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AIG CEO Anderson highlights capacity shift, pricing pressure in property
Anderson said AIG intentionally shrank its property portfolio at its surplus lines insurer Lexington in targeted North America areas, cutting premium retention there by 9 points in Q2.
Eric Anderson, the new CEO of American International Group (AIG), used his first earnings call to outline how he views current conditions in insurance, pointing to an influx of capacity in some parts of the market and the role of delegated underwriting authority structures, along with other sources of supply, according to Insurance Journal.
Anderson said the added entrants have increased competition and pressured pricing, particularly for property, but that the change also creates opportunities because clients are becoming more discerning about the origin of capacity, distinguishing between pass-through providers and those offering underwriting, client service, and responsive claims handling.
In property, Anderson cited AIG’s diverse global portfolio as an advantage, and said that in North America, where competition in excess and surplus lines is dropping rates, AIG decided to shrink its property portfolio at Lexington in targeted areas. He said this approach led to a 9-point reduction in premium retention at Lexington during Q2.
He also described a five-point plan for growth that includes capital deployment toward higher returns, more efficient use of reinsurance, expanding artificial intelligence capabilities, maintaining expenses, and investing in talent. On AI, Anderson said AIG Assist helps scale underwriting and claims by reviewing more submissions and generating quotes faster, and that insights can be applied to broker-level performance to identify distribution trends.