AIG Cuts Property Exposure as Pricing Softens, Underwriting Income Rises 10%

Zacks Investment Research··US·Read original
3▲0 ▼0Impact / 5
Summary · why it matters

American International Group is reducing property exposure rather than chasing premium growth as a more competitive pricing environment pressures rates, particularly in North America. Premium retention at AIG's Lexington property business declined 9 percentage points in the second quarter as the insurer cut targeted exposures and walked away from business that failed to meet its underwriting standards, actions that along with softer pricing reduced growth in North America by more than 3 percentage points. General Insurance net premiums written increased 9% year over year, or 11% excluding North America Property, while General Insurance underwriting income rose 10% to $686 million and the adjusted accident-year combined ratio improved 30 basis points to 88.1%. North America Commercial's adjusted accident-year combined ratio increased 50 basis points on business-mix changes and rate pressure, while North America Retail Casualty pricing rose 10%, including a 14% increase in Excess Casualty. Peers Travelers and Chubb are also emphasizing underwriting discipline, with Travelers' National Property net premiums written down 2% in the second quarter and Chubb's P&C premiums up 3%, or 6.3% excluding large-account and E&S property lines, at a combined ratio of 83.8%.

Impact on assets 3

Climate Adaptation & Water▲ · 2 stocks
Chubb Ltd
CB
± MixedPricingrelevance

Chubb cited only as a peer emphasizing underwriting discipline, with P&C premiums up 3% amid property-line softness.

Financials▲ · 1 stocks
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