Global insurer American International Group (AIG) reported that its general insurance (GI) underwriting revenue rose 48% year-over-year to $670 million in the fourth quarter of 2025, up from $454 million in the same period in 2024.
The increase was driven by a decrease in catastrophe-related expenses of $125 million, or 2.1 loss ratio points, compared to $325 million, or 5.5 loss ratio points, in the year-ago period, more favorable developments in the prior year, and lower acquisition expenses.
GI gross premiums written (GPW) remained relatively flat, rising just 1% in the quarter to $8.1 billion. Meanwhile, net premiums written (NPW) for the quarter were $6 billion, down 1% year over year on a reported basis.
GI’s adjusted pretax income increased 26% from the year-earlier period to $1.6 billion, driven by increases in underwriting revenue and net investment income.
GI’s combined ratio was 88.8% in Q4’25 compared to 92.5% in the same period last year, driven primarily by the Global Commercial segment.
AIG explained that PYD for the quarter, excluding reinsurance and prior-year premiums, was $116 million, compared with $82 million in the same period last year, mainly due to good development in the North American commercial business, driven by U.S. financial insurance, property and casualty insurance, and Canadian casualty insurance.
AIG’s total net investment income was $872 million in 4Q25, down 34% from $1.3 billion in the same period last year due to lower gains on changes in fair value and gains on the sale of Corebridge stock, as well as lower alternative investment income, partially offset by higher income from fixed maturity securities.
Group net income fell to $735 million in the quarter, compared to $898 million in the same period last year, primarily due to changes in unrealized losses related to AIG’s ownership interest in Corebridge and the gain from the divestment of the global personal travel business in the prior year, partially offset by higher underwriting income, net investment income and tax benefits from the one-time release of deferred income tax valuation allowance mentioned above.
Finally, adjusted after-tax income in Q4’25 was $1.1 billion, compared to $817 million in the prior-year period, again driven by increases in underwriting revenue and GI net investment income.
Looking at full-year 2025 results, GI underwriting revenue increased 22% to $2.3 billion, compared with $1.9 billion in 2024. Gross insured amounts were relatively flat at $35.8 billion, while net insured amounts fell 1% to $23.7 billion.
Catastrophe-related expenses fell, with the loss ratio falling 3.9 points compared with 5.0 points in 2024.
In FY25, the GI combined ratio was 90.1% compared to 91.8% in the previous year, primarily driven by North American commerce.
Total net investment income in 2025 was $4.2 billion, down 1% from $4.3 billion in 2024 due to lower investments in other investments, including the previously mentioned gain on changes in fair value and lower gains on the sale of Corebridge stock and dividends, partially offset by higher income from fixed-maturity securities.
The group’s net profit in 2025 will be US$3.1 billion, while the net loss in 2024 will be US$1.4 billion. The increase was primarily due to the absence of losses from the Corebridge demerger in June 2024, as well as higher GI underwriting income and net investment income, partially offset by realized net losses (excluding Fortitude Re fund withholding assets), primarily due to impairments on real estate investments
Finally, adjusted after-tax income in 2025 was $4.0 billion, compared with $3.3 billion last year, reflecting increases in GI underwriting revenue and net investment income.
Peter Zaffino, Chairman and Chief Executive Officer of AIG, commented: “2025 was an extraordinary year for AIG. We made tremendous progress on our strategy, delivered outstanding financial results, and achieved important milestones that position AIG for a bright future. Full-year adjusted after-tax earnings per diluted share increased 43% to $7.09. Core operating ROE was 11.1%, up from 10% in our 2025 the above goals.
“This performance was driven by AIG’s continued strong underwriting performance and operational excellence, effective expense discipline and strategic capital deployment. Underwriting revenue of $2.3 billion increased 22% and our trailing combined ratio reached 90.1%. We delivered on our disciplined capital management strategy in 2025, supported by our strengthened balance sheet and strong liquidity. For the full year, we returned $6.8 billion of capital to shareholders, including $5.8 billion of stock repurchases and our distribution of 10 billion in dividends and a debt to total capital ratio of 18.0%.”
He continued: “In the past two months, we have announced a number of strategic partnerships that we expect will contribute to AIG’s earnings, EPS and ROE in 2026. These include forming Syndicate 2479 with Blackstone and Amwins, investing in CVC’s new private equity secondary marketplace Evergreen platform, and completing the acquisition of minority stakes in Convex Group and Onex Corporation. We at Everest Excellent progress has also been made on the transformation of the global retail portfolio. These innovative, capital efficient transactions will enable us to grow, achieve profitability and improve return on equity without adding complexity to our organization.
“We enter 2026 with strong momentum, with a January 1 reinsurance renewal event that resulted in more favorable terms and favorable pricing, reflecting the quality of our portfolio. We are off to a strong start with our Investor Day guidance and are on track to meet and exceed our financial targets. Thanks to the hard work and commitment of our talented colleagues, AIG is on track to have another extraordinary year.”