AIG exceeded market estimates for quarterly profit on Thursday as its general insurance business faced fewer natural catastrophe and COVID-19 pandemic-related claims.
The U.S. insurer posted an underwriting income of $20 million in its general insurance business in the third quarter, compared with a $423 million loss a year earlier.
The business recorded catastrophe losses of $628 million, mainly from Hurricane Ida and floods in the United Kingdom and Europe. That compared with $790 million a year ago, which included $185 million of estimated COVID-19 losses.
Global insurers last year faced a sharp rise in payouts related to the health crisis, but a wider availability of COVID-19 vaccines has eased the pressure.
Adjusted after-tax income attributable to AIG’s common shareholders rose to $837 million in the quarter to Sept. 30, from $708 million a year earlier.
AIG earned 97 cents per share on an adjusted basis, beating analysts’ estimates of 88 cents, according to Refinitiv.
The company’s general insurance accident year combined ratio - which excludes catastrophe losses - was 90.5 for the quarter, compared with 93.3 a year earlier.
A ratio below 100 means the insurer earns more in premiums than it pays out in claims.
Gross premiums written rose 13% to $8.3 billion in the general insurance business.
AIG’s life and retirement unit posted a 13% fall in adjusted pre-tax income to $877 million.
The company said the planned initial public offering of the unit, in which Blackstone Group (BX.N) has bought a sizeable stake, was on track for 2022.