American International Group (AIG) 2024 KBW Insurance Conference summary

Strategic repositioning and operational transformation

• Completed significant portfolio repositioning, revamped underwriting standards, and reset risk appetite over multiple years, enhancing operational capabilities.

• Achieved financial deconsolidation of Corebridge and executed major divestitures, including sales to Blackstone and Nippon Life, and the sale of the global personal travel business.

• Launched AIG Next to drive $500 million in expense reductions and unify operations as a cohesive General Insurance organization, with efficiency gains expected by 2025.

Capital management and financial performance

• Strengthened the balance sheet, reducing debt to total capital leverage from nearly 30% to 18% post-Corebridge, and maintaining strong liquidity.

• On track for a $10 billion share repurchase plan for 2024-2025, with a target share count of 550-600 million.

• Increased shareholder dividends by over 10% for two consecutive years, with plans for more sustainable repurchase levels after current authorization.

• Well positioned to achieve a 10% ROE target, with excess capital expected to be balanced through ongoing management and growth.

Underwriting, reinsurance, and risk management

• Maintains a comprehensive reinsurance program, shifting focus to growth while preserving underwriting discipline.

• Catastrophe ratio reduced from 16% in 2017 to 4.7% in 2023 and 3.8% in the first half of 2024, with $1.1 billion as a proxy for 2024 catastrophe losses.

• Reinsurance strategy evolved with portfolio quality, emphasizing volatility containment and predictability, supported by strong reinsurer relationships.

• Property portfolio combined ratio improved from over 130 to low 80s, reflecting enhanced profitability and risk-adjusted capital deployment.