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AIG NYSE· American International Group Inc
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AIG NYSE· American International Group Inc
Earnings report Q4 2023

AIG Reports Strong Revenue Growth in Latest Quarter

Segments of Revenue

AIG's revenue in the latest quarter was primarily driven by its General Insurance and Life and Retirement segments. General Insurance achieved $2.3 billion in underwriting income, representing a 15 percent increase compared to the previous year. The segment's strong performance can be attributed to a significant improvement in underwriting income and a combined ratio of 90.6, which was lower than the previous year's ratio of 91.9. Additionally, the accident year combined ratio, as adjusted, improved by 1.0 point to 87.7 compared to 88.7 in the previous year. The Life and Retirement segment also contributed to the company's revenue, although specific figures were not provided in the report.

Strengths

AIG demonstrated strong financial performance in the latest quarter, with a notable increase in underwriting income in its General Insurance segment. This improvement can be attributed to the company's continued focus on enhancing its underwriting model and establishing enterprise-wide standards. AIG's management highlighted the achievement of a sub-100 combined ratio in every quarter of the year, indicating efficient underwriting practices. Furthermore, the company's balanced capital management approach, including share repurchases and dividend payments, contributed to its financial strength and shareholder return.

Challenges

While AIG reported strong revenue growth in its General Insurance segment, the report did not provide specific revenue figures for the Life and Retirement segment. This lack of information makes it difficult to assess the segment's contribution to the company's overall revenue. Additionally, AIG experienced a decrease in net income attributable to common shareholders compared to the previous year, primarily due to lower net gains on divestitures and other factors. The decline in net investment income, driven by lower returns on alternative investments and declines in fair value of fixed maturity securities, also impacted the company's financial performance.

Noteworthy

AIG's focus on deconsolidation was highlighted in the report, indicating the company's progress towards streamlining its operations and potentially divesting certain assets. While no specific details were provided, this strategic initiative could have implications for AIG's future performance and financial outlook.

Summary

AIG reported strong revenue growth in the latest quarter, primarily driven by its General Insurance segment's significant improvement in underwriting income. The company achieved a sub-100 combined ratio in every quarter, indicating efficient underwriting practices. However, AIG faced challenges such as a decrease in net income attributable to common shareholders and lower net investment income. The lack of specific revenue figures for the Life and Retirement segment limits a comprehensive assessment of its contribution. AIG's progress towards deconsolidation reflects its strategic focus on streamlining operations. Overall, AIG's financial performance in the latest quarter demonstrates strengths in its underwriting capabilities and balanced capital management approach, while also highlighting challenges and ongoing strategic initiatives.

Source documents

Form 10-K  filed on Feb 14, 2024
144 pages scanned

Reference data

Company financials Q4 revenue 9.86B
Analyst estimates Q4 EPS beat by 9.19%
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