighted average shares outstanding: |
|
|
|
|
|
|
|||
Basic |
|
816.3 |
|
|
738.7 |
|
|
|
|
Diluted |
|
826.0 |
|
|
744.1 |
|
|
|
|
Reconciliation of Book Value per Common Share |
|||||||||||
As of period end: |
|
March 31, 2022 |
|
|
December 31, 2022 |
|
|
March 31, 2023 |
|||
Total AIG shareholders' equity |
$ |
56,457 |
|
|
$ |
40,970 |
|
|
$ |
43,317 |
|
Less: Preferred equity |
|
485 |
|
|
|
485 |
|
|
|
485 |
|
Total AIG common shareholders' equity (a) |
|
55,972 |
|
|
|
40,485 |
|
|
|
42,832 |
|
Less: Deferred tax assets (DTA)* |
|
4,940 |
|
|
|
4,518 |
|
|
|
4,543 |
|
Less: Accumulated other comprehensive income (AOCI) |
|
(7,029 |
) |
|
|
(22,616 |
) |
|
|
(19,329 |
) |
Add: Cumulative unrealized gains and losses related to Fortitude Re Funds withheld assets |
|
48 |
|
|
|
(2,862 |
) |
|
|
(2,418 |
) |
Subtotal: AOCI plus cumulative unrealized gains and losses related to Fortitude Re funds withheld assets |
|
(7,077 |
) |
|
|
(19,754 |
) |
|
|
(16,911 |
) |
Total adjusted common shareholders' equity (b) |
$ |
58,109 |
|
|
$ |
55,721 |
|
|
$ |
55,200 |
|
Less: Intangible assets: |
|
|
|
|
|
|
|
|
|||
Goodwill |
|
4,009 |
|
|
|
3,927 |
|
|
|
3,939 |
|
Value of business acquired |
|
107 |
|
|
|
92 |
|
|
|
92 |
|
Value of distribution channel acquired |
|
448 |
|
|
|
418 |
|
|
|
408 |
|
Other intangibles |
|
291 |
|
|
|
286 |
|
|
|
284 |
|
Total intangible assets |
|
4,855 |
|
|
|
4,723 |
|
|
|
4,723 |
|
Total adjusted tangible common shareholders' equity (c) |
$ |
53,254 |
|
|
$ |
50,998 |
|
|
$ |
50,477 |
|
Total common shares outstanding (d) |
|
800.2 |
|
|
|
734.1 |
|
|
|
727.6 |
|
As of period end: |
March 31, 2022 |
% Inc.
|
|
|
December 31, 2022 |
% Inc.
|
|
March 31, 2023 |
|||||||
Book value per common share (a÷d) |
$ |
69.95 |
(15.8 |
) |
% |
$ |
55.15 |
6.7 |
|
% |
$ |
58.87 |
|||
Adjusted book value per common share (b÷d) |
|
72.62 |
|
4.5 |
|
|
|
75.90 |
|
— |
|
|
|
75.87 |
|
Adjusted tangible book value per common share (c÷d) |
|
66.55 |
|
4.2 |
|
|
|
69.47 |
|
(0.1 |
) |
|
|
69.37 |
|
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, |
|
||||||
|
|
2022 |
|
|
2023 |
|
||
Actual or annualized net income (loss) attributable to AIG common shareholders (a) |
$ |
16,664 |
|
|
$ |
92 |
|
|
Actual or annualized adjusted after-tax income attributable to AIG common shareholders (b) |
$ |
4,912 |
|
|
$ |
4,844 |
|
|
Average AIG Common Shareholders' equity (c) |
$ |
60,778 |
|
|
$ |
41,659 |
|
|
Less: Average DTA* |
|
5,081 |
|
|
|
4,531 |
|
|
Less: Average AOCI |
|
(979 |
) |
|
|
(20,973 |
) |
|
Add: Average cumulative unrealized gains and losses related to Fortitude Re funds withheld assets |
|
1,420 |
|
|
|
(2,640 |
) |
|
Subtotal: AOCI plus cumulative unrealized gains and losses related to Fortitude Re funds withheld assets |
|
(2,399 |
) |
|
|
(18,333 |
) |
|
Average adjusted common shareholders' equity (d) |
$ |
58,096 |
|
|
$ |
55,461 |
|
|
|
|
|
|
|
|
|
||
ROCE (a÷c) |
|
27.4 |
|
% |
|
0.2 |
|
% |
Adjusted return on common equity (b÷d) |
|
8.5 |
|
% |
|
8.7 |
|
% |
* |
Represents deferred tax assets only related to |
Reconciliation of Net Investment Income |
|||||||
|
|
Three Months Ended |
|||||
|
|
March 31, |
|||||
|
|
2022 |
|
|
2023 |
||
Net Investment Income per Consolidated Statements of Operations |
$ |
3,237 |
|
|
$ |
3,533 |
|
Changes in fair value of securities used to hedge guaranteed living benefits |
|
(14 |
) |
|
|
(13 |
) |
Changes in the fair value of equity securities |
|
27 |
|
|
|
(51 |
) |
Net investment income on Fortitude Re funds withheld assets |
|
(291 |
) |
|
|
(446 |
) |
Net realized gains (losses) related to economic hedges and other |
|
39 |
|
|
|
53 |
|
Net impact from elimination of International reporting lag |
|
— |
|
|
|
(1 |
) |
Total Net Investment Income - APTI Basis |
$ |
2,998 |
|
|
$ |
3,075 |
|
Net Premiums Written - Change in Constant Dollar and Lag Adjusted |
|||||||||||||
|
Three Months Ended March 31, 2023 |
||||||||||||
|
|
|
|
North |
|
|
|
||||||
|
|
Global - |
Global - |
America |
|
International - |
|||||||
|
General |
Commercial |
Personal |
Commercial |
|
Commercial |
Personal |
||||||
General Insurance |
Insurance |
Lines |
Insurance |
Lines |
|
Lines |
Insurance |
||||||
Change in net premiums written |
|
|
|
|
|
|
|
||||||
Increase (decrease) in original currency and adjusted for lag elimination |
10.1 |
% |
11.3 |
% |
6.4 |
% |
14.9 |
% |
|
5.7 |
% |
(1.3 |
) % |
Foreign exchange effect |
(4.1 |
) |
(2.8 |
) |
(8.4 |
) |
(0.8 |
) |
|
(5.2 |
) |
(8.9 |
) |
Lag elimination impact |
(1.0 |
) |
(2.0 |
) |
2.4 |
|
— |
|
|
(4.8 |
) |
2.5 |
|
Increase (decrease) as reported in |
5.0 |
% |
6.5 |
% |
0.4 |
% |
14.1 |
% |
|
(4.3 |
) % |
(7.7 |
) % |
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, |
|||||
|
|
2022 |
|
2023 |
||
Total General Insurance |
|
|
|
|
||
Combined ratio |
|
92.9 |
|
|
91.9 |
|
Catastrophe losses and reinstatement premiums |
|
(4.5 |
) |
|
(4.2 |
) |
Prior year development, net of reinsurance and prior year premiums |
|
1.1 |
|
|
1.0 |
|
Accident year combined ratio, as adjusted |
|
89.5 |
|
|
88.7 |
|
|
|
|
|
|
||
|
|
|
|
|
||
Combined ratio |
|
90.8 |
|
|
90.0 |
|
Catastrophe losses and reinstatement premiums |
|
(2.1 |
) |
|
(3.9 |
) |
Prior year development, net of reinsurance and prior year premiums |
|
1.9 |
|
|
2.6 |
|
Accident year combined ratio, as adjusted |
|
90.6 |
|
|
88.7 |
|
|
|
|
|
|
||
|
|
|
|
|
||
Combined ratio |
|
88.8 |
|
|
87.1 |
|
Catastrophe losses and reinstatement premiums |
|
(2.4 |
) |
|
(4.1 |
) |
Prior year development, net of reinsurance and prior year premiums |
|
1.7 |
|
|
2.7 |
|
Accident year combined ratio, as adjusted |
|
88.1 |
|
|
85.7 |
|
|
|
|
|
|
||
|
|
|
|
|
||
Combined ratio |
|
102.6 |
|
|
107.9 |
|
Catastrophe losses and reinstatement premiums |
|
(0.7 |
) |
|
(2.7 |
) |
Prior year development, net of reinsurance and prior year premiums |
|
3.3 |
|
|
2.4 |
|
Accident year combined ratio, as adjusted |
|
105.2 |
|
|
107.6 |
|
|
|
|
|
|
||
International |
|
|
|
|
||
Combined ratio |
|
94.5 |
|
|
93.8 |
|
Catastrophe losses and reinstatement premiums |
|
(6.4 |
) |
|
(4.5 |
) |
Prior year development, net of reinsurance and prior year premiums |
|
0.5 |
|
|
(0.6 |
) |
Accident year combined ratio, as adjusted |
|
88.6 |
|
|
88.7 |
|
|
|
|
|
|
||
International - Commercial Lines |
|
|
|
|
||
Combined ratio |
|
93.6 |
|
|
91.9 |
|
Catastrophe losses and reinstatement premiums |
|
(9.9 |
) |
|
(6.9 |
) |
Prior year development, net of reinsurance and prior year premiums |
|
(0.2 |
) |
|
(1.3 |
) |
Accident year combined ratio, as adjusted |
|
83.5 |
|
|
83.7 |
|
|
|
|
|
|
||
International - Personal Insurance |
|
|
|
|
||
Combined ratio |
|
95.7 |
|
|
96.4 |
|
Catastrophe losses and reinstatement premiums |
|
(1.8 |
) |
|
(1.1 |
) |
Prior year development, net of reinsurance and prior year premiums |
|
1.3 |
|
|
0.6 |
|
Accident year combined ratio, as adjusted |
|
95.2 |
|
|
95.9 |
|
|
|
|
|
|
||
Global - Commercial Insurance |
|
|
|
|
||
Combined ratio |
|
91.0 |
|
|
89.2 |
|
Catastrophe losses and reinstatement premiums |
|
(5.8 |
) |
|
(5.3 |
) |
Prior year development, net of reinsurance and prior year premiums |
|
0.8 |
|
|
1.0 |
|
Accident year combined ratio, as adjusted |
|
86.0 |
|
|
84.9 |
|
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, |
|
||||||
|
|
2022 |
|
|
2023 |
|
||
|
|
|
|
|
|
|
||
Adjusted pre-tax income |
$ |
1,211 |
|
|
$ |
1,248 |
|
|
Interest expense on attributed financial debt |
|
148 |
|
|
|
126 |
|
|
Adjusted pre-tax income including attributed interest expense |
|
1,063 |
|
|
|
1,122 |
|
|
Income tax expense |
|
246 |
|
|
|
252 |
|
|
Adjusted after-tax income |
|
817 |
|
|
|
870 |
|
|
Dividends declared on preferred stock |
|
3 |
|
|
|
3 |
|
|
Adjusted after-tax income attributable to common shareholders |
$ |
814 |
|
|
$ |
867 |
|
|
|
|
|
|
|
|
|
||
Ending adjusted segment common equity |
$ |
26,618 |
|
|
$ |
29,543 |
|
|
Average adjusted segment common equity |
$ |
26,543 |
|
|
$ |
29,936 |
|
|
Return on adjusted segment common equity |
|
12.3 |
|
% |
|
11.6 |
|
% |
|
|
|
|
|
|
|
||
Total segment shareholder’s equity |
$ |
24,576 |
|
|
$ |
24,522 |
|
|
Less: Preferred equity |
|
206 |
|
|
|
211 |
|
|
Total segment common equity |
|
24,370 |
|
|
|
24,311 |
|
|
Less: Accumulated other comprehensive income (AOCI) |
|
(2,455 |
) |
|
|
(5,821 |
) |
|
Add: Cumulative unrealized gains and losses related to Fortitude Re funds withheld assets |
|
(207 |
) |
|
|
(589 |
) |
|
Subtotal: AOCI plus cumulative unrealized gains and losses related to Fortitude Re funds withheld assets |
|
(2,248 |
) |
|
|
(5,232 |
) |
|
Total adjusted segment common equity |
$ |
26,618 |
|
|
$ |
29,543 |
|
|
Reconciliation of Life and Retirement Return on Adjusted Segment Common Equity |
|
|||||||
|
|
|
|
|
|
|
||
|
Three Months Ended |
|
||||||
|
March 31, |
|
||||||
|
|
2022 |
|
|
2023 |
|
||
|
|
|
|
|
|
|
||
Adjusted pre-tax income |
$ |
934 |
|
|
$ |
886 |
|
|
Interest expense on attributed financial debt |
|
74 |
|
|
|
115 |
|
|
Adjusted pre-tax income including attributed interest expense |
|
860 |
|
|
|
771 |
|
|
Income tax expense |
|
174 |
|
|
|
154 |
|
|
Adjusted after-tax income |
|
686 |
|
|
|
617 |
|
|
Dividends declared on preferred stock |
|
2 |
|
|
|
2 |
|
|
Adjusted after-tax income attributable to common shareholders |
$ |
684 |
|
|
$ |
615 |
|
|
|
|
|
|
|
|
|
||
Ending adjusted segment common equity |
$ |
22,892 |
|
|
$ |
22,945 |
|
|
Average adjusted segment common equity |
$ |
22,408 |
|
|
$ |
23,062 |
|
|
Return on adjusted segment common equity |
|
12.2 |
|
% |
|
10.7 |
|
% |
|
|
|
|
|
|
|
||
Total segment shareholder’s equity |
$ |
20,824 |
|
|
$ |
10,689 |
|
|
Less: Preferred equity |
|
152 |
|
|
|
161 |
|
|
Total segment common equity |
|
20,672 |
|
|
|
10,528 |
|
|
Less: Accumulated other comprehensive income (AOCI) |
|
(1,965 |
) |
|
|
(14,246 |
) |
|
Add: Cumulative unrealized gains and losses related to Fortitude Re funds withheld assets |
|
255 |
|
|
|
(1,829 |
) |
|
Subtotal: AOCI plus cumulative unrealized gains and losses related to Fortitude Re funds withheld assets |
|
(2,220 |
) |
|
|
(12,417 |
) |
|
Total adjusted segment common equity |
$ |
22,892 |
|
|
$ |
22,945 |
|
|
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, |
||||||
|
|
2022 |
|
|
2023 |
||
Individual Retirement: |
|
|
|
|
|
||
Premiums |
$ |
56 |
|
|
$ |
78 |
|
Deposits |
|
3,830 |
|
|
|
4,807 |
|
Other |
|
(5 |
) |
|
|
(2 |
) |
Premiums and deposits |
$ |
3,881 |
|
|
$ |
4,883 |
|
|
|
|
|
|
|
||
Group Retirement: |
|
|
|
|
|
||
Premiums |
$ |
8 |
|
|
$ |
6 |
|
Deposits |
|
1,880 |
|
|
|
2,240 |
|
Other |
|
— |
|
|
|
— |
|
Premiums and deposits |
$ |
1,888 |
|
|
$ |
2,246 |
|
|
|
|
|
|
|
||
Life Insurance: |
|
|
|
|
|
||
Premiums |
$ |
547 |
|
|
$ |
542 |
|
Deposits |
|
397 |
|
|
|
398 |
|
Other |
|
225 |
|
|
|
216 |
|
Premiums and deposits |
$ |
1,169 |
|
|
$ |
1,156 |
|
|
|
|
|
|
|
||
Institutional Markets: |
|
|
|
|
|
||
Premiums |
$ |
238 |
|
|
$ |
1,575 |
|
Deposits |
|
82 |
|
|
|
581 |
|
Other |
|
7 |
|
|
|
7 |
|
Premiums and deposits |
$ |
327 |
|
|
$ |
2,163 |
|
|
|
|
|
|
|
||
Total Life and Retirement: |
|
|
|
|
|
||
Premiums |
$ |
849 |
|
|
$ |
2,201 |
|
Deposits |
|
6,189 |
|
|
|
8,026 |
|
Other |
|
227 |
|
|
|
221 |
|
Premiums and deposits |
$ |
7,265 |
|
|
$ |
10,448 |
|
Total Debt and Preferred Stock Leverage |
||
|
|
|
|
Three Months Ended |
|
|
March 31, 2023 |
|
Hybrids / Total capital |
2.9 |
% |
Financial debt / Total capital (including AOCI) |
29.2 |
|
Total debt / Total capital |
32.1 |
|
Preferred stock / Total capital (including AOCI) |
0.7 |
|
Total debt & preferred stock / Total capital (including AOCI) |
32.8 |
|
AOCI Impact |
(6.5 |
) |
Total debt & preferred stock / Total capital (excluding AOCI) |
26.3 |
% |
View source version on businesswire.com: https://www.businesswire.com/news/home/20230504005898/en/
Quentin McMillan (Investors): quentin.mcmillan@aig.com
Claire Talcott (Media): claire.talcott@aig.com
Source: American International Group, Inc.
