American International Group, Inc. New · NYSE:AIG

American International Group, Inc. New — American International Group — Q4 2022 Earnings Presentation

48 slides from American International Group, Inc. New's earnings presentation, Feb 16, 2023

1. Slide 1: Fourth Quarter and Full Year 2022 Financial Results Presentation

   Fourth Quarter and Full Year 2022 Financial Results Presentation February 16, 2023 Copyright ® 2023 by American International Group, Inc. All rights reserved. No part of this document may be reproduced, republished or reposted without the permission of AIG.

2. Slide 2: Cautionary Statement Regarding Forward-Looking Information

   Certain statements in this presentation and other publicly available documents may include, and members of AIG management may from time to time make and discuss, Cautionary Statement statements which, to the extent they are not statements of historical or present fact, may constitute “forward-lookin

3. Slide 3: 4Q22 Adjusted Pre-Tax Income Reflects Continued Strong Underwriting Margin Improvement

   4Q22 Adjusted Pre-Tax 4Q22 Financial  Net income attributable to AIG common shareholders was $264M, or $0.35 per diluted common share, compared to $3.7B, or $4.38 per common share, in 4Q21 Income (APTI)* Reflects Results  Adjusted after-tax income attributable to AIG common shareholders (AATI)* of

4. Slide 4: In 2022, AIG Nearly Doubled Underwriting Profitability in General Insurance

   In 2022, AIG Nearly Doubled FY'22 Financial  Net income attributable to AIG common shareholders was $10.2B, or $13.01 per diluted common share, compared to $9.4B, or $10.82 per common share, in 2021, largely driven by net realized gains Underwriting Profitability in Results on Fortitude Re funds wi

5. Slide 5: Adjusted Book Value Per Share Growth Reflects Strong Operating Performance

   Adjusted Book Value Per ($M, except per common share amounts) 4Q21 4Q22 Variances FY’21 FY’22 Variances Share Growth Reflects Strong Adjusted Pre-tax Income (Loss): Operating Performance in General Insurance $1,509 $1,212 ($297) $4,359 $4,430 $71 General Insurance and Solid Life and Retirement 1 969

6. Slide 6: Strong Underwriting Improvement Benefiting from Gross Limit Reduction and Underwriting Discipline

   General Insurance Underwriting Income ($B) Strong Underwriting Improvement Benefiting from Over $7B Improvement Gross Limit Reduction and Underwriting Discipline 0.1 1.1 2.0 (1.0) (3.1)  Over $7B of cumulative increase in full year General Insurance (4.5) underwriting income since 2016 (5.6)  Seco

7. Slide 7: General Insurance: Built A Stable and Profitable Underwriting Portfolio

   General Insurance Accident Year Combined Ratio*, As Adjusted General Insurance: Built A (1,260) bps Stable and Profitable 101.0% 99.4% 98.8% Underwriting Portfolio 14.5% 14.1% 12.5% 96.1% 96.1% 95.9% 95.8% 95.5% 94.9% 93.3% 92.9% 92.4% 91.1% 90.5% 89.8% 89.5% 88.5% 88.4% 88.4% 12.5% 12.6% 12.4% 12.8

8. Slide 8: AIG Investment Portfolio is Well Diversified with Solid Credit Characteristics

   Investment Portfolio Composition ($B) Investment Portfolio Composition by Segment1 ($B) AIG Investment Portfolio is Well Diversified with Solid Equities, $0.6 Bonds, FVO, $0.3 $187.4 Credit Characteristics $5.8 $3.8 Equities $0.1 $13.9 $10.1 Bonds, FVO $12.3 $0.4 $30.3 $39.2  $280B high quality inv

9. Slide 9: Investment Income on FMS – AFS Bonds and Mortgage and Other Loans Receivable

   Investment Income on FMS – AFS Bonds and Mortgage and Other Loans Receivable2 Investment Income on FMS – ($M, %) AFS Bonds and Mortgage and Other Loans Receivable1 $3,071 $3,126 $3,040 $3,039 $3,012 $2,901 $2,788 $2,494 $2,469 $2,564 $2,456 $2,417 $2,443 $2,411 $2,410 $2,389  Yield3 on FMS - AFS Bo

10. Slide 10: Execution of Balanced Capital Management Actions

    Quarterly Share Repurchases Execution of Balanced (in millions, except per share data) 4Q21 1Q22 2Q22 3Q22 4Q22 Capital Management Actions Aggregate Share Repurchases $992 $1,403 $1,699 $1,268 $779 Number of Shares Repurchased 17 23 30 24 13  Aggregated share repurchases of $5.1B in 2022 % of Share

11. Slide 11: Continued Progress on Capital Management Initiatives

    Capital Structure ($B) Capital Ratios Continued Progress on $90.8 (%) Dec 31, Sep 30, Dec 31, Capital Management 2021 2022 2022 $1.2 $0.4 $63.4 $1.0 $1.0 $20.3 Hybrids - AIG 1 Initiatives $3.0 $0.5 $8.4 $10.8 Hybrids - CRBG Hybrids / Total capital 1.3% 3.1% 3.1% $5.2 Financial debt / $2.2 $0.5 1,2 2

12. Slide 12: Completion of Corebridge IPO Creates Two Standalone, Market-Leading Companies

    Progress of Corebridge Separation Completion of Corebridge IPO Creates Two Standalone, October 2020 November 2021 March 2022 September December 2022 Market-Leading Companies AIG announced its intent to AIG and Blackstone closed AIG announced strategic 2022 AIG and Corebridge have 2023 Completion of

13. Slide 13: Path to Double-Digit Return On Common Equity

    Key Drivers for Delivering Double Digit ROCE2 Path to Double-Digit Return On Common Equity Continued Momentum on Underwriting Profitability Separation of Life & Retirement Business  Expect to reduce share count to 600-650M while maintaining leverage in the low 20s including AOCI1 Leaner Operating M

14. Slide 14: Fourth Quarter 2022 Financial Detail

    Fourth Quarter 2022 Financial Detail Copyright ® 2023 by American International Group, Inc. All rights reserved. No part of this document may be reproduced, republished or reposted without the permission of AIG.

15. Slide 15: General Insurance: Combined Ratio Improved 2.5 Points; Global AYCR Improved 1.4 Points

    General Insurance: Combined ($M) 4Q21 4Q22 Net Premiums Written ($M) Ratio Improved 2.5 Points; Net premiums written Net premiums earned $5,961 $5,610 Total NPW -6% / +1% (ex. FX) $6,553 $6,291 $5,961 Global AYCR Improved 1.4 Loss and loss adjustment expense 4,047 3,681 $5,610 Points in 4Q22 Acquisi

16. Slide 16: General Insurance: North America Combined Ratio Improved 8.4 Points

    General Insurance: North ($M) 4Q21 4Q22 North America Net Premiums Written ($M) America Combined Ratio Net premiums written Commercial Lines $2,642 2,208 $2,674 2,272 Total NPW Improved 8.4 Points and Personal Insurance 434 402 $2,642 +1% $2,674 AYCR Improved 1.5 Points Net premiums earned $3,009 $3

17. Slide 17: General Insurance: Strong International Commercial Underwriting Results

    General Insurance: Strong ($M) 4Q21 4Q22 International Net Premiums Written ($M) International Commercial Net premiums written Commercial Lines $3,319 1,915 $2,936 1,763 Underwriting Results with a Personal Insurance 1,404 1,173 $3,319 $2,936 5.1-Point Improvement In Personal Insurance Net premiums

18. Slide 18: Life and Retirement 4Q22

    Life and Retirement 4Q22 Adjusted Pre-tax Income ($M) Noteworthy Items ($M) $969 4Q21 4Q22 Variance $165 $781 Return on alternative investments 374 16 (358) $64 $314 $106 Other yield enhancements 136 10 (126)  The decline in 4Q22 APTI from the prior year reflects the $177 impact of 2022 capital mar

19. Slide 19: Life and Retirement 4Q22: Tailwinds from Higher Interest Rates and Wider Credit Spreads

    Individual Retirement Life and Retirement 4Q22: Premiums and Net Flows Assets Under APTI 4Q22 vs 4Q21 APTI reflects Tailwinds from Higher Deposits* ($M) ($M) Management ($B) ($M) Unfavorable impact from:  Lower returns from alternative investments and Interest Rates and Wider $3,827 (+16% vs. 4Q21)

20. Slide 20: Life and Retirement 4Q22: Life Insurance Reflects Improved Mortality

    Life Insurance Life and Retirement 4Q22: New Business Sales Premiums and Deposits* 4Q22 vs 4Q21 APTI reflects Life Insurance Reflects ($M) ($M) APTI ($M) Favorable impact from:  Improved mortality Improved Mortality; Reserve $107 (-1% vs. 4Q21) $1,179 (-2% vs. 4Q21) $106 n.m.  Higher base portfoli

21. Slide 21: Other Operations: APTL Improved due to Lower Eliminations

    Other Operations: APTL Improved due to Lower Eliminations ($M) 4Q21 4Q22  Other Operations APTL of $451M in 4Q22 improved by $197M from the prior year quarter Corporate and Other ($577) ($494)  Before consolidation and eliminations, the APTL increased by $278M, reflecting lower investment income d

22. Slide 22: Gross Investment Income (GII), APTI basis

    Gross investment income Gross Investment Income, APTI basis ($M) (GII), APTI basis* General Insurance Life and Retirement Other Operations $3,406 Total AIG Interest & dividends $82 $3,071 Alternative investments $189 $812 $90 All other $2,411 Other adjustments1 $2,337 $17 $67 $374 $16 $2,846 $1,058

23. Slide 23: 4Q21 and 4Q22 Noteworthy Items

    4Q21 and 4Q22 Noteworthy Items 4Q21 4Q22 EPS – EPS – ($M, except per share amounts) APTI AATI1 APTI AATI1 Diluted2 Diluted2 Expense Items: Catastrophe-related losses, net of reinsurance $194 $153 $0.18 239 $189 $0.25 Reinstatement premiums related to catastrophes (2) (2) (0.00) 13 10 0.01 Unfavorabl

24. Slide 24: Full Year 2022 Financial Detail

    Full Year 2022 Financial Detail Copyright ® 2023 by American International Group, Inc. All rights reserved. No part of this document may be reproduced, republished or reposted without the permission of AIG.

25. Slide 25: General Insurance: Strongest Underwriting Result Ever Achieved

    General Insurance: Strongest ($M) FY'21 FY'22 Net Premiums Written ($M) Underwriting Result Ever Net premiums written Net premiums earned $25,890 $25,057 $25,512 $25,340 $25,890 Total NPW -1% / +4% (ex. FX) Achieved; Calendar Year Loss and loss adjustment expense 16,097 15,407 $25,512 Combined Ratio

26. Slide 26: General Insurance: North America NPW Growth of 5% and 3.0-Point AYCR Improvement

    General Insurance: North ($M) FY'21 FY'22 North America Net Premiums Written ($M) America NPW Growth of 5% Net premiums written Commercial Lines $11,733 10,226 $12,364 10,899 and a 3.0-Point Improvement Personal Insurance 1,507 1,465 Total NPW +5% $12,364 in AYCR Net premiums earned $10,989 $12,071

27. Slide 27: General Insurance: International Commercial Lines NPW Grew with Strong AYCR Improvement

    General Insurance: ($M) FY'21 FY'22 International Net Premiums Written ($M) International Commercial Net premiums written Commercial Lines $14,157 8,030 $13,148 7,877 $14,157 Lines NPW Grew with Strong Personal Insurance 6,127 5,271 $13,148 Improvement in Commercial Net premiums earned $14,068 $13,2

28. Slide 28: Life and Retirement 2022

    Life and Retirement 2022 Adjusted Pre-tax Income ($M) Noteworthy Items ($M) $3,911 FY'21 FY'22 Variance $582 Annual actuarial assumption updates ($166) ($57) $109 $106 $2,657 Return on alternative investments 1,299 366 (933) $1,284 $349  The decline in 2022 APTI from 2021 reflects the impact of $33

29. Slide 29: Life and Retirement 2022: Tailwinds from Higher Interest Rates and Wider Credit Spreads

    Individual Retirement Life and Retirement 2022: Premiums and Assets Under FY'22 vs FY'21 APTI reflects Net Flows ($M) APTI ($M) Tailwinds from Higher Deposits* ($M) Management ($B) Unfavorable impact from:  Lower returns from alternative investments and $15,120 $2,410 $136.6 $1,222 Interest Rates a

30. Slide 30: Life and Retirement 2022: Life Insurance Reflects Improved Mortality

    Life Insurance Life and Retirement 2022: New Business Sales Premiums and Deposits* FY'22 vs FY'21 APTI reflects Life Insurance Reflects ($M) ($M) APTI ($M) Favorable impact from:  Improved mortality Improved Mortality; Reserve $444 (-2% vs FY'21) $4,671 (Flat vs. FY'21) $337 (+218% vs. FY'21)  Hig

31. Slide 31: Other Operations: APTL Improved due to Lower Losses and Interest Expense

    Other Operations: APTL Improved due to Lower Losses and Interest Expense Partially Offset by Lower NII ($M) FY'21 FY'22 Corporate and Other ($2,329) ($2,053)  Other Operations APTL was $1.9B in FY'22, an improvement of $403M from the prior year benefiting from AIG 200 Asset Management Group 911 511

32. Slide 32: Gross Investment Income (GII), APTI basis

    Gross Investment Income Gross Investment Income, APTI basis ($M) (GII), APTI basis General Insurance Life and Retirement Other Operations $13,303 Total AIG Interest & dividends $579 Alternative investments $11,399 All other $2,579 $234 $9,753 $819 Other adjustments1 $8,661 $289 $1,299 $30 $366 $10,2

33. Slide 33: FY'21 and FY'22 Noteworthy Items

    FY'21 and FY'22 Noteworthy Items FY'21 FY'22 EPS – EPS – ($M, except per share amounts) APTI AATI1 APTI AATI1 Diluted2 Diluted2 Expense Items: Catastrophe-related losses, net of reinsurance $1,401 $1,107 $1.28 $1,234 $975 $1.24 Reinstatement premiums related to catastrophes 20 16 0.02 84 66 0.08 Unf

34. Slide 34: Appendix

    Copyright ® 2023 by American International Group, Inc. All rights reserved. No part of this document may be reproduced, republished or reposted without the permission of AIG.

35. Slide 35: Glossary of Non-GAAP Financial Measures

    Glossary of Non-GAAP Glossary of Non-GAAP Throughout this presentation, we present our financial condition and results of operations in the way we believe will be most meaningful and Financial Measures representative of our business results. Some of the measurements we use are “Non-GAAP financial me

36. Slide 36: Glossary of Non-GAAP Financial Measures

    Glossary of Non-GAAP Glossary of Non-GAAP  Adjusted After-tax Income attributable to AIG common shareholders (AATI) is derived by excluding the tax effected APTI adjustments described above, Financial Measures dividends on preferred stock, noncontrolling interest on net realized gains (losses), oth

37. Slide 37: Glossary of Non-GAAP Financial Measures

    Glossary of Non-GAAP Glossary of Non-GAAP  Adjusted Revenues exclude Net realized gains (losses), income from non-operating litigation settlements (included in Other income for GAAP purposes), changes in fair value Financial Measures of securities used to hedge guaranteed living benefits (included

38. Slide 38: Non-GAAP Reconciliations - Adjusted Pre-tax and After-tax Income

    Non-GAAP Reconciliations- (in millions) 4Q21 Quarterly 4Q22 Twelve Months Ended 2021 December 31, 2022 Adjusted Pre-tax and Pre-tax income from continuing operations Adjustments to arrive at Adjusted pre-tax income Changes in fair value of securities used to hedge guaranteed living benefits $ 5,048

39. Slide 39: Non-GAAP Reconciliations - Adjusted Pre-tax and After-tax Income

    Non-GAAP Reconciliations- (in millions) 4Q21 Quarterly 4Q22 Twelve Months Ended December 31, 2021 2022 Adjusted Pre-tax and After-tax net income, including noncontrolling interests Noncontrolling interests (income) loss $ 4,106 $ (360) $ 186 85 $ 9,923 $ (535) 11,275 (999) After-tax Income - Net inc

40. Slide 40: Non-GAAP Reconciliations - Book Value Per Common Share

    Non-GAAP Reconciliations- Book Value Per Common Share Book Value Per Common (in millions, except per common share data) Book Value Per Common Share March 31, 2022 June 30, 2022 September 30, 2022 December 31, 2021 2022 Share Total AIG shareholders' equity Less: Preferred equity $ 55,944 $ 485 45,344

41. Slide 41: Non-GAAP Reconciliations - Return on Common Equity

    Non-GAAP Reconciliations- Return on Common Equity Return on Common Equity Twelve Months Ended (in millions) Quarterly December 31, Return On Common Equity Computations 4Q21 4Q22 2021 2022 Actual or annualized net income attributable to AIG common shareholders (a) $ 14,956 $ 1,056 $ 9,359 $ 10,247 Ac

42. Slide 42: Non-GAAP Reconciliations - Return on Common Equity (continued)

    Non-GAAP Reconciliations- Return on Common Equity (continued) Return on Common Equity Life and Retirement Twelve Months Ended (in millions) Quarterly December 31, 4Q21 4Q22 2021 2022 (continued) and Net Adjusted pre-tax income Interest expense on attributed financial debt Adjusted pre-tax income inc

43. Slide 43: Non-GAAP Reconciliations - Accident Year Loss Ratio and Combined Ratio

    Non-GAAP Reconciliations- General Insurance Twelve Months Ended General Insurance - North America Twelve Months Ended Accident Year Loss Ratio, Quarterly 4Q21 4Q22 December 31, 2021 2022 Quarterly 4Q21 4Q22 December 31, 2021 2022 as adjusted, and Accident Loss ratio 61.8 58.5 64.2 60.8 Loss ratio 70

44. Slide 44: Non-GAAP Reconciliations - Accident Year Loss Ratio and Combined Ratio

    Non-GAAP Reconciliations- General Insurance - International Twelve Months Ended General Insurance - International - Twelve Months Ended Accident Year Loss Ratio, Quarterly 4Q21 4Q22 December 31, 2021 2022 Commercial Lines Quarterly 4Q21 4Q22 December 31, 2021 2022 as adjusted, and Accident Loss rati

45. Slide 45: Non-GAAP Reconciliations - Accident Year Loss Ratio and Combined Ratio

    Non-GAAP Reconciliations- Accident Year Loss Ratio, Twelve Months Ended December 31, 2022 Lexington Glatfelter Global Specialty as adjusted, and Accident Loss ratio 73.2 59.9 49.9 Catastrophe losses and reinstatement premiums (18.8) (3.1) (2.1) Prior year development, net of reinsurance and prior ye

46. Slide 46: Non-GAAP Reconciliations - Accident Year Loss Ratio and Combined Ratio

    Non-GAAP Reconciliations- Accident Year Loss Ratio, as General Insurance Quarterly 2Q’18 3Q'18 4Q'18 1Q'19 2Q'19 3Q'19 4Q'19 1Q'20 2Q'20 3Q'20 4Q'20 1Q'21 2Q'21 3Q'21 4Q'21 1Q’22 2Q’22 3Q’22 FY'18 FY'21 adjusted, and Accident Year Loss ratio Catastrophe losses and 65.7 88.6 80.1 63.1 63.0 69.3 65.6

47. Slide 47: Non-GAAP Reconciliations - Gross and Net Premiums Written Constant Dollar

    Non-GAAP Reconciliations- Gross Premiums Written – Change in Constant Dollar Gross and Net Premiums Written – Change in Commercial Personal General Insurance Total Insurance Insurance Foreign exchange effect on worldwide premiums: 4Q22 4Q22 4Q22 Constant Dollar Change in gross premiums written Incre

48. Slide 48: Non-GAAP Reconciliations - Premiums

    Non-GAAP Reconciliations- (in millions) Quarterly Twelve Months Ended December 31, Premiums Individual Retirement: 4Q21 4Q22 2021 2022 Premiums $ 68 $ 62 $ 191 230 Deposits 3,244 3,764 13,732 14,900 Other (4) 1 (7) (10) Premiums and deposits $ 3,308 $ 3,827 $ 13,916 15,120 Individual Retirement (Fix

American International Group — Q4 2022 Earnings Presentation on 6ix