AIG's general insurance business has reported $458m of estimated Covid-19 losses for the second quarter. However, the impacts from the pandemic will be manageable, according to the insurer.
“We are effectively navigating the current complex environment due to the strong foundation we built over the last three years. While unprecedented and ongoing, Covid-19 remains and earnings, not a capital, event for AIG,” said AIG CEO Brian Duperreault.
“In general insurance, the underlying underwriting profitability improvement was driven by our focus on portfolio remediation and expense discipline. Life and retirement benefited from its diversification and agility and continues to meet client needs despite an uncertain economic environment.”
Meanwhile, Lloyd’s underwriter Hiscox has reserved $232 million net for claims arising from Covid-19 in the first half of 2020 and delivered a pre-tax loss of $138.9 million for the period according to a recent announcement.
Hiscox Chairman Robert Childs commented: “The magnitude of what many in the industry suggest may be the largest insured loss in history is gradually becoming apparent, and as a result we expect a continued contraction of risk appetites along the entire (re)insurance chain.”
However, despite these challenging conditions, Hiscox Retail is said to have delivered a strong underlying performance with the segment contributing more than $100 million in profits. And, in spite of the pandemic, AIG also increased its financial flexibility ending the second quarter with over $10 billion in liquidity.