American International Group, Inc. New · NYSE:AIG
American International Group, Inc. New — American International Group — Q4 2021 Earnings Presentation
40 slides from American International Group, Inc. New's earnings presentation, Feb 17, 2022
Slide 1: Fourth Quarter and Full Year 2021 Financial Results Presentation
Fourth Quarter and Full Year 2021 Financial Results Presentation February 17, 2022 Copyright ® 2022 by American International Group, Inc. All rights reserved. No part of this document may be reproduced, republished or reposted without the permission of AIG.
Slide 2: Cautionary Statement Regarding Forward-Looking Information
Cautionary Statement 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, statements which, to the extent they are not statements of historical or present fact, ma
Slide 3: 4Q21 and FY'21 APTI reflects continued strong underwriting margin improvement
4Q21 and FY’21 APTI reflects ▪ Adjusted after-tax income attributable to AIG common shareholders (AATI)* of $1.3B, or $1.58 per diluted common share, compared to 4Q21 $827M, or $0.94 per diluted common share, in 4Q20, due to strong operating performance in General Insurance Financial continued stron
Slide 4: Adjusted ROE improvement and tangible book value growth reflect strong operating performance
Adjusted ROE improvement ($M, except per common share amounts) 4Q20 4Q21 Variances FY’20 FY’21 Variances and tangible book value Adjusted Pre-tax Income (Loss): growth reflect strong General Insurance $809 $1,509 $700 $1,901 $4,359 $2,458 operating performance in Life and Retirement 1,027 969 (58) 3
Slide 5: AIG finished the year with a strong Parent liquidity position of $10.7B
AIG finished the year with a Capital Structure ($B) Risk Based Capital (RBC) Ratios4 strong Parent liquidity $88.3 $90.8 1.2 Hybrids 1 Period Life and Retirement Companies General Insurance Companies $1.6 position of $10.7B, benefiting $21.0 $20.7 Financial Debt 1,2 from sales proceeds on the $5.6 $
Slide 6: AIG 200: Continued execution of global, multi-year initiative
AIG 200: Continued execution 1 The Standard Commercial Underwriting Platform will modernize global underwriting capabilities by simplifying processes and tools to create a contemporary data architecture of global, multi-year initiative General 2 Transform Japan business into a next-generation digita
Slide 7: General Insurance: Successfully built a stable and profitable underwriting portfolio
General Insurance: General Insurance Accident Year Combined Ratio, As Adjusted Successfully built a stable and (1,120) bps profitable underwriting 101.0% 99.4% 98.8% 96.1% 96.1% 95.9% 95.8% 95.5% 94.9% 93.3% 92.9% 92.4% 91.1% 90.5% 89.8% portfolio between 2018 and 14.5% 14.1% 12.5% 12.5% 12.6% 12.4%
Slide 8: Fourth Quarter 2021 Financial Detail
Fourth Quarter 2021 Financial Detail Copyright ® 2021 by American International Group, Inc. All rights reserved. No part of this document may be reproduced, republished or reposted without the permission of AIG.
Slide 9: Gross investment income (GII), APTI basis
Gross investment income Invested Assets & Gross Investment Income, APTI Basis (GII), APTI basis* General Insurance Life and Retirement Other Operations Total AIG Gross Investment Income, APTI basis ($M) $3,377 $3,406 $22 $82 $135 $605 $812 $2,435 $2,411 $79 $17 $293 $374 Interest & dividends Alterna
Slide 10: 4Q20 and 4Q21 noteworthy items
4Q20 and 4Q21 noteworthy items 4Q20 4Q21 EPS – EPS – ($M, except per share amounts) APTI AATI1 APTI AATI1 Diluted2 diluted2 CATs excluding General Insurance COVID-193 $377 $298 $0.34 $194 $153 $0.18 General Insurance COVID-19 CATs 178 141 0.16 - - - Reinstatement premiums related to current year cat
Slide 11: General Insurance: Global Commercial Lines NPW grew 13%
General Insurance: Global ($M) 4Q20 4Q21 General Insurance Net Premiums Written ($M) Commercial Lines NPW grew Net premiums written $5,565 $5,961 Global Commercial Lines Global Personal Insurance 13%; AYCR, as adjusted Net premiums earned $5,993 $6,553 $4,123 Loss and loss adjustment expense improve
Slide 12: General Insurance: North America NPW growth of 12%
General Insurance: North ($M) 4Q20 4Q21 North America Net Premiums Written ($M) America NPW growth of 12% Net premiums written Commercial Lines $2,361 $2,642 and a 5.0 point improvement Personal Insurance 1,992 369 2,208 434 $2,642 in AYCR, as adjusted Net premiums earned $2,603 $3,009 $2,361 $369 $
Slide 13: General Insurance: Strong International Commercial Lines NPW growth of 15%
General Insurance: Strong ($M) 4Q20 4Q21 International Net Premiums Written ($M) International Commercial Net premiums written Commercial Lines $3,204 $3,319 Lines NPW growth of 15% and Personal Insurance 1,662 1,542 1,915 1,404 $3,204 $3,319 a 2.5 point improvement in Net premiums earned $3,390 $3,
Slide 14: Life and Retirement: Adverse mortality and lower yield enhancements
Life and Retirement: Adverse Adjusted Pre-tax Income (APTI) ($M) Noteworthy Items ($M) mortality and lower yield $1,027 4Q20 4Q21 Variance enhancements, offset by $127 $30 $969 $165 Return on alternative investments 293 374 81 favorable alternative $318 $314 Other yield enhancements 206 136 (70) inv
Slide 15: Life and Retirement: Solid sales growth in Individual Retirement
Life and Retirement: Solid Individual Retirement sales growth in Individual Premiums and Deposits ($M) Net Flows ($M) Assets Under Administration ($B) APTI ($M) 4Q21 vs 4Q20 APTI reflects Favorable impacts from: Retirement; elevated Group $3,308 ($34) $158.6 $498 ▪ Higher alternative investments inc
Slide 16: Life and Retirement: Life Insurance shows solid international life sales
Life and Retirement: Life Life Insurance Insurance shows solid New Business Sales ($M) Premiums and Deposits ($M) APTI ($M) 4Q21 vs 4Q20 APTI reflects Favorable impacts from: international life sales, but $108 (+4% vs. 4Q20) $1,206 (+4% vs. 4Q20) ($8) n.m. ▪ Higher alternative investments income Unf
Slide 17: Other Operations: APTL improved due to higher NII and lower interest expense
Other Operations: APTL improved due to higher NII and lower interest expense ($M) 4Q20 4Q21 ▪ Other Operations APTL was $648M in 4Q21, including $470M of reductions from consolidation and eliminations, Corporate and Other compared to APTL of $720M, including $292M of reductions ($519) ($577) from co
Slide 18: Full Year 2021 Financial Detail
Full Year 2021 Financial Detail Copyright ® 2021 by American International Group, Inc. All rights reserved. No part of this document may be reproduced, republished or reposted without the permission of AIG.
Slide 19: Gross investment income (GII), APTI basis
Gross investment income1 Invested Assets & Gross Investment Income, APTI Basis (GII), APTI basis General Insurance Life and Retirement Other Operations Total AIG Gross Investment Income, APTI basis ($M) $12,863 $13,303 $1 $579 $616 $914 $2,579 $9,178 $9,753 $348 $289 $591 $1,299 Interest & dividends
Slide 20: FY'20 and FY'21 noteworthy items
FY'20 and FY'21 noteworthy items FY'20 FY'21 EPS – EPS – ($M, except per share amounts) APTI AATI1 APTI AATI1 Diluted2 diluted2 CATs excluding General Insurance COVID-193 $1,358 $1,073 $1.23 $1,401 $1,107 $1.28 General Insurance COVID-19 CATs 1,093 863 0.99 - - - Reinstatement premiums related to cu
Slide 21: General Insurance: Global Commercial Lines NPW grew 18%
General Insurance: Global ($M) FY'20 FY'21 General Insurance Net Premiums Written ($M) Global Commercial Lines Global Personal Insurance Commercial Lines NPW grew Net premiums written $22,959 $25,890 $18,256 $7,450 $7,634 18%; AYCR, as adjusted Net premiums earned $23,662 $25,057 $15,509 Loss and lo
Slide 22: General Insurance: North America NPW growth of 20%
General Insurance: North ($M) FY'20 FY'21 North America Net Premiums Written ($M) America NPW growth of 20% Net premiums written Commercial Lines $9,784 $11,733 $11,733 and a 4.9 point improvement Personal Insurance 8,635 1,149 10,226 1,507 $9,784 $1,507 in AYCR, as adjusted Net premiums earned $10,
Slide 23: General Insurance: Strong International Commercial Lines NPW growth of 17%
General Insurance: Strong ($M) FY'20 FY'21 International Net Premiums Written ($M) International Commercial Net premiums written Commercial Lines $13,175 $14,157 $13,175 $14,157 Lines NPW growth of 17% Personal Insurance 6,874 6,301 8,030 6,127 along with 3.4 points of Net premiums earned $13,360 $1
Slide 24: Life and Retirement: Favorable net investment income and fee income
Life and Retirement: Adjusted Pre-tax Income (APTI) ($M) Noteworthy Items ($M) Favorable net investment $3,911 FY'20 FY'21 Variance income and fee income, $3,531 $438 $582 $106 partially offset by unfavorable $142 $1,013 $1,284 Annual actuarial assumption updates ($107) ($166) ($59) impact of mortal
Slide 25: Life and Retirement: Solid sales growth in Individual Retirement
Life and Retirement: Solid Individual Retirement sales growth in Individual Premiums and Deposits ($M) Net Flows ($M) Assets Under Administration ($B) APTI ($M) FY'21 vs FY'20 APTI reflects Favorable impacts from: Retirement; Group $13,916 ($590) $158.6 $1,939 ▪ Higher alternative investments income
Slide 26: Life and Retirement: Life Insurance favorable annual actuarial impact
Life and Retirement: Life Life Insurance Insurance had favorable New Business Sales ($M) Premiums and Deposits ($M) APTI ($M) FY'21 vs FY'20 APTI reflects Favorable impacts from: impact from annual actuarial $453 n.m. $4,650 (+5% vs. FY'20) $106 (-25% vs. FY'20) ▪ Year-over-year change for annual ac
Slide 27: Other Operations: APTL improved due to higher NII and lower interest expense
Other Operations: APTL improved due to higher NII and lower interest expense ($M) FY'20 FY'21 Corporate and Other ▪ Other Operations APTL was $2.4B in FY'21, including ($2,041) ($2,329) $932M of reductions from consolidation and eliminations, Asset Management compared to APTL of $2.4B, including $46
Slide 28: Copyright ® 2021 by American International Group, Inc. All rights reserved. No part of
Copyright ® 2021 by American International Group, Inc. All rights reserved. No part of this document may be reproduced, republished or reposted without the permission of AIG.
Slide 29: 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
Slide 30: Glossary of Non-GAAP Financial Measures
Glossary of Non-GAAP Glossary of Non-GAAP ▪ Book Value per Common Share, Excluding Accumulated Other Comprehensive Income (Loss) (AOCI) adjusted for the cumulative unrealized gains Financial Measures and losses related to Fortitude Re funds withheld assets and Deferred Tax Assets (DTA) (Adjusted Boo
Slide 31: 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) and changes in fair Financial Measures value of securities used to hedge guaranteed living benefits (includ
Slide 32: Non-GAAP Reconciliations- Adjusted Pre-tax and After-tax Income
Non-GAAP Reconciliations- Twelve Months Ended (in millions) Quarterly December 31, 4Q20 4Q21 2020 2021 Adjusted Pre-tax and Pre-tax income (loss) from continuing operations Adjustments to arrive at Adjusted pre-tax income (loss) Changes in fair value of securities used to hedge guaranteed living ben
Slide 33: Non-GAAP Reconciliations- Adjusted Pre-tax and After-tax Income
Twelve Months Ended Non-GAAP Reconciliations- (in millions) 4Q20 Quarterly 4Q21 December 31, 2020 2021 Adjusted Pre-tax and After-tax net income (loss), including noncontrolling interests $ (16) $ 4,106 $ (5,829) $ 9,923 Noncontrolling interests (income) loss (37) (360) (115) (535) Net income (loss)
Slide 34: 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) September 30, December 31, Share Book Value Per Common Share Total AIG shareholders' equity $ 2021 64,863 $ 2020 66,362 $ 2021 65,956 Less: Preferred equity 485 485 485 Total AIG c
Slide 35: 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 4Q20 4Q21 2020 2021 Actual or Annualized net income (loss) attributable to AIG common shareholders (a) $ (240) $ 14,956 $ (5,973) $
Slide 36: Non-GAAP Reconciliations- Accident Year Loss Ratio, as adjusted
Non-GAAP Reconciliations- Twelve Months Twelve Months Accident Year Loss Ratio, General Insurance Ended General Insurance - North America Ended Quarterly December 31, Quarterly December 31, 4Q20 4Q21 2020 2021 as adjusted, and Accident 2Q18 4Q20 4Q21 2020 2021 Loss ratio 65.7 70.2 61.8 71.0 64.2 Los
Slide 37: Non-GAAP Reconciliations- Accident Year Loss Ratio, as adjusted
Non-GAAP Reconciliations- General Insurance - International Twelve Months Ended Twelve Months Accident Year Loss Ratio, General Insurance - International - Ended Quarterly December 31, Commercial Lines Quarterly December 31, 4Q20 4Q21 2020 2021 as adjusted, and Accident 4Q20 4Q21 2020 2021 Loss rati
Slide 38: Non-GAAP Reconciliations- Accident Year Loss Ratio, as adjusted
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 FY'18 FY'19 FY'20 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 66.8 7
Slide 39: Non-GAAP Reconciliations- Net Premiums Written Change in Constant Dollar
Non-GAAP Reconciliations- Net Premiums Written – Net Premiums Written – Change in Constant Dollar Change in Constant Dollar General North America - Commercial North America - Personal International - Commercial International - Personal Global - Commercial Global - Personal and Net Investment General
Slide 40: Non-GAAP Reconciliations- Premiums and Deposits
Non-GAAP Reconciliations- (in millions) Quarterly Twelve Months Ended December 31, Premiums Individual Retirement: Premiums Deposits $ 4Q20 37 $ 2,720 4Q21 68 $ 3,244 2020 151 $ 10,228 2021 191 13,732 Other 1 (4) (9) (7) Premiums and deposits $ 2,758 $ 3,308 $ 10,370 $ 13,916 Individual Retirement (
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