4 May 2017Insurance

AIG returns to profit as it reaps rewards of restructuring

American International Group (AIG) enjoyed a return to solid profits in its first quarter results as its CEO highlighted the company was enjoying the fruits of actions it has taken to execute to strengthen its balance sheet and improve earnings quality.

The company made a net profit of $1.1 billion in the first quarter compared with a loss of $183 million in the same period a year earlier. Its pre-tax operating income increased to $1.7 billion compared with $1.1 billion a year earlier.

The company stressed its ongoing efforts to improve its portfolio. Net premiums written by its commercial insurance unit, for example, dropped by 17 percent (or 14 percent on a consistent dollar basis) to $3.6 billion in the quarter as it executed a strategy of better risk selection and also bought more reinsurance.

It said the increased use of reinsurance in property represented 4 points of the decline, while the remaining 10 points was related to continued execution on our strategic portfolio actions throughout the first quarter of 2017, and the important January 1st renewal date in Europe.

“Our first quarter results highlight the success of the actions we have taken to execute on our strategy, strengthen our balance sheet, and improve earnings quality,” said Peter Hancock, AIG chief executive.

“Operating results across our core Commercial and Consumer businesses improved and we continued to return excess capital to shareholders. Since January 1, 2016, we have returned over $18 billion of capital towards our $25 billion target. We will continue to execute our strategy and further build on our position as a leading global insurance company.”

Today’s stories

Munich Re leads investment in insurtech firm Next

Swiss Re blames Australian cat claims for slump in Q1 profits

Profits tumble at PartnerRe but CEO highlights positives

Profits up, GWP down at Lancashire as CEO warns on 'unsustainable' rates

Swiss Re spies prospects in Asia as it shuns unprofitable business

Liberty hires chief technology officer from Chubb

Positive reserve development helps RSA absorb £40m Ogden hit

Willis Towers Watson elevates Tarantello to lead western US

Aon acquires Mayfair's global benefits portfolio to expand in APAC

Investment gains drive Q1 profits at Argo Group amid challenges

Chubb wraps up European integration

Did you enjoy reading this story?  Sign up to our free daily newsletters and get stories like this sent straight to your inbox.


More on this story

Insurance
1 December 2023   Patricia Walsh has decided to stay with her current employer.
Insurance
28 November 2023   Ukrainian airlines seeks direct access to reinsurance sums due local Fairfax unit
Insurance
16 November 2023   The new CIO replacing John Repko comes from CVS Health.

More on this story

Insurance
1 December 2023   Patricia Walsh has decided to stay with her current employer.
Insurance
28 November 2023   Ukrainian airlines seeks direct access to reinsurance sums due local Fairfax unit
Insurance
16 November 2023   The new CIO replacing John Repko comes from CVS Health.

Intelligent Insurer
Newton Media Ltd
Kingfisher House
21-23 Elmfield Road
BR1 1LT
United Kingdom