American International Group Inc (AIG) Reports Strong Q4 and Full Year 2023 Results
Net Income: Q4 net income per diluted share at $0.12; full year at $4.98.
Adjusted After-Tax Income (AATI): Q4 AATI per diluted share increased to $1.79; full year AATI per diluted share rose to $6.79.
General Insurance: Net premiums written up 3% YoY in Q4; combined ratio improved to 89.1%.
Life and Retirement: APTI for Q4 at $957 million, up 12% YoY.
Capital Return: $1.3 billion returned to shareholders in Q4 through stock repurchases and dividends.
Book Value: Book value per common share increased to $65.14 as of December 31, 2023.
Strategic Progress: Notable divestitures and reduced AIGs ownership in Corebridge to 52.2%.
On February 13, 2024, American International Group Inc (NYSE:AIG) released its 8-K filing, detailing its financial results for the fourth quarter and full year ended December 31, 2023. The company, a leading global insurance organization, reported a net income per diluted share of $0.12 for the fourth quarter and $4.98 for the full year. Adjusted after-tax income (AATI) per diluted share was notably higher at $1.79 for the quarter and $6.79 for the full year, reflecting a 33% increase from the prior year.
General Insurance Performance
General Insurance net premiums written (NPW) increased by 3% year-over-year in the fourth quarter, or 7% on a comparable basis. The segment's combined ratio improved by 80 basis points from the prior year quarter to 89.1%, indicating a strong underwriting performance. The adjusted pre-tax income (APTI) for General Insurance was $1.4 billion in the quarter, a 19% increase from the prior year, driven by higher net investment income and improved accident year losses.
Life and Retirement Strength
The Life and Retirement segment also showed robust performance with a 12% increase in APTI to $957 million for the fourth quarter. This growth was attributed to continued spread expansion and strong sales, with total premiums and deposits exceeding $40 billion for the full year.
Capital Management and Shareholder Returns
AIG demonstrated a balanced capital management strategy by returning $1.3 billion to shareholders through $1.0 billion of common stock repurchases and $256 million of dividends in the fourth quarter. The company also repurchased $1.6 billion senior unsecured notes during the quarter, showcasing its commitment to financial flexibility and shareholder value.
Strategic Progress and Outlook
The year 2023 marked a period of strategic progress for AIG, including the divestiture of Validus Re, the sale of Crop Risk Services, and the reduction of AIGs ownership in Corebridge Financial to 52.2%. Chairman & CEO Peter Zaffino commented on the exceptional underwriting performance and the company's repositioning for the future. He highlighted the momentum AIG carries into 2024, emphasizing the importance of underwriting, operations, claims service, and talent in driving growth.
AIG's financial achievements in 2023, particularly in underwriting income and net investment income, underscore the company's operational strength and strategic execution. These results are crucial for an insurance company, as they reflect the ability to effectively assess risk, manage volatility, and generate returns on investments. For investors, AIG's performance indicates a resilient business model capable of delivering value amidst a complex global risk environment.
For a detailed view of AIG's financial performance and strategic initiatives, investors and stakeholders are encouraged to review the full 8-K filing.
Explore the complete 8-K earnings release (here) from American International Group Inc for further details.
This article first appeared on GuruFocus.
