AMERICAN INTERNATIONAL GROUP Q1 FY26 earnings call AIG

General Insurance net premiums written rose 18% YoY on a constant-dollar basis, with Global Commercial +21% and Global Personal +11%. North America Commercial NPW jumped 36%, largely driven by reinsurance changes and the Everest renewals in the retail business, alongside continued double-digit growth in retail casualty. International Commercial NPW rose 12%, with the majority of growth from the Convex whole-account quota share, Everest renewals and reinsurance changes. Global Commercial new business was $1.6B including Everest renewals, up 42% YoY, while global commercial retention held at 88% (North America 88%, International 89%).

AIG secured enhanced terms, conditions and favorable pricing at the January 1 renewal, negotiating substantial year-over-year savings that — combined with the Everest portfolio — provided a meaningful tailwind to net premiums written. Management stressed the savings came on same attachment points and comparable modeling (i.e. no additional net risk taken), with property-cat placements carrying lower modeled attachment points and higher exhaust limits per geography on a risk-adjusted basis. AIG's strategy of maintaining a consistently low net catastrophe retention through the cycle lets it benefit from more attractive reinsurance pricing, showing up directly in higher net premiums written.

AIG framed its $6.5B gross-written property portfolio across multiple entry points. International property (~40% of the book) ran a calendar-year combined ratio in the low 70s across 2024-2025 with pricing down only 4% in the quarter — just the second quarter of rate reductions in five years. U.S. retail property posted combined ratios in the 70s, and the Lexington middle-market E&S book remains one of the fastest-growing, best-performing segments. The exception is the Lexington large-account shared-and-layered E&S business (<10% of global property), under significant pricing pressure with North America property pricing down 11%; AIG cut new business 19% and will keep contracting it, redeploying capacity elsewhere.

Global Personal Insurance delivered an 11% NPW increase and a dramatic profitability step-up: the accident-year combined ratio as adjusted improved 570 bps to 89.9% and the calendar-year combined ratio improved over 18 points to 89.4% from 107.9% a year earlier, aided by a 410 bps expense-ratio reduction. Management attributed the gains to a deliberate multi-year repositioning — restructuring related reinsurance treaties plus organic growth — that continues to earn in, keeping the segment ahead of its 94%-by-2027 target.

AIG detailed a deepening AI program built around underwriting and claims. Its 2025-launched 'underwriting by AIG Assist' is now deployed across 8 lines of business; in Lexington middle-market property it delivered a 30% improvement in quoting more submissions, cut time-to-quote by 55% and lifted binding by ~40%. Partnering with Palantir (Foundry ontology) and Anthropic, AIG is building a multi-agentic solution with an orchestration layer coordinating purpose-built agents for submission ingestion, risk evaluation and pricing benchmarking, with human oversight retained. Management noted agent autonomy has extended from under an hour (Claude 2.0) to as long as 30 hours, and cited an Anthropic beta in which Claude's fraudulent/legitimate determinations matched a professional adjuster on 88% of 100 claims out-of-the-box.

General Insurance net investment income rose 17% to $864M, with core fixed-income NII up nearly 20% as AIG reinvested at new-money yields ~80 bps above sales and maturities (annualized core yield 4.61%, +51 bps YoY). This was partly offset by alternative income of just $6M (vs $43M) on 1.6% PE returns. AIG slowed private-credit deployment: it defines private credit broadly (CML, IG private placements, asset-backed finance, direct lending), with direct-lending exposure of ~$1.2B (<1.5% of the GI portfolio, avg loan ~$6M, all held on balance sheet not via BDCs) and software exposure of ~$130M (16 bps). Book value per share was $75.82 (+6%), adjusted tangible book $70.85 (+4%), and total-debt-to-total-adjusted-capital 17.7%.

Eric Andersen, who joined in February after three decades as one of AIG's largest trading partners, becomes CEO on June 1 and reaffirmed the 2025 Investor Day strategy and financial guidance, signaling continuity and hard execution rather than a pivot. Management also addressed the ongoing Middle East conflict, noting a significant colleague presence in the region shifted to remote operations; rising demand for property/energy, trade-credit and political-risk insurance; and that the direct impact on AIG is not material to date while it monitors accumulation risk and stress-tests the investment portfolio.