AIG reports slight drop in Q3 P&C net premiums earned

American International Group Inc., which offers property and casualty insurance under the Chartis brand, has reported a profitable third-quarter, while Q3 property casualty operating income is up year-over- year due to lower catastrophe losses.

New York City-based AIG released financial results Nov. 1 for the period ending Sept. 30, noting its head office remains without power after post-tropical storm Sandy and on Nov. 11 its core insurance products will assume the AIG brand.

In P&C operations, net premiums written for the three months ending Sept. 30 were $8.7 billion, up 0.6% from $8.65 billion during the same period in 2011. All figures are in U.S. currency

Net premiums earned for the third quarter was $8.75 billion in 2012, down 3.2% from $9.04 billion in 2011. In Q3 AIG recorded net income of $1.86 billion, compared to a loss of $3.99 billion during the same period of 2011.

For the first nine months of 2012, AIG reported net income of  $7.396 billion, compared to a loss of $ 1.67 billion during the first nine months of 2011.

“AIG Property Casualty reported operating income of $786 million in the third quarter of 2012, compared to $492 million in the third quarter of 2011, reflecting lower catastrophe losses, higher net investment income due to positive marks on recently acquired structured securities, and underwriting improvements,” the firm stated in a press release. “AIG Property Casualty continued optimizing its mix of business through focused risk selection, while benefiting from improving pricing trends.”

In commercial insurance, AIG said its operating income was $321 million in the third quarter, down from $405 million in the third quarter of 2011.

“The accident year loss ratio, as adjusted, improved to 71.7 from 74.2 in the third quarter of 2011 due to the shift to higher value business and price increases,” AIG stated.

“On November 11, our core insurance segments will assume the AIG brand, marking not just an extraordinary comeback, but also the enduring support and confidence of so many of our clients and distribution partners over the last several years,” president and CEO Robert Benmosche stated in the press release. “During the quarter, we achieved the important milestone of making America whole on the $182 billion support provided to AIG during the crisis, plus a combined positive return to the American taxpayers of more than $15 billion to date. Underscoring our financial strength and liquidity, AIG has repurchased approximately $13 billion of common stock year-to-date.”

The share repurchase, announced Sept. 11, was expected to reduce the U.S. government’s ownership stake in AIG from 53.4% to $15.3%.