If you are looking for a stock that has a solid history of beating earnings estimates and is in a good position to maintain the trend in its next quarterly report, you should consider American International Group (AIG) . This company, which is in the Zacks Insurance - Multi line industry, shows potential for another earnings beat.When looking at the last two reports, this insurer has recorded a strong streak of surpassing earnings estimates. The company has topped estimates by 6.01%, on average, in the last ...

Dublin, April 07, 2025 (GLOBE NEWSWIRE) -- The "Enterprise Tech Ecosystem Series: AIG 2025" company profile has been added to ResearchAndMarkets.com's offering. The report provides insights into AIG's tech activities, including its digital transformation strategies, its innovation programs, and its technology initiatives. AIG is a multi-line insurance group. The group provides life insurance, property and casualty insurance, retirement products, and other financial services to individuals and businesses. I ...

Move aligns with insurer's next phase of growth and digital transformationDUBAI, UAE, April 7, 2025 /PRNewswire/ -- Regional insurer Salama (DFM: SALAMA) has announced the appointment of Mohamed Ali Bouabane as Group Chief Executive Officer.Previously CEO of AIG GCC & North Africa, Bouabane brings extensive experience in the insurance sector, positioning Salama for its next stage of expansion and digital innovation. Salama appoints AIG veteran Mohamed Ali Bouabane as Group CEO (PRNewsfoto/Salama) With ...

Company Overview - American International Group (AIG) is headquartered in New York and operates in the Finance sector [3] - The stock has experienced a price change of 9.46% since the beginning of the year [3] Dividend Information - AIG currently pays a dividend of $0.4 per share, resulting in a dividend yield of 2.01%, which is higher than the Insurance - Multi line industry's yield of 1.6% and the S&P 500's yield of 1.54% [3] - The annualized dividend of $1.60 represents a 2.6% increase from the previous year [4] - Over the past five years, AIG has increased its dividend twice on a year-over-year basis, with an average annual increase of 4.96% [4] - The current payout ratio is 29%, indicating that AIG paid out 29% of its trailing 12-month earnings per share as dividends [4] Earnings Expectations - AIG is expecting earnings to grow this fiscal year, with the Zacks Consensus Estimate for 2025 at $6.25 per share, reflecting a 26.26% increase from the previous year [5] Investment Considerations - AIG is considered a compelling investment opportunity due to its strong dividend profile and current Zacks Rank of 3 (Hold) [7] - The company is viewed as a solid dividend option, particularly in contrast to high-growth businesses or tech start-ups that typically do not offer dividends [7]

Industry Overview - The Zacks Multiline Insurance industry includes companies that provide various insurance coverages, allowing customers to pay a single premium for multiple products, which enhances customer retention and reduces concentration risk [3][4] - The industry is experiencing increased demand for protection products, particularly in life insurance, driven by heightened awareness and customized offerings [4] Trends Impacting the Industry - Product diversification is helping industry players mitigate concentration risk and improve revenue generation [1] - Accelerated digitalization and the adoption of embedded insurance are expected to drive growth, with global premiums from embedded insurance projected to exceed $722 billion by 2030 [1][6] - The transition to green energy and the rise of cyber insurance due to increased AI adoption present new growth opportunities [4][6] Mergers and Acquisitions - The solid capital levels of multiline insurers are expected to fuel M&A activities, with a focus on diversifying operations and gaining market share [2][5] - Consolidation is anticipated to rise in 2024, particularly among insurance technology companies [5] Financial Performance - The Multiline Insurance industry has underperformed compared to the Finance sector and the S&P 500, with a collective gain of 11.1% over the past year, while the Finance sector increased by 25.6% and the S&P 500 rose by 24.1% [11] - The industry's Zacks Industry Rank is 128, placing it in the bottom 48% of 251 Zacks industries, reflecting a negative earnings outlook with a 28.1% downward revision in earnings estimates for the current year [8][9] Current Valuation - The industry is currently trading at a trailing 12-month price-to-book (P/B) ratio of 2.38X, compared to the S&P 500's 8.07X and the sector's 3.71X [13] Company Highlights - **Radian Group**: Focused on mortgage insurance, with a strong capital position and expected growth driven by new business and increasing persistency [17][18] - **CNO Financial Group**: Offers a range of insurance products with a projected earnings increase of 10.3% for 2026 [20][21] - **MetLife**: A global financial services company with a focus on growth potential and cost control, expecting a 19% increase in earnings for 2025 [23][24] - **American International Group (AIG)**: Growth driven by strategic de-risking and acquisitions, with a projected earnings increase of 27.7% for 2025 [26][27] - **Prudential Financial**: Strong asset-based businesses and a competitive edge expected to drive long-term growth, with a projected earnings increase of 13.6% for 2025 [29][30]

Financial Performance - AIG reported adjusted earnings of $1.30 per share for the fourth quarter, surpassing market estimates of $1.23 per share [1] - General Insurance net premiums written reached $6.1 billion, reflecting a 6% year-over-year increase on a reported basis [1] Strategic Achievements - In 2024, AIG executed multiple complex strategic and operational priorities, resulting in outstanding financial results and exceptional value for clients and stakeholders [2] - The company strengthened its capital structure and improved financial performance, achieving a historic milestone with the deconsolidation of Corebridge Financial, which allowed for the organization of its business into three distinct operating segments [2] Market Reaction - Following the earnings announcement, AIG shares fell 0.6% to close at $76.40 [3] - Analysts adjusted their price targets for AIG, with Keefe, Bruyette & Woods raising it from $87 to $90, while Morgan Stanley increased it from $75 to $76 [4]

Financial Performance - AIG achieved a strong combined ratio of 91.8 and an adjusted accident year combined ratio of 88.2, indicating effective underwriting performance [26]. - The company generated $1.9 billion in underwriting income, contributing to over $7 billion of cumulative underwriting income from 2021 to 2024 [26]. - AIG reported net premiums written of $23.9 billion, supported by new business growth, strong retention, and rate discipline [26]. - Net investment income grew by 23% year-over-year, reflecting improved investment performance [26]. - AIG completed the deconsolidation of Corebridge Financial, reducing its ownership to 22.7% and generating gross proceeds of $6.0 billion [26]. - The company divested its global individual personal travel insurance business for $600 million, enhancing financial flexibility [26]. - AIG repurchased $6.6 billion of common stock, reducing outstanding shares by 12% [26]. - The company ended 2024 with parent liquidity of $7.7 billion, demonstrating strong financial health [26]. Regulatory Environment - AIG's insurance subsidiaries are subject to extensive regulation and supervision, impacting their operations and profitability [49]. - The Risk-Based Capital (RBC) levels of AIG's U.S. domiciled insurance companies exceeded specific thresholds as of December 31, 2024 [58]. - AIG is now formally subject to the Group Capital Calculation (GCC) requirement beginning in 2024, which evaluates the firm's capital position at the group level [60]. - The aggregate assessments levied against AIG by state insurance guaranty associations have not been material to its financial condition in the past three years [61]. - AIG's insurance operations in the EU are governed by Solvency II, which includes minimum capital and solvency requirements [69]. - The Monetary Authority of Singapore (MAS) imposes minimum capital and solvency requirements on AIG's insurance subsidiary in Singapore [71]. - AIG's Japanese insurance operations must maintain a minimum solvency margin ratio (SMR) to avoid corrective actions from the Japan Financial Services Agency (JFSA) [72]. - The Dodd-Frank Act established the Federal Insurance Office (FIO) to monitor the insurance industry and recommend prudential standards [63]. - AIG's lead U.S.-state regulator is the New York State Department of Financial Services (NYDFS), which oversees its regulatory compliance [58]. - The Financial Stability Board (FSB) promotes international financial stability and issues frameworks addressing systemic financial risk and capital standards [73]. - The IAIS has adopted a risk-based global Insurance Capital Standard (ICS) applicable to Internationally Active Insurance Groups (IAIGs), which was formally adopted in December 2024 [76]. - The FSB will begin publishing an annual list of insurers, including AIG, subject to resolution planning requirements starting December 2024 [75]. - The NAIC Data Security Model Law has been adopted by more than 20 jurisdictions as of December 31, 2024, requiring insurers to develop and maintain a written information security program [81]. Cybersecurity and Data Privacy - The SEC has mandated that registrants disclose any material cybersecurity incident on Form 8-K within four business days [84]. - The EU General Data Protection Regulation (GDPR) imposes fines of up to 4% of global revenue for serious infringements, affecting compliance costs [85]. - The California Consumer Privacy Act (CCPA) and its amendments impose significant privacy obligations on businesses handling data related to California residents [82]. - The company is subject to various laws and regulations requiring notification of data breaches to affected individuals and regulators [79]. - The company actively monitors the regulatory landscape surrounding climate change and its implications for governance and risk management [92]. Economic and Market Risks - The company faces significant risks from economic conditions, including potential recessionary environments and market volatility, which could adversely affect business operations and financial condition [104]. - Increased loss payments and costs due to inflation have been noted, impacting profitability and potentially leading to higher credit impairments across various asset classes [107]. - The company is exposed to risks from fluctuations in interest rates, which could materially affect the value of its investment portfolio and lead to increased unrealized losses [109]. - The adequacy of reserves for unpaid losses and loss adjustment expenses is under continuous review, with potential adverse developments impacting financial results [112]. - Reinsurance availability and costs are influenced by market conditions, with recent years seeing increased severity and frequency of major catastrophes affecting reinsurance terms [117]. - The company relies on the Terrorism Risk Insurance Program, but coverage for terrorism-related losses remains limited, posing additional risks [120]. - Catastrophic events, both natural and man-made, have historically impacted the company's operations and could lead to significant losses in the future [122]. Competition and Operational Challenges - The company is subject to intense competition across its business lines, which may be exacerbated by technological changes and evolving market dynamics [118]. - Legal and regulatory changes, including those related to environmental, social, and governance matters, may adversely affect the company's reputation and operational results [119]. - The company may face challenges in attracting and retaining key employees due to intense competition in the industry, which is critical for its success [118]. - Legislative and regulatory initiatives may require the company to pay insured amounts beyond original policy provisions, potentially impairing cash flows and capital ratios [124]. - The company faces widespread claim costs associated with various insurance types, including property, casualty, and cyber claims, which could adversely impact financial performance [124]. Climate Change and Environmental Risks - Climate change has increased the frequency and severity of natural disasters, presenting significant financial implications for underwriting, claims, and investments [126]. Investment and Liquidity Risks - The company is exposed to credit risk from counterparties, including issuers of securities and reinsurers, which could materially affect investment value and profitability [137]. - The investment portfolio is concentrated in specific segments, such as real estate and financial institutions, making it vulnerable to adverse developments in those areas [139]. - The company relies on external investment managers for the majority of its portfolio, which may expose it to risks if these managers fail to meet performance expectations [144]. - Liquidity may be insufficient to meet the company's needs, potentially requiring recourse to expensive external financing [152]. - The company may face challenges in generating cash due to the illiquidity of certain investments, which could adversely affect financial condition and operations [154]. - Adverse changes in market conditions could materially impact the liquidity and value of the company's investment portfolios [156]. - A downgrade in the Insurer Financial Strength ratings could limit the ability of the insurance companies to write new business and impair customer retention [158]. - Downgrades in credit ratings may increase financing costs and limit availability of financing, adversely affecting business operations and liquidity [158]. Risk Management and Compliance - The company is enhancing risk management policies to identify and mitigate risks, but effectiveness is uncertain and may not cover all potential exposures [160]. - Pricing adequacy for products depends on accurate risk assessment and market conditions, with potential adverse effects on profitability if pricing is inadequate [163]. - The company is exposed to risks from reliance on critical technology systems, which could compromise business operations if disrupted [164]. - Cybersecurity threats are evolving, requiring significant resources to manage and mitigate risks associated with data breaches and system failures [166]. - Compliance with privacy and information security laws is critical, with potential legal and financial repercussions for non-compliance [172]. International Operations and Third-Party Risks - A substantial portion of business is conducted outside the U.S., exposing the company to risks from foreign regulations and economic conditions [173]. - The company must satisfy local regulatory requirements in foreign jurisdictions, with potential impacts on operations if licenses are modified or revoked [174]. - Third-party service providers may not perform as anticipated, which could adversely affect business operations and results [177]. - The company relies on third-party providers for various operational processes, which may lead to risks including operational difficulties and increased costs [178]. - A significant portion of the company's investment assets is managed by third-party investment managers, and past performance does not guarantee future results [179]. - The company faces risks from third-party providers located outside the U.S., including potential business disruptions and political risks [180]. Distribution and Marketing Challenges - The company may experience difficulties in marketing and distributing products through current and future distribution channels, which could adversely affect sales [182]. - Key distribution partners may renegotiate terms or terminate relationships, impacting the company's ability to market products effectively [183]. Legal and Intellectual Property Risks - The company is exposed to risks from legal and regulatory proceedings, which could result in fines, penalties, and reputational damage [197]. - The divestment of Corebridge stock may lead to risks including economic downturns and unfavorable market conditions affecting the company's financial condition [195]. - The company is subject to increasing scrutiny regarding environmental, social, governance, and sustainability matters, which may impact its reputation and operations [201]. - The company may not fully realize anticipated expense reductions and operational efficiencies from restructuring initiatives, potentially harming its competitive position [188]. - The integration of acquired businesses may not yield expected benefits, and undisclosed risks could negatively impact financial performance [190]. - Public health crises, such as the COVID-19 pandemic, have led to significant societal disruption and economic uncertainty, adversely impacting the company's business and financial condition [207]. - Increased claim volumes and exposure to certain industries have resulted in greater variability and subjectivity in investment decisions, potentially leading to impairment of estimates and assumptions [208]. - Future public health crises may cause heightened market stress and volatility, adversely affecting the company's operations and financial condition [209]. - Legal proceedings related to epidemic or pandemic losses could be filed against the company, which may result in additional operational risks [209]. - The company faces challenges in protecting its intellectual property, which may lead to costly litigation and potential damages [210]. - Third parties may infringe upon the company's intellectual property rights, resulting in significant expenses and operational limitations [210]. - The inability to secure or protect intellectual property assets could harm the company's reputation and competitive position [210].

Core Insights - American International Group, Inc. (AIG) reported fourth-quarter 2024 adjusted earnings per share of $1.30, exceeding the Zacks Consensus Estimate by 3.2% and showing a year-over-year improvement of 1.6% [1] - Adjusted operating revenues were $6.85 billion, a significant decline year over year, but still beating the consensus mark by 1.3% [2] - The fourth-quarter results were bolstered by new business production, strong retention, and reduced expenses, although lower premiums and high catastrophe charges partially offset these positives [2] Financial Performance - Total net investment income increased by 44.4% year over year to $1.3 billion, driven by higher income from alternative investments and dividends from Corebridge Financial, Inc. (CRBG), surpassing the consensus estimate by 50% [4] - Total benefits, losses, and expenses decreased by 6.9% year over year to $5.6 billion, attributed to lower general operating expenses and net gains from divestitures [5] - Adjusted return on equity improved by 70 basis points year over year to 7.2% [5] Segment Performance - General Insurance – North America Commercial segment reported net premiums written of $2.2 billion, a 5% increase year over year, benefiting from new business production and improved rate trends [6] - General Insurance – International Commercial segment saw net premiums written of $2.1 billion, up 9% year over year, aided by new business production [8] - General Insurance – Global Personal segment recorded net premiums written of $1.8 billion, a 2% increase year over year, with underwriting income improving nearly four-fold [10] Investment and Capital Management - AIG repurchased shares worth $1.8 billion and distributed dividends totaling $244 million [14] - As of December 31, 2024, AIG had a cash balance of $1.3 billion, total assets of $161.3 billion, and total equity of $42.6 billion, reflecting declines from the previous year [12] Full-Year Update - For the full year 2024, AIG's total revenues were $27.3 billion, down from $27.9 billion in 2023, while adjusted earnings improved to $4.95 per share from $4.42 [15]

Financial Data and Key Metrics Changes - General Insurance reported strong net premiums written of $6.1 billion, an increase of 7% year-over-year, with net premiums earned of $6 billion growing 6% year-over-year [15][24] - Adjusted after-tax income per share grew 5% year-over-year to $1.30 per share, with a calendar year combined ratio of 92.5% [16][24] - For the full year 2024, adjusted after-tax income was $3.3 billion or $4.95 per diluted share, an increase of 28% year-over-year [24][79] Business Line Data and Key Metrics Changes - North America Commercial net premiums written increased by 9% year-over-year, driven by strong new business growth of 17% [57][105] - International Commercial net premiums written increased by 7% year-over-year, with new business growth of 15% and excellent retention of 88% [57][99] - Global Personal net premiums written increased by 1% on a constant currency basis, with a 16% growth in the Global High Net Worth business [57][58] Market Data and Key Metrics Changes - The reinsurance market saw a significant reset on January 1, 2023, with property reinsurers focusing on upper layers with more remote return periods [28][29] - Insured loss from natural catastrophes in 2024 was approximately $145 billion, the sixth costliest on record, compared to an average of $140 billion over the last five years [31][34] - AIG's expected loss from the recent California wildfires is approximately $500 million before reinstatement premiums [37] Company Strategy and Development Direction - AIG realigned its General Insurance business into three segments: North America Commercial, International Commercial, and Global Personal [13][53] - The company executed significant strategic initiatives, including the deconsolidation of Corebridge Financial and the launch of AIG Underwriter Assist, a generative AI solution [18][22] - AIG aims to achieve a 10% plus core ROE for the full year 2025, focusing on profitable growth and capital allocation to attractive risk-adjusted returns [49][79] Management's Comments on Operating Environment and Future Outlook - Management acknowledged the escalating risks and complicated environment due to recent wildfires in California, emphasizing the importance of resilience in navigating these challenges [10][11] - The company expressed optimism about achieving meaningful organic growth driven by the Global Commercial business and the benefits of the restructured reinsurance program [49][50] - Management confirmed guidance on achieving a 10% plus ROE, including the impact of the recent wildfires [85][88] Other Important Information - AIG returned $8.1 billion of capital to shareholders in 2024 through share repurchases and increased dividends [21][79] - The company reduced its debt to total capital ratio to 17% and ended the year with $7.7 billion of parent liquidity [21][48] - AIG's adjusted effective tax rate for the fourth quarter and full year was 24.6%, with expectations for 2025 to be in line with 2024 [78] Q&A Session Summary Question: Is the core ROE including the wildfire impact? - Yes, the 10% plus ROE includes the $500 million wildfire impact [85] Question: What areas is AIG targeting for organic growth? - AIG is focusing on risk-adjusted returns and has seen strong retention and new business growth across its portfolio [93][99] Question: How is AIG utilizing artificial intelligence in underwriting? - AIG is leveraging AI to improve data ingestion and provide underwriters with more qualified data in a timely manner, enhancing underwriting capabilities [113][117] Question: What is the timeline for improving the high net worth personal lines business? - AIG expects continued improvement in the combined ratio and loss ratio for the high net worth business, with growth anticipated in 2025 [120][123] Question: Are there any aspirational areas of business AIG is looking to enter? - AIG is largely done with divesting non-core businesses and is focused on maintaining a balanced portfolio while remaining disciplined in potential M&A opportunities [130][132]

Fourth Quarter and Full Year 2024 Financial Results Presentation February 12, 2025 Copyright ® 2025 by American International Group, Inc. All rights reserved. No part of this document may be reproduced, republished or reposted without the permission of AIG. Earnings Key Themes "2024 was an outstanding year of accomplishments for AIG. We strengthened the company's capital structure, improved our financial performance, and achieved a major milestone with the deconsolidation of Corebridge Financial which enabl ...