American International Group reported a US$1.1 billion net profit for the second quarter of 2025, marking a significant recovery from a US$4 billion loss in the same period last year.
The result was driven by a strong performance in the insurer’s core general insurance business and higher investment income.
For Q2, adjusted after-tax income rose to US$1 billion, or US$1.81 per diluted share, up 56% year-on-year. General insurance led the earnings improvement, delivering US$626 million in underwriting income, a 46% jump from Q2 2024. The segment’s combined ratio improved to 89.3%, with the accident year combined ratio, excluding catastrophes, at 88.4%, reflecting improved pricing discipline and portfolio mix.
Net premiums written across the group came in at US$6.9 billion, down 1% on a reported basis, but up 1% when adjusted for changes in foreign exchange and other comparability factors. Global commercial lines contributed US$5.2 billion, up 3% from the prior-year quarter, with North America commercial premiums rising 4%.
AIG also reported US$1.5 billion in net investment income for the quarter, an increase of 48% from the same period in 2024. On an adjusted basis, investment income reached US$955 million, up 9% year-on-year.
CEO Peter Zaffino said the group had “tremendous momentum” heading into the second half of the year, citing operational progress and cost savings of more than US$500 million delivered through AIG’s transformation program.
“General insurance delivered excellent underwriting profitability,” Zaffino said, adding that catastrophe losses were kept in check at US$170 million, equivalent to 2.9 points on the loss ratio.
In line with its capital management strategy, AIG returned US$2 billion to shareholders during the quarter, including US$1.8 billion in share repurchases. The group reported a core operating return on equity of 11.7% and ended the quarter with US$4.8 billion in parent liquidity. Rating upgrades from both Moody’s and S&P during the quarter affirmed AIG’s improved financial footing.
The insurer said it remains confident in its ability to meet long-term financial targets, supported by underwriting momentum, investment stability and continued execution of its restructuring efforts.
