Feb. 14 (Bloomberg) — American International Group Inc. suffered another year of impairments in its portfolio of death- benefit bets as insured people lived longer than the company expected.
AIG recorded an $832 million impairment on its life- settlement holdings in the fourth quarter, bringing the total for 2013 to $971 million before taxes. In life settlements, AIG buys insurance policies from individuals and pays premiums until they die, when the company collects the payout. The arrangement becomes less profitable for AIG the longer the person survives.
The charge on the death bets "was prompted by the continued underperformance relative to our mortality assumptions," Chief Financial Officer David Herzog said on a conference call with analysts today. "We revised our future mortality assumptions."
Continue Reading for Free
Register and gain access to:
- Breaking benefits news and analysis, on-site and via our newsletters and custom alerts
- Educational webcasts, white papers, and ebooks from industry thought leaders
- Critical converage of the property casualty insurance and financial advisory markets on our other ALM sites, PropertyCasualty360 and ThinkAdvisor
Already have an account? Sign In Now
© 2024 ALM Global, LLC, All Rights Reserved. Request academic re-use from www.copyright.com. All other uses, submit a request to [email protected]. For more information visit Asset & Logo Licensing.
