NEW YORK: Insurer American International Group Inc beat market estimates for quarterly profit on Monday (Aug 8) as a jump in underwriting income cushioned the blow from lower investment returns.
Net premiums written in the company's general insurance business rose 5% on a constant currency basis in the April-June quarter to US$6.9 billion (RM30.7 billion), while underwriting income climbed 73%.
That helped AIG – one of the world’s biggest commercial insurers – report adjusted after-tax income attributable to common shareholders of US$1.19 per share. Analysts had expected a figure of US$1.10 a share, according to Refinitiv IBES data.
But the insurer’s consolidated net investment income fell 29% to US$2.6 billion, partly hurt by weakness in alternative investments such as private equity.
An unabating surge in inflation, rising interest rates and the toll of the Russia-Ukraine war have rattled financial markets this year, sapping the investment income that had powered insurers’ profits last year.
AIG also blamed the market volatility for a delay in the initial public offering (IPO) of its life and retirement unit.
The unit – set to be renamed Corebridge Financial Inc when it goes public – had filed for its offering in March and planned to complete its listing by the end of June, subject to market conditions.
“Completing the IPO is a significant priority for us and we remain ready to execute,” CEO Peter Zaffino said without giving a new deadline for the offering.
AIG had first announced the move in 2020 and it sold a 9.9% stake in the unit to private equity firm Blackstone Group Inc for US$2.2 billion last year. – Reuters
