Investor Presentaiton
General Insurance: Higher North America Commercial Lines CYCR from CATS; On an AY, as
adjusted, basis North America Commercial Lines improved; Personal Insurance results reflect
the formation of Lloyd's Syndicate 2019 and COVID-19 impact on Travel business
($M)
2Q19
Net premiums written
$3,307
2Q20
$2,347
Commercial Lines
2,364
Personal Insurance
943
2,497
(150)
Net premiums earned
$3,302
$2,653
Commercial Lines
2,457
2,263
Personal Insurance
845
390
($5)
(36)
31
$723
($419)
(385)
(34)
$424
Adjusted pre-tax income
$718
$5
Exclude: Impact of CATS
($170)
($519)
Adjusted pre-tax income (ex. CATS)
$888
$524
Underwriting loss
Commercial Lines
Personal Insurance
Net investment income
Key Takeaways:
North America Commercial Lines and Personal Insurance Underwriting Results
■ Net premiums written decreased by 29% to $2.3B; Personal Insurance decreased by $1.1B
primarily as a result of $725M of ceded premium for new quota share reinsurance
agreements and our newly formed Syndicate 2019, and lower Travel premium due to the
impact of COVID-19. Commercial Lines NPW grew 6% driven by improved rate and retention
in our core lines including Retail Property, Lexington and AIG Re
■ NA Commercial Lines CYCR increased 15.5 pts; on an AY, as adjusted, basis improved 3.2
pts driven by improved mix of business, significant rate increases, benefits from underwriting
actions in 2019 and improvement in the expense ratio due to changes in the business mix
■ NA Personal Insurance CYCR increased 12.3 pts; on an AY, as adjusted, basis increased
14.7 pts driven by the impact of lower net premiums earned on the GOE ratio. In addition, the
AYLR was higher due to the shift in business mix, offset in part by a lower acquisition ratio
North America APTI
■ CATS of $519M includes an estimated $364M related to COVID-19, $81M related to civil
unrest, and $74M related to natural CATS
■ NII decreased reflecting private equity losses, which are generally reported on a one quarter
lag, and lower returns on fixed income securities
North America Combined Ratios
Total
Commercial Lines
Personal Insurance
115.7%
100.1%
101.5%
117.0%
108.7%
96.4%
2.6%
5.0%
19.6%
5.4%
22.6%
3.9%
(1.7%)
(1.2%)
(3.1%)
1.3%
(1.6%)
2.4%
104.8%
96.8%
97.3%
99.2%
AYCR, as
96.0%
90.1%
10.6%
12.1%
11.3%
16.4%
adjusted,
11.4%
8.8%
20.3%
15.7%
15.4%
improved
13.8%
26.7%
3.2 pts
34.6%
AYLR, as
65.9%
69.5%
72.5%
adjusted,
70.8%
61.7%
improved
46.7%
1.7 pts
2Q19
AIG
2Q20
2Q19
2Q20
PYD Ratio ☐ AYCR, As adjusted
Calendar Year Combined Ratio CAT Ratio
AYLR, As adjusted
Note: Calendar year combined ratios refers to a GAAP measure; the corresponding accident year, as adjusted, ratios refers to financial measure not calculated in accordance
with GAAP; definitions and abbreviations of Non-GAAP measures and reconciliations to their closest GAAP measures can be found in this presentation under the heading
Glossary of Non-GAAP Financial Measures and Non-GAAP Reconciliations.
GOE Ratio
2Q19
Acquisition Ratio
2Q20
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