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(Reuters) – American International Group Inc. reported a net loss of $1.26 billion for the third quarter ended Sept. 30.
This compares with a loss of $1.74 billion in the year earlier quarter, which was hit by hurricanes in the US and Caribbean.
AIG recorded net pre-tax catastrophe losses of $1.6 billion in the 2018 quarter that were largely in line with its forecast.
The losses were mainly related to typhoons in Japan as well as Hurricane Florence. AIG’s revised estimates for California mudslides also contributed to the losses.
Insured losses from Hurricane Florence will range from $2.8 billion to $5 billion, said RMS, a risk modeling and analytics firm, in September.
AIG CEO Brian Duperreault, who took charge in May 2017, has vowed to turn the company around and post an underwriting profit as soon as year-end.
But some analysts are not convinced his plan is working. "The third-quarter results do not suggest progress in and of themselves," Sandler O'Neill analyst Paul Newsome said in an interview.
AIG has not made much progress in improving underwriting profit in its commercial property/casualty insurance business, even without the catastrophe losses, he said. But there are some signs that AIG's loss ratio is improving, he said.
AIG estimated it has exhausted about $700 million of the $750 million retention under its North America aggregate catastrophe reinsurance program following the mudslides, Hurricane Florence and loss estimate from Hurricane Michael, which crashed into Florida earlier this month.
The adjusted pre-tax loss from the general insurance business narrowed 72% to $825 million, while the underwriting loss narrowed to $1.73 billion from $3.8 billion a year ago.
Adjusted pre-tax income from the life and retirement business fell 38% to $713 million in the quarter.
The insurer's combined ratio improved to 124.4% from 157.1%.
Its loss ratio fell to 88.6% from 124.1%, when it recorded pre-tax catastrophe losses of $3 billion related to hurricanes Harvey, Irma and Maria.