NEW YORK--(BUSINESS WIRE)--Apr. 19, 2017--
American International Group, Inc. (NYSE:AIG) today announced two items
impacting results for the quarter ending March 31, 2017.
In the first quarter of 2017, AIG expects to record an increase to prior
year loss reserves of approximately $100 million pre-tax from the recent
decision by the UK Ministry of Justice to reduce the discount rate
applied to lump-sum bodily injury payouts, known as the Ogden rate, to
-0.75%. Our carried reserves as at December 31, 2016 were estimated
using an assumption that the Ogden rate would decline to 1.0%. This
discount rate change primarily impacts the Liability & Financial Lines
business within Commercial Insurance in the United Kingdom.
Secondly, AIG will recognize an estimated nominal pre-tax deferred gain
of $2.6 billion in connection with the adverse development cover entered
into with Berkshire Hathaway as previously disclosed. Beginning in the
first quarter of 2017, AIG will begin amortizing the deferred gain over
the expected reinsurance recovery period. The amortization of such
amount will be included in pre-tax operating income for the Liability
and Financial lines business each quarter. First quarter 2017 results
will reflect a partial quarter of amortization of approximately $40
million pre-tax based on the closing date of the contract of February 3,
2017.
American International Group, Inc. (AIG) is a leading global insurance
organization. Founded in 1919, today AIG member companies provide a wide
range of property casualty insurance, life insurance, retirement
products, and other financial services to customers in more than 80
countries and jurisdictions. These diverse offerings include products
and services that help businesses and individuals protect their assets,
manage risks and provide for retirement security. AIG’s core businesses
include Commercial Insurance and Consumer Insurance, as well as Other
Operations. Commercial Insurance comprises two modules – Liability and
Financial Lines, and Property and Special Risks. Consumer Insurance
comprises four modules – Individual Retirement, Group Retirement, Life
Insurance and Personal Insurance. AIG common stock is listed on the New
York Stock Exchange and the Tokyo Stock Exchange.
Additional information about AIG can be found at www.aig.com
and www.aig.com/strategyupdate
| YouTube: www.youtube.com/aig
| Twitter: @AIGinsurance | LinkedIn: http://www.linkedin.com/company/aig.
These references with additional information about AIG have been
provided as a convenience, and the information contained on such
websites is not incorporated by reference into this press release.
AIG is the marketing name for the worldwide property-casualty, life and
retirement, and general insurance operations of American International
Group, Inc. For additional information, please visit our website at www.aig.com.
All products and services are written or provided by subsidiaries or
affiliates of American International Group, Inc. Products or services
may not be available in all countries, and coverage is subject to actual
policy language. Non-insurance products and services may be provided by
independent third parties. Certain property-casualty coverages may be
provided by a surplus lines insurer. Surplus lines insurers do not
generally participate in state guaranty funds, and insureds are
therefore not protected by such funds.
View source version on businesswire.com: http://www.businesswire.com/news/home/20170419006560/en/
Source: American International Group, Inc.
AIG
Investors
Liz Werner, 212-770-7074
elizabeth.werner@aig.com
or
Fernando
Melon, 212-770-4630
fernando.melon@aig.com
or
Media
Jennifer
Hendricks Sullivan, 212-770-3141
jennifer.sullivan@aig.com