American International Group, Inc. New · NYSE:AIG
American International Group, Inc. New — American International Group — Q2 2021 Earnings Presentation
29 slides from American International Group, Inc. New's earnings presentation, Aug 6, 2021
Slide 1: Second Quarter 2021 Financial Results Presentation
Second Quarter 2021 Financial Results Presentation August 5, 2021
Slide 2: Cautionary Statement Regarding Forward-Looking Information
Cautionary Statement Regarding Forward-Looking Information, Comment on Regulation G and Other Information This document and the remarks made within this presentation may include, and officers and representatives of American International Group, Inc. (AIG) may from time to time make and discuss, proj
Slide 3: 2Q21 results reflect exceptional top-line growth in General Insurance
2Q21 results reflect exceptional top-line growth in General Insurance as well as improved profitability in both General Insurance and Life and Retirement Adjusted after-tax income attributable to AIG common shareholders (AATI)* was $1.3B, or $1.52 per diluted common share, compared to $561M, or $0
Slide 4: APTI of $1.7B reflects strong General Insurance underwriting results
APTI of $1.7B reflects strong General Insurance underwriting results and premium growth, significantly lower CATs, and 26% growth in Life & Retirement APTI ($M, except per common share amounts) 2Q20 2Q21 Variances Key Takeaways Adjusted Pre-tax Income (Loss): General Insurance APTI of $1.2B reflec
Slide 5: 2Q20 and 2Q21 noteworthy items
2Q20 and 2Q21 noteworthy items 2Q20 2Q21 EPS – EPS – ($M, except per share amounts) Pre-tax After-tax1 Pre-tax After-tax1 diluted2 diluted2 CATs excluding General Insurance COVID-193 $216 $171 $0.20 $120 $95 $0.11 General Insurance COVID-19 CATs 458 362 0.42 - - - Reinstatement premiums related to c
Slide 6: Gross investment income, APTI basis, increased 11%
Gross investment income (GII), APTI basis*, excluding the impact of Fortitude Funds Withheld Assets, in 2Q201 increased $332M or 11% Invested Assets & Gross Investment Income, APTI Basis 2Q21 Invested Assets Gross Investment Income, APTI basis ($M) Interest and $B Alternatives All Other Dividends 2Q
Slide 7: General Insurance: Global Commercial Lines and Personal Insurance NPW growth
General Insurance: Global Commercial Lines and Personal Insurance NPW grew +16% and +45%, respectively; AYCR, as adjusted improved by 3.8 pts in 2Q21 ($M) 2Q20 2Q21 Net Premiums Written (NPW) ($M) Net premiums written $5,549 $6,860 Global Commercial Lines Global Personal Insurance $4,717 Net premium
Slide 8: General Insurance: Strong NPW growth in North America
General Insurance: Strong NPW growth in North America Commercial Lines and Personal Insurance along with continued strong underwriting margin improvement ($M) 2Q20 2Q21 Key Takeaways: NA Commercial Lines NPW grew 15% from 2Q20 reflecting continued rate increases, Net premiums written $2,153 $3,156
Slide 9: General Insurance: Strong International Commercial Lines NPW growth
General Insurance: Strong International Commercial Lines NPW growth of +17% along with 1.9 pts of total AYCR, as adjusted improvement Key Takeaways: ($M) 2Q20 2Q21 International Commercial Lines NPW grew 17% (10% on a constant dollar basis) from 2Q20 Net premiums written $3,396 $3,704 reflecting c
Slide 10: Life and Retirement: Strong results across all segments
Life and Retirement: Strong results across all segments largely due to favorable capital markets conditions Key Highlights: 2Q21 vs 2Q20 Adjusted Pre-Tax Income (APTI) ($M) APTI reflects growth primarily arising from: ‒ Favorable equity market impacts resulting in higher alternative +26% or $1,124
Slide 11: Life and Retirement: Individual Retirement
Life and Retirement: Strong growth arising from favorable capital markets conditions Individual Retirement1 Assets Under 2Q21 vs 2Q20 APTI reflects Premiums and Net Administration APTI ($M) Deposits ($M) Flows ($M) Favorable impacts from: ($B) Equity markets resulting in higher alternative investm
Slide 12: Life and Retirement: Life Insurance and Institutional Markets
Life and Retirement: Strong growth arising from favorable capital markets conditions; adverse COVID-19 mortality in Life Insurance Life Insurance New Business Premiums and 2Q21 vs 2Q20 APTI reflects APTI ($M) Sales ($M) Deposits ($M) Favorable impacts from: $125 $1,161 $20 Equity markets resulting
Slide 13: Other Operations: APTL increased due in-part to Fortitude
Other Operations: APTL increased due in-part to the impact of Fortitude which was deconsolidated in 2Q20 ($M) 2Q20 2Q21 Corporate and Other ($248) ($617) Asset Management (84) 101 Adjusted pre-tax loss before consolidation and eliminations ($332) ($516) Consolidation and eliminations: Consolidation
Slide 14: Financial flexibility remains strong with reduced debt and $7.2B Parent liquidity
Financial flexibility remains strong with reduced debt and $7.2B of Parent liquidity at June 30, 2021; Total debt & preferred stock leverage of 27.0% Capital Structure ($B) Risk Based Capital (RBC) Ratios4 $93.2 $91.1 $1.6 Hybrids 1 Life and Retirement General Insurance $1.6 Year 1,2 Companies Compa
Slide 15: AIG 200: Continued execution of global multi-year initiative
AIG 200: Continued execution of our global, multi-year initiative to achieve transformational change and $1B of progress on the GOE savings The Standard Commercial Underwriting Platform will modernize global underwriting capabilities by 1 simplifying processes and tools to create a contemporary data
Slide 16: Corporate debt investment portfolio remains well diversified
AIG’s corporate debt investment portfolio remains well diversified by industry sector; credit quality remains strong Fixed Maturity Securities by NAIC Designation Corporate Debt by Industry Sector June 30, 2021 – $243.6B1,2 June 30, 2021 – $149.0B1 NAIC 3-6 Other 8% Basic materials $114.4 Energy $17
Slide 17: Disclosures Related to AIG's Partnership with Blackstone
Disclosures Related to AIG’s Partnership with Blackstone 17
Slide 18: The transactions with Blackstone generate new capital
The transactions with Blackstone generate new capital, provide flexibility on IPO timing and size, and utilize additional foreign tax credits (FTCs) Equity Stake Separately Managed Affordable in Life and Retirement Account (SMA) Agreements Housing Sale Transaction • Blackstone to acquire a 9.9% equi
Slide 19: Glossary of Non-GAAP Financial Measures and Non-GAAP Reconciliations
Glossary of Non-GAAP Financial Measures and Non-GAAP Reconciliations 19
Slide 20: Glossary of Non-GAAP Financial Measures
Glossary of Non-GAAP Financial Measures 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 representative of our business results. Some of the measurements we use are “Non-GAAP financial me
Slide 21: Glossary of Non-GAAP Financial Measures
Glossary of Non-GAAP Financial Measures Glossary of Non-GAAP Book Value per Common Share, Excluding Accumulated Other Comprehensive Income (AOCI) adjusted for the cumulative unrealized gains and losses related to Fortitude Re funds withheld assets and Deferred Tax Assets (DTA) (Adjusted Book Value
Slide 22: Glossary of Non-GAAP Financial Measures
Glossary of Non-GAAP Financial Measures Glossary of Non-GAAP Ratios: We, along with most property and casualty insurance companies, use the loss ratio, the expense ratio and the combined ratio as measures of underwriting performance. These ratios are relative measurements that describe, for every
Slide 23: Non-GAAP Reconciliations
Non-GAAP Reconciliations Adjusted Pre-tax and After-tax Income - Consolidated (in millions) Quarterly 2Q20 2Q21 Pre-tax income (loss) from continuing operations $ (9,661) $ 147 Adjustments to arrive at Adjusted pre-tax income Changes in fair value of securities used to hedge guaranteed living benefi
Slide 24: Non-GAAP Reconciliations
Non-GAAP Reconciliations Adjusted Pre-tax and After-tax Income - Consolidated (in millions) Quarterly 2Q20 2Q21 After-tax net income (loss), including noncontrolling interests $ (7,766) $ 150 Noncontrolling interests (income) loss (162) (51) Net income (loss) attributable to AIG $ (7,928) $ 99 Divid
Slide 25: Non-GAAP Reconciliations
Non-GAAP Reconciliations Book Value Per Common Share (in millions, except per common share data) As of June 30, December 31, (in millions, except per common share data) As of June 30, December 31, Book Value Per Common Share 2020 2021 2020 Tangible Book Value Per Common Share 2020 2021 2020 Total AI
Slide 26: Non-GAAP Reconciliations
Non-GAAP Reconciliations Accident Year Loss Ratio, as adjusted, and Accident Year Combined Ratio, as adjusted General Insurance General Insurance - North America Quarterly Quarterly 2Q18 2Q20 2Q21 2Q20 2Q21 Loss ratio 65.7 72.6 61.3 Loss ratio 89.7 67.4 Catastrophe losses and reinstatement premiums
Slide 27: Non-GAAP Reconciliations
Non-GAAP Reconciliations Accident Year Loss Ratio, as adjusted, and Accident Year Combined Ratio, as adjusted General Insurance - International General Insurance - International - Quarterly Commercial Lines Quarterly 2Q20 2Q21 2Q20 2Q21 Loss ratio 59.7 56.7 Loss ratio 66.1 57.8 Catastrophe losses an
Slide 28: Non-GAAP Reconciliations
Non-GAAP Reconciliations Net Premiums Written – Change in Constant Dollar North America - International - International - Global - Global - General Commercial Commercial Personal Commercial Personal General Insurance Insurance Lines Lines Insurance Lines Insurance Foreign exchange effect on worldwid
Slide 29: Non-GAAP Reconciliations
Non-GAAP Reconciliations Premiums (in millions) Six Months Ended Quarterly June 30, Individual Retirement: 2Q20 2Q21 2020 2021 Premiums $ 38 $ 32 $ 79 $ 57 Deposits 1,759 3,949 4,838 7,298 Other (3) (3) (7) (4) Premiums and deposits $ 1,794 $ 3,978 $ 4,910 $ 7,351 Individual Retirement (Fixed Annuit
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