AIG Reports First Quarter 2015 Net Income
In a release on
After-tax operating income was
"Our first quarter results showed progress on our financial objectives, and our commitment to balance sheet management," said
"Our diversified business model and balance sheet deleveraging highlight how we have reduced our overall risk level," Hancock continued. "Our focus on value and long-term sustainability benefits our clients and our shareholders, and leverages our global scale to achieve the right balance between growth, profitability, and risk."
CAPITAL AND LIQUIDITY
-AIG shareholders' equity totaled
-In the first quarter of 2015, AIG issued
-In the first quarter of 2015, AIG repurchased approximately 29 million shares of AIG Common Stock for an aggregate purchase price of
-In the first quarter of 2015, AIG launched cash tender offers that resulted in the repurchase in
-In the first quarter of 2015, AIG repurchased through cash tender offers approximately
-In the first quarter of 2015, AIG paid
-AIG Parent liquidity sources increased to
Pre-tax operating income increased to
Prior year loss reserve development unfavorable, net of reinsurance and premium adjustments 28 160 Net reserve discount charge (benefit) 93 (126 )
Property Casualty's increase in pre-tax operating income is attributable to an increase in underwriting income, partially offset by lower net investment income. The combined ratio decreased 1.8 points to 97.1 in the first quarter of 2015. The loss ratio decreased 1.3 points to 68.1 in the first quarter of 2015, primarily due to lower current accident year losses, lower catastrophe losses and lower net unfavorable prior year loss reserve development, partially offset by a net reserve discount charge for workers' compensation reserves compared to a net reserve discount benefit in the prior-year quarter.
Catastrophe losses were
The first quarter 2015 accident year loss ratio, as adjusted, decreased 0.8 points to 64.4, primarily due to enhanced risk selection and pricing discipline in Specialty and Financial lines, particularly in the U.S., and lower attritional losses in U.S. Property. The acquisition ratio remained unchanged. The general operating expense ratio decreased slightly to 12.8, primarily due to efficiencies from organizational realignment initiatives, offset by investments in technology, engineering and analytics.
First quarter 2015 net premiums written increased 1 percent compared to the prior-year quarter. Excluding the effects of foreign exchange, net premiums written increased 6 percent compared to the prior-year quarter. This increase was primarily driven by new business growth in Financial lines and Property, as well as a renewal of a multi-year multinational policy in Financial lines which contributed approximately 40 percent of the growth. These increases were partially offset by the decreases in U.S. Casualty, reflecting rate pressure and the effect on renewals from continued discipline in certain classes of business in Specialty.
Mortgage Guaranty's pre-tax operating income increased to
Net premiums written increased 12 percent to
Retirement pre-tax operating income of
Premiums and deposits for Retirement were lower in the first quarter of 2015 compared to the prior-year quarter, due to lower deposits in the Fixed Annuities product line given the low interest rate environment, and lower deposits in Group Retirement and Retail Mutual Funds. Premiums and deposits benefited from strong sales of variable and index annuities in the Retirement Income Solutions product line, which increased 13 percent compared to the prior-year quarter, principally driven by index annuities.
Life pre-tax operating income of
Gross life insurance in force at
The loss ratio decreased 0.4 points to 58.8 in the first quarter of 2015, reflecting lower current accident year losses and lower catastrophe losses. The prior-year quarter also included favorable net loss reserve development compared to unfavorable net loss reserve development in the first quarter of 2015. All lines of business contributed to the improvement in the accident year loss ratio, as adjusted. Severe losses in the first quarter of 2015 were lower in frequency compared to the prior-year quarter. In addition, the lower losses associated with a warranty retail program were offset by an increase in acquisition costs for the related profit- sharing arrangement in the first quarter of 2015 compared to the prior-year quarter.
The acquisition ratio increased 0.6 points in the first quarter of 2015 compared to the prior-year quarter, primarily due to the profit-sharing arrangement for the warranty retail program described above. In addition, the general operating expense ratio remained unchanged compared to the prior-year quarter.
Excluding the effects of foreign exchange, first quarter 2015 net premiums written increased over 1 percent from the prior-year quarter, reflecting the continued execution of strategies to maintain underwriting discipline, and balance investment and growth. Growth in the A&H, automobile, and property businesses, primarily in
DIB pre-tax operating income decreased in the first quarter of 2015 compared to the prior-year quarter, primarily due to lower asset appreciation and declines in net credit valuation adjustments on assets and liabilities for which the fair value option was elected.
GCM's pre-tax operating income increased in the first quarter of 2015 compared to the prior-year quarter, primarily due to gains realized upon unwinding certain positions, partially offset by declines in unrealized market valuation gains related to the super senior credit default swap portfolio.
Run-off insurance lines reported a pre-tax operating loss in the first quarter of 2015 compared to pre-tax operating income in the prior-year quarter, primarily due to higher net reserve discount expense, reflecting the update to the discount rates used on excess workers' compensation reserves.
Other businesses' pre-tax operating income improved in the first quarter of 2015 compared to the prior-year quarter, primarily due to
AIG Parent and Other's pre-tax operating results increased in the first quarter 2015 compared to the prior-year quarter, primarily due to AIG's share of
More Information:
((Comments on this story may be sent to [email protected]))
Advisor News
Annuity News
Health/Employee Benefits News
Life Insurance News