Core Insights - American International Group (AIG) reported a significant decline in revenue for the quarter ended June 2024, with total revenue at $6.64 billion, down 49.5% year-over-year and missing the Zacks Consensus Estimate by 45.73% [1] - Earnings per share (EPS) for the quarter was $1.16, a decrease from $1.75 in the same quarter last year, and also fell short of the consensus estimate of $1.39 by 16.55% [1] Financial Performance Metrics - Combined Ratio for Total General Insurance was reported at 92.5%, slightly above the average estimate of 92% from four analysts [3] - Expense Ratio for Total General Insurance was 31.5%, better than the average estimate of 32% [4] - Loss Ratio for Total General Insurance was 61%, higher than the estimated 58.8% [4] - Combined Ratio for International - Commercial Lines was 88.6%, compared to the average estimate of 87.1% [4] - Combined Ratio for North America - Personal Insurance was 105.3%, exceeding the estimate of 100.2% [4] Premiums and Investment Income - Net premiums earned in General Insurance were $5.75 billion, slightly below the estimate of $5.76 billion, representing an 11.5% decline year-over-year [5] - Net premiums written in General Insurance were $6.93 billion, surpassing the estimate of $6.53 billion, but reflecting an 8% decrease from the previous year [7] - Adjusted Revenue from Other Operations showed a significant drop in other income at $4 million, compared to the estimate of $12.33 million, marking a 55.6% decline year-over-year [6] - Adjusted Revenue from Other Operations for net investment income was $141 million, exceeding the estimate of $71.56 million, with a year-over-year increase of 64% [8] - General Insurance's net investment income was reported at $746 million, below the estimate of $791.62 million, but showing a 2.9% increase from the previous year [10] Stock Performance - AIG shares have returned +4.9% over the past month, outperforming the Zacks S&P 500 composite, which saw a -0.4% change [11] - The stock currently holds a Zacks Rank 3 (Hold), indicating expected performance in line with the broader market in the near term [11]

Company Performance - American International Group (AIG) reported quarterly earnings of $1.16 per share, missing the Zacks Consensus Estimate of $1.39 per share, and down from $1.75 per share a year ago, representing an earnings surprise of -16.55% [1] - The company posted revenues of $6.64 billion for the quarter ended June 2024, missing the Zacks Consensus Estimate by 45.73%, and down from $13.14 billion year-over-year [1] - Over the last four quarters, AIG has surpassed consensus EPS estimates three times and topped consensus revenue estimates two times [1] Stock Performance - AIG shares have increased approximately 16.6% since the beginning of the year, outperforming the S&P 500's gain of 14% [2] - The current consensus EPS estimate for the upcoming quarter is $1.56 on revenues of $12.15 billion, and for the current fiscal year, it is $6.40 on revenues of $49.29 billion [4] Industry Outlook - The Zacks Industry Rank for Insurance - Multi line is currently in the top 33% of over 250 Zacks industries, indicating a favorable outlook as the top 50% of Zacks-ranked industries outperform the bottom 50% by more than 2 to 1 [5] - Another company in the same industry, Kemper, is expected to report quarterly earnings of $1.19 per share, reflecting a year-over-year change of +557.7%, with revenues expected to be $1.08 billion, down 15% from the year-ago quarter [5][6]

Financial Performance - General Insurance net premiums written (NPW) were $6.9 billion, a decrease of 8% on a reported basis, but an increase of 7% on a comparable basis, driven by 10% growth in North America Commercial[1]. - Adjusted after-tax income per diluted share was $1.16, a 9% increase from the prior year quarter, and a 38% increase on a comparable basis[2]. - AIG returned almost $2.0 billion to shareholders, including $1.7 billion in stock repurchases and $261 million in dividends[1][11]. - Total net investment income for the second quarter was $990 million, an 18% increase from $837 million in the prior year quarter[10]. - AIG reported adjusted pre-tax income of $1,041 million for the three months ended June 30, 2023, compared to $1,288 million for the same period in 2022, reflecting a decrease of approximately 19.2%[55]. - The net income attributable to AIG common shareholders for the six months ended June 30, 2023, was $1,508 million, down from $2,010 million in the same period last year, representing a decline of about 25%[58]. - AIG's adjusted after-tax income attributable to common shareholders excludes various non-operating items, providing a clearer view of profitability[46]. - Income from continuing operations for the three months ended June 30, 2024, was $1.15 per share, a decrease of 37.4% compared to $0.72 in the same period of 2023[61]. - Net income attributable to AIG common shareholders for the three months ended June 30, 2024, was $2.05 per share, compared to a loss of $6.02 per share in the same period of 2023[61]. - Adjusted after-tax income attributable to AIG common shareholders per diluted share for the three months ended June 30, 2024, was $1.06, an increase of 9.4% from $1.16 in the same period of 2023[61]. Insurance Operations - Record Commercial Lines new business reached $1.3 billion, an 18% year-over-year increase, with strong global retention[1]. - General Insurance combined ratio was 92.5%, an increase of 160 basis points year-over-year, while the accident year combined ratio improved by 40 basis points to 87.6%[1][2]. - North America Commercial Lines net premiums written decreased by 19% year-over-year to $3,410 million, but increased by 10% on a comparable basis[15]. - The combined ratio for North America Commercial Lines increased by 460 basis points to 90.2%, driven by a higher loss ratio and changes in business mix[15]. - North America Personal Insurance net premiums written grew by 8% year-over-year to $563 million, primarily due to positive rate changes in High Net Worth[17]. - The combined ratio for North America Personal Insurance improved by 760 basis points to 105.3%, driven by favorable development in prior year loss reserves[17]. - International Commercial Lines net premiums written increased by 3% year-over-year to $2,223 million, or 6% on a comparable basis, attributed to growth in Global Specialty and Property[19]. - The combined ratio for International Commercial Lines improved by 40 basis points to 88.6%, primarily due to favorable development in prior year loss reserves[19]. - International Personal Insurance net premiums written declined by 4% year-over-year to $1,341 million, but grew by 3% on a comparable basis[20]. - The combined ratio for International Personal Insurance improved by 100 basis points to 97.0%, driven by lower catastrophe loss ratio and expense ratio[20]. Investment and Capital Management - The company executed nearly $5 billion in capital management actions in the first half of 2024, including $3.3 billion in share repurchases[4]. - Book value per share increased to $68.40 as of June 30, 2024, while adjusted book value per share was $72.78[11]. - AIG's total debt to total capital ratio was 18.1% as of June 30, 2024, indicating a strong balance sheet[11]. - Total AIG shareholders' equity increased from $42,454 million as of June 30, 2023, to $44,445 million as of June 30, 2024[65]. - Book value per share increased by 16.9% from $58.49 as of June 30, 2023, to $68.40 as of June 30, 2024[65]. - Average adjusted common shareholders' equity for the three months ended June 30, 2024, was $50,270 million, compared to $57,016 million in the same period of 2023[68]. - General Insurance Net Investment Income on an APTI basis was $725 million for the three months ended June 30, 2023, compared to $746 million for the same period in 2024[62]. - The company reported total net investment income of $775 million for the three months ended June 30, 2023, compared to $884 million for the same period in 2024[62]. - Net investment income on Fortitude Re funds withheld was reported at $383 million for the six months ended June 30, 2023, compared to $294 million in the same period of 2022, marking an increase of approximately 30.2%[58]. Risk Management and Regulatory Environment - AIG's reliance on third-party investment managers and the concentration in investment portfolios pose potential risks to financial performance[30]. - The effectiveness of AIG's enterprise risk management policies is crucial for adequately assessing risk and estimating related losses[30]. - The impact of regulatory changes and sanctions, particularly related to the Russia-Ukraine conflict, could significantly affect AIG's operations[30]. - AIG's total tax charge for the three months ended June 30, 2023, was $256 million, compared to $110 million for the same period in 2022, indicating an increase of approximately 132.7%[55]. - AIG's total tax benefits for the three months ended June 30, 2023, were $403 million, compared to $110 million for the same period in 2022, indicating an increase of approximately 267.3%[58]. Operational Efficiency - Other Operations adjusted pre-tax loss improved by $120 million year-over-year, primarily due to higher net investment income and lower interest expenses[22]. - Total net investment income increased by $89 million from the prior year quarter, driven by dividend income from Corebridge and higher yields on short-term investments[23]. - The general operating expense ratio on a comparable basis remained stable at 12.4% for both periods[73]. - Adjusted pre-tax income, excluding Crop Risk Services and Validus Re, was $430 million for the three months ended June 30, 2024, compared to $420 million in the same period last year[78]. - The accident year combined ratio, as adjusted, for North America - Personal Insurance improved to 101.8% from 107.1% year-over-year[76]. - Catastrophe losses and reinstatement premiums for the total general insurance segment increased to $(5.7) million for the three months ended June 30, 2024, compared to $(3.9) million in the prior year[73]. - The loss ratio for North America - Commercial Lines increased to 67.4% from 61.0% year-over-year[73]. - The combined ratio for International - Personal Insurance improved to 97.0% from 98.0% year-over-year[76]. - Adjusted pre-tax income, as reported, was $1,176 million for the three months ended June 30, 2024, down from $1,319 million in the prior year[79].

American International Group, Inc. (AIG) is set to report its second-quarter 2024 results on Jul 31, after the closing bell.The Zacks Consensus Estimate for second-quarter earnings is currently pegged at $1.39 per share, implying a decrease of 20.6% from the year-ago reported number. The estimate was revised downward by four analysts in the past month against one movement in the opposite direction, resulting in a decrease of 21.9% from $1.78 per share. The Zacks Consensus Estimate for second-quarter revenue ...

Core Insights - Analysts project that American International Group (AIG) will report quarterly earnings of $1.39 per share, a decline of 20.6% year over year, with revenues expected to reach $12.23 billion, down 6.9% from the same quarter last year [1] Earnings Estimates - There has been a 4% downward revision in the consensus EPS estimate over the last 30 days, indicating a collective reconsideration by analysts [1] - The consensus estimate for 'Adjusted Revenue- Life and Retirement- Net investment income' is projected at $2.74 billion, reflecting a year-over-year increase of 10.6% [2] - 'General Insurance- Net premiums earned' is estimated at $5.76 billion, indicating a decline of 11.4% year over year [2] - 'Adjusted Revenue- Group Retirement' is expected to reach $689.52 million, showing a slight decrease of 0.1% year over year [2] Additional Revenue Metrics - The consensus for 'Adjusted Revenue- Life Insurance' stands at $1.29 billion, suggesting a year-over-year increase of 0.5% [3] - 'Adjusted Revenue- Institutional Markets' is projected at $2.00 billion, indicating a decline of 15.5% from the prior-year quarter [3] Insurance Ratios - Analysts predict a 'Combined Ratio - Total General Insurance' of 92.0%, compared to 90.9% from the previous year [3] - The 'Expense Ratio - Total General Insurance' is expected to be 32.0%, up from 31.6% year over year [3] - The 'Loss Ratio - Total General Insurance' is forecasted to be 58.8%, slightly improved from 59.3% in the same quarter last year [3] Regional Combined Ratios - 'Combined Ratio - International - Commercial Lines' is estimated at 87.1%, compared to 89% from the previous year [4] - 'Combined Ratio - North America - Personal Insurance' is projected at 100.2%, down from 112.9% in the same quarter last year [4] - 'Combined Ratio - International - Personal Insurance' is expected to be 98.3%, slightly up from 98% year over year [4] - 'Combined Ratio - North America - Commercial Lines' is forecasted at 90.5%, compared to 85.6% from the previous year [4] Stock Performance - Over the past month, AIG shares have recorded a return of +0.4%, contrasting with the S&P 500 composite's -1.2% change [5] - AIG holds a Zacks Rank 3 (Hold), suggesting that its performance is likely to align with the overall market in the upcoming period [5]

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Group 1 - American International Group, Inc. (AIG) has entered into a definitive agreement to divest its global individual personal travel insurance and assistance business for $600 million in cash, with additional earn-out consideration to Zurich Insurance Group, expected to be completed by the end of 2024 [1] - The sale includes AIG's Travel Guard line and servicing capabilities, excluding Japan and its joint venture in India, as well as travel insurance offered through its Accident & Health line, which will simplify operations and free up capital for AIG [1] - AIG is focusing on its General Insurance business to improve profitability, bolster liquidity, and reduce portfolio volatility, as evidenced by recent divestments from global insurance organizations [2] Group 2 - AIG aims to become a pure-play Property and Casualty insurer, with improving underwriting results indicated by a 210 basis point improvement in the combined ratio in the first quarter [3] - AIG shares have gained 32.6% over the past year, outperforming the industry growth of 26% [4] - The company has repurchased shares worth $1.7 billion in Q1 2024 and $613 million in April, while also increasing its dividend by 11% in Q1 2024, indicating a commitment to enhancing shareholder value [2]

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Core Insights - The Zacks Multiline Insurance industry is benefiting from product diversification, which lowers concentration risk and enhances revenue generation and retention ratios. Companies like MetLife, AIG, Prudential, The Hartford, and Old Republic are expected to gain from improved pricing, prudent underwriting, and economic recovery [1] - The industry is experiencing a solid capital level that is likely to fuel merger and acquisition activities, with an improving rate environment expected to drive higher investment income for insurers [1] Industry Overview - The Zacks Multiline Insurance industry includes companies that provide bundled insurance coverage for various needs, improving customer retention and offering lower premium payments compared to individual policies [2] - The diversified portfolios of multiline insurers help lower concentration risk, with increased demand for protection products expected to boost sales and premiums, particularly in life insurance [3] Trends Impacting the Industry - Continued consolidation is anticipated as companies seek to diversify operations and gain market share, with a resurgence in M&A activities expected in 2024 [4] - The adoption of advanced technologies such as AI, blockchain, and cloud computing is transforming operations, enhancing efficiency, and enabling online policy sales [5] Industry Performance - The Zacks Multiline Insurance industry ranks 87, placing it in the top 35% of 249 Zacks industries, indicating a positive earnings outlook [6][7] - Over the past year, the industry has outperformed the Finance sector with a gain of 5.3%, while underperforming the S&P 500, which rose by 7% [8] Current Valuation - The industry is currently trading at a trailing 12-month price-to-book (P/B) ratio of 2.48X, lower than the S&P 500's 6.14X and the sector's 3.06X [10] Notable Companies - **Old Republic International (ORI)**: Zacks Rank 2, with a projected earnings increase of 3.8% for 2024 and 4.4% for 2025, supported by a strong capital position [11] - **American International Group (AIG)**: Zacks Rank 3, expected earnings growth of 4.4% in 2024 and 16% in 2025, driven by strategic derisking and acquisitions [13] - **MetLife (MET)**: Zacks Rank 3, with anticipated earnings growth of 17.6% for 2024 and 13.7% for 2025, focusing on cost control and efficiency [14] - **Prudential Financial (PRU)**: Zacks Rank 3, expected earnings growth of 15.4% in 2024 and 8.3% in 2025, with a strong asset management business [15] - **The Hartford Financial Services Group (HIG)**: Zacks Rank 3, projected earnings growth of 11.9% for 2024 and 14.3% for 2025, benefiting from improved mortgage insurance quality [16]

American International Group, Inc. (AIG) has recently marked a major milestone with the deconsolidation of Corebridge Financial, Inc. (CRBG) for accounting purposes. It gave up majority control over Corebridge's board of directors, signified by the resignation of Chris Schaper, AIG's executive vice president and global chief underwriting officer, from Corebridge's board, which now has 12 members.This action finalizes the long-awaited separation of the two companies. For several years, AIG meticulously plann ...