Net income down at AIG for first quarter after higher catastrophe losses

American International Group has reported net income of $1.6 billion for the first quarter of the year, down from $2.2 billion in the first three months of 2013.

After-tax operating income attributable to AIG was $1.8 billion for the first quarter of 2014, compared to $2.0 billion for the prior-year quarter. Insurance pre-tax operating income for the three months ended March 31 totaled $2.7 billion. All figures are in U.S. currency.

Net premiums written for AIG’s property and casualty business were $8.33 billion for Q1, compared with $8.44 billion in the first quarter of 2013. Net premiums earned were $8.23 billion for the first quarter of 2014, down from $8.56 billion in 2013.

The company also reported an underwriting loss for P&C of $97 million for Q1, compared with underwriting income of $232 million in the first quarter last year.

Pre-tax operating income for the P&C business decreased to $1.2 billion “due to higher catastrophe and severe losses, unfavorable loss reserve development, and a decrease in net investment income,” according to AIG.

Catastrophe losses were $262 million, up significantly from $41 million in the first quarter of 2013.

The Q1 combined ratio for P&C was 101.2%, a 3.9 point increase from the prior year quarter.

Underwriting income for commercial insurance underwriting was $113 million for Q1, down from $396 million in Q1 of 2013. The combined ratio for commercial insurance underwriting in the first quarter was 97.7%, compared with 92.2% in Q1 last year.

Consumer insurance underwriting saw a $59 million loss, compared with a $55 million underwriting income in Q1 2013. The combined ratio for that business was 101.9% for the first quarter, versus 98.4% in 2013.

AIG’s life and retirement business had a quarterly pre-tax operating income of nearly $1.42 billion in Q1, up from $1.39 billion in the first quarter of 2013.