01—Abstract
Summary
Summary of the 8-K filed February 11, 2025. Cited figures are marked; the original filing is the authoritative source.
AIG reported fourth quarter and full year 2024 results on February 11, 2025, with the headline story being a sharp swing to a full-year GAAP net loss of $1.4 billiona (-$2.17 per diluted share) versus $3.6 billion of net income in 2023.
The decline is driven by accounting from the deconsolidation of Corebridge Financial, which moved AIG's historical Corebridge results into discontinued operations and changed how its retained stake is measured. Management is steering investors toward adjusted after-tax income (AATI), which rose 12% to $4.95b per diluted share for the year (28% on a comparable basis), and to Q4 AATI of $1.30 per diluted share, up 2%. Underlying operations were solid.
General Insurance net premiums written were $23.9 billionc for the year, down 11% as reported due to divestitures but up 6% on a comparable basis, with Global Commercial growing 7%. The full-year combined ratio was 91.8% and the accident-year combined ratio, as adjusted, was 88.2%, both still good for a property-and-casualty insurer. Fourth-quarter results were weighed down by catastrophe losses from Hurricane Milton and Hurricane Helene, and AIG estimated its net loss from the California wildfires at about $500 million before reinstatement premiums.
Capital management was active: AIG returned $8.1 billiond to shareholders in 2024, including $6.6 billion of buybacks, reduced debt by $1.6 billion, and ended the year with a 17.0% debt-to-total-capital ratio and $7.7 billion of parent liquidity. Looking ahead, management said it is well on track to deliver a core operating return on equity of 10% or more for 2025 and noted that the new Lloyd's reinsurance Syndicate 2478, launched with Blackstone, began underwriting January 1, 2025.
The board declared a quarterly dividend of $0.40 per share, payable March 31, 2025 to holders of record on March 17, 2025. Investors should weigh the strong operating momentum against the sizable catastrophe exposure and the continuing volatility in reported GAAP earnings tied to the remaining Corebridge stake.
02—Key points
Key Highlights
- Full-year 2024 GAAP net loss attributable to common shareholders of $1.4 billion (-$2.17 per diluted share), compared with net income of $3.6 billion ($4.98 per share) in 2023, mainly due to the Corebridge deconsolidation accounting change.
- Adjusted after-tax income per diluted share rose 12% to $4.95 for 2024 (28% on a comparable basis); Q4 AATI was $1.30 per share, up 2% year over year.
- General Insurance NPW of $23.9 billion for 2024, down 11% reported but up 6% comparable, with Global Commercial NPW growing 7% on a comparable basis and new business reaching a record $4.5 billion.
- Full-year combined ratio of 91.8% (below 92% for a third consecutive year) and accident-year combined ratio, as adjusted, of 88.2%, reflecting strong underlying underwriting profitability despite elevated catastrophe losses.
- Q4 2024 catastrophe charges of $325 million (5.5 loss ratio points) from Hurricane Milton and Hurricane Helene; AIG estimates its net loss from the California wildfires at approximately $500 million before reinstatement premiums.
- Capital returns of $8.1 billion in 2024 (including $6.6 billion of buybacks and $1.0 billion of dividends), $1.6 billion of debt reduction, debt-to-total-capital of 17.0%, and parent liquidity of $7.7 billion.
- Quarterly dividend of $0.40 per share declared, payable March 31, 2025 to holders of record as of March 17, 2025; management targets 10%+ core operating ROE for 2025.
03—Questions
Frequently Asked Questions
Why did AIG report a net loss for 2024 when adjusted earnings grew?
The GAAP net loss of $1.4 billion reflects the accounting impact of deconsolidating Corebridge Financial. Corebridge's historical results are now reported as discontinued operations, and AIG's remaining stake is marked to Corebridge's stock price. Adjusted after-tax income excludes these items, which is why AATI per share rose 12% to $4.95.
How did the California wildfires affect AIG's results?
AIG estimated the net loss from the California wildfires at approximately $500 million before reinstatement premiums. The loss contributed to the higher Q4 catastrophe charges, which were $325 million in total, including Hurricane Milton and Hurricane Helene adjustments. Management said it is too early to determine the full impact.
Is AIG's underlying insurance business still profitable?
Yes. The full-year General Insurance combined ratio was 91.8%, and the accident-year combined ratio, as adjusted, was 88.2%, indicating underwriting profitability before catastrophes and reserve development. Underwriting income was nearly $2 billion for the year, although Q4 underwriting income fell 29% due to catastrophe losses.
Why did reported premiums decline in 2024?
General Insurance NPW fell 11% on a reported basis to $23.9 billion, mainly because of divestitures, including Validus Re and Crop Risk Services in 2023 and the travel business in 2024. On a comparable basis, premiums grew 6%, led by 7% growth in Global Commercial.
What is AIG's outlook and dividend policy?
Management said it is well on track to deliver a 10%+ core operating return on equity for 2025, citing disciplined capital management and underwriting. The board declared a $0.40 quarterly dividend payable March 31, 2025 to shareholders of record on March 17, 2025.
04—Continue