AIG ( AIG ) provides life insurance in the U.S. and also has property & casualty operations in some of the larger markets around the world. In our analysis of the company, the life and retirement division is further divided into two sub-parts based on the two key revenue streams- investment income, and premiums and fees. Total revenues from the life insurance and retirement division were $20 billion for the nine months ending September 2016, accounting for more than 50% of the total company revenues.

AIG holds about 2.2% of the life insurance market in the U.S. in terms of premiums earned. Within this division, AIG offers individual fixed and variable annuities and group retirement-benefit products. AIG is the second largest player in the U.S. annuities market and the third largest player in the variable annuities business in the U.S.

2016 Review

In the first three -quarters of 2016, Life and Retirement division’s revenues declined by 4% to $20 billion but pre-tax operating income increased by 25% owing to improved underwriting in the Personal Insurance business. This was aided by lower direct marketing expenses, lower employee-related expenses arising from organizational realignment activities and lower strategic investment expenditures.
The Personal Insurance accident year combined ratio improved from 100% in the first three quarters of 2015 to 95.3% in the same period last year, owing to lower general operating expenses leading to a lower expense ratio, which declined from 45.9% in the first three quarters of 2015 to 40.4% in the same period last year.

Please refer to our complete analysis for AIG

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