Analyzing AIG’s Life and Personal Insurance Business

Under AIG’s Life Insurance business, premiums and deposits rose in 2Q17 compared to 2Q16. Premium and deposits under the Life Insurance business stood at $947 million in 2Q17 and $879 million in 2Q16. In 2Q17, policy fees under the Life Insurance business stood at $357 million compared to $343 million in 2Q16.

During the same period, the Life Insurance business saw a substantial rise in its pretax operating income compared to 2Q16. In 2Q17, under the Life Insurance business, AIG’s pretax operating income stood at $106 million, and in 2Q16 it stood at $26 million.

Under personal insurance, pretax operating income saw a substantial rise in 2Q17 compared to 2Q16, which is mainly due to a reduction in expenses, fewer loss activities, and a rise in net investment income. AIG’s pretax operating income for personal insurance stood at $330 million in 2Q17. In 2Q16, it stood at $152 million.

AIG’s management has a positive outlook on the personal insurance business regarding future growth.

American International Group’s (AIG) operating cash flow on a trailing-12-month (or TTM) basis stood at ~-$7.5 billion. The operating cash flow levels of other insurance companies (IYF) on a TTM basis are as follows:

• Chubb Ltd. (CB): ~$4.8 billion
• Allstate (ALL): ~$4.0 billion
• MetLife (MET): ~$14.1 billion