AIG Shifts Focus to Better-Priced Businesses Amid Softening Property Prices
American International Group (AIG) is adjusting its underwriting strategy in response to softening property prices. AIG's Lexington property business has seen a decline of 9 percentage points in premium retention as the company reduces targeted exposures and walks away from business that doesn't meet its underwriting standards.
This approach, combined with softer pricing, has reduced growth in North America by more than 3 percentage points. However, AIG's General Insurance segment saw a 9% increase in net premiums written year-over-year, or 11% excluding North America Property, indicating stronger momentum across better-priced businesses.
AIG's underwriting performance remains solid, with General Insurance underwriting income rising 10% to $686 million and the adjusted accident-year combined ratio improving by 30 basis points to 88.1%. Meanwhile, peers such as The Travelers Companies (TRV) and Chubb Limited (CB) are also emphasizing underwriting discipline in response to softening property prices.