AIG has reported adjusted pre-tax net income of $1.13bn for Q3 2021, with general insurance almost doubling its contribution to $811m and returning to underwriting profit of $20m after a loss of $423m for Q3 last year.
AIG said “elevated” cat losses of $628m in Q3 2021, mainly from exposure to Hurricane Ida and European floods, were 21% lower than cat losses of $790m in Q3 2020, which included $185m in Covid-19 claims.
The quarter closed with a combined ratio of 99.7%, improving from 107.2% in Q3 2020, after lower cat losses and stronger underwriting results, as well as commercial lines benefiting from premium growth and rate increases.
AIG president and CEO Peter Zaffino said AIG’s general insurance performance reflects “the underwriting discipline now embedded in our culture and the benefits of our volatility reduction efforts through a well-articulated risk appetite and reinsurance programme that performed well”.
However, overall underwriting profits were largely driven by gains in personal lines in North America and international business. North America commercial lines recorded further underwriting losses of $503m for Q3 2021, from $153m last year, and was running a combined ratio of 120%; while international commercial lines reported underwriting losses of $94m, improved from a loss of $148m in Q3 2020.
General insurance net premiums increased by 11% during the quarter to $6.6bn, driven by commercial lines, which increased premiums by 17% to $4.65bn. That was based on improved levels of retention but also “outstanding” levels of new business and strong rates, AIG said