AIG - Earnings call transcript Q2 2024 | American International Group, Inc.

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Operator

Good day, and welcome to AIG's Second Quarter 2024 Financial Results Conference Call. This conference is being recorded.

Now at this time, I would like to turn the conference over to Quentin McMillan. Please go ahead.

Quentin McMillan

Thanks very much, and good morning. forward-looking are include and to may uncertainties. remarks statements, subject which risks Today's not performance of are statements guarantees These are future management's expectations. based current or on and events that provide AIG's the events details could materially. cause on to filings differ actual SEC important with or results factors update estimates required to or change. applicable opinions no by if statements as laws, AIG should forward-looking Except under circumstances is securities obligation any or management's

financial figures measures. the Today's included The website of available remarks to may release, to GAAP also on such earnings of earnings most our non-GAAP comparable and presentation, is refer in measures our supplement which aig.com. reconciliation financial at all are

reflected deconsolidation discontinued XXXX, note results all with of in following the on are consolidated Financial for accordance the AIG's statements financial of in Additionally, operations U.S. condensed as historical X, June GAAP. Corebridge that presented Corebridge periods

results, basis, to net a margin, sale related comparable remarks for premiums today's basis of constant the year-over-year Services the Validus as applicable underwriting of dollar sale General are income written, as and Re. and Finally, key underwriting adjusted which on comparison and Insurance Risk metrics a Crop such on reflects presented including

earnings basis. presentation a go-forward for changes since on General view most the result and presentation reconciliations refer to the reported Insurance Please XXXX. of metrics comparable XX the We useful the to through this business believe of of provides light portfolio such in of substantial the XX Pages

over Zaffino. our that, like With the and Chairman I'd now Peter CEO, turn to to call

Peter Zaffino;Chairman and CEO

results. joining second thank review XXXX and financial our for you to today morning, Good us quarter

I'm you it work the for today. AIG transformed the excited next done have We and through chapter, have take to foundational and

join second our will for International detail us call. on America quarter. will the and Bailey my remarks, and provide Jon portion Q&A the more Hancock, Following of Then Sabra leaders, Don North the

of to have ample remarks Q&A. a lot We intend to detail, provide of time deconsolidation related Corebridge. for prepared particularly Our our

with highlights start quarter to want outstanding second performance. of I our

will Quentin our a otherwise all of basis, Re clear the the performance. today excluding to noted the on underlying be unless mentioned reference Risk Validus order will of in at comparable a call, provide Services, Crop of view As beginning and figures I impact

Adjusted $XXX share, diluted outstanding. underwriting expense strong per in representing $X.XX year-over-year, after-tax XX% very ongoing strong a and million in our or driven income shares volatility was per continuation discipline, a decrease earnings a by containment organic growth, share of performance, increase

excluding by which a underlying General XX.X%, over Insurance The net led or premiums prior combined year $XXX year the XX% development, $XXX X%. year. improved million. prior X%, underwriting from grew catastrophes income, grew Global XX of was Commercial, basis The points income ratio and was written Underwriting increase calendar year-over-year. slight million

from ratio year a Consolidated investment year. loss the cat X.X% improvement accident excluding of a The income XX.X%, or was pretax XXX-basis-point was adjusted combined catastrophes, increase year-over-year. million, basis catastrophe-related XX% was $XXX losses. net income $XXX on million The ratio, prior total

We dividends. stock we of XX%, ratio quarter, and billion. multiple strategic $X.X we ability debt-to-total capital on the deliver and shareholders ended $XXX making very pleased through parent our During to nearly I'm we're of I'm have progress the continue financial to with quarter and Overall, the liquidity returned pleased total billion outstanding strong to with billion performance, initiatives. $X.X equally AOCI, of repurchases a second with $X including million of

got now, cover how give this we where want There are here we are a the to several you things future holds. sense what and I of on to call

our update, the and Next. In renewals discuss [indiscernible] our update AIG announced a Select, of recently plan personal strategy and on an capital addition today's and to reinsurance on I through business for walking travel provide execution an quick provide management update our results call, on Client market outline Private financial a our transactions disciplined to

note should quarter on treatment our of complex by were remarks, capital complicated as financial deconsolidation. as the shareholders' accounting in In GAAP impact explain equity, well structure, to the financial strong she including the accounting our details I to will implications results the statements. that Sabra's prepared our

of and Before to important further, AIG marked X-year pivotal on to journey, for behind to decision want the of shareholders, on major I in for reflect the milestone to AIG's maximize the we XXXX, our a a Corebridge. options eventually In XXXX, Corebridge, the to to evaluating October accomplishments to strategic moment and height business, we pandemic this the which announced take the the significant I It's AIG. Life separate. become deconsolidation our go along At would whether a separate including both explore comment which for AIG. Corebridge, way value intention undertook rationale detailed Retirement and analysis from

its XXXX, an noteworthy become will new There that many In in AIG were of and like Group accomplishments to way, anchor with few. Blackstone along July I'd highlight assets stand-alone the company acquisition manage announced over of with a the strategic investor Corebridge X years. subsequent the up under management to a management into relationship asset $XX.X entered to long-term Corebridge. of X.X% Blackstone also billion of

certain with of would where $XX $XXX particularly from flowed assets, placed largest of At during manage of a significant income the mid-September of the announced XX.X% billion of billion privately of March partnership they volatility. a XXXX, market AIG a end XXXX, fixed and which BlackRock come of strategic year, in time IPO AIG U.S. a of Corebridge noteworthy portfolio. In achievement the the would Corebridge

of year-end. considerable to and Laya Healthcare with from support sales AIG, reducing deals, divested, billion transactional executed strategic These and our U.K. Life. generated proceeds over In $X.X XXXX, ownership During X by overall Corebridge investors. XX% Corebridge XXXX, for marketed

Corebridge, subject Nippon in AIG regulatory Company, to would XXX to XX% representing world, the XXXX, company, of approvals May of of respected and In Insurance an announced most conditions. it insurance approximately life companies customary sell in stake the million the Life shares one that closing

the AIG deconsolidation met Corebridge had year, accounting the of mid-June announced requirements it of purposes. for for Lastly, in this

It's We conditions a market and selling stake amount. time, ownership other subject a to tremendous accomplished down fully to and remain our been have considerations. in journey, committed quite we over remaining Corebridge

turn business. the travel let's to Now

quarter, is travel Health insurance Accident its future business. India the as coverage assistance announced travel also insurance of provide with continue business and and will important further global simplify excludes our strategic step well corporate travel portfolio. to in another Group. arrangement the Tata transaction which the Guard business, sale positioning and as group joint businesses for Travel to in personal our we companies venture The global AIG individual our AIG and During in insurance our includes Japan the service infrastructure & through our the AIG

of XXXX, million, customary $XXX Personal approvals The annual for and written end subject North Insurance. premiums regulatory closing is expected sale the America which are under reported travel conditions. to by are net of to The approximately most close

transaction And business. we another announced high-net-worth last week, involving significant our

several Private insurance about ultra-high-net-worth general we've As Select the this positioned relationship of transforming Surplus line's high- discussed to in a prior the for announcement be & series been high-net-worth our through a years, including over the markets to entering we've business strategic better partner and strategic Specialty services. underwriter, recent of distribution for Client quarters, our with future. Excess actions, Ryan our course most into through deliberately We've done become managing

we're million over future. infrastructure business years, and the to We like for digital positioned our invested and believe in past and the committed over business is capabilities business, it. several well we $XXX the high-net-worth We've the for

admitted to We're capabilities. and solutions delivering our also growing committed

foundational progress plan our communicated, grow created to for drive the E&S previously clients reflects broader value capabilities and expanded of core has paper high-net-worth to for with distribution we we will all As the MGU establish our points continuing exceptional Company, been at the MGU, while attract AIG and states capital enable approvals. exclusive Insurance eventually capabilities, through the multiple as momentum we've an appropriate regulatory all more and subject infrastructure Marbleshore business. with portfolio partnerships. to for XX Specialty resources provide This

from to X% from increase and for prior from growth Personal. of X% X% year, General with for a billion, year. billion, Commercial premiums prior Now $X.X results. turning an growth were the Insurance quarter Net quarter written Global were increase the written the Gross Global premiums the X% $X.X from

growth year combined accident had with quarter, net Commercial excellent by continued strong improvement. an driven X% significant and written of premiums Global ratio impressive retention business, new

business. XX%. North driven business, and written had Casualty. grew Captive Retail casualty, with In World, grew premiums wholesale grew casualty grew Solutions wholesale Risk XX% in led XX%, we Commercial, America net XX%, growth grew by our by And in Excess XX%, Western grew growth Lexington Management XX% which which new XX%; Property, and XX%; XX%, which grew

XX% by written In X%. International XX%. net Property Talbot Retail growth Energy. XX%, premiums grew led and grew grew grew Specialty in Global X%, Commercial,

quarter, quarter. increase from second produced Commercial XX% of XX% an Global over of increase nearly the the quarter. Commercial the year record business XX% North America quarter, of in an $XXX prior $X.X an In business produced which new million of increase year-over-year new and is the billion, from prior

repositioned highest-gross-premiums-written increase a since is quarter, significant was quarter the the written of quarter. also gross the XX% prior new XX% business the Lexington, new The growth by milestone, highest this business business with of led in growth Lexington year from which new XXXX. Lexington first billion year-over-year had achieved any the business tenure. in a volume over we my quarter, quarter $X from growth and premiums This for XX%

our growth. casualty growth marine; had retail X% $XXX XX% International led This business XX%, Commercial and grew Excess XX% energy business was XX% increase and the new over produced year-over-year. by growth; over businesses, an new Risk of over had new which quarter, Specialty, business led which of Casualty. and growth which business by Property, Global led million for other by Casualty, In Management had

was Global very America was retention North addition, XX%, XX%. retention. International In and strong had Commercial retention renewal

the global and X% America written X% written Auto & business. increased Health increased quarter, Moving to primarily International net by North Personal year-over-year. the Personal in written new by Personal premiums business. personal year by premiums premiums from Accident prior X% growth Insurance. grew driven net driven Net high-net-worth year-over-year, on

Shifting combined to the ratio.

driven General in As I improvement the ratio. accident second quarter improvement year the XXX-basis-point a catastrophes, combined XXX-basis-point Insurance a expense earlier, by noted excluding was year-over-year, XX.X%, ratio,

North XXX-basis-point excluding excluding combined America XXX-basis-point combined International excluding Commercial, accident or The a a In quarter Commercial was was Commercial the year year catastrophes, improvement. ratio, XXX-basis-point ratio, XX.X% And XX.X%, ratio, the XX.X%, accident catastrophes, improvement. Global catastrophes, improvement. a was combined second year accident

improvements combined a excluding basis to year accident ratio. its Personal XXX-basis-point in its ratio, ratio, Global improvement. year catastrophes was excluding combined XX to by accident combined a expense North by year America year accident the The ratio, prior the XXX-basis-point improved XXX.X%, quarter. Personal XX.X%, XX.X% improvement from catastrophes, Personal International excluding improved driven points catastrophes,

I conditions some Now to reinsurance provide around shift and context midyear to reinsurance market. renewals want the recent in

treaty previously have we X. January majority the of we discussed, our reinsurance purchased As at vast

XX% approximately maintaining of of in overall achieving across reinsurance to decreases purchasing second occurs risk-adjusted the our our this our or and quarter. lowering major of all purchases. We goals strategic rate reinsurance on core were execute quarter, However, all able retentions

The natural for outlook respect catastrophes, XXXX, season. are The is activity uncertain. second hurricane predicting to with the for half forecasters of particularly the XXXX leading above-average X

simply learned was the positive natural declaring cat a the before quarter, be the in until natural I've how unpredictable. loss It's industry my following over lot by and wait career year over impacted typhoon are seasons there disasters. will to wind the While modest across sentiment too of first activity

attachment When important higher what the On reinsurers they We're to in coverage periods, alternative the in rated it's to perils. named and XXXX. from restricted average, capital market, higher-return well and reviewing with all the points market capacity market. of capacity happened to moved rated aware analyze mostly significantly they available the

estimated complementary in it XX the and, to If has ways, available capital stated prior many you of $XXX capital billion in any more individual at were capital years. look alternative the over approximately year deployed market,

risk. alternative capital in and you to bond make true ILW time XX% review history, market However, nominal approximately cat billion for risk market those what with some cases, need availability basis products market, basis the and any of and, of the reinsurance. accompanied $XXX amount highest in The to up appreciate meaningful makes that are the up

Additionally, collateralized reinsurance deploying occurrence of market capital. for XXXX to of which the as somewhere collateralized limit is less of available collateralized between is to retro, leaving billion aggregate than occurrence billion levels, is market remaining $XX XX% the XX% or The back the covers. $XX reinsurance

aggregate attachment of outline approximately cat this prudently once level ILS from cat XX% our get based the and attachment simply do Why my capacity. volatility. remain give or potential the aggregate aggregate Because on very allows them again, lower utilizes you AIG detail? of I to And us and occurrence frequency up back. at cover point, insurers This and experience, protects the available of maintain not us we reinsurance globally same disciplined purchase manage do points,

Further, over XXX period. points attachment published inflation-adjusted average analyzing XXXX, world, Aon that in on cases, industry data companies an and nominal some basis XXXX from everywhere during went by between the significantly up in

example, U.K., and XXX%; points the increased have the XXX%; For structured over EMEA in lower treaties in average Asia, XXX%. points its has and U.S., attachment volatility. attachment to over AIG with less over

lowest attachment our occurrence maintained to amongst has its or the reduced measurement, AIG XXXX is points, XXXX, peer from across world another examining group. very it points the When making attachment which good

including and million we well on Reinsurance North both our is cover, are original aggregate $XXX events. on our For in appetite and frequency of well. quake. we within remain performing and exceptionally Property excluding protected severity against the and pricing, portfolio and of have believe risk for is balance well our remaining $XX million established aggregate our Japan, cat embedded cover, premiums the wind This America well International XXXX, approximately our

high-level on value and strategy our a capital Now positioning for executing milestones the disciplined we've the focus with management for I'll progress our capital goals provide AIG enormous accomplished. a We've summary driving manner, a future management of against shareholders. and in made our

with We last have over flexibility. which strategy billion $XX AIG over provided management years, that towards in maximum cash the has deployed X capital

what or past the are over we $XX.X Using AIG repurchased In current million on XXX shares accomplished, greater years, liquidity XXXX, shares by of shares, count reducing outstanding some earnings, the and million magnitude overall billion over and and proceeds there $XX preferred stock. XX%. generated XXX over and of we than share context from approximately highlights. divestitures debt provide our key To outstanding had X approximately billion of

have As of XXX million than June outstanding. less shares we XX, XXXX,

further the Nippon half the Life of to our as depending to future second well as approvals, subject subject and XXXX expect regulatory in sell-downs XXXX, remaining the We market reduce of of of Corebridge timing this shares, on additional the conditions. transaction, in closing to

of XXXX, $XX in representing dividends. XXXX, end XX% last course We to target we By the the share over XXXX, be XXX repurchases of our subject X and that million share consecutive approximately by last quarter, the more a XXX paid expect million total of $X XXXX provided to the consistent range, with to dividend increased of shareholder billion guidance billion Since count in market the of conditions. we the than each years. of I

Additionally, our ago. have reduced $X.X range of of XX% with the ratio years debt-to-capital $XX billion XX% X billion to versus from outstanding AIG's XX%, achieved quarter second to leverage debt target and we leverage XX%

ended Our strategic continue to with capital $X.X we capital. compelling billion us insurance liquidity, to We will target that company are with of additional without second in the a having subsidiaries enable strong current to parent explore capital ranges, opportunities which and are very to and inorganic to position, complementary our grow profitably business. ratios continue contribute above quarter

and several capabilities the areas As the claims the to a part to of simplify over company organization journey in as cohesive AIG. with future. skills together future, for of We're to years, weaving all the operate functional underwriting, been across we've positioning one seamlessly our the and AIG compete past on

the multiple our investing transformation These a future. base programs. resulted while $X.X approximately XXX, a in since company, XXXX As of completed we've billion AIG reduction including expense efforts, have of for

to in X and For workflow, million years, digital talent invested data, progress. approximately our accelerate last AI example, we've over the $XXX

and has end-to-end AIG our process were workflow of X If past you XXX, $X that billion. years, over data over investments part investment it been includes look foundational technology, the

efficiencies. Also to at the accelerate formally beginning further Next of the XXXX, realization operational we AIG launched additional of

As related part audit. such public we're redefining as being reflect costs our existing only related parent costs governance, company, of risk and the expenses Next regulated AIG enterprise to corporate retained management to global a to program,

X% company defined to not [ Our Expenses Insurance to cost decrease of retained be $XXX they'll premiums General embedded going parent million forward. within where as redundant. results, to net objective fully earned is ] to million the $XXX will parent costs X.X% be or

factors the being combined calendar ratio at taken it combined lower ratio as the and part year rate to year the our the XXXX of metric provided originally AIG XXXX, believe exit All be Next. or XXXX year equal, would the XXXX we basis the can of of end achieve guidance full the same of calendar were we we run expect we comparable a would that result in year. full now reach than We a on the actions as at

I've while strategy ingestion the and efficiency the intelligence, data want blueprint execution data not is provide creating where we each substantial language advancing a past, and AI one using AIG we've workflow connected, together, XX past the overview. applications, we XX I digital and detail augmenting spoken progress, its components and months, use the Additionally, processes. artificial considerable about in future underwriting models high-level increasing refine end-to-end over capabilities. objective the for is integral and of these time to making and spent We've in underwriting a each that been redesign to large of with and

faster, processes. issuance validated and more leveraging is sources to and quoting, third-party additional underwriting Our thorough, and productivity more binding will better data. portfolio improve and data with This broker underwriting optimization service submissions that increased accurate, such drive of supplemented by through of decisions automation agent sources foundational manual informed the as enabling construct primary objective AI-powered deeper an capability by policy provides in customer analysis through

rapidly and Underpinning designed combine work keep We this governance will to the landscape. compute a is global robust AI advanced framework capabilities. this pace with regulatory with then evolving enhanced modeling amplified capability

of X appetite. management. objectives we're developing allowing more models efficiency, underwriting areas submissions language underwriters mechanism capacity automatically using through by meet underwriting filtered real-time a and efficiency underwriting defined to ability focus: criteria, assess our discuss risk will that more With guidelines, underwriting submissions which large and many the I underwriting are and

and we're to management, more guidelines pricing with objectives, underwriting leadership limit market underwriting and of conditions dynamically dynamic managing In application allowing the enabling analyze data of adjustments review and deeply guidelines, portfolio to underwriting submission underwriting disciplined and the deployment. accurately

evolve that partners with As we multi-vendor build a technology authentic ecosystem, to using our we're time. multiple designed is strategy over

Our flexibility, This current ability technology. AI includes the adaptability platform and platform underwriter future configurability been support scalability to of has to while for decision-making. generative expansion the across keeping the center accommodate capabilities and for our built the of globally at

been and This we've use We'll a enter digital of and remainder to data is glimpse and into efforts continue over these significant as AI the generative our language of models advance work overall doing just this as the to part large XXXX. we year strategy.

performance our In the I'm we've bright years pleased only future. with to the summary, in AIG the but quarter quarter prepare a during for second what very accomplished, over and several not past

the that, to turn over call I'll With Sabra.

Sabra Purtill

will share a quarter with financial second This operations, exceptional written per focus particular financial trends, Corebridge Thank Insurance quarterly of and deconsolidation, results, ROE. results, rate morning, value Peter. accounting provide you, General AIG's premium book details on I other on treatment the

accounting held-for-sale agreement Because the Corebridge-related close with the with to announced was reduce of the could classification activity few for of our as and AIG's quarter I announcement accounting and on accounting will XX%, sale Corebridge well key that discontinued dates Nippon below and operations months XX triggered purposes. to treatment within ownership Life. XX, outline. A we begin May On this financials. the

Corebridge XX, Next, ownership brought we May shares of sold our XX%. on which to million XX

June to X triggering filing trigger accounting forma had Corebridge of accounting required right raised AIG resigned the representation the our Board. right as our one deconsolidation the to with we days and financials not did pro it On X, well later. still from because on the Board, representation, SEC majority majority However, designees deconsolidation a of Corebridge as

to few principles in accounting I changes my in explain these to significant will drove deconsolidation deck and which added slides operations quarter. a remarks. this refer the AIG's Discontinued financials investor changes, in We

for sale with an discontinued accounting assets that Held-for-sale and Let business, period me you balance stipulates in to Slide current financials on the held classified the start a recast be operations impact and in sell for the must liabilities reach both sides XX. sheet. one each line with agreement of when of its

we accounting However, period for the operations, past since a it recast which the a current Corebridge continued that for intend fully not to also just reporting met exit, was core criteria requires for also periods. business but

net income is periods. of income financials we tax a Corebridge's of operations result, quarter in Slide assets XX. for discontinued reflected This from into loss AIG and and liabilities reclassed net or the As discontinued liabilities prior and treatment on operations assets, the second and income

billion significant XXXX, originally total and AIG reported While assets the a of there operations is discontinued of as items. following the XX, line within as presentation, movement $XXX March is same

For and investments reported, presentation, of example, investments cash $XXX to with $XXX billion included in originally operations and assets discontinued billion cash $XX decreased of operations. now of total as Corebridge billion, with discontinued

which change was was deconsolidation, quarter The in next triggered June X. on the

On quarter steps described to I I'll through with numbers. call, Today, related the this walk XXXX earnings final steps those accounting the principle. the fourth

XX. Turning to Slide

The of fair $X.X amount billion and our comprised assets Corebridge of the assets first principally the billion, of value and consolidated market previously that net net intercompany The as date fair of investment June liabilities value the was shares entities. value step Corebridge's $X.X and of fair-valuing X. at is

accumulated does AIG's and Corebridge's the gain equity the booking comprehensive shown balance AIG-retained of Corebridge calculate a and a on resulted loss $X.X other is $X.X sheet, income records we from loss not the This by tax. difference of to on then on $X.X the Slide This net This fair on earnings After recognition billion AOCI between which $X.X Next, portfolio higher XX. AIG's of pretax on $X.X statement on after due AIG's which losses $X.X billion principles through book billion. change sheet, shareholders' value rates. and the on value balance operations loss the sheet. require billion that, billion accounting the of was AOCI unrealized billion interest or of in discontinued investment it balance in reducing recognition sale

impact of together calculate the the loss net deconsolidation to loss the the of determine $X.X deconsolidation, comprehensive and income statement $X.X billion of accumulated are on after-tax after-tax billion billion. added To gain other $X.X accounting

is net add the to loss Corebridge's sale, loss June quarter which in the $XXX recorded prior resulting net in discontinued tax, to income step a next income operations on for quarter. $X.X net X, million AIG's of was on after billion the Finally, total to statement for the

shareholders' Now I'll on impact cover the AIG's equity.

Turning to Slide equity XX, to on of walk June. the end end XX, was AIG's consolidated AIG total a at $XX.X including of equity of a March the which basis. has from Corebridge billion shareholders' March

of quarter second deconsolidation. of the billion paid. impacts, shareholders' was of million, $X.X billion, $XXX million a AIG share repurchases and of This AIG in operations deconsolidation continuing before a equity shareholders' $XXX by forma in offset of reflecting decrease from results income $XX.X pro billion equity $X.X Excluding change dividends

billion June a XX, in sale deconsolidation after-tax net $XX.XX of of in or $X.X Then X% billion June XXXX, you on $XX.X at gain at quarter, layer for the in increase XX. book value equity per adding a share the March XX, increase $X.X billion by resulting from impacts the shareholders' AIG total

the the interest of portion value equity, calculation gain also recognition Please is net through deconsolidation $X.X note sale. billion Corebridge as which total in owned shareholders, by well book noncontrolling the in on other represents of eliminated equity of the that with

and Total balance is XX, in within noncontrolling XX% billion $X.X $X.X for XX XX.X%, impact balances for billion range. Corebridge's was $X.X at $XX.X billion interest on XX. and capital, total XX% debt capital XXXX, debt-to-total With $XX.X capital billion deconsolidation target debt of ratio debt-to-total eliminated Slide total debt AIG AIG's June and leverage of a XX.X%. to leverage and March a $XX.X our total of was of ratio debt and deconsolidation, results for of billion, well billion, This on are on sheet. for for equity last The Corebridge

are operations of explanation this I understanding results. this second helpful deconsolidation now the quarter. Insurance General in the hope slides treatment We will accounting and quarter in Corebridge cover

rates Turning underwriting dividends paid in at up Adjusted on comparable was investment end, General Insurance. from reinvestment Insurance and quarter in higher $XXX APTI, $XXX a results million. the strong short-term and $XX from quarter and expect investments rates on basis million, quarter $X.X to X% we General investment billion on net Considering billion, Income parent up current was XX% up pretax interest higher and maturities Insurance income, million of income net due a loans. comparable or General General investment to million, income. investment on due of $X.X quarter, to million, basis million to million second $X and maturities, were income and third respectively, $XX about other in respectively, fixed Insurance $XX assets loans alternatives total $XX and fixed XXXX.

second loss higher significant forward of earned lower catastrophe comparable million we barring in offset in half. ratio prior by catastrophes in year, versus $XXX unforeseen to the a by on roll changes expenses, same loss year. with quarter second ex the accident year will $XXX the loss the trends, business by last expect XX.X%, half underwriting of driven year XXXX ratio level results first Year-to-date, on have income losses. ex strong at remain in as driven basis mix million Based accident strong, compared and approximately premium an catastrophes the underwriting XXXX quarter was Second changes mainly been partially

to with catastrophes. elevated another XXX Turning The of natural losses approximately events. globally quarter had industry

North hail the points Brazil totaled and loss between losses Japan, America principally a quarter the secondary from East or perils, on ratio, the convective storms split X.X in $XXX catastrophe million second AIG, with in Middle XX-XX and roughly United including severe For and States, International. in floods

in exceptionally rains heavy loss quarter in from largest million the UAE. the totaled Our $XX

for catastrophe secondary for total we XXXX. believe proxy good Considering year is using the last full losses hurricane year season year-to-date, this that year losses forecast peril AIG's and a

third of While actual net the underwriting strength the frequency impact help on the programs, occurrence and quarter total AIG's the and balance severity reinsurance losses the global the and size our XX% will will quarter, usually, catastrophe depend of year. with catastrophe events, sheet. is aggregate, on highest averaging for to XX% of reduce limits both and far, standards, by Nevertheless, a basis, losses on

and reserves. reserves, reinsurance in quarter. Casualty, $XX favorable more development, for of was $XX in resulted the which Prior completed year net billion on a on XXXX. to the DVRs Compensation unfavorable the about development net U.S. of $XX Excess $XX the Casualty, net favorable Overall, including of DVRs, net total Turning result on million, of year from included million reflecting million accident XX% development Workers' than modest

reserve few Casualty charges severity after rebound frequency in the large and low. XXXX auto for very in lockdown and known were frequency when loss auto the was pandemic Excess losses XXXX reflecting The a trends, commercial

in the have We recent severity not in frequency this accident years. seen increase more trends and

In and remain Casualty our severity the with books Casualty consistent assumptions. generally trends overall, Excess

we XXXX some to favorable time allow to years the to years, will trends mature. While see accident for XXXX in these we continue

Pricing, which view loss this exposure trends for Compensation X%, includes cost quarter, on while remained our Lines, Lines stable. Global increased Commercial rate have and Workers' excluding Financial and

excluding Commercial, a increase Financial excluding largely increased exclude and second America North renewal the and X%, Workers' exposure Compensation overall rates was Financial you Financial the and X% X% X%. quarter flat increase In Lines. or in or was X% was increase, International the Commercial, Lines, rate exposure In if Lines,

since such continue in retail To give rate is on in it XX% monitor and the of of our saw below second XXXX, drop Property in portfolio while ratio. trend is wholesale higher. XXX% very XXX% excess below In had an trend to XXXX Property International America trends Property, business, on North in the rate combined closely, others. and We quarter but back insight is excellent in more excess increases certain Property, second increases in on above lines the that's and, as our XXXX. Property of portfolio about cumulatively, quarter, of rate

In North America loss Excess to Casualty rate excess in lines, of in trend. we Casualty, continue particular get

line, and continue price by that business remains portfolio, We course, focus overall returns. And of our attractive adequacy to of it writing within our on the while varies has expectations. strong

dividends Corebridge in attributable income. and quarter Turning loss investment a million was higher $XX to pretax vastly Deconsolidation the year-over-year, primarily income Adjusted simplified XX% the $XXX to short-term statement. operations. in improvement million, other

line XX% we be with tax Finally, rate XXXX deconsolidation, second to quarter. discrete before in our about expect adjusted with items, our

the With opportunity the changes, are no this more vastly non-GAAP and simpler, of With took annuity a and statement our balance were conglomerate. which to ago volatility of complicated established the Life quarter, metrics, a evaluate deconsolidation we equity AIG Insurance accounting. have income AIG's than we the Corebridge was longer all sheet when and more decade

to par adjusted other for bonds The investment-related maturity. book was $XX.XX management's adjust value principal per revising income, share only Adjusted approach was value which which within our will accumulated per share of not as to June is and XX, control calculation revert comprehensive book change XXXX. at

metric value equity in from to book is We of Both In core AATI. subtracting adjusted for a tax metric, credits. of Insurance global progress added deferred go-forward believe to the to contribute for the and our AIG's business AIG's losses this a little target. ROE valuing but by XX%-plus significant measuring business. more General net towards addition, operating our also reflects which shareholders' related useful invested is equity shareholders we and stock have and It operating GAAP these value assets market calculated tax Corebridge assets value

Corebridge our and Over per to book earnings, as DTA value reduce $XX.XX value zero we same as XX, Core book in core share operating will through was monetize book ownership June at per share operating become XXXX. the time, adjusted the value.

a General and and in another major was the accomplishment wrap To delivered we AIG profitability quarter up, this Corebridge XXXX. with deconsolidation and continued operational excellent Insurance in accomplishments quarter, strong business. our Achieving growth financial significant had of

largely intently focused by growth, reshaping With expense and top reduction underwriting strong and our portfolio driven ROE target achieving us, capital XX%-plus behind management. are line on we our now

core continue goal, progress make operating of the second with on to ROE X.X% a and We this for year-to-date. quarter X.X%

With that, I Peter. to call turn over back will the

Peter Zaffino;Chairman and CEO

Thank Operator, questions. Great. for ready we're you, Sabra.

Operator

with [Operator question from comes first Instructions] Our Zaremski BMO. Michael

Michael Zaremski

combined First the question ratio or for guidance updated 'XX. kind on of trajectory

I'm loud implies you focus of curious -- basis like-for-like of on So you'll can kind on to and if bit on able the what sooner. loss ratio, kind clear a loss guidance a hit ratio. the if the we that be it

that's Some their given I'm if get releases. something seeing levels of ratio in that's within curious loss lower some most of companies considered around loss continuously the are reserve guidance. your questions slippage ratios we

Peter Zaffino;Chairman and CEO

not that guidance question. terms expense The the improvement given any what year for in does the It's loss ratio. Mike, full contemplate Thanks, we've XXXX of the for in expect all ratio. we in

exist And be and we of expenses the eliminated ratios all is combined our 'XX. we're so that or into business, guidance going parent. that we're not on gave trying increasing to that they'll the to based guide everybody in into operations the end at transition will that other They'll go be the

guidance. So meet on able we're not that caveats be loss anticipating to ratios any to

Michael Zaremski

I'll And stick my follow-up. this just for I guess on

the to like pricing is loss to given ratio. trends are absolute the certain the -- is still in So lines accretive ROE maybe this understanding pricing -- loss absolute and or the answer, that below levels Property

Just be trying to the that held, able flattish? make the margin. stay ratio kind -- current to of be of environment pricing to kind it negative, the on nitpick to And does does extent not it loss should why trying sense the just

Peter Zaffino;Chairman and CEO

No, great it's question. a

for America, Property. pointed Let's because North take you example, out

This quarter increases, it in In plus like in care. overall the health the exposure. In we with to in in rate, was headwind Property XX% index index. increase XX% achieved that and single-digit high in in Lexington, Casualty, Excess terms X% was of rate XX% Casualty, Casualty, mid-single-digit

again, So trends. cost above loss

of -- Surplus XX% at and increase. rate a quarter. what's And market the this That's after X flat double-digit past years. like increase, look Excess last was in year the Property have & over look you years to it lines, XX%. you retail, if at But the with it property happened was the several was even

-- time, in second giving ratio combined little the the low ratio, think career, quarter, with can my for back increases cat, of over first look, has maybe quarter, bit in the rate take the with that combined if it. I rest I'll activity I the mean cat with And in a an fully outstanding get ratio. even I cumulative Property combined So loaded the

detail a there's kind deterioration And I again, and underlying in into -- why I any mean what can't be. highly more so of market is inflation. in the I about by like don't of terms predict. cat really think went is driven don't we like I our happens little like I cat bit of That's mean Property sort overall know. what index that will

sort what think its profitability. X so predict now, I'm we portfolio I but not feel And going really quarters of happens to from comfortable the and with

Operator

question Shields KBW. next comes Our Meyer from with

Meyer Shields

Personal. just the results the general I in North of on underwriting hoping First impact was can get the of travel sense we sale question, of insurance America a

Peter Zaffino;Chairman and CEO

in terms the de million my impact, in it $XXX which minimis forma In outlined premium I lose once to remarks -- written. of premiums out. ratio, prepared the of is terms Insurance pro would we within General on what overall on combined net the But it's be we going

Meyer Shields

Okay. Perfect.

I Second to you even sort outside question, hoping Sabra's than that a I comments if on down that years older of I want which but And XXXX, weird confirm recent Casualty, favorable us. the line guess, I understood Excess that could break of that. I on was correctly, you rather development years, was had year. that's assume for

Peter Zaffino;Chairman and CEO

really on line she based total to remarks, and in it her went every gave the global over our Sabra. just it know, hand But on prepared a of Casualty, of in on I'll you Yes, book of in what's business going every and in the we reviewed as And market, we XX% detail. tremendous through second in down lot year detail drilled quarter. and and

give of just analysis. few Sabra, So in can a that maybe terms you highlights

Sabra Purtill

what And the bit everyone's sure. by the did quarter just a in for benefit, framing DVRs. for just little I'll we Yes, start

the and So XXX of of and quarter, to different that Casualty. you U.S. we That's than XX-Q. evaluated that reserves billion comprised lines this then lines $XX.X of the X XX separate business, DVRs aggregates more for on see

were return workers' of unfavorable reserves. comp It also million about which billion which in then $XX about and $XX was that favorable about of And was ADC, premiums, $XX $XX quarter in favorable. Excess changes million million reserves. $X billion about only also in has or it's the the reserves net $X the billion So after million after in Casualty, $X Casualty, has

we adjustments -- in high have increased noted that and and subsequent we previous in experience, our reported reserves. years. still known XXXX expect attachment accident XXXX In The we've IBNR XXXX the a that early penetrate a early we including the level, circumstances, facts terms their to due on level for XXXX and of severity. as not the accident of cost In years, we the year, same frequency the auto therefore, just claims level had have loss are excess of we've in to and rebound made just XXXX combination a from claims calls, trends of and

have we With delta in while million that Casualty respect from adverse XXXX, favorable to the of within nets accident Excess down the years $XX development amount. to $XX XXXX, Excess development the did million had and accident to note that's closer the million accident would we Casualty, to $XX of where years I It year prior comes.

Operator

Greenspan comes Elyse Fargo. question from next with Wells Our

Elyse Greenspan

that guys what Validus. the Since What was year ex all lower appreciate the out? and the basis, full providing just first that you the be 'XX. or is, guys same said call. are than I the you you full My year ratio color baseline said figure so we setting you're Peter, question, figure? I'm would year comparable mean just adjusted the crop on XXXX assuming combined Can XXXX you 'XX know you the what disclose calendar

Peter Zaffino;Chairman and CEO

XX.X%.

Elyse Greenspan

my what you opportunities. of you Okay. you second about mentioned have You inorganic is And guys action your also remarks, prepared businesses. taken certain said something expand that then of means? question in divesting exploring just obviously Can

you need meet? And criteria deals would what side? to what inorganic would expansion on the So potential any look at

Peter Zaffino;Chairman and CEO

strategic Travel new the And included like I been flexibility for therefore, very fit owners. wanted bit their about a that having prepared Re ourselves. crop. -- needed But we the financial like to just Elyse. on created we of that have in that Validus the flexibility, not of remarks, divest less The them divestitures in Thanks, and really scale amount businesses we've they based was my business, and and with volatility divested. little well terrific, are some be really,

complementary existing There we businesses be to are competitive want there opportunities we feel but be selective, as have think have scale but where we better for But could further having network. that we're of we parts us perhaps as different internationally would could also we expand going would within multinational advantages business. very I good be where But there give very again, geography could to to where International the be geographies that only helpful. look we as very our be places disciplined. that terrific though more look to capabilities future, not

India There a in we is have. to Tata businesses further large-scale an in are fast-growing, leader. AIG opportunities about that is invest industry Think that business

opportunities there as there's well. so And

So it disciplined, make it's strategic on use sure accelerates the we same additive, progress furthers it's the which make can an organic actually criteria, basis. and and we it's to will is

updates we -- will so again, there's And share. we'll keep as information giving relevant more to

Operator

Our Goldman comes next Rob with Sachs. from Cox question

Robert Cox

a and question on same of approximately more that a help ex cat over basis the about where guidance for I the that AIG loss shakes points what basis versus the a here reported the back half? has out bit you half. goes Just us on improvement in into first level year accident Can think, little the, ratio XXX in think comparable

Peter Zaffino;Chairman and CEO

total driven if identical really a And look premium. and a XX-basis-point like stayed loss Insurance largely Personal take year Commercial then ratio of year to compared earned basis, improvement, by terms business. businesses And overall you to on contribution mix largely a flat net this like last but in Commercial are Sure. its at Thank flat. the literally premium you, the Rob. It's of

was improved, happened ratio XXX which by What North was Insurance basis loss points. the dramatically over driven America, Personal well

improved And so. if think But seen the the at first business, thing? mean, tremendous all look new I little the so in the I the first you've we the at have. bit really that And a we back should ratio mix year-over-year back months. half, I half same really look year. X the But X be think that's we driving momentum The changed we what's business could driving see loss the when months. of the of that's

is a business North America significant the that of them improvement making also and expect continue to to So really Personal it's and make. true we mix

Robert Cox

sort some of kind high And it. is just The worth, to of that what for been kind now? work down change AIG? to underwriting Okay. good of the opportunities double Got decision move Or maybe in in follow-up. net by drove there? more always put a And they have driven a that view in capital to

Peter Zaffino;Chairman and CEO

same too had that business more because TIV, and high-net-worth high-net-worth more had the Commercial The it's did, business much it issues it dense. gets pronounced the business which the in

the market. needed world nonadmitted we it. affected we then in exposure like too a capabilities changed aggregate so the And to COVID, reasons. had that much shed and for also the that And macro in lot of One all certain factors is evolution geographies the with more the pandemic of

what you so complement have do infrastructure the for where have is that an actually very client decided, informed that nonadmitted years, there's be And strong, going to the a right rate and respond this be the build also to a and and we thinking ability been flexibility, about platform needs. And to is couple and you we've need. able and market how of out can but grow to that admitted limits that with

we've And best Specialty. been that, so the do what's on to partnering Ryan with what way working is

market. wholesale fragmented highly a It's

real strong to doing unless net it. a build high And Ryan expertise in think you worth has been nobody So start I that. has

And the that terms able grow in for we we'll to going property just such we done be of to on with the to both And announced so nonadmitted that market a believe we aggregate options. to agents have partnership recently. product that based have just able opportunity want a saleable, that's be getting be to job access XX,XXX the independent and more we terrific creating

plan, in out fragmented do just and going been want have didn't always a we it's strategic but nonadmitted go to and So to not say the approach. we're

a And the different is access to this great give us going so to we in believe opportunities market way.

Operator

Our with next Citi. question from Mike Ward comes

Michael Ward

we mindset, sort overall culture you've business are had about change thinking to equal, of the of market, as all curious just spigots executed? about AIG that of being where grow question by just I part guess the for turning a and guys shifting to the than we on? But in else growth faster and I Commercial are including you Lines, And story? the the potentially related. think back that able is the how one somewhat some And all back should

Peter Zaffino;Chairman and CEO

with Yes. to I Hancock Bailey Don terrific here and me. question, It's happen have a Jon and

on I'm ask It's So them America question. great and to a both International. to going comment North

Don, why new don't have you focused very we been start retention but business how America? not on North with only in actually

Donald Bailey

business growth doing pivoted mindset. this the mention to that And over first, we of we off the important Peter. Thanks, It's, few transforming were last that Yes. have years. to definitely

regarding into profitability. come discipline, of position growth a the So we with underwriting strength

You've all that. about heard

ever very in creating Regarding for more risks. the our deliberate clients and growth, pursuing, and more we're distribution applying and targeted than rigor been value much like, we've before, partners

to see start in And numbers give I you little showing of All what that a is color. up you now. can bit the more

levels We're executing retention retention. Lexington. that add all delivering The opportunities, of also retail would high of on I across we're and our business. specific market notably casualty

retail the for moving positive side, we're in offense. now, on the casualty us market On right discipline and on excess a are The we is that.

places. Regarding X comes Lex, there the growth from

-- strong have We there, customers. strong products new continued and new retention

would healthy, from not growth. limits. it horizontal So I as bigger describe it's

should to clear We add up in last of in quality on look Regarding of Lex I X flight months. I Lex and I also Year-to-date that it, advance. of can through the of that resourced are growth as XX%, XX% that year, our that this that's top through you. some is space. at at a view and sustainability with we think all which submission data share important, submissions

coming. we're to what's advantage positioned take well of So

my I'll while all growth that the this just end, And core say we're ratios loss getting in in Peter, closing business. outstanding on achieving

Peter Zaffino;Chairman and CEO

a context was bit Jon, of little International? thank maybe That you. Don, great. on

Jon Hancock

I amount very or us diverse this large across International, a opportunity, for but market mean a good huge won't got said, Peter different is at I of underwrite time. to Yes. geographies would Don, gives different access different I what really say a points you've We've us already segments, portfolio repeat still in. to in

what we shift reshape we and So the each book on see market. in can depending

planful. is hard very This building a long quality been really off very a We here. build this book. We've book we've what growth high very, worked opportunistic of with strong to time to a been start XX% Don, has Similar to business. really not this retaining for of themes

flight our well market's flight as retaining agree New that business Don, We're as with well. submissions I -- up the to quality are the quality. market. as own to

A and X% in me. couple both. in very It's driven Global got in grown over last for We've increase the especially good our all and that's in you marine, And our where quarter. already world-class Global in new especially energy, in a Specialty hubs the XX% that's And referenced highlights actually. Europe. new of world of of grown business. global of energy, the very, we business leaders are in -- year, U.K. all by new recognized cargo in all business across QX marine some and segments, strong We've the in business Specialty and Peter, year-over-year. XX% products

our profitability businesses. of best-performing one with growth targeted strong really really, So

energy got XX%, we've of for growth. add driven I'll see XX%. grew got, lines that's at Talbot at Lloyd's, the growth we -- XX%. Specialty pipeline as targeted finish just I'll And in very, that well. Talbot we've and very good liability that upstream growth again, and expect at continued of And good those market, And at marine both cargo by XX% in quarter another of we -- to the of specie

Peter Zaffino;Chairman and CEO

and That's great, really to Thanks Don detail, you helpful. for Jon. that

to framework contributions I continued and all extend their and our instrumental Bolt, congratulate was him Tom very his establishing governance colleagues world AIG. retiring during Tom AIG's to significant want gratitude been of structures the a want and for in risk to executive for at the is appetite our their storied of I many career. who dedication, important his year, want thank to us my just deep alignment terrific on teamwork for a time global and with has AIG and standards, for around a refined thank also joining do everybody today. commitment, at execution. the end I to underwriting

today. So joining again, have for a us great you Everybody, day. thank

Operator

the conclude does This program. you. Thank

You disconnect. may Good day. now

American International (AIG) 1 Aug 242024 Q2 Earnings call transcript