AIG UK, a division of American International Group Limited (AIG), has reported a pre-tax profit of £186.4 million in 2019, its first full operational year.
In 2018, AIG restructured AIG Europe Limited (AEL) and established two legal entities, AIG UK and AIG Europe SA, in response to the UK’s Brexit vote and exit from the European Union (EU).
In its first full operational year, AIG UK reported a strong performance, with an underwriting result of £44.9 million, which benefited from low catastrophe losses, positive premium rate change, and underwriting and business mix action. The company notes that investment income further improved the pre-tax profit.
In total, net premiums written reached £1.13 billion, while the net loss ratio totalled 67%. Net operating expenses amounted to £364 million, and overall, AIG UK ended 2019 with a combined ratio of 96.4%.
As at November 30th, 2019, the total equity of AIG UK was approximately £1.8 billion, and, following the approval of the firm’s Internal Model during 2019, its Own Funds were 138.3% of its Solvency Capital Requirement.
Andrew Baldwin, Chief Executive Officer (CEO) of AIG UK, commented: “During 2019 we made significant progress on the execution of our strategy to position AIG for sustainable profitable growth and delivered on our commitment to achieve a full year of underwriting profit.
“These results reflect critical foundational work to improve underwriting fundamentals, reposition our portfolio and aggressively decrease limits, while meaningfully reducing volatility through a comprehensive reinsurance strategy. We also instilled discipline and focus on expense management.
“Strong performance from our high growth lines as well as improvements in the underlying quality and profitability across all our lines of business demonstrated the significant work done to optimise our portfolio.”