AIG CEO Touts Shift Toward Growth as Insurer Beats Estimates
(Bloomberg) -- American International Group Inc. beat analysts’ profit estimates in a quarter Chief Executive Officer Peter Zaffino heralded as a shift toward growth following a years-long effort to overhaul the insurer.
- “Optimization work will continue, but the magnitude of what we accomplished over the last three years is worth reflecting on because the first quarter of 2021 was an important inflection point for our team,” Zaffino said Friday on a conference call with analysts. “Our focus pivoted from remediation to driving profitable growth.” Adjusted profit of $1.05 a share beat the 95-cent average estimate of 16 analysts in a Bloomberg survey.
- A key metric for AIG improved with underwriting in North America and international businesses. The adjusted accident-year combined ratio, which excludes catastrophe costs, decreased to 92.4 from 95.5 a year earlier.
- Catastrophe costs totaled $422 million, primarily related to winter storms.
- The life and retirement business reported a 57% increase in adjusted pretax income, driven in part by greater investment returns. Life insurance saw a $40 million adjusted pretax loss brought on by elevated mortality driven by Covid-19.
- The company believes an initial public offering remains the “optimal path forward” for a stake in the insurer’s life and retirement business that it’s seeking to divest, Zaffino said on the call. He had said last quarter that AIG was fielding inquiries from companies interested in the segment.
- AIG shares rose 0.8% to $50.57 at 11:28 a.m. in New York. They’re up 34% this year.
- For AIG’s press release, click here.
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