What changed in this filing

/stocks — the workspaceLOADING

Item 5. Other Information

2024-08-01 compared with 2024-05-02 · 1902 added, 1902 removed, 2098 unchanged (64% of the section changed)

This section is long enough that the comparison stopped early. What follows is partial, and the remainder is not necessarily unchanged.

Other Information

AIG | First Quarter 2024 Form 10-Q

AIG | Second Quarter 2024 Form 10-Q

Part I – Financial Information

2 unchanged sentences

Condensed Consolidated Balance Sheets (unaudited)

(in millions, except for share data) March 31,

(in millions, except for share data) June 30,

2024 December 31, 2023

7 unchanged sentences

Mortgage and other loans receivable, net of allowance for credit losses of $ 37,799 in 2024 and $ 37,776 in 2023*

52,475 51,553

Other invested assets (portion measured at fair value:

1 unchanged sentence

2023 - $ 4,175 )

15,977 16,217

Short-term investments, including restricted cash of $ 3 in 2024 and $ 1 in 2023 (portion measured at fair value:

6 unchanged sentences

Premiums and other receivables, net of allowance for credit losses and disputes of $ 126 in 2024 and $ 138 in 2023

11,293 10,561

Reinsurance assets - Fortitude Re, net of allowance for credit losses and disputes of $ 0 in 2024 and $ 0 in 2023

29,732 30,612

Reinsurance assets - other, net of allowance for credit losses and disputes of $ 211 in 2024 and $ 206 in 2023

37,068 35,293

Deferred income taxes 14,376 14,445

Deferred income tax assets 5,568 6,186

Deferred policy acquisition costs 2,123 2,117

Market risk benefit assets, at fair value 1,172 912

Other assets, net of allowance for credit losses of $ 49 in 2024 and $ 49 in 2023, including restricted cash of $ 43 in 2024 and $ 45 in 2023 (portion measured at fair value:

2024 - $ 705 ;

Goodwill 3,407 3,422

Deposit accounting assets, net of allowance for credit losses of $ 49 in 2024 and $ 49 in 2023

Other assets, including restricted cash of $ 18 in 2024 and $ 32 in 2023 (portion measured at fair value:

2024 - $ 189 ;

2023 - $ 374 )*

Separate account assets, at fair value 95,173 91,005

Assets held for sale 185 30

Assets of discontinued operations — 378,748

Total assets $ 167,890 $ 539,306

3 unchanged sentences

Future policy benefits for life and accident and health insurance contracts 1,355 1,467

Policyholder contract deposits (portion measured at fair value:

2024 - $ 8,613 ;

2023 - $ 7,997 )

163,698 161,979

Market risk benefit liabilities, at fair value 5,167 5,705

Other policyholder funds 435 495

2 unchanged sentences

2023 - $( 148 ))

28,789 29,484

Premiums and other related payables 7,729 6,219

Deposit accounting liabilities 2,782 2,612

Commissions and premium taxes payable 1,395 1,351

Current and deferred income tax liabilities 375 347

Other liabilities (portion measured at fair value:

1 unchanged sentence

2023 - $ 482 )

28,245 25,958

Short-term and long-term debt, of which $ 250 and $ 250 is short-term debt in 2024 and 2023 (portion measured at fair value:

2024 - $ 68 ;

2023 - $ 53 )

19,318 19,796

Long-term debt 9,861 10,375

Debt of consolidated investment entities* 79 231

Separate account liabilities 95,173 91,005

Liabilities held for sale 153 28

Liabilities of discontinued operations — 366,089

Total liabilities 123,415 488,005

23 unchanged sentences

See accompanying Notes to Condensed Consolidated Financial Statements.

AIG | First Quarter 2024 Form 10-Q

AIG | Second Quarter 2024 Form 10-Q

American International Group, Inc.

Condensed Consolidated Statements of Income (Loss) (unaudited)

Three Months Ended March 31,

Three Months Ended

June 30, Six Months Ended

(dollars in millions, except per common share data) 2024 2023 2024 2023

Premiums $ 5,748 $ 6,614 $ 11,619 $ 12,990

Policy fees 714 698

Net investment income:

10 unchanged sentences

Benefits, losses and expenses:

Policyholder benefits and losses incurred (including remeasurement losses of $ 100 and $ 64 for the three months ended March 31, 2024, and 2023, respectively)

Change in the fair value of market risk benefits, net ( 369 ) 196

Interest credited to policyholder account balances 1,204 1,040

Losses and loss adjustment expenses incurred 3,467 3,979 6,980 7,883

Amortization of deferred policy acquisition costs 842 933 1,680 1,972

1 unchanged sentence

Interest expense 125 129 241 253

Loss on extinguishment of debt 1 — 1 —

Net (gain) loss on divestitures and other ( 102 ) 15 ( 102 ) 12

Total benefits, losses and expenses 5,943 6,550 11,648 12,857

Income (loss) from continuing operations before income tax expense (benefit) 2,051 ( 231 )

Income tax expense (benefit) 451 ( 144 )

Income (loss) from continuing operations 1,600 ( 87 )

Income from continuing operations before income tax expense 617 886 1,675 1,288

Income tax expense 142 45 403 110

Income from continuing operations 475 841 1,272 1,178

Income (loss) from discontinued operations, net of income taxes ( 4,359 ) 850 ( 3,556 ) 426

Net income (loss) ( 3,884 ) 1,691 ( 2,284 ) 1,604

Net income (loss) from continuing operations attributable to noncontrolling interests 384 ( 117 )

Net income (loss) attributable to noncontrolling interests 93 198 477 81

Net income (loss) attributable to AIG ( 3,977 ) 1,493 ( 2,761 ) 1,523

2 unchanged sentences

Income per common share attributable to AIG common shareholders:

Income (loss) from continuing operations $ 1.75 $ 0.03

Income from discontinued operations $ — $ —

Income from continuing operations $ 0.72 $ 1.15 $ 1.86 $ 1.59

Income (loss) from discontinued operations $ ( 6.74 ) $ 0.90 $ ( 6.00 ) $ 0.47

Net income (loss) attributable to AIG common shareholders $ ( 6.02 ) $ 2.05 $ ( 4.14 ) $ 2.06

Income (loss) from continuing operations $ 1.74 $ 0.03

Income from discontinued operations $ — $ —

Income from continuing operations $ 0.71 $ 1.14 $ 1.85 $ 1.58

Income (loss) from discontinued operations $ ( 6.67 ) $ 0.89 $ ( 5.96 ) $ 0.47

Net income (loss) attributable to AIG common shareholders $ ( 5.96 ) $ 2.03 $ ( 4.11 ) $ 2.05

3 unchanged sentences

See accompanying Notes to Condensed Consolidated Financial Statements.

AIG | First Quarter 2024 Form 10-Q

AIG | Second Quarter 2024 Form 10-Q

American International Group, Inc.

Condensed Consolidated Statements of Comprehensive Income (Loss) (unaudited)

Three Months Ended

Three Months Ended Six Months Ended

June 30, June 30,

(in millions) 2024 2023 2024 2023

1 unchanged sentence

Other comprehensive income (loss), net of tax

Change in unrealized appreciation (depreciation) of fixed maturity securities on which allowance for credit losses was taken 57 6

Change in unrealized appreciation of fixed maturity securities on which allowance for credit losses was taken 5 29 26 17

Change in unrealized appreciation (depreciation) of all other investments ( 160 ) ( 591 ) ( 275 ) 528

Change in fair value of market risk benefits attributable to changes in our own credit risk ( 23 ) 75

Change in the discount rates used to measure traditional and limited payment long-duration insurance contracts ( 92 ) ( 77 ) ( 90 ) ( 14 )

1 unchanged sentence

Change in retirement plan liabilities adjustment 10 52 17 78

Change in other comprehensive income (loss) related to discontinued operations ( 318 ) ( 1,087 ) ( 945 ) 1,673

Corebridge Deconsolidation 7,214 — 7,214 —

Other comprehensive income (loss) 6,694 ( 1,738 ) 5,637 2,175

3 unchanged sentences

See accompanying Notes to Condensed Consolidated Financial Statements.

AIG | First Quarter 2024 Form 10-Q

AIG | Second Quarter 2024 Form 10-Q

American International Group, Inc.

10 unchanged sentences

controlling Interests Total

Three Months Ended March 31, 2024

Three Months Ended June 30, 2024

Balance, beginning of period $ — $ 4,766 $ ( 60,603 ) $ 75,625 $ 38,466 $ ( 14,869 ) $ 43,385 $ 5,725 $ 49,110

Common stock issued under stock plans — — 25 ( 15 ) — — 10 — 10

Purchase of common stock — — ( 1,677 ) — — — ( 1,677 ) — ( 1,677 )

Net income (loss) attributable to AIG or noncontrolling interests — — — — ( 3,977 ) — ( 3,977 ) 93 ( 3,884 )

Dividends on common stock ($ 0.40 per share)

— — — — ( 261 ) — ( 261 ) — ( 261 )

Other comprehensive income — — — — — 6,694 6,694 — 6,694

Net decrease due to divestitures and acquisitions — — — ( 408 ) — 610 202 ( 5,802 ) ( 5,600 )

Contributions from noncontrolling interests — — — — — — — 17 17

Distributions to noncontrolling interests — — — — — — — ( 2 ) ( 2 )

Other — — — 72 ( 3 ) — 69 ( 1 ) 68

Balance, end of period $ — $ 4,766 $ ( 62,255 ) $ 75,274 $ 34,225 $ ( 7,565 ) $ 44,445 $ 30 $ 44,475

Three Months Ended June 30, 2023

Balance, beginning of period $ 485 $ 4,766 $ ( 56,857 ) $ 79,562 $ 34,690 $ ( 19,329 ) $ 43,317 $ 2,989 $ 46,306

Common stock issued under stock plans — — 11 ( 4 ) — — 7 — 7

Purchase of common stock — — ( 562 ) — — — ( 562 ) — ( 562 )

Net income attributable to AIG or noncontrolling interests — — — — 1,493 — 1,493 198 1,691

Dividends on preferred stock ($ 365.625 per share)

— — — — ( 8 ) — ( 8 ) — ( 8 )

Dividends on common stock ($ 0.36 per share)

— — — — ( 260 ) — ( 260 ) — ( 260 )

Other comprehensive loss — — — — — ( 1,480 ) ( 1,480 ) ( 258 ) ( 1,738 )

Net increase (decrease) due to divestitures and acquisitions — — — ( 1,913 ) — 1,827 ( 86 ) 1,261 1,175

Contributions from noncontrolling interests — — — — — — — 11 11

Distributions to noncontrolling interests — — — — — — — ( 194 ) ( 194 )

Other — — — 32 1 — 33 30 63

Balance, end of period $ 485 $ 4,766 $ ( 57,408 ) $ 77,677 $ 35,916 $ ( 18,982 ) $ 42,454 $ 4,037 $ 46,491

AIG | Second Quarter 2024 Form 10-Q

American International Group, Inc.

Condensed Consolidated Statements of Equity (unaudited)(continued)

(in millions, except per share data) Preferred

Capital Common

Stock Treasury

Stock Additional

Capital Retained

Earnings Accumulated

Comprehensive

Income (Loss) Total

Equity Non- redeemable Non-

controlling Interests Total

Six Months Ended June 30, 2024

Balance, beginning of the year $ 485 $ 4,766 $ ( 59,189 ) $ 75,810 $ 37,516 $ ( 14,037 ) $ 45,351 $ 5,950 $ 51,301

2 unchanged sentences

Purchase of common stock — — ( 3,359 ) — — — ( 3,359 ) — ( 3,359 )

Net income attributable to AIG or noncontrolling interests — — — — 1,216 — 1,216 384 1,600

Net income (loss) attributable to AIG or noncontrolling interests — — — — ( 2,761 ) — ( 2,761 ) 477 ( 2,284 )

Dividends on preferred stock ($ 365.625 per share) and preferred stock redemption premiums

2 unchanged sentences

— — — — ( 504 ) — ( 504 ) — ( 504 )

Other comprehensive loss — — — — — ( 759 ) ( 759 ) ( 298 ) ( 1,057 )

Net decrease due to divestitures and acquisitions — — — ( 10 ) — ( 73 ) ( 83 ) ( 202 ) ( 285 )

Other comprehensive income (loss) — — — — — 5,935 5,935 ( 298 ) 5,637

Net increase (decrease) due to divestitures and acquisitions — — — ( 418 ) — 537 119 ( 6,004 ) ( 5,885 )

Contributions from noncontrolling interests — — — — — — — 28 28

2 unchanged sentences

Balance, end of period $ — $ 4,766 $ ( 62,255 ) $ 75,274 $ 34,225 $ ( 7,565 ) $ 44,445 $ 30 $ 44,475

Three Months Ended March 31, 2023

Six Months Ended June 30, 2023

Balance, beginning of year $ 485 $ 4,766 $ ( 56,473 ) $ 79,915 $ 34,893 $ ( 22,616 ) $ 40,970 $ 2,484 $ 43,454

1 unchanged sentence

Purchase of common stock — — ( 1,165 ) — — — ( 1,165 ) — ( 1,165 )

Net income (loss) attributable to AIG or noncontrolling interests — — — — 30 — 30 ( 117 ) ( 87 )

Net income attributable to AIG or noncontrolling interests — — — — 1,523 — 1,523 81 1,604

Dividends on preferred stock ($ 731.25 per share)

3 unchanged sentences

Other comprehensive income — — — — — 1,807 1,807 368 2,175

Net increase (decrease) due to divestitures and acquisitions — — — ( 1,913 ) — 1,827 ( 86 ) 1,261 1,175

Contributions from noncontrolling interests — — — — — — — 27 27

3 unchanged sentences

See accompanying Notes to Condensed Consolidated Financial Statements.

AIG | First Quarter 2024 Form 10-Q

AIG | Second Quarter 2024 Form 10-Q

American International Group, Inc.

Condensed Consolidated Statements of Cash Flows (unaudited)

Three Months Ended March 31,

Six Months Ended June 30,

(in millions) 2024 2023

1 unchanged sentence

Net income (loss) $ ( 2,284 ) $ 1,604

(Income) loss from discontinued operations 3,556 ( 426 )

Adjustments to reconcile net income (loss) to net cash provided by operating activities:

2 unchanged sentences

Net (gain) loss on divestitures and other ( 102 ) 12

Unrealized (gains) losses in earnings - net 403 ( 112 )

Change in the fair value of market risk benefits in earnings, net ( 891 ) 316

(Gain) loss on extinguishment of debt 1 —

Unrealized gains in earnings - net ( 349 ) ( 33 )

Equity in (income) loss from equity method investments, net of dividends or distributions ( 46 ) 18

9 unchanged sentences

Total adjustments 281 255

Net cash provided by operating activities - continuing operations 1,553 1,433

Net cash used in operating activities - discontinued operations ( 104 ) ( 322 )

Net cash provided by operating activities 1,449 1,111

15 unchanged sentences

Other, net ( 51 ) ( 662 )

Net cash provided by (used in) investing activities 308 ( 1,474 )

Net cash provided by investing activities - continuing operations 2,875 191

Net cash used in investing activities - discontinued operations ( 4,171 ) ( 832 )

Net cash used in investing activities ( 1,296 ) ( 641 )

Cash flows from financing activities:

Proceeds from (payments for)

Policyholder contract deposits 8,504 8,226

Policyholder contract withdrawals ( 7,150 ) ( 6,468 )

Issuance of long-term debt 1 742

Issuance of debt of consolidated investment entities 57 36

Repayments of long-term debt ( 464 ) ( 451 )

5 unchanged sentences

Other, net 242 723

Net cash provided by (used in) financing activities ( 1,141 ) 817

Net cash used in financing activities - continuing operations ( 4,557 ) ( 615 )

Net cash provided by financing activities - discontinued operations 4,409 500

Net cash used in financing activities ( 148 ) ( 115 )

Effect of exchange rate changes on cash and restricted cash ( 66 ) 18

Net decrease in cash and restricted cash ( 343 ) ( 158 )

Net increase (decrease) in cash and restricted cash ( 61 ) 373

Cash and restricted cash at beginning of year 1,573 1,571

1 unchanged sentence

Cash and restricted cash at end of period $ 1,402 $ 1,560

AIG | First Quarter 2024 Form 10-Q

AIG | Second Quarter 2024 Form 10-Q

American International Group, Inc.

1 unchanged sentence

Supplementary Disclosure of Condensed Consolidated Cash Flow Information

Three Months Ended March 31,

Six Months Ended June 30,

(in millions) 2024 2023

15 unchanged sentences

See accompanying Notes to Condensed Consolidated Financial Statements.

AIG | First Quarter 2024 Form 10-Q

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 1.

10 unchanged sentences

In the opinion of management, these Condensed Consolidated Financial Statements contain normal recurring adjustments, including eliminations of material intercompany accounts and transactions, necessary for a fair statement of the results presented herein.

Operating results for the three months ended March 31, 2024, are not necessarily indicative of the results that may be expected for the year ending December 31, 2024.

We evaluated the need to recognize or disclose events that occurred subsequent to March 31, 2024 and prior to the issuance of these Condensed Consolidated Financial Statements.

Operating results for the six months ended June 30, 2024, are not necessarily indicative of the results that may be expected for the year ending December 31, 2024.

We evaluated the need to recognize or disclose events that occurred subsequent to June 30, 2024 and prior to the issuance of these Condensed Consolidated Financial Statements.

Prior year Condensed Consolidated Financial Statements have been reclassified for comparative purpose to conform with the captions presented in the current year.

SALES/DISPOSALS OF ASSETS AND BUSINESSES

AIG Life Limited

On April 8, 2024, Corebridge Financial, Inc.

(Corebridge) completed the sale of AIG Life Limited (AIG Life) to Aviva plc and received gross proceeds of £ 453 million ($ 569 million).

For further details on this transaction, see Note 4.

Separation of Life and Retirement Business and Relationship with Blackstone Inc.

AIG owns 52.7 percent of the outstanding common stock of Corebridge as of March 31, 2024.

Corebridge is the holding company for AIG’s Life and Retirement business.

AIG continues to consolidate Corebridge in AIG’s Condensed Consolidated Financial Statements.

The portion of equity interest of Corebridge that AIG does not own is reflected as noncontrolling interest in AIG’s Condensed Consolidated Financial Statements.

In the three months ended March 31, 2024, Corebridge repurchased 9.5 million shares of Corebridge common stock for an aggregate purchase price of $ 243 million.

As a result, AIG recorded a decrease of $ 83 million in Total AIG shareholders' equity.

Blackstone Inc.

(Blackstone) owns a 10.1 percent equity stake in Corebridge as of March 31, 2024.

Blackstone is required to hold its ownership interest in Corebridge, subject to exceptions currently permitting Blackstone to sell 67 percent and 75 percent of its ownership interest after September 19, 2024 and 2025, respectively, with the transfer restrictions terminating in full on September 19, 2027.

AIG | First Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 1.

Basis of Presentation

Global Personal Travel Business

On June 26, 2024, AIG announced that it has entered into a definitive agreement to sell its global individual personal travel insurance and assistance business to Zurich Insurance Group for $ 600 million in cash plus additional earn-out consideration.

The sale is expected to close by the end of 2024, subject to customary closing conditions, including the receipt of regulatory approvals.

For further details, see Note 4.

Separation of Life and Retirement Business

For further details, see Note 4.

USE OF ESTIMATES

3 unchanged sentences

• loss reserves;

• valuation of future policy benefit liabilities and recognition of measurement gains and losses;

• valuation of market risk benefits (MRBs) related to guaranteed benefit features of variable annuity, fixed annuity and fixed index annuity products;

• valuation of embedded derivative liabilities for fixed index annuity and index universal life products;

• reinsurance assets, including the allowance for credit losses and disputes;

5 unchanged sentences

To the extent actual experience differs from the assumptions used, our consolidated financial condition, results of operations and cash flows could be materially affected.

Certain critical accounting estimates were eliminated as a result of the Corebridge deconsolidation.

There were no changes to the remaining critical accounting estimates.

For further details, see Note 4.

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 2.

Summary of Significant Accounting Policies

ACCOUNTING STANDARDS ADOPTED DURING 2024

3 unchanged sentences

The Company adopted the standard on January 1, 2024, prospectively for entities other than investment companies.

The adoption of the standard did not have a material impact to AIG consolidated financial statements.

The adoption of the standard did not have a material impact on AIG Consolidated Financial Statements.

FUTURE APPLICATION OF ACCOUNTING STANDARDS

2 unchanged sentences

The standard is effective for public companies for annual periods beginning after December 15, 2024, with early adoption permitted.

The standard will be applied on a prospective basis with the option to apply the standard retrospectively.

The standard should be applied on a prospective basis, but retrospective application is permitted.

We are assessing the impact of this standard.

6 unchanged sentences

The guidance is effective for public companies for fiscal years beginning after December 15, 2023 and interim periods in fiscal years within fiscal years beginning after December 15, 2024, with early adoption permitted.

The amendment is applied retrospectively to all prior periods presented.

The amendment will be applied retrospectively to all prior periods presented.

We are assessing the impact of this standard.

AIG | First Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 3.

Segment Information

We report our results of operations consistent with the manner in which our chief operating decision makers review the business to assess performance and allocate resources, as follows:

As a result of the Corebridge deconsolidation, we no longer present a Life and Retirement segment and no longer include asset management and Corebridge Life Holdings, Inc.

interest and general expenses within the Other Operations segment.

Historical results of Other Operations have been revised to reflect these changes.

Previously reported results for the General Insurance segment were not impacted by the Corebridge deconsolidation.

For further details on the separation of the Life and Retirement business, see Note 4.

As presented herein and reflecting the Corebridge deconsolidation, we report our results of operations consistent with the manner in which our chief operating decision makers review the business to assess performance and allocate resources, as follows:

GENERAL INSURANCE

4 unchanged sentences

as well as AIG’s Global Specialty business.

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 3.

Segment Information

North America and International operating segments consist of the following products:

1 unchanged sentence

– Personal Insurance – consists of Accident & Health and Personal Lines.

For further discussion on recent activity in the General Insurance business, see Note 1 to the Consolidated Financial Statements in the 2023 Annual Report.

LIFE AND RETIREMENT

Life and Retirement business is presented as four operating segments:

• Individual Retirement – consists of fixed annuities, fixed index annuities and variable annuities.

• Group Retirement – consists of recordkeeping, plan administration and compliance services, financial planning and advisory solutions offered to employer-defined contribution plan participants, along with proprietary and limited non-proprietary annuities and advisory and brokerage products offered outside of plans.

• Life Insurance – primary products in the U.S.

include term life and universal life insurance.

Corebridge previously announced agreements to sell Laya Healthcare Limited (Laya) and AIG Life.

The sale of Laya closed on October 31, 2023 and the AIG Life sale closed on April 8, 2024.

• Institutional Markets – consists of stable value wrap products, structured settlement and pension risk transfer annuities, corporate- and bank-owned life insurance, high net worth products and guaranteed investment contracts (GICs).

For further discussion on the ongoing separation of the Life and Retirement business from AIG and other recent activity, see Note 1.

For further discussion on recent activity in the General Insurance business, see Note 1 and Note 4 herein and Note 1 to the Consolidated Financial Statements in the 2023 Annual Report.

OTHER OPERATIONS

Other Operations primarily consists of income from assets held by AIG Parent and other corporate subsidiaries, deferred tax assets related to tax attributes, corporate expenses and intercompany eliminations, our institutional asset management business and results of our consolidated investment entities, General Insurance portfolios in run-off as well as the historical results of our legacy insurance lines ceded to Fortitude Re.

Other Operations primarily consists of income and expenses from assets, including AIG's ownership of Corebridge, held by AIG Parent and other corporate subsidiaries, deferred tax assets related to tax attributes, corporate expenses and intercompany eliminations, results of our consolidated investment entities, General Insurance portfolios in run-off as well as the historical results of our legacy insurance lines ceded to Fortitude Reinsurance Company Ltd.

(Fortitude Re).

SEGMENT RESULTS

We evaluate segment performance based on adjusted revenues and adjusted pre-tax income (loss).

Adjusted revenues and adjusted pre-tax income (loss) are derived by excluding certain items from total revenues and pre-tax income (loss), respectively.

Adjusted revenues and adjusted pre-tax income (loss) are derived by excluding certain items from total revenues and income (loss) from continuing operations before income tax expense (pre-tax income (loss)), respectively.

These items generally fall into one or more of the following broad categories:

4 unchanged sentences

For the items excluded from adjusted revenues and adjusted pre-tax income (loss), see the table below.

AIG | First Quarter 2024 Form 10-Q

The following table presents AIG’s continuing operations by operating segment:

Three Months Ended June 30, 2024 2023

(in millions) Adjusted

Revenues Adjusted

(Loss) Adjusted

Revenues Adjusted

General Insurance

North America $ 2,470 $ 163 (a)

$ 3,195 $ 352 (a)

International 3,279 267 (a)

3,302 242 (a)

Net investment income 746 746 725 725

Total General Insurance 6,495 1,176 7,222 1,319

Other Operations

Other Operations before consolidation and eliminations 144 ( 158 ) 173 ( 270 )

Consolidation and eliminations ( 5 ) — ( 17 ) ( 8 )

Total Other Operations 139 ( 158 ) 156 ( 278 )

Total 6,634 1,018 7,378 1,041

Reconciling items:

Changes in the fair values of equity securities and AIG's investment in Corebridge 59 59 41 41

Other income (expense) - net 15 — 8 —

Gain (loss) on extinguishment of debt — ( 1 ) — —

Net investment income on Fortitude Re funds withheld assets 33 33 25 25

Net realized losses on Fortitude Re funds withheld assets ( 1 ) ( 1 ) ( 7 ) ( 7 )

Net realized gains on Fortitude Re funds withheld embedded derivative 8 8 58 58

Net realized losses (b)

( 188 ) ( 186 ) ( 67 ) ( 64 )

Net gain (loss) on divestitures and other — 102 — ( 15 )

Non-operating litigation reserves and settlements — — — ( 1 )

Favorable prior year development and related amortization changes ceded under retroactive reinsurance agreements — 62 — 18

Net loss reserve discount charge — ( 26 ) — ( 16 )

Pension expense related to lump sum payments to former employees — — — ( 54 )

Integration and transaction costs associated with acquiring or divesting businesses — ( 18 ) — ( 8 )

Restructuring and other costs (c)

— ( 426 ) — ( 125 )

Non-recurring costs related to regulatory or accounting changes — ( 7 ) — ( 7 )

Revenues and pre-tax income $ 6,560 $ 617 $ 7,436 $ 886

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 3.

Segment Information

The following table presents AIG’s continuing operations by operating segment:

Three Months Ended March 31, 2024 2023

Six Months Ended June 30, 2024 2023

(in millions) Adjusted

9 unchanged sentences

Total General Insurance 13,043 2,534 14,227 2,567

Life and Retirement

Individual Retirement 1,686 622 1,484 533

Group Retirement 689 199 683 187

Life Insurance 1,214 58 1,249 82

Institutional Markets 2,332 112 1,955 84

Total Life and Retirement 5,921 991 5,371 886

Other Operations

4 unchanged sentences

Reconciling items:

Changes in fair value of securities used to hedge guaranteed living benefits 17 ( 2 ) 13 ( 3 )

Change in the fair value of market risk benefits, net (b)

— 369 — ( 196 )

Changes in benefit reserves related to net realized gains (losses) — 2 — 6

Changes in the fair value of equity securities 99 99 51 51

Changes in the fair values of equity securities and AIG's investment in Corebridge 147 147 62 62

Other income (expense) - net 17 — 23 —

Gain (loss) on extinguishment of debt — ( 1 ) — —

Net investment income on Fortitude Re funds withheld assets 72 72 77 77

Net realized losses on Fortitude Re funds withheld assets ( 20 ) ( 20 ) ( 61 ) ( 61 )

Net realized gains (losses) on Fortitude Re funds withheld embedded derivative 13 13 ( 1,165 ) ( 1,165 )

Net realized losses (c)

Net realized losses on Fortitude Re funds withheld embedded derivative ( 1 ) ( 1 ) ( 82 ) ( 82 )

Net realized losses (b)

( 240 ) ( 241 ) ( 386 ) ( 383 )

3 unchanged sentences

Net loss reserve discount benefit (charge) — ( 102 ) — ( 80 )

Pension expense related to lump sum payments to former employees — — — ( 54 )

Integration and transaction costs associated with acquiring or divesting businesses — ( 15 ) — ( 8 )

2 unchanged sentences

Net impact from elimination of international reporting lag (d)

Revenues and pre-tax income (loss) $ 12,578 $ 2,051 $ 10,984 $ ( 231 )

Revenues and pre-tax income $ 13,323 $ 1,675 $ 14,145 $ 1,288

(a) General Insurance North America’s and General Insurance International’s Adjusted pre-tax income does not include Net investment income as the investment portfolio results are managed at the General Insurance level.

Net investment income is shown separately as a component of General Insurance’s total Adjusted pre-tax income results.

(b) Includes realized gains and losses on certain derivative instruments used for non-qualifying (economic) hedging.

(c) Includes all net realized gains and losses except earned income (periodic settlements and changes in settlement accruals) on derivative instruments used for non-qualifying (economic) hedging or for asset replication and net realized gains and losses on Fortitude Re funds withheld assets held by AIG in support of Fortitude Re’s reinsurance obligations to AIG (Fortitude Re funds withheld assets).

(b) Includes all net realized gains and losses except earned income (periodic settlements and changes in settlement accruals) on derivative instruments used for non-qualifying (economic) hedging or for asset replication and net realized gains and losses on Fortitude Re funds withheld assets held by AIG in support of Fortitude Re’s reinsurance obligations to AIG (Fortitude Re funds withheld assets).

(c) In the second quarter of 2024, Restructuring and other costs increased primarily as a result of employee-related costs, including severance, and real estate impairment charges.

(d) For additional information, see Note 1 to the Consolidated Financial Statements in the 2023 Annual Report.

AIG | First Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 4.

Held-For-Sale Classification

For the three months ended June 30, 2024, we recorded a severance charge of $ 285 million and asset impairment of $ 53 million as a result of restructuring activities.

Held-For-Sale Classification & Discontinued Operations Presentation

HELD-FOR-SALE CLASSIFICATION

We report and classify a business as held-for-sale (Held-For-Sale Business) when management has approved the sale or received approval to sell the business and is committed to a formal plan, the business is available for immediate sale, the business is being actively marketed, the sale is anticipated to occur during the next 12 months and certain other specified criteria are met.

We report and classify a business or a component of an entity as held-for-sale (Held-For-Sale Business) when management has approved the sale or received approval to sell the business and is committed to a formal plan, the business is available for immediate sale, the business is being actively marketed, the sale is anticipated to occur during the next 12 months and certain other specified criteria are met.

A Held-For-Sale Business is recorded at the lower of its carrying amount or estimated fair value less cost to sell.

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Assets and liabilities related to a Held-For-Sale Business are reported in Assets held for sale and Liabilities held for sale, respectively, in our Condensed Consolidated Balance Sheets beginning in the period in which the business is classified as held-for-sale.

At March 31, 2024, the following businesses and assets were reported and classified as held-for-sale:

AIG Life Limited

On April 8, 2024, Corebridge completed the sale of AIG Life to Aviva plc and received gross proceeds of £ 453 million ($ 569 million).

The results of AIG Life are reported in Life and Retirement.

Other primarily consists of real estate.

The following table summarizes the components of assets and liabilities held-for-sale on the Condensed Consolidated Balance Sheets at March 31, 2024 and December 31, 2023 after elimination of intercompany balances:

March 31, 2024 December 31, 2023

(in millions) AIG Life Other Total AIG Life Other Total

Bonds available for sale $ 160 $ 15 $ 175 $ 167 $ 14 $ 181

At June 30, 2024, businesses and assets reported and classified as held-for-sale primarily consisted of our global individual personal travel insurance and assistance business and did not meet the criteria for discontinued operations.

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 4.

Held-For-Sale Classification & Discontinued Operations Presentation

On May 16, 2024, AIG entered into a stock purchase agreement with Corebridge Financial, Inc.

(Corebridge), the holding company for AIG's Life and Retirement business, and Nippon Life Insurance Company, a mutual company (sougogaisha) organized under the laws of Japan (Nippon), pursuant to which AIG agreed to sell 121,956,256 shares of common stock of Corebridge, representing approximately 20 percent of the issued and outstanding common stock at signing, to Nippon for aggregate consideration of $ 3.8 billion in cash.

The transaction is expected to close in the first quarter of 2025, subject to certain closing conditions, including the receipt of regulatory approvals.

As a result, Corebridge met the criteria to be presented as held for sale and discontinued operations.

However, on June 9, 2024, AIG met the requirements for the deconsolidation of Corebridge.

For further details, see Discontinued Operations Presentation below.

Global Personal Travel Business

On June 26, 2024, AIG entered into a definitive agreement to sell its global individual personal travel insurance and assistance business to Zurich Insurance Group for $ 600 million in cash plus additional earn-out consideration.

The agreement includes the Travel Guard business and its servicing capabilities, excluding our travel insurance businesses in Japan and our AIG joint venture arrangement in India.

Travel coverages offered through AIG’s Accident & Health business are also excluded from this agreement.

The sale is expected to close by the end of 2024, subject to customary closing conditions, including regulatory approvals.

The results of our global individual personal travel insurance and assistance business are reported in General Insurance.

DISCONTINUED OPERATIONS PRESENTATION

We present a business, or a component of an entity, as discontinued operations if a) it meets the held-for-sale criteria, or is disposed of by sale, or is disposed of other than by sale, and b) the disposal of the business, or component of an entity, represents a strategic shift that has (or will have) a major effect on AIG’s financial results.

On June 3, 2024, AIG closed on a secondary offering of 30 million shares of Corebridge common stock.

The sale was recorded as an equity transaction as AIG controlled Corebridge as of the transaction date.

The aggregate gross proceeds of the offering, before deducting underwriting discounts and commission and other expenses payable by AIG, were $ 876 million.

As a result of the offering, AIG recorded an increase of $ 261 million in Total AIG shareholders' equity.

On July 2, 2024, the underwriters exercised their option to purchase an additional 1.9 million shares which reduced AIG's remaining investment in Corebridge reported in Other invested assets.

In September 2022, AIG closed on the initial public offering of Corebridge.

Since September 2022 and through June 9, 2024, AIG sold portions of its interests in Corebridge through secondary public offerings.

On June 9, 2024, AIG held 48.4 percent of Corebridge common stock, waived its right to majority representation on the Corebridge Board of Directors and one of AIG's designees resigned from the Corebridge Board of Directors as of June 9, 2024 (Deconsolidation Date).

As a result, AIG met the requirements for the deconsolidation of Corebridge.

The historical financial results of Corebridge, for all periods presented, are reflected in these Condensed Consolidated Financial Statements as discontinued operations.

Due to share repurchases by Corebridge after the Deconsolidation Date, as of June 30, 2024, AIG held 49.0 percent of the outstanding common stock of Corebridge.

The assets and liabilities of Corebridge are classified as Assets of discontinued operations and Liabilities of discontinued operations in AIG’s Condensed Consolidated Balance Sheets as of December 31, 2023.

The results of operations of Corebridge are reported as discontinued operations for all periods presented in the Condensed Consolidated Statement of Income (Loss).

AIG recognized a loss of $ 4.7 billion as a result of the deconsolidation (mainly due to the recognition of accumulated comprehensive loss of $ 7.2 billion).

The loss is recorded as a component of discontinued operations.

Corebridge was previously reported in Life and Retirement and Other Operations.

Subsequent to the Deconsolidation Date, AIG has elected the fair value option and will reflect its retained interest in Corebridge as an equity method investment in Other invested assets in AIG's Condensed Consolidated Balance Sheets using Corebridge’s stock price as its fair value.

Dividends received from Corebridge and changes in its stock price are recognized in Net investment income in AIG’s Condensed Consolidated Financial Statements.

The following provides financial information related to Corebridge as an equity method investee as if Corebridge was an equity method investee for the periods presented.

The “Equity method income (loss) related to Corebridge (based on fair value)” assumes a retained interest in Corebridge of 49.0 percent and is calculated based on the changes in Corebridge’s stock price for the periods presented.

Three Months Ended

June 30, Six Months Ended

(in millions) 2024 2023 2024 2023

Corebridge pre-tax income $ 361 $ 980 $ 1,354 $ 347

Equity method income (loss) related to Corebridge (based on fair value) $ 115 $ 482 $ 2,195 $ ( 706 )

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 4.

Held-For-Sale Classification & Discontinued Operations Presentation

The following table summarizes the components of assets and liabilities held-for-sale and assets and liabilities of discontinued operations on the Condensed Consolidated Balance Sheets at June 30, 2024 and December 31, 2023:

June 30, 2024 December 31, 2023

(in millions) Assets and

Held for Sale Corebridge

Liabilities of

Operations) Assets and

Held for Sale

Fixed maturity securities:

Bonds available for sale, at fair value, net of allowance for credit losses $ 14 $ 166,657 $ 14

Other bond securities, at fair value — 4,579 —

Equity securities, at fair value — 63 —

Mortgage and other loans receivable, net of allowance for credit losses — 46,732 —

Other invested assets — 9,916 —

Short-term investments

24 1 25 11 1 12

Total investments 29 232,293 15

Cash 90 618 —

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Premiums and other receivables, net of allowance for credit losses and disputes 42 709 9

Reinsurance assets - Fortitude Re, net of allowance for credit losses and disputes — 26,772 —

Reinsurance assets - other, net of allowance for credit losses and disputes 6 2,519 3

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Deferred policy acquisition costs — 10,782 —

Market risk benefit assets, at fair value — 912 —

Other assets, net of allowance for credit losses (a)

82 13 95 83 31 114

Total assets held for sale $ 2,170 $ 218 $ 2,388 $ 2,143 $ 125 $ 2,268

Separate account assets, at fair value — 91,005 —

Total assets held for sale/assets of discontinued operations $ 185 $ 378,748 $ 30

Liability for unpaid losses and loss adjustment expenses, including allowance for credit losses $ 24 $ — $ 19

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Future policy benefits for life and accident and health insurance contracts — 57,946 —

Policyholder contract deposits — 161,979 —

Market risk benefit liabilities, at fair value — 5,705 —

Other policyholder funds — 2,862 —

Fortitude Re funds withheld payable — 25,957 —

Other liabilities 117 8,790 2

Total liabilities held for sale $ 1,773 $ 40 $ 1,813 $ 1,746 $ 29 $ 1,775

(a) Other assets, net of allowance for credit losses includes goodwill and other intangibles of $ 23 million and $ 3 million, respectively, for AIG Life at March 31, 2024 and $ 23 million and $ 3 million, respectively, at December 31, 2023.

AIG | First Quarter 2024 Form 10-Q

Short-term and long-term debt — 9,420 —

Debt of consolidated investment entities — 2,360 —

Separate account liabilities — 91,005 —

Total liabilities held for sale/liabilities of discontinued operations $ 153 $ 366,089 $ 28

(a) Other assets, net of allowance for credit losses includes goodwill and other intangibles of $ 116 million and $ 3 million, respectively, for Corebridge at December 31, 2023.

The following table presents the amounts related to the operations of Corebridge that have been reflected in Net income from discontinued operations:

Three Months Ended

June 30, Six Months Ended

(in millions) 2024 2023 2024 2023

Premiums $ 428 $ 2,442 $ 2,723 $ 4,548

Policy fees 555 693 1,269 1,392

Net investment income 2,314 2,732 5,238 5,420

Net realized gains (losses) ( 587 ) ( 281 ) ( 923 ) ( 1,680 )

Other income 155 193 372 375

Total revenues 2,865 5,779 8,679 10,055

Benefits, losses and expenses:

Policyholder benefits and losses incurred 811 2,879 3,618 5,372

Change in the fair value of market risk benefits, net 20 ( 262 ) ( 350 ) ( 66 )

Interest credited to policyholder account balances 980 1,063 2,184 2,102

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 4.

Fair Value Measurements

Held-For-Sale Classification & Discontinued Operations Presentation

Three Months Ended

June 30, Six Months Ended

(in millions) 2024 2023 2024 2023

Amortization of deferred policy acquisition costs 199 257 465 511

General operating and other expenses 574 772 1,350 1,512

Interest expense 106 149 249 331

Net (gain) loss on divestitures and other ( 186 ) ( 59 ) ( 191 ) ( 54 )

Total benefits, losses and expenses 2,504 4,799 7,325 9,708

Income (loss) from discontinued operations before income tax expense (benefit) and loss on disposal of discontinued operations 361 980 1,354 347

Income tax expense (benefit) 36 130 226 ( 79 )

Income (loss) from discontinued operations, net of income taxes before loss on disposal of discontinued operations 325 850 1,128 426

Loss on disposition of operations, net of tax ( 4,684 ) — ( 4,684 ) —

Income (loss) from discontinued operations, net of income taxes ( 4,359 ) 850 ( 3,556 ) 426

Net income (loss) from discontinued operations attributable to noncontrolling interests 93 198 477 81

Net income (loss) from discontinued operations attributable to AIG $ ( 4,452 ) $ 652 $ ( 4,033 ) $ 345

DISCONTINUED OPERATIONS LOSS PRESENTATION

The loss recognized for the deconsolidation of Corebridge includes (i) $ 8.5 billion of retained investment in Corebridge (Corebridge’s quoted stock price is used for fair value measurement, which is classified as level 1 in the fair value hierarchy), (ii) $ 817 million of certain other investments (considered level 3 in the fair value hierarchy) which are measured based on valuation techniques (i.e., third party appraisals) that use significant inputs (i.e., terminal capital rate and discount rate), and (iii) $ 378 million of an unsettled receivable.

For details on fair value hierarchy, see Note 5.

The loss on deconsolidation of Corebridge is calculated as follows:

(in millions)

Corebridge retained investment ( 48.4 % @ 28.90 per share at June 9, 2024)

Retained Interest in certain investment entities and other assets 1,195

Net fair value of assets retained 9,697

Corebridge book value at June 9, 2024 12,392

Noncontrolling interests 5,732

Corebridge book value excluding noncontrolling interest 6,660

Gain on sale pre-tax 3,037

Tax expense 507

After tax gain 2,530

Reclassification adjustment of Accumulated other comprehensive loss at June 9, 2024 ( 7,214 )

Loss on sale of Corebridge - after-tax $ ( 4,684 )

Fair Value Measurements

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Therefore, we must make certain assumptions about the inputs a hypothetical market participant would use to value that asset or liability.

In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy.

In such cases, the level in the fair value hierarchy within which the fair value measurement in its entirety falls is determined based on the lowest level input that is significant to the fair value measurement in its entirety.

AIG | First Quarter 2024 Form 10-Q

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 5.

Fair Value Measurements

In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy.

ASSETS AND LIABILITIES MEASURED AT FAIR VALUE ON A RECURRING BASIS

The following table presents information about assets and liabilities measured at fair value on a recurring basis and indicates the level of the fair value measurement based on the observability of the inputs used:

March 31, 2024 Level 1 Level 2 Level 3 Counterparty

June 30, 2024 Level 1 Level 2 Level 3 Counterparty

Collateral Total

40 unchanged sentences

3,845 4,292 — — — 8,137

Market risk benefit assets — — 1,172 — — 1,172

Other assets (c)

— — 130 — — 130

Separate account assets

$ 13,257 $ 63,871 $ 4,354 $ ( 245 ) $ ( 288 ) $ 80,949

$ 95,743 $ 221,765 $ 35,850 $ ( 4,545 ) $ ( 2,601 ) $ 346,212

Policyholder contract deposits $ — $ 63 $ 8,550 $ — $ — $ 8,613

Market risk benefit liabilities — — 5,167 — — 5,167

Derivative liabilities (c) :

3 unchanged sentences

— 324 1 — — 325

Equity contracts

— 1,175 54 — — 1,229

Credit contracts

— — 33 — — 33

Other contracts — — 1 — — 1

Counterparty netting and cash collateral

6 unchanged sentences

— — 99 — — 99

Long-term debt

— 68 — — — 68

Total $ — $ 615 $ ( 21 ) $ ( 245 ) $ ( 180 ) $ 169

AIG | First Quarter 2024 Form 10-Q

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 5.

43 unchanged sentences

2,613 6,750 — — — 9,363

Market risk benefit assets — — 912 — — 912

Other assets (c)

— — 243 — — 243

Separate account assets

$ 3,473 $ 69,731 $ 4,640 $ ( 450 ) $ ( 711 ) $ 76,683

$ 91,356 $ 225,085 $ 33,013 $ ( 3,864 ) $ ( 2,220 ) $ 343,370

Policyholder contract deposits $ — $ 55 $ 7,942 $ — $ — $ 7,997

Market risk benefit liabilities — — 5,705 — — 5,705

Derivative liabilities (c) :

3 unchanged sentences

— 561 3 — — 564

Equity contracts

2 680 63 — — 745

Credit contracts

— 3 33 — — 36

Other contracts — — 2 — — 2

Counterparty netting and cash collateral

5 unchanged sentences

Other liabilities — 107 122 — — 229

Long-term debt

— 53 — — — 53

Total $ — $ 1,023 $ 10 $ ( 450 ) $ ( 249 ) $ 334

(a) Represents netting of derivative exposures covered by qualifying master netting agreements.

(b) Excludes investments that are measured at fair value using the net asset value (NAV) per share (or its equivalent), which totaled $ 9.5 billion and $ 9.5 billion as of March 31, 2024 and December 31, 2023, respectively.

(b) Excludes investments that are measured at fair value using the net asset value (NAV) per share (or its equivalent), which totaled $ 3.6 billion and $ 3.8 billion as of June 30, 2024 and December 31, 2023, respectively.

As of June 30, 2024 , includes AIG's ownership interest in Corebridge of $ 8.6 billion on which AIG elected the fair value option.

(d) Excludes $ 176 million and $ 182 million as of March 31, 2024 and December 31, 2023, respectively, of assets reclassified to Assets held for sale on the Condensed Consolidated Balance Sheets.

AIG | First Quarter 2024 Form 10-Q

(d) Excludes $ 22 million and $ 15 million as of June 30, 2024 and December 31, 2023, respectively, of assets reclassified to Assets held for sale on the Condensed Consolidated Balance Sheets.

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 5.

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CHANGES IN LEVEL 3 RECURRING FAIR VALUE MEASUREMENTS

The following tables present changes during the three months ended March 31, 2024 and 2023 in Level 3 assets and liabilities measured at fair value on a recurring basis, and the realized and unrealized gains (losses) related to the Level 3 assets and liabilities in the Condensed Consolidated Balance Sheets at March 31, 2024 and 2023:

The following tables present changes during the three and six months ended June 30, 2024 and 2023 in Level 3 assets and liabilities measured at fair value on a recurring basis, and the realized and unrealized gains (losses) related to the Level 3 assets and liabilities in the Condensed Consolidated Balance Sheets at June 30, 2024 and 2023:

(in millions) Fair Value

of Year MRBs and

of Period Net Realized

in Income Other

11 unchanged sentences

at End of Period

Three Months Ended March 31, 2024

Three Months Ended June 30, 2024

Bonds available for sale:

Obligations of states, municipalities and political subdivisions $ 4 $ — $ — $ — $ — $ — $ — $ 4 $ — $ —

7 — — — — — — 7 — —

Corporate debt

383 — ( 2 ) ( 22 ) 36 ( 36 ) — 359 — ( 2 )

1,766 24 ( 29 ) ( 75 ) 287 ( 1 ) 44 2,016 — ( 30 )

43 ( 4 ) 6 ( 18 ) 68 ( 1 ) — 94 — —

CLO/ABS 1,284 3 3 ( 47 ) 44 ( 12 ) — 1,275 — 3

Total bonds available for sale

3,487 23 ( 22 ) ( 162 ) 435 ( 50 ) 44 3,755 — ( 29 )

Other bond securities:

Corporate Debt 46 1 — — — — ( 3 ) 44 — —

RMBS 53 — — ( 2 ) — ( 2 ) — 49 — —

CLO/ABS 144 1 — ( 3 ) 2 — 1 145 1 —

Total other bond securities

243 2 — ( 5 ) 2 ( 2 ) ( 2 ) 238 1 —

Equity securities

13 — — — — — — 13 — —

Other invested assets

183 ( 4 ) — ( 36 ) — — 2 145 ( 1 ) —

129 — — 1 — — — 130 — —

$ 4,055 $ 21 $ ( 22 ) $ ( 202 ) $ 437 $ ( 52 ) $ 44 $ 4,281 $ — $ ( 29 )

(in millions) Fair Value

of Period Net

in Income Other

Comprehensive

Income (Loss) Purchases,

Out Other Fair

Period Changes in

of Period Changes in

Unrealized Gains

Included in Other

Comprehensive

Income (Loss) for

Recurring Level 3

Instruments Held

at End of Period

Derivative liabilities, net:

Interest rate contracts

$ ( 128 ) $ ( 8 ) $ — $ 133 $ — $ — $ — $ ( 3 ) $ — $ —

Foreign exchange contracts

2 ( 2 ) — — — — — — — —

Equity contracts

( 56 ) ( 2 ) — 23 — — — ( 35 ) 2 —

Other contracts

( 1 ) — — — — — — ( 1 ) 1 —

Total derivative liabilities, net (a)

( 183 ) ( 12 ) — 156 — — — ( 39 ) 3 —

Fortitude Re funds withheld payable ( 119 ) ( 8 ) — ( 27 ) — — — ( 154 ) 33 —

Other Liabilities 92 28 — ( 21 ) — — — 99 — —

Total $ ( 210 ) $ 8 $ — $ 108 $ — $ — $ — $ ( 94 ) $ 36 $ —

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 5.

Fair Value Measurements

(in millions) Fair Value

of Period Net Realized

in Income Other

Comprehensive

Income (Loss) Purchases,

Out Other Fair

Period Changes in

of Period Changes in

Unrealized Gains

Included in Other

Comprehensive

Income (Loss) for

Recurring Level 3

Instruments Held

at End of Period

Three Months Ended June 30, 2023

Bonds available for sale:

Obligations of states, municipalities and political subdivisions $ 15 $ — $ 1 $ — $ — $ — $ — $ 16 $ — $ —

governments 9 — 1 ( 2 ) — ( 2 ) — 6 — 1

5 unchanged sentences

Other bond securities:

Corporate debt — — — 44 — — — 44 — —

RMBS 52 2 — ( 2 ) — — — 52 ( 4 ) —

CLO/ABS 176 ( 3 ) — ( 19 ) — — — 154 ( 25 ) —

Total other bond securities 228 ( 1 ) — 23 — — — 250 ( 29 ) —

Equity securities 25 2 — — 2 ( 1 ) — 28 2 —

Other invested assets 235 1 — ( 9 ) — — — 227 ( 3 ) —

Other assets 110 — — 1 — — — 111 — —

$ 4,990 $ ( 9 ) $ 69 $ ( 253 ) $ 9 $ ( 412 ) $ ( 26 ) $ 4,368 $ ( 30 ) $ 48

(in millions) Fair Value

of Period Net

in Income Other

Comprehensive

Income (Loss) Purchases,

Out Other Fair

Period Changes in

of Period Changes in

Unrealized Gains

Included in Other

Comprehensive

Income (Loss) for

Recurring Level 3

Instruments Held

at End of Period

Derivative liabilities, net:

Interest rate contracts $ ( 355 ) $ 26 $ — $ ( 10 ) $ — $ — $ — $ ( 339 ) $ — $ ( 21 )

Foreign exchange contracts — 2 — — — — — 2 — ( 2 )

Equity contracts ( 328 ) 2 — ( 73 ) — — — ( 399 ) 4 —

Credit contracts — ( 1 ) — 1 — — — — — —

Other contracts ( 1 ) — — — — — — ( 1 ) 1 —

Total derivative liabilities, net(a) ( 684 ) 29 — ( 82 ) — — — ( 737 ) 5 ( 23 )

Fortitude Re funds withheld payable ( 167 ) ( 58 ) — ( 44 ) — — — ( 269 ) 78 —

Other liabilities 112 ( 14 ) — — — — — 98 — —

Total $ ( 739 ) $ ( 43 ) $ — $ ( 126 ) $ — $ — $ — $ ( 908 ) $ 83 $ ( 23 )

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 5.

Fair Value Measurements

(in millions) Fair Value

of Year Net Realized

in Income Other

Comprehensive

Income (Loss) Purchases,

Out Other Fair

Period Changes in

of Period Changes in

Unrealized Gains

Included in Other

Comprehensive

Income (Loss) for

Recurring Level 3

Instruments Held

at End of Period

Six Months Ended June 30, 2024

Bonds available for sale:

Obligations of states, municipalities and political subdivisions $ 3 $ — $ — $ 1 $ — $ — $ — $ 4 $ — $ —

governments 7 — — — — — — 7 — —

Corporate debt 323 1 ( 2 ) ( 60 ) 134 ( 37 ) — 359 — ( 1 )

2 unchanged sentences

CLO/ABS 1,289 ( 12 ) 32 ( 66 ) 44 ( 12 ) — 1,275 — 29

Total bonds available for sale 3,439 32 34 ( 293 ) 550 ( 51 ) 44 3,755 — 27

Other bond securities:

Corporate debt 45 1 — — — — ( 2 ) 44 — —

RMBS 51 — — — — ( 2 ) — 49 — —

CLO/ABS 138 — — 5 2 — — 145 ( 1 ) —

Total other bond securities 234 1 — 5 2 ( 2 ) ( 2 ) 238 ( 1 ) —

4 unchanged sentences

(in millions) Fair Value

of Year MRBs and

in Income Other

11 unchanged sentences

at End of Period

Policyholder contract deposits $ 7,942 $ 452 $ — $ 156 $ — $ — $ — $ 8,550 $ ( 3 ) $ —

Derivative liabilities, net:

3 unchanged sentences

Other contracts ( 1 ) ( 1 ) — 1 — — — ( 1 ) 1 —

Total derivative liabilities, net (b)

Total derivative liabilities, net (a)

( 453 ) 40 — 374 — — — ( 39 ) 8 —

1 unchanged sentence

Other Liabilities 122 ( 2 ) — ( 21 ) — — — 99 — —

$ 5,607 $ 304 $ — $ ( 72 ) $ — $ — $ — $ 5,839 $ 602 $ —

AIG | First Quarter 2024 Form 10-Q

Total $ ( 479 ) $ 39 $ — $ 346 $ — $ — $ — $ ( 94 ) $ 55 $ —

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 5.

1 unchanged sentence

(in millions) Fair Value

of Year MRBs and

of Year Net Realized

in Income Other

11 unchanged sentences

at End of Period

Three Months Ended March 31, 2023

Six Months Ended June 30, 2023

Bonds available for sale:

7 unchanged sentences

Other bond securities:

Obligations of states, municipalities and political subdivisions — — — 1 — — — 1 — —

Corporate debt — — — 44 — — — 44 — —

RMBS 65 2 — ( 15 ) — — — 52 ( 9 ) —

CMBS 28 ( 1 ) — — — — — 27 ( 1 ) —

CLO/ABS 158 1 — ( 13 ) — ( 3 ) 11 154 ( 23 ) —

5 unchanged sentences

(in millions) Fair Value

of Year MRBs and

in Income Other

11 unchanged sentences

at End of Period

Policyholder contract deposits $ 5,367 $ 381 $ — $ 316 $ — $ — $ — $ 6,064 $ ( 368 ) $ —

Derivative liabilities, net:

Interest rate contracts $ ( 311 ) $ 84 $ — $ ( 112 ) $ — $ — $ — $ ( 339 ) $ — $ ( 29 )

Foreign exchange contracts — 2 — — — — — 2 — ( 2 )

Equity contracts ( 271 ) ( 69 ) — ( 59 ) — — — ( 399 ) 63 —

Credit contracts — ( 1 ) — 1 — — — — — —

Other contracts ( 1 ) ( 1 ) — 1 — — — ( 1 ) 1 —

Total derivative liabilities, net (b)

Total derivative liabilities, net (a)

( 583 ) 15 — ( 169 ) — — — ( 737 ) 64 ( 31 )

2 unchanged sentences

$ ( 512 ) $ 83 $ — $ ( 479 ) $ — $ — $ — $ ( 908 ) $ 16 $ ( 31 )

(a) Excludes MRB assets of $ 1.2 billion at March 31, 2024 and $ 830 million at March 31, 2023.

For additional information, see Note 13.

(b) Total Level 3 derivative exposures have been netted in these tables for presentation purposes only.

For additional information, see Note 13.

AIG | First Quarter 2024 Form 10-Q

(a) Total Level 3 derivative exposures have been netted in these tables for presentation purposes only.

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 5.

Fair Value Measurements

Market risk benefits and net realized and unrealized gains and losses included in income related to Level 3 assets and liabilities shown above are reported in the Condensed Consolidated Statements of Income (Loss) as follows:

Net realized and unrealized gains and losses included in income related to Level 3 assets and liabilities shown above are reported in the Condensed Consolidated Statements of Income (Loss) as follows:

(in millions) Net

Income Net Realized

Gains (Losses) Change in the fair

value of market

risk benefits, net (c)

Three Months Ended March 31, 2024

Gains (Losses) Total

Three Months Ended June 30, 2024

Bonds available for sale $ 25 $ ( 2 ) $ 23

Other bond securities 2 — 2

Other invested assets ( 4 ) — ( 4 )

Three Months Ended June 30, 2023

Bonds available for sale $ 4 $ ( 15 ) $ ( 11 )

Other bond securities ( 1 ) — ( 1 )

Equity securities 2 — 2

Other invested assets 1 — 1

Three Months Ended March 31, 2023

Six Months Ended June 30, 2024

Bonds available for sale $ 40 $ ( 8 ) $ 32

1 unchanged sentence

Other invested assets ( 13 ) — ( 13 )

Six Months Ended June 30, 2023

Bonds available for sale $ 37 $ ( 16 ) $ 21

Other bond securities 3 — 3

Equity securities 2 — 2

Other invested assets ( 7 ) — ( 7 )

(in millions) Net

Income Net Realized

(Gains) Losses Change in the fair

value of market

risk benefits, net (c)

Three Months Ended March 31, 2024

Policyholder contract deposits (a)

$ — $ 452 $ — $ — $ 452

Market risk benefit liabilities, net (b)

— ( 2 ) ( 1,069 ) — ( 1,071 )

(Gains) Losses Total

Three Months Ended June 30, 2024

Derivative liabilities, net $ — $ ( 12 ) $ ( 12 )

1 unchanged sentence

Other Liabilities — 28 28

Three Months Ended March 31, 2023

Policyholder contract deposits (a)

$ — $ 381 $ — $ — $ 381

Market risk benefit liabilities, net (b)

Three Months Ended June 30, 2023

Derivative liabilities, net $ — $ 29 $ 29

Fortitude Re funds withheld payable — ( 58 ) ( 58 )

(a) Primarily embedded derivatives.

(b) Market risk benefit assets and liabilities have been netted in the above table for presentation purposes only.

(c) The portion of the fair value change attributable to own credit risk is recognized in Other comprehensive income (loss) (OCI) .

The following table presents the gross components of purchases, sales, issuances and settlements, net, shown above, for the three months ended March 31, 2024 and 2023 related to Level 3 assets and liabilities in the Condensed Consolidated Balance Sheets:

Other Liabilities — ( 14 ) ( 14 )

Six Months Ended June 30, 2024

Derivative liabilities, net $ — $ 40 $ 40

Fortitude Re funds withheld payable — 1 1

Other Liabilities — ( 2 ) ( 2 )

Six Months Ended June 30, 2023

Derivative liabilities, net $ — $ 15 $ 15

Fortitude Re funds withheld payable — 82 82

Other Liabilities — ( 14 ) ( 14 )

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 5.

Fair Value Measurements

The following table presents the gross components of purchases, sales, issuances and settlements, net, shown above, for the three and six months ended June 30, 2024 and 2023 related to Level 3 assets and liabilities in the Condensed Consolidated Balance Sheets:

(in millions) Purchases Sales Issuances

3 unchanged sentences

Settlements, Net (a)

Three Months Ended March 31, 2024

Three Months Ended June 30, 2024

Bonds available for sale:

Obligations of states, municipalities and political subdivisions $ 1 $ — $ ( 1 ) $ —

governments $ 4 $ — $ ( 4 ) $ —

Corporate debt 5 — ( 27 ) ( 22 )

10 unchanged sentences

Total $ 15 $ ( 1 ) $ ( 216 ) $ ( 202 )

AIG | First Quarter 2024 Form 10-Q

Derivative liabilities, net $ — $ — $ 156 $ 156

Fortitude Re funds withheld payable — — ( 27 ) ( 27 )

Other liabilities — — ( 21 ) ( 21 )

Total $ — $ — $ 108 $ 108

Three Months Ended June 30, 2023

Bonds available for sale:

governments $ — $ — $ ( 2 ) $ ( 2 )

Corporate debt — — ( 131 ) ( 131 )

RMBS 46 — ( 82 ) ( 36 )

CMBS — ( 5 ) 5 —

CLO/ABS 77 ( 148 ) ( 28 ) ( 99 )

Total bonds available for sale 123 ( 153 ) ( 238 ) ( 268 )

Other bond securities:

Corporate debt 20 — 24 44

RMBS — — ( 2 ) ( 2 )

CLO/ABS — 4 ( 23 ) ( 19 )

Total other bond securities 20 4 ( 1 ) 23

Other invested assets ( 1 ) — ( 8 ) ( 9 )

Other assets — — 1 1

Total $ 142 $ ( 149 ) $ ( 246 ) $ ( 253 )

Derivative liabilities, net $ ( 105 ) $ 1 $ 22 $ ( 82 )

Fortitude Re funds withheld payable — — ( 44 ) ( 44 )

Total $ ( 105 ) $ 1 $ ( 22 ) $ ( 126 )

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 5.

5 unchanged sentences

Settlements, Net (a)

Policyholder contract deposits $ — $ 332 $ ( 176 ) $ 156

Six Months Ended June 30, 2024

Bonds available for sale:

Obligations of states, municipalities and political subdivisions $ 1 $ — $ — $ 1

governments 4 — ( 4 ) —

Corporate debt 11 ( 3 ) ( 68 ) ( 60 )

RMBS — ( 1 ) ( 149 ) ( 150 )

CMBS — — ( 18 ) ( 18 )

CLO/ABS 66 ( 2 ) ( 130 ) ( 66 )

Total bonds available for sale 82 ( 6 ) ( 369 ) ( 293 )

Other bond securities:

RMBS 3 ( 1 ) ( 2 ) —

CLO/ABS 11 — ( 6 ) 5

Total other bond securities 14 ( 1 ) ( 8 ) 5

Other invested assets 1 — ( 40 ) ( 39 )

Other assets — — ( 113 ) ( 113 )

Total $ 97 $ ( 7 ) $ ( 530 ) $ ( 440 )

Derivative liabilities, net $ — $ — $ 374 $ 374

Fortitude Re funds withheld payable — — ( 7 ) ( 7 )

Other Liabilities — — ( 21 ) ( 21 )

Total $ — $ — $ 346 $ 346

Three Months Ended March 31, 2023

Six Months Ended June 30, 2023

Bonds available for sale:

Obligations of states, municipalities and political subdivisions $ 1 $ ( 4 ) $ ( 2 ) $ ( 5 )

governments — — ( 2 ) ( 2 )

Corporate Debt 8 — ( 355 ) ( 347 )

4 unchanged sentences

Other bond securities:

Obligations of states, municipalities and political subdivisions 1 — — 1

Corporate debt 20 — 24 44

6 unchanged sentences

Total $ 327 $ ( 179 ) $ ( 588 ) $ ( 440 )

Policyholder contract deposits

$ — $ 326 $ ( 10 ) $ 316

Derivative liabilities, net $ ( 316 ) $ 4 $ 143 $ ( 169 )

1 unchanged sentence

Total $ ( 316 ) $ 4 $ ( 167 ) $ ( 479 )

(a) There were no issuances during the three months ended March 31, 2024 and 2023.

(a) There were no issuances during the three and six months ended June 30, 2024 and 2023.

Both observable and unobservable inputs may be used to determine the fair values of positions classified in Level 3 in the tables above.

As a result, the unrealized gains (losses) on instruments held at March 31, 2024 and 2023 may include changes in fair value that were attributable to both observable (e.g., changes in market interest rates) and unobservable inputs (e.g., changes in unobservable long-dated volatilities).

As a result, the unrealized gains (losses) on instruments held at June 30, 2024 and 2023 may include changes in fair value that were attributable to both observable (e.g., changes in market interest rates) and unobservable inputs (e.g., changes in unobservable long-dated volatilities).

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 5.

Fair Value Measurements

Transfers of Level 3 Assets and Liabilities

The Net realized and unrealized gains (losses) included in income (loss) or OCI as shown in the table above excludes $( 11 ) million and $ 7 million of net gains (losses) related to assets and liabilities transferred into Level 3 during the three months ended March 31, 2024 and 2023, respectively, and includes $ 4 million and $( 5 ) million of net gains (losses) related to assets and liabilities transferred out of Level 3 during the three months ended March 31, 2024 and 2023, respectively.

The Net realized and unrealized gains (losses) included in income (loss) or Other comprehensive income (loss) (OCI) as shown in the table above excludes $( 24 ) million and $( 27 ) million of net gains (losses) related to assets and liabilities transferred into Level 3 during the three and six months ended June 30, 2024, respectively, and includes $ 1 million and $ 1 million of net gains (losses) related to assets and liabilities transferred out of Level 3 during the three and six months ended June 30, 2024, respectively.

The Net realized and unrealized gains (losses) included in income (loss) or OCI as shown in the table above excludes $ 0 million and $ 1 million of net gains (losses) related to assets and liabilities transferred into Level 3 during the three and six months ended June 30, 2023, respectively, and includes $( 9 ) million and $( 9 ) million of net gains (losses) related to assets and liabilities transferred out of Level 3 during the three and six months ended June 30, 2023, respectively.

Transfers of Level 3 Assets

During the three months ended March 31, 2024 and 2023, transfers into Level 3 assets primarily included certain investments in private placement corporate debt, commercial mortgage-backed securities (CMBS) and collateralized loan obligations (CLO)/asset-backed securities (ABS).

During the three and six months ended June 30, 2024 and 2023, transfers into Level 3 assets primarily included certain investments in private placement corporate debt, commercial mortgage-backed securities (CMBS), residential mortgage-backed securities (RMBS) and collateralized loan obligations (CLO)/asset-backed securities (ABS).

Transfers of private placement corporate debt and certain ABS into Level 3 assets were primarily the result of limited market pricing information that required us to determine fair value for these securities based on inputs that are adjusted to better reflect our own assumptions regarding the characteristics of a specific security or associated market liquidity.

The transfers of investments in CMBS and CLO and certain ABS into Level 3 assets were due to diminished market transparency and liquidity for individual security types.

During the three months ended March 31, 2024 and 2023, transfers out of Level 3 assets primarily included certain investments in private placement corporate debt, residential mortgage-backed securities (RMBS), CMBS and CLO/ABS.

Transfers of private placement corporate debt and certain ABS out of Level 3 assets were based on consideration of market liquidity as well as related transparency of pricing and associated observable inputs for these investments.

Transfers of certain investments in private placement corporate debt and certain ABS out of Level 3 assets were primarily the result of using observable pricing information that reflects the

AIG | First Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 5.

Fair Value Measurements

fair value of those securities without the need for adjustment based on our own assumptions regarding the characteristics of a specific security or the current liquidity in the market.

The transfers of investments in CMBS, RMBS, CLO and certain ABS into Level 3 assets were due to diminished market transparency and liquidity for individual security types.

During the three and six months ended June 30, 2024 and 2023, transfers out of Level 3 assets primarily included certain investments in private placement corporate debt and CMBS.

Transfers of private placement corporate debt out of Level 3 assets were based on consideration of market liquidity as well as related transparency of pricing and associated observable inputs for these investments.

Transfers of certain investments in private placement corporate debt out of Level 3 assets were primarily the result of using observable pricing information that reflects the fair value of those securities without the need for adjustment based on our own assumptions regarding the characteristics of a specific security or the current liquidity in the market.

Transfers of Level 3 Liabilities

There were no significant transfers of derivative or other liabilities into or out of Level 3 for the three months ended March 31, 2024 and 2023.

There were no significant transfers of derivative or other liabilities into or out of Level 3 for the three and six months ended June 30, 2024 and 2023.

QUANTITATIVE INFORMATION ABOUT LEVEL 3 FAIR VALUE MEASUREMENTS

2 unchanged sentences

(in millions) Fair Value at

March 31, 2024 Valuation

June 30, 2024 Valuation

Technique Unobservable Input (b)

8 unchanged sentences

CMBS 14 Discounted cash flow Yield 7.22 % - 15.19 % ( 11.20 %)

Market risk benefit assets 1,172 Discounted cash flow Equity volatility 6.35 % - 49.95 %

Base lapse rate 0.16 % - 28.80 %

Dynamic lapse multiplier (e)

20.00 % - 186.18 %

Mortality multiplier (e)(f)

38.25 % - 160.01 %

Utilization (g)

80.00 % - 100.00 %

Equity / interest rate correlation 0.00 % - 30.00 %

0.06 % - 2.33 %

Liabilities (d) :

Market risk benefit liabilities:

Variable annuities guaranteed benefits 1,675 Discounted cash flow Equity volatility 6.35 % - 49.95 %

Base lapse rate 0.16 % - 28.80 %

Dynamic lapse multiplier (e)

20.00 % - 186.18 %

Mortality multiplier (e)(f)

38.25 % - 160.01 %

Utilization (g)

80.00 % - 100.00 %

Equity / interest rate correlation

0.00 % - 30.00 %

0.06 % - 2.33 %

Fixed annuities guaranteed benefits 1,130 Discounted cash flow Base lapse rate 0.20 % - 15.75 %

Dynamic lapse multiplier (e)

20.00 % - 186.18 %

Mortality multiplier (e)(f)

40.26 % - 168.43 %

Utilization (g)

90.00 % - 97.50 %

0.06 % - 2.33 %

Fixed index annuities guaranteed benefits 2,362 Discounted cash flow Equity volatility 6.35 % - 49.95 %

Base lapse rate 0.20 % - 50.00 %

Dynamic lapse multiplier (e)

20.00 % - 186.18 %

Mortality multiplier (e)(f)

24.00 % - 146.00 %

Utilization (g)

60.00 % - 97.50 %

Option budget 0.00 % - 6.00 %

Equity / interest rate correlation 0.00 % - 30.00 %

0.06 % - 2.33 %

AIG | First Quarter 2024 Form 10-Q

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 5.

1 unchanged sentence

(in millions) Fair Value at

March 31, 2024 Valuation

Technique Unobservable Input (b)

(Weighted Average) (c)

Embedded derivatives within Policyholder contract deposits:

Index credits on fixed index annuities (i)

7,603 Discounted cash flow Equity volatility 6.35 % - 49.95 %

Base lapse rate 0.20 % - 50.00 %

Dynamic lapse multiplier (e)

20.00 % - 186.18 %

Mortality multiplier (e)(f)

24.00 % - 146.00 %

Utilization (g)

60.00 % - 97.50 %

Option budget 0.00 % - 6.00 %

Equity / interest rate correlation 0.00 % - 30.00 %

0.06 % - 2.33 %

Index universal life 947 Discounted cash flow Base lapse rate 0.00 % - 37.97 %

Mortality rate 0.00 % - 100.00 %

Equity volatility 5.85 % - 19.95 %

0.06 % - 2.33 %

(in millions) Fair Value at

December 31, 2023 Valuation

9 unchanged sentences

CMBS 22 Discounted cash flow Yield 9.84 % - 17.24 % ( 13.54 %)

Market risk benefit assets 912 Discounted cash flow Equity volatility 6.25 % - 49.75 %

Base lapse rate 0.16 % - 28.80 %

Dynamic lapse multiplier (e)

20.00 % - 186.18 %

Mortality multiplier (e)(f)

38.25 % - 160.01 %

Utilization (g)

80.00 % - 100.00 %

Equity / interest rate correlation 0.00 % - 30.00 %

0.00 % - 2.29 %

Liabilities (d) :

Market risk benefit liabilities:

Variable annuities guaranteed benefits 2,174 Discounted cash flow Equity volatility 6.25 % - 49.75 %

Base lapse rate 0.16 % - 28.80 %

Dynamic lapse multiplier (e)

20.00 % - 186.18 %

Mortality multiplier (e)(f)

38.25 % - 160.01 %

Utilization (g)

80.00 % - 100.00 %

Equity / interest rate correlation 0.00 % - 30.00 %

0.00 % - 2.29 %

Fixed annuities guaranteed benefits 1,111 Discounted cash flow Base lapse rate 0.20 % - 15.75 %

Dynamic lapse multiplier (e)

20.00 % - 186.18 %

Mortality multiplier (e)(f)

40.26 % - 168.43 %

Utilization (g)

90.00 % - 97.50 %

0.00 % - 2.29 %

Fixed index annuities guaranteed benefits 2,420 Discounted cash flow Equity volatility 6.25 % - 49.75 %

Base lapse rate 0.20 % - 50.00 %

Dynamic lapse multiplier (e)

20.00 % - 186.18 %

Mortality multiplier (e)(f)

24.00 % - 146.00 %

Utilization (g)

60.00 % - 97.50 %

Option budget 0.00 % - 6.00 %

Equity / interest rate correlation 0.00 % - 30.00 %

0.00 % - 2.29 %

AIG | First Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 5.

Fair Value Measurements

(in millions) Fair Value at

December 31, 2023 Valuation

Technique Unobservable Input (b)

(Weighted Average) (c)

Embedded derivatives within Policyholder contract deposits:

Index credits on fixed index annuities (i)

6,953 Discounted cash flow Equity volatility 6.25 % - 49.75 %

Base lapse rate 0.20 % - 50.00 %

Dynamic lapse multiplier (e)

20.00 % - 186.18 %

Mortality multiplier (e)(f)

24.00 % - 146.00 %

Utilization (g)

60.00 % - 97.50 %

Option budget 0.00 % - 6.00 %

Equity / interest rate correlation 0.00 % - 30.00 %

0.00 % - 2.29 %

Index universal life 989 Discounted cash flow Base lapse rate 0.00 % - 37.97 %

Mortality rate 0.00 % - 100.00 %

Equity volatility 5.85 % - 20.36 %

0.00 % - 2.29 %

(a) Information received from third-party valuation service providers.

3 unchanged sentences

Because the valuation methodology for embedded derivatives with policyholder contract deposits and market risk benefits uses a range of inputs that vary at the contract level over the cash flow projection period, management believes that presenting a range, rather than weighted average, is a more meaningful representation of the unobservable inputs used in the valuation.

(d) The Fortitude Re funds withheld payable has been excluded from the above table.

As discussed in Note 8, the Fortitude Re funds withheld payable is created through modified coinsurance (modco) and funds withheld reinsurance arrangements where the investments supporting the reinsurance agreements are withheld by, and continue to reside on AIG’s balance sheet.

This embedded derivative is valued as a total return swap with reference to the fair value of the invested assets held by AIG.

Accordingly, the unobservable inputs utilized in the valuation of the embedded derivative are a component of the invested assets supporting the reinsurance agreements that are held on AIG’s balance sheet.

(e) The ranges for these inputs vary due to the different guaranteed minimum withdrawal benefits (GMWB) product specification and policyholder characteristics across in-force policies.

Policyholder characteristics that affect these ranges include age, policy duration, and gender.

(f) Mortality inputs are shown as multipliers of the 2012 Individual Annuity Mortality Basic table.

(g) The partial withdrawal utilization unobservable input range shown applies only to policies with GMWB riders.

(h) The non-performance risk adjustment (NPA) applied as a spread over risk-free curve for discounting.

(i) The fixed index annuities embedded derivative associated with index credits related to the contracts with guaranteed product features included in policyholder contract deposits was $ 1.7 billion and $ 1.5 billion at March 31, 2024 and December 31, 2023, respectively.

The ranges of reported inputs for Obligations of states, municipalities and political subdivisions, Corporate debt, RMBS, CLO/ABS, and CMBS valued using a discounted cash flow technique consist of one standard deviation in either direction from the value‑weighted average.

14 unchanged sentences

In general, increases in the yield would decrease the fair value of investments, and conversely, decreases in the yield would increase the fair value of investments.

AIG | First Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 5.

Fair Value Measurements

MRBs and Embedded Derivatives within Policyholder Contract Deposits

For MRBs and embedded derivatives, the assumptions for unobservable inputs vary throughout the period over which cash flows are projected for valuation purposes.

The following are applicable unobservable inputs:

• Long-term equity volatilities represent equity volatility beyond the period for which observable equity volatilities are available.

Increases in assumed volatility will generally increase the fair value of both the projected cash flows from rider fees as well as the projected cash flows related to benefit payments.

Therefore, the net change in the fair value of the liability may be either a decrease or an increase, depending on the relative changes in projected rider fees and projected benefit payments.

• Equity and interest rate correlation estimates the relationship between changes in equity returns and interest rates in the economic scenario generator used to value our MRBs.

In general, a higher positive correlation assumes that equity markets and interest rates move in a more correlated fashion, which generally increases the fair value of the liability.

Only our fixed index annuities with a GMWB rider are subject to the equity and interest correlation assumption.

Other policies such as accumulation fixed index annuity and life products do not use a correlation assumption.

• Base lapse rate assumptions are determined by company experience and judgment and are adjusted at the contract level using a dynamic lapse function, which reduces the base lapse rate when the contract is in-the-money (when the contract holder’s guaranteed value, as estimated by the company, is worth more than their underlying account value).

Lapse rates are also generally assumed to be lower in periods when a surrender charge applies.

Increases in assumed lapse rates will generally decrease the fair value of the liability as fewer policyholders would persist to collect guaranteed benefit amounts.

• Mortality rate assumptions, which vary by age and gender, are based on company experience and include a mortality improvement assumption.

Increases in assumed mortality rates will decrease the fair value of the GMWB liability, while lower mortality rate assumptions will generally increase the fair value of the liability because guaranteed withdrawal payments will be made for a longer period of time and generally exceed any decrease in guaranteed death benefits.

• Utilization assumptions estimate the timing when policyholders with a GMWB will elect to utilize their benefit and begin taking withdrawals.

The assumptions may vary by the type of guarantee, tax-qualified status, the contract’s withdrawal history and the age of the policyholder.

Utilization assumptions are based on company experience, which includes partial withdrawal behavior.

Increases in assumed utilization rates will generally increase the fair value of the liability.

• Non-performance or “own credit” risk adjustment used in the valuation of MRBs and embedded derivatives, which reflects a market participant’s view of our claims-paying ability by incorporating a different spread (the NPA spread) to the curve used to discount projected benefit cash flows.

When corporate credit spreads widen, the change in the NPA spread generally reduces the fair value of the MRBs and embedded derivatives, resulting in a gain in AOCI or Net realized gains (losses), respectively, and when corporate credit spreads narrow or tighten, the change in the NPA spread generally increases the fair value of the MRBs and embedded derivatives, resulting in a loss in AOCI or Net realized gains (losses), respectively.

• The projected cash flows incorporate best estimate assumptions for policyholder behavior (including mortality, lapses, withdrawals and benefit utilization), along with an explicit risk margin to reflect a market participant’s estimates of the fair value of projected cash flows and policyholder behavior.

Estimates of future policyholder behavior assumptions are subjective and based primarily on our historical experience.

• For embedded derivatives, option budgets estimate the expected long-term cost of options used to hedge exposures associated with index price changes.

The level of option budgets determines future costs of the options, which impacts the growth in account value and the valuation of embedded derivatives.

Embedded Derivatives within Reinsurance Contracts

The fair value of embedded derivatives associated with funds withheld reinsurance contracts is determined based upon a total return swap technique with reference to the fair value of the investments held by AIG related to AIG’s funds withheld payable.

The fair value of the underlying assets is generally based on market observable inputs using industry standard valuation techniques.

The valuation also requires certain significant inputs, which are generally not observable, and accordingly, the valuation is considered Level 3 in the fair value hierarchy.

AIG | First Quarter 2024 Form 10-Q

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 5.

3 unchanged sentences

For these investments, which are measured at fair value on a recurring basis, we use the net asset value per share to measure fair value.

March 31, 2024 December 31, 2023

June 30, 2024 December 31, 2023

(in millions) Investment Category Includes Fair Value Using NAV Per Share (or its equivalent) Unfunded Commitments Fair Value Using NAV Per Share (or its equivalent) Unfunded Commitments

18 unchanged sentences

Some of the portfolio consists of illiquid run-off or “side-pocket” positions whose liquidation horizons are uncertain and likely beyond a year after submission of the redemption notice.

AIG | First Quarter 2024 Form 10-Q

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 5.

2 unchanged sentences

The following table presents the gains or losses recorded related to the eligible instruments for which we elected the fair value option:

Three Months Ended March 31, Gain (Loss)

Gain (Loss) Three Months

Ended June 30, Gain (Loss) Six Months

Ended June 30,

(in millions) 2024 2023 2024 2023

Other bond securities (a)

$ 5 $ ( 11 ) $ 7 $ 9

Alternative investments (b)

Long-term debt (c)

28 54 108 130

All other investments (c)

Total gain (loss) $ 98 $ 43 $ 180 $ 139

2 unchanged sentences

For additional information regarding the funds withheld arrangements with Fortitude Re, see Note 8.

(b) Includes certain hedge funds, private equity funds and other investment partnerships.

(b) Includes certain hedge funds, private equity funds and real estate investments.

We calculate the effect of these credit spread changes using discounted cash flow techniques that incorporate current market interest rates, our observable credit spreads on these liabilities and other factors that mitigate the risk of nonperformance such as cash collateral posted.

The following table presents the difference between fair value and the aggregate contractual principal amount of long-term debt for which the fair value option was elected:

March 31, 2024 December 31, 2023

(in millions) Fair Value Outstanding Principal Amount Difference Fair Value Outstanding Principal Amount Difference

Long-term debt* $ 68 $ 60 $ 8 $ 53 $ 44 $ 9

* Includes GIAs, notes, bonds, loans and mortgages payable.

FAIR VALUE MEASUREMENTS ON A NON-RECURRING BASIS

The following table presents assets measured at fair value on a non-recurring basis at the time of impairment and the related impairment charges recorded during the periods presented:

Assets at Fair Value Impairment Charges

Non-Recurring Basis Three Months Ended

(in millions) Level 1 Level 2 Level 3 Total 2024 2023

March 31, 2024

Other investments $ — $ — $ 98 $ 98 $ 25 $ —

Other assets — — — — 1 9

Total $ — $ — $ 98 $ 98 $ 26 $ 9

December 31, 2023

Other investments $ — $ — $ 80 $ 80

Total $ — $ — $ 80 $ 80

AIG | First Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 5.

Fair Value Measurements

FAIR VALUE INFORMATION ABOUT FINANCIAL INSTRUMENTS NOT MEASURED AT FAIR VALUE

2 unchanged sentences

(in millions) Level 1 Level 2 Level 3 Total

March 31, 2024

June 30, 2024

Mortgage and other loans receivable $ — $ 341 $ 3,871 $ 4,212 $ 4,347

4 unchanged sentences

Other assets 18 — — 18 18

Policyholder contract deposits associated with investment-type contracts — 86 136,106 136,192 141,851

Fortitude Re funds withheld payable — — 3,518 3,518 3,518

Other liabilities (c)

— 3,585 — 3,585 3,585

Short-term and long-term debt — 17,928 249 18,177 19,250

Long-term debt — 8,867 235 9,102 9,861

Debt of consolidated investment entities — — 79 79 79

Separate account liabilities - investment contracts — 91,243 — 91,243 91,243

Estimated Fair Value Carrying

(in millions) Level 1 Level 2 Level 3 Total

December 31, 2023

1 unchanged sentence

Other invested assets — 645 6 651 651

Short-term investments (a)

— 6,428 — 6,428 6,428

Short-term investments

— 3,502 — 3,502 3,502

Cash 1,540 — — 1,540 1,540

Other assets 32 — — 32 32

Policyholder contract deposits associated with investment-type contracts — 90 130,094 130,184 140,652

Fortitude Re funds withheld payable — — 3,675 3,675 3,675

Other liabilities (c)

— 2,467 — 2,467 2,467

Short-term and long-term debt — 18,595 267 18,862 19,743

Long-term debt — 9,623 267 9,890 10,375

Debt of consolidated investment entities — — 231 231 231

Separate account liabilities - investment contracts — 87,215 — 87,215 87,215

(a) Excludes $ 25 million and $ 11 million at March 31, 2024 and December 31, 2023, respectively, reclassified to Assets held for sale on the Condensed Consolidated Balance Sheets.

(b) Excludes $ 1 million and $ 3 million at March 31, 2024 and December 31, 2023, respectively, reclassified to Assets held for sale on the Condensed Consolidated Balance Sheets.

(c) Excludes $ 52 million and $ 45 million at March 31, 2024 and December 31, 2023, respectively, reclassified to Liabilities held for sale on the Condensed Consolidated Balance Sheets.

AIG | First Quarter 2024 Form 10-Q

(a) Excludes $ 7 million at June 30, 2024 reclassified to Assets held for sale on the Condensed Consolidated Balance Sheets.

(b) Excludes $ 90 million at June 30, 2024 reclassified to Assets held for sale on the Condensed Consolidated Balance Sheets.

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 6.

2 unchanged sentences

(in millions) Amortized

March 31, 2024

June 30, 2024

Bonds available for sale:

8 unchanged sentences

Total mortgage-backed, asset-backed and collateralized 15,028 ( 9 ) 252 ( 687 ) 14,584

Total bonds available for sale (c)

Total bonds available for sale (b)

$ 65,326 $ ( 33 ) $ 847 $ ( 3,807 ) $ 62,333

10 unchanged sentences

Total mortgage-backed, asset-backed and collateralized 15,759 ( 13 ) 273 ( 747 ) 15,272

Total bonds available for sale (c)

Total bonds available for sale (b)

$ 68,119 $ ( 34 ) $ 1,073 $ ( 3,916 ) $ 65,242

1 unchanged sentence

Changes in the allowance for credit losses are recorded through Net realized gains (losses) and are not recognized in OCI.

(b) At March 31, 2024, includes mark to market movement relating to embedded derivatives.

(c) At March 31, 2024 and December 31, 2023, the fair value of bonds available for sale held by us that were below investment grade or not rated totaled $ 16.9 billion or 7 percent and $ 17.1 billion or 7 percent, respectively.

AIG | First Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 6.

(b) At June 30, 2024 and December 31, 2023, the fair value of bonds available for sale held by us that were below investment grade or not rated totaled $ 4.8 billion or 8 percent and $ 5.2 billion or 8 percent, respectively.

Securities Available for Sale in a Loss Position for Which No Allowance for Credit Loss Has Been Recorded

2 unchanged sentences

(in millions) Fair

March 31, 2024

June 30, 2024

Bonds available for sale:

7 unchanged sentences

Total bonds available for sale $ 13,886 $ 291 $ 30,118 $ 3,490 $ 44,004 $ 3,781

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 6.

Less than 12 Months 12 Months or More Total

(in millions) Fair

December 31, 2023

8 unchanged sentences

Total bonds available for sale $ 11,248 $ 493 $ 31,037 $ 3,392 $ 42,285 $ 3,885

* At March 31, 2024, includes mark to market movement relating to embedded derivatives.

At March 31, 2024, we held 27,875 individual fixed maturity securities that were in an unrealized loss position and for which no allowance for credit losses has been recorded (including 22,726 individual fixed maturity securities that were in a continuous unrealized loss position for 12 months or more).

At June 30, 2024, we held 13,477 individual fixed maturity securities that were in an unrealized loss position and for which no allowance for credit losses has been recorded (including 9,923 individual fixed maturity securities that were in a continuous unrealized loss position for 12 months or more).

At December 31, 2023, we held 13,052 individual fixed maturity securities that were in an unrealized loss position and for which no allowance for credit losses has been recorded (including 10,027 individual fixed maturity securities that were in a continuous unrealized loss position for 12 months or more).

We did not recognize the unrealized losses in earnings on these fixed maturity securities at March 31, 2024 because it was determined that such losses were due to non-credit factors.

We did not recognize the unrealized losses in earnings on these fixed maturity securities at June 30, 2024 because it was determined that such losses were due to non-credit factors.

Additionally, we neither intend to sell the securities nor do we believe that it is more likely than not that we will be required to sell these securities before recovery of their amortized cost basis.

For fixed maturity securities with significant declines, we performed fundamental credit analyses on a security-by-security basis, which included consideration of credit enhancements, liquidity position, expected defaults, industry and sector analysis, forecasts and available market data.

AIG | First Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 6.

Contractual Maturities of Fixed Maturity Securities Available for Sale

The following table presents the amortized cost and fair value of fixed maturity securities available for sale by contractual maturity:

March 31, 2024 Total Fixed Maturity Securities

June 30, 2024 Total Fixed Maturity Securities

Available for Sale

9 unchanged sentences

The following table presents the gross realized gains and gross realized losses from sales or maturities of our available for sale securities:

Three Months Ended March 31,

Three Months Ended June 30, Six Months Ended June 30,

2024 2023 2024 2023

(in millions) Gross

Fixed maturity securities $ 28 $ 197 $ 24 $ 119 $ 43 $ 313 $ 118 $ 577

For the three months ended March 31, 2024 and 2023, the aggregate fair value of available for sale securities sold was $ 4.9 billion and $ 10.8 billion, respectively, which resulted in net realized gains (losses) of $( 443 ) million and $( 452 ) million, respectively.

Included within the net realized gains (losses) are $( 37 ) million and $( 65 ) million of net realized gains (losses) for the three months ended March 31, 2024 and 2023, respectively, which relate to Fortitude Re funds withheld assets.

For the three and six months ended June 30, 2024, the aggregate fair value of available for sale securities sold was $ 2.6 billion and $ 5.0 billion, respectively, which resulted in net realized gains (losses) of $( 169 ) million and $( 270 ) million, respectively.

Included within the net realized gains (losses) are $( 1 ) million and $( 16 ) million of net realized gains (losses) for the three and six months ended June 30, 2024, respectively, which relate to Fortitude Re funds withheld assets.

These net realized gains (losses) are included in Net realized gains (losses) on Fortitude Re funds withheld assets.

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 6.

For the three and six months ended June 30, 2023, the aggregate fair value of available for sale securities sold was $ 2.6 billion and $ 10.7 billion, respectively, which resulted in net realized gains (losses) of $( 95 ) million and $( 459 ) million, respectively.

Included within the net realized gains (losses) are $( 7 ) million and $( 59 ) million of net realized gains (losses) for the three and six months ended June 30, 2023, respectively, which relate to Fortitude Re funds withheld assets.

These net realized gains (losses) are included in Net realized gains (losses) on Fortitude Re funds withheld assets.

OTHER SECURITIES MEASURED AT FAIR VALUE

The following table presents the fair value of fixed maturity securities measured at fair value based on our election of the fair value option, which are reported in the other bond securities caption in the financial statements, and equity securities measured at fair value:

(in millions) March 31, 2024 December 31, 2023

(in millions) June 30, 2024 December 31, 2023

Value Percent

8 unchanged sentences

CMBS 42 3 33 2

CLO/ABS and other collateralized 1,721 28 1,681 28

CLO/ABS and other collateralized securities 236 16 207 16

Total mortgage-backed, asset-backed and collateralized

3 unchanged sentences

Total $ 1,454 100 % $ 1,328 100 %

AIG | First Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 6.

OTHER INVESTED ASSETS

The following table summarizes the carrying amounts of other invested assets:

(in millions) March 31, 2024 December 31, 2023

(in millions) June 30, 2024 December 31, 2023

Alternative investments (a)(b)

$ 4,283 $ 4,345

Investment real estate (c)

All other investments (d)

Retained investment in Corebridge using fair value option 8,567 —

All other investments

Total $ 14,788 $ 6,368

(a) At March 31, 2024, included hedge funds of $ 0.7 billion and private equity funds of $ 10.5 billion.

At December 31, 2023, included hedge funds of $ 0.7 billion and private equity funds of $ 10.6 billion.

(a) At June 30, 2024, included hedge funds of $ 188 million and private equity funds of $ 3.9 billion.

At December 31, 2023, included hedge funds of $ 411 million and private equity funds of $ 3.7 billion.

Includes investments in real estate, net of accumulated depreciation.

At June 30, 2024 and December 31, 2023, the accumulated depreciation was $ 162 million and $ 161 million, respectively.

(b) The majority of our hedge fund investments are redeemable upon a single month or quarter’s notice, though redemption terms vary from single, immediate withdrawals, to withdrawals staggered up to six quarters.

Some of the portfolio consists of illiquid run-off or “side-pocket” positions whose liquidation horizons are uncertain and likely beyond a year after submission of the redemption notice.

At March 31, 2024 and December 31, 2023, the accumulated depreciation was $ 834 million and $ 853 million, respectively.

(d) Includes AIG's ownership interest in Fortitude Group Holdings, LLC (FRL), and DaVinciRe Holdings Ltd, Class D (DVRH), which are recorded using the measurement alternative for equity securities.

Our investment in FRL totaled $ 156 million and $ 156 million at March 31, 2024 and December 31, 2023, respectively.

Our investment in DVRH totaled $ 300 million and $ 300 million at March 31, 2024 and December 31, 2023, respectively.

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 6.

NET INVESTMENT INCOME

The following table presents the components of Net investment income:

Three Months Ended March 31, 2024 2023

Three Months Ended June 30, 2024 2023

(in millions) Excluding Fortitude

11 unchanged sentences

32 — 32 44 — 44

Real estate 5 ( 7 ) ( 2 ) 3 — 3

Other investments

Other investments (b)

177 1 178 ( 6 ) 2 ( 4 )

2 unchanged sentences

Net investment income $ 957 $ 33 $ 990 $ 812 $ 25 $ 837

(a) Included income from hedge funds, private equity funds and affordable housing partnerships.

Hedge funds are recorded as of the balance sheet date.

Private equity funds are generally reported on a one-quarter lag.

AIG | First Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 6.

NET REALIZED GAINS AND LOSSES

The following table presents the components of Net realized gains (losses):

Three Months Ended March 31, 2024 2023

Six Months Ended June 30, 2024 2023

(in millions) Excluding Fortitude

4 unchanged sentences

Funds Withheld

Available for sale fixed maturity securities, including short-term investments $ 1,488 $ 42 $ 1,530 $ 1,354 $ 50 $ 1,404

Other fixed maturity securities

( 4 ) 11 7 2 7 9

Equity securities 84 — 84 62 — 62

Interest on mortgage and other loans 133 17 150 139 18 157

Alternative investments (a)

87 ( 1 ) 86 139 — 139

Other investments (b)

199 3 202 8 2 10

Total investment income 1,987 72 2,059 1,704 77 1,781

Investment expenses 90 — 90 100 — 100

Net investment income $ 1,897 $ 72 $ 1,969 $ 1,604 $ 77 $ 1,681

(a) Included income from hedge funds, private equity funds and real estate investments.

Hedge funds are recorded as of the balance sheet date.

Private equity funds are generally reported on a one-quarter lag.

(b) Includes dividends received from Corebridge and changes in its stock price of $ 68 million and $ 65 million, respectively, for both three and six months ended June 30, 2024.

NET REALIZED GAINS AND LOSSES

The following table presents the components of Net realized gains (losses):

Three Months Ended June 30, 2024 2023

(in millions) Excluding

Assets Fortitude

Assets Total Excluding

Assets Fortitude

Sales of fixed maturity securities $ ( 168 ) $ ( 1 ) $ ( 169 ) $ ( 88 ) $ ( 7 ) $ ( 95 )

Intent to sell ( 16 ) ( 32 ) ( 48 ) — — —

Change in allowance for credit losses on fixed maturity securities ( 18 ) — ( 18 ) ( 30 ) — ( 30 )

1 unchanged sentence

Foreign exchange transactions 52 — 52 123 2 125

Index-linked interest credited embedded derivatives, net of related hedges 90 — 90 ( 178 ) — ( 178 )

All other derivatives and hedge accounting ( 21 ) — ( 21 ) ( 89 ) ( 3 ) ( 92 )

Sales of alternative investments and real estate investments 30 ( 1 ) 29 4 1 5

Sales of alternative investments 4 — 4 — — —

Other ( 24 ) ( 3 ) ( 27 ) 18 — 18

Net realized losses – excluding Fortitude Re funds withheld embedded derivative ( 187 ) ( 1 ) ( 188 ) ( 65 ) ( 7 ) ( 72 )

Net realized gains on Fortitude Re funds withheld embedded derivative — 8 8 — 58 58

Net realized gains (losses) $ ( 187 ) $ 7 $ ( 180 ) $ ( 65 ) $ 51 $ ( 14 )

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 6.

Six Months Ended June 30, 2024 2023

(in millions) Excluding

Assets Fortitude

Assets Total Excluding

Assets Fortitude

Sales of fixed maturity securities $ ( 254 ) $ ( 16 ) $ ( 270 ) $ ( 400 ) $ ( 59 ) $ ( 459 )

Change in allowance for credit losses on fixed maturity securities ( 19 ) — ( 19 ) ( 24 ) — ( 24 )

Change in allowance for credit losses on loans ( 20 ) 1 ( 19 ) ( 7 ) ( 1 ) ( 8 )

Foreign exchange transactions 111 ( 3 ) 108 155 5 160

All other derivatives and hedge accounting ( 69 ) 2 ( 67 ) ( 113 ) ( 6 ) ( 119 )

Sales of alternative investments 14 ( 1 ) 13 1 — 1

Other ( 9 ) ( 3 ) ( 12 ) 6 — 6

Net realized gains (losses) – excluding Fortitude Re funds withheld embedded derivative ( 246 ) ( 20 ) ( 266 ) ( 382 ) ( 61 ) ( 443 )

Net realized gains (losses) on Fortitude Re funds withheld embedded derivative — 13 13 — ( 1,165 ) ( 1,165 )

Net realized losses on Fortitude Re funds withheld embedded derivative — ( 1 ) ( 1 ) — ( 82 ) ( 82 )

Net realized gains (losses) $ ( 246 ) $ ( 21 ) $ ( 267 ) $ ( 382 ) $ ( 143 ) $ ( 525 )

* Derivative activity related to hedging MRBs is recorded in Change in the fair value of MRBs, net.

For additional disclosures about MRBs, see Note 13.

CHANGE IN UNREALIZED APPRECIATION (DEPRECIATION) OF INVESTMENTS

The following table presents the increase (decrease) in unrealized appreciation (depreciation) of our available for sale securities and other investments:

Three Months Ended March 31,

Three Months Ended

June 30, Six Months Ended

(in millions) 2024 2023 2024 2023

1 unchanged sentence

Fixed maturity securities $ 15 $ ( 180 ) $ ( 117 ) $ 829

Other investments ( 39 ) — ( 39 ) —

Total increase (decrease) in unrealized appreciation (depreciation) of investments* $ ( 24 ) $ ( 180 ) $ ( 156 ) $ 829

* Excludes net unrealized gains and losses attributable to businesses held for sale at March 31, 2024.

* Excludes net unrealized gains and losses attributable to businesses held for sale or reclassified to discontinued operations at June 30, 2024 and 2023.

The following table summarizes the unrealized gains and losses recognized in Net investment income during the reporting period on equity securities and other investments still held at the reporting date:

Three Months Ended March 31, 2024 2023

(in millions) Equities Other

Assets Total Equities Other

Three Months Ended June 30, 2024 2023

(in millions) Equities Other Invested Assets* Total Equities Other Invested Assets Total

Net gains (losses) recognized during the period on equity securities and other investments $ ( 4 ) $ 109 $ 105 $ 41 $ 64 $ 105

Net gains (losses) recognized during the period on equity securities and other investments sold during the period 3 25 28 ( 12 ) 8 ( 4 )

Unrealized gains (losses) recognized during the reporting period on equity securities and other investments still held at the reporting date $ ( 7 ) $ 84 $ 77 $ 53 $ 56 $ 109

Six Months Ended June 30, 2024 2023

(in millions) Equities Other Invested Assets* Total Equities Other Invested Assets Total

Net gains recognized during the period on equity securities and other investments $ 84 $ 192 $ 276 $ 62 $ 143 $ 205

1 unchanged sentence

Unrealized gains (losses) recognized during the reporting period on equity securities and other investments still held at the reporting date $ 41 $ 168 $ 209 $ ( 14 ) $ 134 $ 120

* Includes unrealized gain on AIG’s ownership interest in Corebridge of $ 65 million in the three and six months ended June 30, 2024.

EVALUATING INVESTMENTS FOR AN ALLOWANCE FOR CREDIT LOSSES AND IMPAIRMENTS

For a discussion of our policy for evaluating investments for an allowance for credit losses, see Note 6 to the Consolidated Financial Statements in the 2023 Annual Report.

AIG | First Quarter 2024 Form 10-Q

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 6.

1 unchanged sentence

The following table presents a rollforward of the changes in allowance for credit losses on available for sale fixed maturity securities by major investment category:

Three Months Ended March 31, 2024 2023

Three Months Ended June 30, 2024 2023

(in millions) Structured Non-

1 unchanged sentence

Structured Total

Balance, beginning of period $ 3 $ 25 $ 28 $ 16 $ 12 $ 28

Securities for which allowance for credit losses were not previously recorded 1 5 6 1 23 24

Securities sold during the period — ( 1 ) ( 1 ) ( 2 ) ( 1 ) ( 3 )

Addition to (release of) the allowance for credit losses on securities that had an allowance recorded in a previous period, for which there was no intent to sell before recovery of amortized cost basis 2 10 12 1 5 6

Write-offs charged against the allowance — ( 14 ) ( 14 ) ( 10 ) ( 11 ) ( 21 )

Other — 2 2 1 ( 1 ) —

Balance, end of period $ 6 $ 27 $ 33 $ 7 $ 27 $ 34

Six Months Ended June 30, 2024 2023

(in millions) Structured Non-

Structured Total Structured Non-

Structured Total

Balance, beginning of year $ 13 $ 21 $ 34 $ 20 $ 17 $ 37

17 unchanged sentences

Subsequent to the acquisition date, the PCD assets follow the same accounting as other structured securities that are not high credit quality.

We did not purchase securities with more than insignificant credit deterioration since their origination during the three months ended March 31, 2024 and 2023.

We did not purchase securities with more than insignificant credit deterioration since their origination during the six months ended June 30, 2024 and 2023.

PLEDGED INVESTMENTS

2 unchanged sentences

Our secured financing transactions also include those that involve the transfer of securities to financial institutions in exchange for cash (securities lending agreements).

In all of these secured financing transactions, the securities transferred by us (pledged collateral) may be sold or repledged by the counterparties.

In all of these secured financing transactions, the securities transferred by us

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 6.

(pledged collateral) may be sold or repledged by the counterparties.

These agreements are recorded at their contracted amounts plus accrued interest, other than those that are accounted for at fair value.

2 unchanged sentences

At the termination of the transactions, we and our counterparties are obligated to return the amounts borrowed and the securities transferred, respectively.

AIG | First Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 6.

The following table presents the fair value of securities pledged to counterparties under secured financing transactions, including repurchase and securities lending agreements:

(in millions) March 31, 2024 December 31, 2023

(in millions) June 30, 2024 December 31, 2023

Fixed maturity securities available for sale $ — $ 106

At March 31, 2024 and December 31, 2023, amounts borrowed under repurchase and securities lending agreements totaled $ 3.6 billion and $ 2.6 billion, respectively.

At June 30, 2024 and December 31, 2023, amounts borrowed under repurchase and securities lending agreements totaled $ 0 million and $ 107 million, respectively.

The following table presents the fair value of securities pledged under our repurchase agreements by collateral type and by remaining contractual maturity:

6 unchanged sentences

or greater Total

March 31, 2024

Bonds available for sale:

governments $ — $ 51 $ — $ — $ — $ 51

Corporate debt 14 3,586 — — — 3,600

Total $ 14 $ 3,637 $ — $ — $ — $ 3,651

December 31, 2023

7 unchanged sentences

The following table presents information on the fair value of securities pledged to us under reverse repurchase agreements:

(in millions) March 31, 2024 December 31, 2023

(in millions) June 30, 2024 December 31, 2023

Securities collateral pledged to us $ 1,700 $ 1,200

At March 31, 2024 and December 31, 2023, the carrying value of reverse repurchase agreements totaled $ 927 million and $ 1.1 billion, respectively.

At June 30, 2024 and December 31, 2023, the carrying value of reverse repurchase agreements totaled $ 1.7 billion and $ 1.1 billion, respectively.

All secured financing transactions are collateralized and margined on a daily basis consistent with market standards and subject to enforceable master netting arrangements with rights of set off.

1 unchanged sentence

Insurance – Statutory and Other Deposits

The total carrying value of cash and securities deposited by our insurance subsidiaries under requirements of regulatory authorities or other insurance-related arrangements, including certain annuity-related obligations and certain reinsurance contracts, was $ 18.5 billion and $ 16.5 billion at March 31, 2024 and December 31, 2023, respectively.

The total carrying value of cash and securities deposited by our insurance subsidiaries under requirements of regulatory authorities or other insurance-related arrangements, including certain annuity-related obligations and certain reinsurance contracts, was $ 8.5 billion and $ 8.4 billion at June 30, 2024 and December 31, 2023, respectively.

Other Pledges and Restrictions

Certain of our subsidiaries are members of Federal Home Loan Banks (FHLBs) and such membership requires the members to own stock in these FHLBs.

We owned an aggregate of $ 288 million and $ 283 million of stock in FHLBs at March 31, 2024 and December 31, 2023, respectively.

In addition, our subsidiaries have pledged securities available for sale and residential loans associated with borrowings and funding agreements from FHLBs, with a fair value of $ 6.2 billion and $ 3.1 billion, respectively, at March 31, 2024 and $ 6.5 billion and $ 3.0 billion, respectively, at December 31, 2023.

AIG | First Quarter 2024 Form 10-Q

We owned an aggregate of $ 14 million and $ 15 million of stock in FHLBs at June 30, 2024 and December 31, 2023, respectively.

In addition, our subsidiaries have pledged securities available for sale with a fair value of $ 1.7 billion at June 30, 2024 and $ 1.7 billion at December 31, 2023.

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 6.

Certain GIAs have provisions that require collateral to be posted or payments to be made by us upon a downgrade of our long-term debt ratings.

The actual amount of collateral required to be posted to the counterparties in the event of such downgrades, and the aggregate amount of payments that we could be required to make, depend on market conditions, the fair value of outstanding affected transactions and other factors prevailing at and after the time of the downgrade.

The fair value of securities pledged as collateral with respect to these obligations was approximately $ 77 million and $ 63 million, at March 31, 2024 and December 31, 2023, respectively.

This collateral primarily consists of securities of the U.S.

government and government sponsored entities and generally cannot be repledged or resold by the counterparties.

Investments held in escrow accounts or otherwise subject to restriction as to their use were $ 164 million and $ 164 million, comprised of bonds available for sale and short-term investments at March 31, 2024 and December 31, 2023, respectively.

Reinsurance transactions between AIG and Fortitude Re were structured as modco and loss portfolio transfer arrangements with funds withheld.

Reinsurance transactions between AIG and Fortitude Re were structured as modified coinsurance (modco) and loss portfolio transfer arrangements with funds withheld.

Lending Activities

The following table presents the composition of Mortgage and other loans receivable, net:

(in millions) March 31, 2024 December 31, 2023

(in millions) June 30, 2024 December 31, 2023

Commercial mortgages (a)

$ 3,728 $ 3,836

Residential mortgages 9,241 8,689

Life insurance policy loans 6 7

1 unchanged sentence

Total mortgage and other loans receivable (c)

53,341 52,391

Allowance for credit losses (c) (d)

2 unchanged sentences

$ 4,347 $ 4,441

(a) Commercial mortgages primarily represent loans for apartments, offices and retail properties, with exposures in New York and California representing the largest geographic concentrations (aggregating approximately 18 percent and 10 percent, respectively, at March 31, 2024 and 18 percent and 11 percent, respectively, at December 31, 2023).

(b) There were no loans that were held for sale carried at lower of cost or market as of March 31, 2024 and December 31, 2023.

(c) Excludes $ 37.6 billion at both March 31, 2024 and December 31, 2023 of loan receivable from AIG Financial Products Corp.

(a) Commercial mortgages primarily represent loans for apartments, offices and retail properties, with exposures in California and New York representing the largest geographic concentrations (aggregating approximately 12 percent and 10 percent, respectively, at June 30, 2024 and 13 percent and 10 percent, respectively, at December 31, 2023).

(b) There were no loans that were held for sale carried at lower of cost or market as of June 30, 2024 and December 31, 2023.

(c) Excludes $ 37.6 billion at both June 30, 2024 and December 31, 2023 of loans receivable from AIG Financial Products Corp.

(AIGFP), which has a full allowance for credit losses, recognized upon the deconsolidation of AIGFP.

For additional information, see Note 1 to the Consolidated Financial Statements in the 2023 Annual Report.

(d) Does not include allowance for credit losses of $ 55 million and $ 67 million, respectively, at March 31, 2024 and December 31, 2023, in relation to off-balance-sheet commitments to fund commercial mortgage loans, which is recorded in Other liabilities.

(d) Does not include allowance for credit losses of $ 5 million and $ 9 million, respectively, at June 30, 2024 and December 31, 2023, in relation to off-balance-sheet commitments to fund commercial mortgage loans, which is recorded in Other liabilities.

Interest income is not accrued when payment of contractual principal and interest is not expected.

1 unchanged sentence

Accrual of interest income is generally resumed when delinquent contractual principal and interest is repaid or when a portion of the delinquent contractual payments are made and the ongoing required contractual payments have been made for an appropriate period.

As of March 31, 2024, $ 32 million and $ 656 million of residential mortgage loans and commercial mortgage loans, respectively, were placed on nonaccrual status.

As of December 31, 2023, $ 27 million and $ 492 million of residential mortgage loans and commercial mortgage loans, respectively, were placed on nonaccrual status.

As of June 30, 2024 and December 31, 2023, $ 241 million and $ 73 million, respectively, of commercial mortgage loans were placed on nonaccrual status.

Accrued interest is presented separately and is included in Accrued investment income on the Condensed Consolidated Balance Sheets.

As of March 31, 2024, accrued interest receivable was $ 34 million and $ 187 million associated with residential mortgage loans and commercial mortgage loans, respectively.

As of December 31, 2023, accrued interest receivable was $ 20 million and $ 183 million associated with residential mortgage loans and commercial mortgage loans, respectively.

As of June 30, 2024 and December 31, 2023, accrued interest receivable was $ 20 million and $ 21 million, respectively, associated with commercial mortgage loans.

A significant majority of commercial mortgages in the portfolio are non-recourse loans and, accordingly, the only guarantees are for specific items that are exceptions to the non-recourse provisions.

2 unchanged sentences

Nonperforming loans were not significant for any of the periods presented.

AIG | First Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 7.

Lending Activities

CREDIT QUALITY OF COMMERCIAL MORTGAGES

The following table presents debt service coverage ratios (a) for commercial mortgages by year of vintage:

March 31, 2024 2024 2023 2022 2021 2020 Prior Total

June 30, 2024 2024 2023 2022 2021 2020 Prior Total

(in millions)

3 unchanged sentences

Total commercial mortgages $ 52 $ 493 $ 242 $ 692 $ 158 $ 2,091 $ 3,728

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 7.

Lending Activities

December 31, 2023 2023 2022 2021 2020 2019 Prior Total

5 unchanged sentences

The following table presents loan-to-value ratios (b) for commercial mortgages by year of vintage:

March 31, 2024 2024 2023 2022 2021 2020 Prior Total

June 30, 2024 2024 2023 2022 2021 2020 Prior Total

(in millions)

12 unchanged sentences

(a) The debt service coverage ratio compares a property’s net operating income to its debt service payments, including principal and interest.

Our weighted average debt service coverage ratio was 1.9 x at both periods ended March 31, 2024 and December 31, 2023.

Our weighted average debt service coverage ratio was 1.8 x at both periods ended June 30, 2024 and December 31, 2023.

The debt service coverage ratios are updated when additional relevant information becomes available.

(b) The loan-to-value ratio compares the current unpaid principal balance of the loan to the estimated fair value of the underlying property collateralizing the loan.

Our weighted average loan-to-value ratio was 60 percent at both periods ended March 31, 2024 and December 31, 2023.

Our weighted average loan-to-value ratio was 64 percent and 62 percent at June 30, 2024 and December 31, 2023, respectively.

The loan-to-value ratios have been updated within the last three months to reflect the current carrying values of the loans.

3 unchanged sentences

(dollars in millions) Apartments Offices Retail Industrial Hotel Others Total

March 31, 2024

June 30, 2024

Past Due Status:

In good standing 206 $ 1,241 $ 1,073 $ 422 $ 446 $ 243 $ 120 $ 3,545 95 %

90 days or less delinquent (a)

90 days or less delinquent

1 — 112 — — — — 112 3

2 unchanged sentences

Allowance for credit losses $ 6 $ 99 $ 34 $ 9 $ 12 $ 2 $ 162 4 %

AIG | First Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 7.

Lending Activities

Loans Class Percent

7 unchanged sentences

Allowance for credit losses $ 9 $ 75 $ 36 $ 7 $ 9 $ 2 $ 138 4 %

(a) Includes $ 61 million of Office loans and $ 20 million of Retail loans supporting the Fortitude Re funds withheld arrangements, 90 days or less delinquent, at March 31, 2024.

(b) Does not reflect allowance for credit losses.

The following table presents credit quality performance indicators for residential mortgages by year of vintage:

March 31, 2024 2024 2023 2022 2021 2020 Prior Total

(in millions)

780 and greater $ 55 $ 699 $ 594 $ 2,295 $ 643 $ 845 $ 5,131

720 - 779 198 1,134 539 543 151 345 2,910

660 - 719 69 364 232 131 40 168 1,004

600 - 659 — 12 34 18 10 59 133

Less than 600 — 2 18 9 5 29 63

Total residential mortgages $ 322 $ 2,211 $ 1,417 $ 2,996 $ 849 $ 1,446 $ 9,241

December 31, 2023 2023 2022 2021 2020 2019 Prior Total

(in millions)

780 and greater $ 514 $ 589 $ 2,283 $ 622 $ 240 $ 608 $ 4,856

720 - 779 1,121 625 560 169 99 243 2,817

660 - 719 313 257 113 40 37 128 888

600 - 659 2 20 11 8 9 53 103

Less than 600 — 1 2 2 4 16 25

Total residential mortgages $ 1,950 $ 1,492 $ 2,969 $ 841 $ 389 $ 1,048 $ 8,689

* Fair Isaac Corporation (FICO) is the credit quality indicator used to evaluate consumer credit risk for residential mortgage loan borrowers and scores have been updated within the last twelve months.

FICO scores for residential mortgage investor loans to corporate entities are those of the guarantor at time of purchase.

On March 31, 2024 and December 31, 2023 residential loans direct to consumers totaled $ 2.3 billion and $ 1.7 billion, respectively.

* Does not reflect allowance for credit losses.

METHODOLOGY USED TO ESTIMATE THE ALLOWANCE FOR CREDIT LOSSES

For a discussion of our accounting policy for evaluating Mortgage and other loans receivable for impairment, see Note 7 to the Consolidated Financial Statements in the 2023 Annual Report.

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 7.

Lending Activities

The following table presents a rollforward of the changes in the allowance for credit losses on Mortgage and other loans receivable (a) :

Three Months Ended March 31, 2024 (b)

Three Months Ended June 30, 2024 (b)

(in millions) Commercial

2 unchanged sentences

Mortgages Other

Allowance, beginning of period $ 150 $ 3 $ 153 $ 119 $ 8 $ 127

Loans charged off — — — ( 2 ) — ( 2 )

Net charge-offs — — — ( 2 ) — ( 2 )

Addition to (release of) allowance for loan losses 12 ( 2 ) 10 ( 1 ) ( 5 ) ( 6 )

Allowance, end of period $ 162 $ 1 $ 163 $ 116 $ 3 $ 119

Six Months Ended June 30, 2024 (b)

(in millions) Commercial

Mortgages Other

Loans Total Commercial

Mortgages Other

Allowance, beginning of year $ 138 $ 2 $ 140 $ 109 $ 8 $ 117

4 unchanged sentences

$ 162 $ 1 $ 163 $ 116 $ 3 $ 119

(a) Does not include allowance for credit losses of $ 55 million and $ 62 million, respectively, at March 31, 2024 and 2023 in relation to off-balance-sheet commitments to fund commercial mortgage loans, which is recorded in Other liabilities.

(b) Excludes $ 37.6 billion at both March 31, 2024 and December 31, 2023, of loan receivable from AIGFP, which has a full allowance for credit losses, recognized upon the deconsolidation of AIGFP.

(a) Does not include allowance for credit losses of $ 5 million and $ 13 million, respectively, at June 30, 2024 and 2023 in relation to off-balance-sheet commitments to fund commercial mortgage loans, which is recorded in Other liabilities.

(b) Excludes $ 37.6 billion at both June 30, 2024 and December 31, 2023, of loan receivable from AIGFP, which has a full allowance for credit losses, recognized upon the deconsolidation of AIGFP.

For additional information, see Note 1 to the Consolidated Financial Statements in the 2023 Annual Report.

Our expectations and models used to estimate the allowance for losses on commercial and residential mortgage loans are regularly updated to reflect the current economic environment.

AIG | First Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 7.

Lending Activities

LOAN MODIFICATIONS

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We assess whether a borrower is experiencing financial difficulty based on a variety of factors, including the borrower’s current default on any of its outstanding debt, the probability of a default on any of its debt in the foreseeable future without the modification, the insufficiency of the borrower’s forecasted cash flows to service any of its outstanding debt (including both principal and interest), and the borrower’s inability to access alternative third party financing at an interest rate that would be reflective of current market conditions for a non-troubled debtor.

During the three months ended March 31, 2024, commercial mortgage loans with an amortized cost of $ 17 million supporting the funds withheld arrangements with Fortitude Re and commercial loans, other loans and notes receivable with an amortized cost of $ 168 million (none of which were supporting the funds withheld arrangements with Fortitude Re, and $ 168 million of which is related to the loans previously modified in 2023) were granted term extensions.

The modified loans represent less than 1 percent and 4 percent, respectively, of these portfolio segments.

These modifications added less than one year to the weighted average life of loans in each of these two portfolio segments.

There were no loans that had defaulted during the three months ended March 31, 2024 and 2023, that had been previously modified with borrowers experiencing financial difficulties.

During the six months ended June 30, 2024, commercial mortgage loans with an amortized cost of $ 5 million supporting the funds withheld arrangements with Fortitude Re were granted term extensions.

There were no loans that had defaulted during the six months ended June 30, 2024 and 2023, that had been previously modified with borrowers experiencing financial difficulties.

AIG closely monitors the performance of the loans modified to borrowers experiencing financial difficulty to understand the effectiveness of its modification efforts.

All loans with borrowers experiencing financial difficulty that have been modified in the 12 months prior to March 31, 2024 are current and performing in conjunction with their modified terms.

All loans with borrowers experiencing financial difficulty that have been modified in the 12 months prior to June 30, 2024 are current and performing in conjunction with their modified terms.

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 8.

Fortitude Re is the reinsurer of the majority of AIG’s run-off operations.

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This embedded derivative is considered a total return swap with contractual returns that are attributable to various assets and liabilities associated with these reinsurance agreements.

As of March 31, 2024, approximately $ 26.9 billion of reserves from our Life and Retirement Run-Off Lines and approximately $ 2.9 billion of reserves from our General Insurance Run-Off Lines related to business written by multiple wholly-owned AIG subsidiaries, had been ceded to Fortitude Re under these reinsurance transactions.

AIG | First Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 8.

As of June 30, 2024, $ 3.6 billion of reserves related to business written by multiple wholly-owned AIG subsidiaries, had been ceded to Fortitude Re under these reinsurance transactions.

There is a diverse pool of assets supporting the funds withheld arrangements with Fortitude Re.

The following summarizes the composition of the pool of assets:

March 31, 2024 December 31, 2023

June 30, 2024 December 31, 2023

(in millions) Carrying

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Commercial mortgage loans 474 461 543 528 Amortized cost

Real estate investments 175 302 184 329 Amortized cost

Private equity funds / hedge funds 1,920 1,920 1,910 1,910 Fair value through net investment income

Policy loans 325 325 330 330 Amortized cost

Short-term investments 18 18 46 46 Fair value through net investment income

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Total $ 3,377 $ 3,364 $ 3,542 $ 3,527

(a) The change in the net unrealized gains (losses) on available for sale securities related to the Fortitude Re funds withheld assets was $( 163 ) million ($( 128 ) million after-tax) and $ 704 million ($ 556 million after-tax), respectively for the three months ended March 31, 2024 and 2023.

(a) The change in the net unrealized gains (losses) on available for sale securities related to the Fortitude Re funds withheld assets was $( 53 ) million ($( 42 ) million after-tax) and $ 21 million ($ 16 million after-tax), respectively for the six months ended June 30, 2024 and 2023.

(b) The derivative assets and liabilities have been presented net of cash collateral.

The derivative assets and liabilities supporting the Fortitude Re funds withheld arrangements had a fair market value of $ 17 million and $ 27 million, respectively, as of March 31, 2024.

The derivative assets and liabilities supporting the Fortitude Re funds withheld arrangements had a fair market value of $ 3 million and $ 27 million, respectively, as of June 30, 2024.

The derivative assets and liabilities supporting the Fortitude Re funds withheld arrangements had a fair market value of $ 1 million and $ 28 million, respectively, as of December 31, 2023.

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The impact of the funds withheld arrangements with Fortitude Re was as follows:

Three Months Ended March 31,

Three Months Ended

June 30, Six Months Ended

(in millions) 2024 2023 2024 2023

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Net realized gains (losses) - Fortitude Re funds withheld embedded derivative 8 58 ( 1 ) ( 82 )

Net realized losses on Fortitude Re funds withheld assets ( 166 ) ( 1,196 )

Net realized gains (losses) on Fortitude Re funds withheld assets 7 51 ( 21 ) ( 143 )

Income (loss) from continuing operations before income tax expense (benefit) 40 76 51 ( 66 )

Income tax expense (benefit) (a)

9 16 11 ( 14 )

Net income (loss)

31 60 40 ( 52 )

Change in unrealized appreciation (depreciation) of all other investments (a)

( 34 ) ( 58 ) ( 42 ) 16

Comprehensive income (loss) $ ( 3 ) $ 2 $ ( 2 ) $ ( 36 )

(a) The income tax expense (benefit) and the tax impact in AOCI was computed using AIG’s U.S.

(a) The income tax expense (benefit) and the tax impact in Accumulated other comprehensive income (loss) (AOCI) was computed using AIG’s U.S.

statutory tax rate of 21 percent.

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 8.

Various assets supporting the Fortitude Re funds withheld arrangements are reported at amortized cost, and as such, changes in the fair value of these assets are not reflected in the financial statements.

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We assess the collectability of reinsurance recoverable balances in each reporting period, through either historical trends of disputes and credit events or financial analysis of the credit quality of the reinsurer.

We record adjustments to reflect the results of these assessments through an allowance for credit losses and disputes on uncollectible reinsurance that reduces the carrying amount of reinsurance and other assets on the consolidated balance sheets (collectively, reinsurance recoverables).

We record adjustments to reflect the results of these assessments through an allowance for credit losses and disputes on uncollectible reinsurance that reduces the carrying amount of reinsurance and deposit accounting assets on the consolidated balance sheets (collectively, reinsurance recoverables).

This estimate requires significant judgment for which key considerations include:

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• whether the balance is in dispute or subject to legal collection;

AIG | First Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 8.

• the relative financial health of the reinsurer as classified by the Obligor Risk Ratings (ORRs) we assign to each reinsurer based upon our financial reviews;

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An allowance for disputes is established for a reinsurance recoverable using the losses incurred model for contingencies.

The total reinsurance recoverables as of March 31, 2024 were $ 71.1 billion.

As of that date, utilizing AIG’s ORRs, (i) approximately 90 percent of the reinsurance recoverables were investment grade, of which 49 percent related to General Insurance and 41 percent related to Life and Retirement;

(ii) approximately 9 percent of the reinsurance recoverables were non-investment grade, the majority of which related to General Insurance and (iii) approximately one percent of the reinsurance recoverables related to entities that were not rated by AIG.

The total reinsurance recoverables as of June 30, 2024 were $ 43.1 billion.

As of that date, utilizing AIG’s ORRs, (i) approximately 82 percent of the reinsurance recoverables were investment grade;

(ii) approximately 15 percent of the reinsurance recoverables were non-investment grade and (iii) approximately 3 percent of the reinsurance recoverables related to entities that were not rated by AIG.

The total reinsurance recoverables as of December 31, 2023 were $ 41.4 billion.

As of that date, utilizing AIG’s ORRs, (i) approximately 90 percent of the reinsurance recoverables were investment grade, of which 51 percent related to General Insurance and 39 percent related to Life and Retirement;

(ii) approximately 9 percent of the reinsurance recoverables were non-investment grade, the majority of which related to General Insurance;

(iii) approximately one percent of the reinsurance recoverables related to entities that were not rated by AIG.

As of March 31, 2024 and December 31, 2023, approximately 82 percent and 83 percent, respectively, of our non-investment grade reinsurance exposure related to captive insurers.

As of that date, utilizing AIG’s ORRs, (i) approximately 83 percent of the reinsurance recoverables were investment grade;

(ii) approximately 15 percent of the reinsurance recoverables were non-investment grade;

(iii) approximately 2 percent of the reinsurance recoverables related to entities that were not rated by AIG.

As of June 30, 2024 and December 31, 2023, approximately 78 percent and 85 percent, respectively, of our non-investment grade reinsurance exposure related to captive insurers.

These arrangements are typically collateralized by letters of credit, funds withheld or trust agreements.

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The following table presents a rollforward of the reinsurance recoverable allowance:

Three Months Ended March 31, 2024 2023

(in millions) General Insurance Life and Retirement Total General Insurance Life and Retirement Total

Balance, beginning of year $ 255 $ 30 $ 285 $ 260 $ 84 $ 344

Three Months Ended

June 30, Six Months Ended

(in millions) 2024 2023 2024 2023

Balance, beginning of period $ 255 $ 253 $ 255 $ 260

Addition to (release of) allowance for expected credit losses and disputes, net ( 1 ) ( 1 ) — ( 4 )

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Past due balances on claims that are not in dispute were not material for any of the periods presented.

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 9.

Deferred Policy Acquisition Costs

DAC represent those costs that are incremental and directly related to the successful acquisition of new or renewal of existing insurance contracts.

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The amounts deferred are derived based on successful efforts for each distribution channel and/or cost center from which the cost originates.

AIG | First Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 9.

Deferred Policy Acquisition Costs

DAC for all contracts, except for those with limited to no exposure to policyholder behavior risk, (i.e., certain investment contracts), is grouped and amortized on a constant level basis over the expected term of the related contracts.

The following table presents a rollforward of DAC:

Three Months Ended March 31, 2024 General

Insurance Individual

Retirement Group

Retirement Life

Insurance Institutional

(in millions) Total

Six Months Ended June 30,

(in millions) 2024 2023

Balance, beginning of year $ 2,117 $ 2,343

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Balance, end of period $ 2,123 $ 2,032

Three Months Ended March 31, 2023

Balance, beginning of year $ 2,310 $ 4,597 $ 1,060 $ 4,839 $ 51 $ 12,857

Capitalization 1,358 187 20 120 4 1,689

Amortization expense ( 1,034 ) ( 137 ) ( 21 ) ( 99 ) ( 2 ) ( 1,293 )

Other, including foreign exchange 40 — — 11 — 51

Balance, end of period $ 2,674 $ 4,647 $ 1,059 $ 4,871 $ 53 $ 13,304

* Represents changes in DAC included in Assets held for sale.

For additional information, see Note 4.

DEFERRED SALES INDUCEMENTS

We offer DSI which include enhanced crediting rates or bonus payments to contract holders (bonus interest) on certain annuity and investment contract products.

To qualify for accounting treatment as an asset, the bonus interest must be explicitly identified in the contract at inception.

We must also demonstrate that such amounts are incremental to amounts we credit on similar contracts without bonus interest and are higher than the contracts’ expected ongoing crediting rates for periods after the bonus period.

DSI is reported in Other assets, while amortization related to DSI is recorded in Interest credited to policyholder account balances.

DSI amounts are deferred and amortized on a constant level basis over the life of the contract consistent with DAC.

The following table presents a rollforward of DSI:

Three Months Ended March 31, 2024 2023

(in millions) Individual

Retirement Group

Retirement Total Individual

Retirement Group

Retirement Total

Balance, beginning of year $ 333 $ 164 $ 497 $ 381 $ 177 $ 558

Capitalization 1 — 1 2 — 2

Amortization expense ( 13 ) ( 3 ) ( 16 ) ( 14 ) ( 3 ) ( 17 )

Balance, end of period* $ 321 $ 161 $ 482 $ 369 $ 174 $ 543

* At March 31, 2024 and 2023, Other assets, excluding DSI, totaled $ 11.8 billion and $ 12.4 billion, respectively.

Variable Interest Entities

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While also considering these factors, the consolidation conclusion depends on the breadth of our decision-making ability and our ability to influence activities that significantly affect the economic performance of the VIE.

AIG | First Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 10.

Variable Interest Entities

BALANCE SHEET CLASSIFICATION AND EXPOSURE TO LOSS

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The following table presents the total assets and total liabilities associated with our variable interests in consolidated VIEs, as classified in the Condensed Consolidated Balance Sheets:

(in millions) Real Estate and

Investment Entities (d)

Securitization

March 31, 2024

(in millions) June 30, 2024 December 31, 2023

Bonds available for sale $ 30 $ 72

Other bond securities 46 — 46

Equity securities 19 — 19

Mortgage and other loans receivable

— 1,993 1,993

Other invested assets

Alternative investments (a)

2,536 — 2,536

Investment real estate 1,413 — 1,413

Short-term investments — 5

Accrued investment income 1 2

$ 4,346 $ 2,166 $ 6,512

Debt of consolidated investment entities $ 1,019 $ 1,114 $ 2,133

Total* $ 32 $ 202

December 31, 2023

Bonds available for sale $ 36 $ 148 $ 184

Other bond securities 45 — 45

Equity securities 8 — 8

Mortgage and other loans receivable — 2,063 2,063

Other invested assets

Alternative investments (a)

2,695 — 2,695

Investment real estate 1,488 — 1,488

Short-term investments 125 10 135

Accrued investment income 2 7 9

Other assets 94 2 96

$ 4,554 $ 2,230 $ 6,784

Debt of consolidated investment entities $ — $ 38

Total $ — $ 38

(a) Comprised primarily of investments in real estate joint ventures at March 31, 2024 and December 31, 2023.

(b) The assets of each VIE can be used only to settle specific obligations of that VIE.

(d) At March 31, 2024 and December 31, 2023, off-balance sheet exposure primarily consisting of our insurance companies’ commitments to real estate and investment entities were $ 1.8 billion and $ 1.9 billion, respectively, of which commitments to external parties were $ 0.5 billion and $ 0.4 billion, respectively.

We calculate our maximum exposure to loss to be (i) the amount invested in the debt or equity of the VIE, (ii) the notional amount of VIE assets or liabilities where we have also provided credit protection to the VIE with the VIE as the referenced obligation, and (iii) other commitments and guarantees to the VIE.

AIG | First Quarter 2024 Form 10-Q

* The assets of each VIE can be used only to settle specific obligations of that VIE.

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 10.

Variable Interest Entities

The following table presents total assets of unconsolidated VIEs in which we hold a variable interest, as well as our maximum exposure to loss associated with these VIEs:

2 unchanged sentences

Assets On-Balance

March 31, 2024

June 30, 2024

Real estate and investment entities (a)

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(a) Comprised primarily of hedge funds and private equity funds.

(b) At March 31, 2024 and December 31, 2023, excludes approximately $ 1,948 million and $ 1,971 million, respectively, of VIE assets related to AIGFP and its consolidated subsidiaries, with maximum off-balance sheet exposure to loss of $ 1,918 million and $ 1,941 million, respectively.

(b) At June 30, 2024 and December 31, 2023, excludes approximately $ 1,948 million and $ 1,971 million, respectively, of VIE assets related to AIGFP and its consolidated subsidiaries, with maximum off-balance sheet exposure to loss of $ 1,918 million and $ 1,941 million, respectively.

For additional information, see Note 1 to the Consolidated Financial Statements in the 2023 Annual Report.

(c) At March 31, 2024 and December 31, 2023, $ 9.2 billion and $ 9.1 billion, respectively, of our total unconsolidated VIE assets were recorded as Other invested assets.

(c) At June 30, 2024 and December 31, 2023, $ 3.7 billion and $ 4.1 billion, respectively, of our total unconsolidated VIE assets were recorded as Other invested assets.

(d) These amounts represent our unfunded commitments to invest in private equity funds and hedge funds.

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dollar denominated debt, net capital exposures, foreign currency transactions, and foreign denominated investments.

Equity derivatives are used to economically mitigate financial risk associated with embedded derivatives and MRBs in certain insurance liabilities.

Equity derivatives are used to economically mitigate financial risk associated with embedded derivatives.

We use credit derivatives to manage our credit exposures.

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As part of our strategy to enhance investment income, in addition to hedging activities, we also enter into derivative contracts with respect to investment operations, which may include, among other things, credit default swaps (CDSs), total return swaps and purchases of investments with embedded derivatives, such as equity-linked notes and convertible bonds.

AIG | First Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 11.

Derivatives and Hedge Accounting

The following table presents the notional amounts of our derivatives and the fair value of derivative assets and liabilities in the Condensed Consolidated Balance Sheets:

March 31, 2024 December 31, 2023

June 30, 2024 December 31, 2023

Gross Derivative Assets Gross Derivative Liabilities Gross Derivative Assets Gross Derivative Liabilities

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Derivatives designated as hedging instruments:

Interest rate contracts $ 577 $ 208 $ 2,638 $ 50 $ 1,863 $ 230 $ 752 $ 17

Foreign exchange contracts $ 625 $ 42 $ 947 $ 157 $ 933 $ 58 $ 1,296 $ 164

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2,123 1 — — 2,131 1 — —

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 11.

Derivatives and Hedge Accounting

June 30, 2024 December 31, 2023

Gross Derivative Assets Gross Derivative Liabilities Gross Derivative Assets Gross Derivative Liabilities

(in millions) Notional

Value Notional

Total derivatives, gross $ 8,839 $ 592 $ 4,441 $ 649 $ 59,589 $ 1,292 $ 10,973 $ 952

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(a) Fair value amounts are shown before the effects of counterparty netting adjustments and offsetting cash collateral.

(b) As of March 31, 2024 and December 31, 2023, included CDSs on super senior multi-sector CLO with a net notional amount of $ 49 million and $ 50 million (fair value liability of $ 33 million and $ 32 million, respectively).

(b) As of June 30, 2024 and December 31, 2023, included CDSs on super senior multi-sector CLO with a net notional amount of $ 48 million and $ 50 million (fair value liability of $ 32 million and $ 32 million, respectively).

The net notional amount represents the maximum exposure to loss on the portfolio.

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Derivative instrument assets and liabilities are recorded in Other assets and Other liabilities, respectively.

Fair value of assets related to bifurcated embedded derivatives was $ 1.4 billion at March 31, 2024 and $ 1.2 billion at December 31, 2023.

Fair value of liabilities related to bifurcated embedded derivatives was $ 8.7 billion and $ 8.0 billion, respectively, at March 31, 2024 and December 31, 2023.

Fair value of assets related to bifurcated embedded derivatives was $ 154 million at June 30, 2024 and $ 3.4 billion at December 31, 2023.

Fair value of liabilities related to bifurcated embedded derivatives was zero at both June 30, 2024 and December 31, 2023.

A bifurcated embedded derivative is generally presented with the host contract in the Condensed Consolidated Balance Sheets.

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The actual amount of collateral required to be posted to counterparties in the event of such downgrades, or the aggregate amount of payments that we could be required to make, depends on market conditions, the fair value of outstanding affected transactions and other factors prevailing at and after the time of the downgrade.

Collateral posted by us to third parties for derivative transactions was $ 1.4 billion and $ 1.9 billion at March 31, 2024 and December 31, 2023, respectively.

Collateral posted by us to third parties for derivative transactions was $ 437 million and $ 593 million at June 30, 2024 and December 31, 2023, respectively.

In the case of collateral posted under derivative transactions that are not subject to clearing, this collateral can generally be repledged or resold by the counterparties.

Collateral provided to us from third parties for derivative transactions was $ 3.2 billion and $ 2.8 billion at March 31, 2024 and December 31, 2023, respectively.

Collateral provided to us from third parties for derivative transactions was $ 370 million and $ 856 million at June 30, 2024 and December 31, 2023, respectively.

In the case of collateral provided to us under derivative transactions that are not subject to clearing, we generally can repledge or resell collateral.

AIG | First Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 11.

Derivatives and Hedge Accounting

We have elected to present all derivative receivables and derivative payables, and the related cash collateral received and paid, on a net basis on our Condensed Consolidated Balance Sheets when a legally enforceable ISDA Master Agreement exists between us and our derivative counterparty.

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The fair value hedges include foreign currency forwards and cross currency swaps designated as hedges of the change in fair value of foreign currency denominated available for sale securities attributable to changes in foreign exchange rates.

We also designated certain interest rate swaps entered into with third parties as fair value hedges of fixed rate GICs attributable to changes in benchmark interest rates.

We also designated certain interest rate swaps entered into with third parties as fair value hedges of fixed rate guaranteed investment contracts attributable to changes in benchmark interest rates.

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 11.

Derivatives and Hedge Accounting

We use foreign currency denominated debt and cross-currency swaps as hedging instruments in net investment hedge relationships to mitigate the foreign exchange risk associated with our non-U.S.

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For net investment hedge relationships that use derivatives as hedging instruments, we assess hedge effectiveness and measure hedge ineffectiveness using changes in forward rates.

For the three months ended March 31, 2024 and 2023, we recognized gains (losses) of $ 25 million and $( 25 ) million, respectively, included in Change in foreign currency translation adjustments in OCI related to the net investment hedge relationships.

For the three and six months ended June 30, 2024, we recognized gains (losses) of $ 9 million and $ 34 million, respectively, and for the three and six months ended June 30, 2023, we recognized gains (losses) of $( 7 ) million and $( 31 ) million, respectively, included in Change in foreign currency translation adjustments in OCI related to the net investment hedge relationships.

A qualitative methodology is utilized to assess hedge effectiveness for net investment hedges, while regression analysis is employed for all other hedges.

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Items Net Impact

Three Months Ended March 31, 2024

Interest rate contracts:

Interest credited to policyholder account balances $ ( 62 ) $ — $ 64 $ 2

Three Months Ended June 30, 2024

Foreign exchange contracts:

Net realized gains/(losses) $ ( 57 ) $ ( 15 ) $ 57 $ ( 15 )

Three Months Ended March 31, 2023

Interest rate contracts:

Interest credited to policyholder account balances $ 43 $ — $ ( 47 ) $ ( 4 )

Three Months Ended June 30, 2023

Foreign exchange contracts:

Net realized gains/(losses) $ ( 141 ) $ ( 2 ) $ 141 $ ( 2 )

Six Months Ended June 30, 2024

Foreign exchange contracts:

Net realized gains/(losses) $ ( 115 ) $ ( 27 ) $ 115 $ ( 27 )

Six Months Ended June 30, 2023

Foreign exchange contracts:

Net realized gains/(losses) $ ( 191 ) $ ( 2 ) $ 191 $ ( 2 )

(a) Gains and losses on derivative instruments designated and qualifying in fair value hedges that are included in the assessment of hedge effectiveness.

(b) Gains and losses on derivative instruments designated and qualifying in fair value hedges that are excluded from the assessment of hedge effectiveness and recognized in income on a mark-to-market basis.

AIG | First Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 11.

Derivatives and Hedge Accounting

DERIVATIVES NOT DESIGNATED AS HEDGING INSTRUMENTS

The following table presents the effect of derivative instruments not designated as hedging instruments in the Condensed Consolidated Statements of Income (Loss):

Three Months Ended March 31, Gains (Losses) Recognized in Income

Gains (Losses) Recognized in Income

Three Months Ended

June 30, Six Months Ended

(in millions) 2024 2023 2024 2023

5 unchanged sentences

Credit contracts ( 1 ) — — ( 1 )

Other contracts 16 16

Embedded derivatives 8 58 ( 1 ) ( 82 )

1 unchanged sentence

By Classification:

Policy fees $ 15 $ 16

Net investment income - excluding Fortitude Re funds withheld assets — —

Net investment income - Fortitude Re funds withheld assets — ( 1 ) — ( 1 )

Net realized gains (losses) - excluding Fortitude Re funds withheld assets (a)

Net realized losses on Fortitude Re funds withheld assets (b)

Net realized losses - excluding Fortitude Re funds withheld assets

( 27 ) ( 89 ) ( 69 ) ( 113 )

Policyholder benefits and claims incurred ( 3 ) 3

Change in the fair value of market risk benefits, net (c)

Net realized gains (losses) on Fortitude Re funds withheld assets *

8 55 1 ( 88 )

Total $ ( 19 ) $ ( 35 ) $ ( 68 ) $ ( 202 )

(a) Includes $ 5 million gain related to the sale of AIG Life reported in Net (gain) loss on divestitures.

For additional information, see Notes 1 and 4 .

(b) Includes over-the-counter derivatives supporting the funds withheld arrangements with Fortitude Re and the embedded derivative contained within the funds withheld payable with Fortitude Re.

(c) This represents activity related to derivatives that economically hedged changes in the fair value of certain market risk benefits.

* Includes over-the-counter derivatives supporting the funds withheld arrangements with Fortitude Re and the embedded derivative contained within the funds withheld payable with Fortitude Re.

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 11.

Derivatives and Hedge Accounting

CREDIT RISK-RELATED CONTINGENT FEATURES

We estimate that at March 31, 2024, based on our outstanding financial derivative transactions, a downgrade of our long-term senior debt ratings to BBB or BBB– by Standard & Poor’s Financial Services LLC, a subsidiary of S&P Global Inc., and/or a downgrade to Baa2 or Baa3 by Moody’s Investors’ Service, Inc.

We estimate that at June 30, 2024, based on our outstanding financial derivative transactions, a downgrade of our long-term senior debt ratings to BBB or BBB– by Standard & Poor’s Financial Services LLC, a subsidiary of S&P Global Inc., and/or a downgrade to Baa2 or Baa3 by Moody’s Investors’ Service, Inc.

would permit counterparties to make additional collateral calls and permit certain counterparties to elect early termination of contracts, resulting in corresponding collateral postings and termination payments in the total amount of up to approximately $ 6 million.

The aggregate fair value of our derivatives that were in a net liability position and that contain such credit risk-related contingencies which can be triggered below our long-term senior debt ratings of BBB+ or Baa1 was approximately $ 32 million and $ 32 million at March 31, 2024 and December 31, 2023, respectively.

The aggregate fair value of assets posted as collateral under these contracts at March 31, 2024 and December 31, 2023, was approximately $ 33 million and $ 34 million, respectively.

The aggregate fair value of assets posted as collateral under these contracts at June 30, 2024 and December 31, 2023, was approximately $ 33 million and $ 34 million, respectively.

HYBRID SECURITIES WITH EMBEDDED CREDIT DERIVATIVES

4 unchanged sentences

Our investments in these hybrid securities are reported as Other bond securities in the Condensed Consolidated Balance Sheets.

The fair value of these hybrid securities was under $ 1 million at both March 31, 2024 and December 31, 2023, respectively.

These securities have par amounts of $ 42 million and $ 42 million at March 31, 2024 and December 31, 2023, respectively, and have remaining stated maturity dates that extend to 2052.

AIG | First Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 12.

Insurance Liabilities

The fair value of these hybrid securities was under $ 1 million at both June 30, 2024 and December 31, 2023, respectively.

These securities have par amounts of $ 17 million at both June 30, 2024 and December 31, 2023, respectively, and have remaining stated maturity dates that extend to 2052.

Insurance Liabilities

6 unchanged sentences

Reserve changes that decrease previous estimates of ultimate cost are referred to as favorable development or reserve releases.

Our gross loss reserves before reinsurance and discount are net of contractual deductible recoverable amounts due from policyholders of approximately $ 12.5 billion and $ 12.1 billion at March 31, 2024 and December 31, 2023, respectively.

Our gross loss reserves before reinsurance and discount are net of contractual deductible recoverable amounts due from policyholders of approximately $ 12.3 billion and $ 12.1 billion at June 30, 2024 and December 31, 2023, respectively.

These recoverable amounts are related to certain policies with high deductibles (in excess of high dollar amounts retained by the insured through self-insured retentions, deductibles, retrospective programs, or captive arrangements, each referred to generically as “deductibles”), primarily for U.S.

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Thus, these recoverable amounts represent a credit exposure to us.

At March 31, 2024 and December 31, 2023 we held collateral of approximately $ 8.8 billion and $ 8.7 billion, respectively, for these deductible recoverable amounts, consisting primarily of letters of credit and funded trust agreements.

Allowance for credit losses for the unsecured portion of these recoverable amounts was $ 14 million at both March 31, 2024 and December 31, 2023.

At June 30, 2024 and December 31, 2023 we held collateral of approximately $ 8.7 billion and $ 8.7 billion, respectively, for these deductible recoverable amounts, consisting primarily of letters of credit and funded trust agreements.

Allowance for credit losses for the unsecured portion of these recoverable amounts was $ 14 million at both June 30, 2024 and December 31, 2023.

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 12.

Insurance Liabilities

The following table presents the rollforward of activity in loss reserves:

Three Months Ended March 31,

Three Months Ended

June 30, Six Months Ended

(in millions) 2024 2023 2024 2023

Liability for unpaid loss and loss adjustment expenses, beginning of year $ 70,393 $ 75,167

Liability for unpaid loss and loss adjustment expenses, beginning of period $ 70,060 $ 75,793 $ 70,393 $ 75,167

Reinsurance recoverable ( 30,169 ) ( 32,366 ) ( 30,289 ) ( 32,102 )

Net Liability for unpaid loss and loss adjustment expenses, beginning of year 40,104 43,065

Net Liability for unpaid loss and loss adjustment expenses, beginning of period 39,891 43,427 40,104 43,065

Losses and loss adjustment expenses incurred:

12 unchanged sentences

Retroactive reinsurance adjustment (net of discount) (b)

186 47 178 59

Reclassified to held for sale, net of reinsurance recoverables (c)

— ( 3,383 ) ( 5 ) ( 3,383 )

Total other changes 28 ( 3,361 ) ( 481 ) ( 2,952 )

1 unchanged sentence

Net liability for unpaid losses and loss adjustment expenses 39,934 40,058 39,934 40,058

Reinsurance recoverable

Reinsurance recoverable (d)

29,849 30,226 29,849 30,226

2 unchanged sentences

(Berkshire), covering U.S.

asbestos exposures for the three months ended March 31, 2024 and 2023, respectively.

(b) Includes benefit (charge) from change in discount on retroactive reinsurance in the amount of $ 55 million and $ 70 million for the three months ended March 31, 2024 and 2023, respectively.

asbestos exposures for the three months ended June 30, 2024 and 2023, respectively, and $ 44 million and $ 13 million for the six months ended June 30, 2024 and 2023, respectively.

(b) Includes benefit (charge) from change in discount on retroactive reinsurance in the amount of $ 23 million and $ 26 million for the three months ended June 30, 2024 and 2023 respectively, and $ 78 million and $ 96 million for the six months ended June 30, 2024 and 2023, respectively.

For additional information, see Note 4 .

AIG | First Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 12.

Insurance Liabilities

(d) Excludes $ 1.5 billion of Reinsurance recoverable reclassified to Assets held for sale on the Condensed Consolidated Balance Sheets at June 30, 2023.

On January 20, 2017, we entered into an adverse development reinsurance agreement with NICO, under which we transferred to NICO 80 percent of the reserve risk on substantially all of our U.S.

6 unchanged sentences

Prior Year Development

During the three months ended March 31, 2024, we did not recognize any prior year loss reserve development excluding discount and amortization of deferred gain.

During the three months ended March 31, 2023, we recognized favorable prior year loss reserve development of $ 27 million excluding discount and amortization of deferred gain.

The development in this period was primarily driven by favorable development on U.S.

Workers' Compensation and Other product lines, partially offset by unfavorable development on prior year catastrophes.

During the three and six months ended June 30, 2024, we recognized favorable prior year loss reserve development of $ 108 million excluding discount and amortization of deferred gain.

The development in this period was largely driven by favorable development on our loss sensitive U.S.

Workers' Compensation business along with favorable development in U.S.

Other Casualty, offset by adverse development in U.S.

Excess Casualty.

During the three months ended June 30, 2023, we recognized favorable prior year loss reserve development of $ 107 million excluding discount and amortization of deferred gain.

The development in this period was largely driven by favorable development on our loss sensitive U.S.

Workers' Compensation business, U.S.

Other Casualty and U.S.

Property & Special Risks including prior year catastrophes, partially offset by unfavorable development on European Casualty.

During the six months ended June 30, 2023, we recognized favorable prior year loss reserve development of $ 134 million excluding discount and amortization of deferred gain.

The development in this period was largely driven by favorable development on our loss sensitive U.S.

Workers' Compensation business, U.S.

Other Casualty and U.S.

Property & Special Risks, partially offset by unfavorable development on European Casualty.

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 12.

Insurance Liabilities

Discounting of Loss Reserves

At March 31, 2024 and December 31, 2023, the loss reserves reflect a net loss reserve discount of $ 1.2 billion and $ 1.2 billion, respectively, including tabular and non-tabular calculations based upon the following assumptions:

At June 30, 2024 and December 31, 2023, the loss reserves reflect a net loss reserve discount of $ 1.2 billion and $ 1.2 billion, respectively, including tabular and non-tabular calculations based upon the following assumptions:

• The non-tabular workers’ compensation discount is calculated separately for companies domiciled in New York, Pennsylvania and Delaware, and follows the statutory regulations (prescribed or permitted) for each state.

9 unchanged sentences

The discount for asbestos reserves has been fully accreted.

At March 31, 2024 and December 31, 2023, the discount consists of $ 293 million and $ 294 million of tabular discount, respectively, and $ 919 million and $ 939 million of non-tabular discount for workers’ compensation, respectively.

During the three months ended March 31, 2024 and 2023, the benefit / (charge) from changes in discount of $( 76 ) million and $( 64 ) million, respectively, were recorded as part of Policyholder benefits and losses incurred in the Condensed Consolidated Statements of Income (Loss).

At June 30, 2024 and December 31, 2023, the discount consists of $ 288 million and $ 294 million of tabular discount, respectively, and $ 921 million and $ 939 million of non-tabular discount for workers’ compensation, respectively.

During the six months ended June 30, 2024 and 2023, the benefit / (charge) from changes in discount of $( 102 ) million and $( 80 ) million, respectively, were recorded as part of Policyholder benefits and losses incurred in the Condensed Consolidated Statements of Income (Loss).

The following table presents the components of the loss reserve discount discussed above:

(in millions) March 31, 2024 December 31, 2023

(in millions) June 30, 2024 December 31, 2023

workers' compensation $ 2,235 $ 2,337

2 unchanged sentences

$ 1,209 $ 1,233

(a) Excludes $ 194 million and $ 196 million of discount related to certain long-tail liabilities in the UK at March 31, 2024 and December 31, 2023, respectively.

(b) Includes gross discount of $ 680 million and $ 687 million, which was 100 percent ceded to Fortitude Re at March 31, 2024 and December 31, 2023, respectively.

AIG | First Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 12.

Insurance Liabilities

(a) Excludes $ 196 million and $ 196 million of discount related to certain long-tail liabilities in the UK at June 30, 2024 and December 31, 2023, respectively.

(b) Includes gross discount of $ 673 million and $ 687 million, which was 100 percent ceded to Fortitude Re at June 30, 2024 and December 31, 2023, respectively.

The following table presents the net loss reserve discount benefit (charge):

Three Months Ended March 31,

Three Months Ended

June 30, Six Months Ended

(in millions) 2024 2023 2024 2023

4 unchanged sentences

Net change in total reserve discount* $ ( 3 ) $ 10 $ ( 24 ) $ 16

* Excludes $( 2 ) million and $ 4 million of discount related to certain long-tail liabilities in the UK for the three months ended March 31, 2024 and 2023, respectively.

* Excludes $ 2 million and $ 4 million discount related to certain long-tail liabilities in the UK for the three months ended June 30, 2024 and 2023, respectively, and excludes $ 0 million and $ 8 million discount related to certain long-tail liabilities in the UK for the six months ended June 30, 2024 and 2023, respectively.

Amortization of Deferred Gain on Retroactive Reinsurance

Amortization of the deferred gain on retroactive reinsurance includes $ 27 million and $ 53 million related to the adverse development reinsurance cover with NICO for the three months ended March 31, 2024 and 2023, respectively.

Amortization of the deferred gain on retroactive reinsurance includes $( 6 ) million and $ 19 million related to the adverse development reinsurance cover with NICO for the three months ended June 30, 2024 and 2023, respectively, and $ 21 million and $ 72 million related to the adverse development reinsurance cover with NICO for the six months ended June 30, 2024 and 2023, respectively.

Amounts recognized reflect the amortization of the initial deferred gain at inception, as amended for subsequent changes in the deferred gain due to changes in subject reserves.

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 12.

Insurance Liabilities

FUTURE POLICY BENEFITS

5 unchanged sentences

For traditional and limited pay long-duration products, benefit reserves are accrued and benefit expense is recognized using a net premium ratio methodology for each annual cohort of business.

AIG | First Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 12.

Insurance Liabilities

The following tables present the balances and changes in the liability for future policy benefits and a reconciliation of the net liability for future policy benefits to the liability for future policy benefits in the Condensed Consolidated Balance Sheets:

Three Months Ended March 31, 2024 General

Insurance Individual

Retirement Group

Retirement Life

Insurance Institutional

Markets Other (f)

(in millions, except for liability durations)

Present value of expected net premiums

Balance, beginning of year $ 1,702 $ — $ — $ 8,379 $ — $ 973 $ 11,054

Effect of changes in discount rate assumptions (AOCI) 339 — — 1,482 — 44 1,865

Reclassified to Liabilities held for sale — — — 4,287 — — 4,287

Beginning balance at original discount rate 2,041 — — 14,148 — 1,017 17,206

Effect of actual variances from expected experience ( 2 ) — — ( 13 ) — — ( 15 )

Adjusted beginning of year balance 2,039 — — 14,135 — 1,017 17,191

Issuances 31 — — 353 — — 384

Interest accrual 11 — — 117 — 11 139

Net premium collected ( 138 ) — — ( 381 ) — ( 29 ) ( 548 )

Foreign exchange impact ( 91 ) — — ( 46 ) — — ( 137 )

Other — — — ( 4 ) — — ( 4 )

Ending balance at original discount rate 1,852 — — 14,174 — 999 17,025

Effect of changes in discount rate assumptions (AOCI) ( 283 ) — — ( 1,621 ) — ( 57 ) ( 1,961 )

Reclassified to Liabilities held for sale — — — ( 4,247 ) — — ( 4,247 )

Balance, end of period $ 1,569 $ — $ — $ 8,306 $ — $ 942 $ 10,817

Present value of expected future policy benefits

Balance, beginning of year $ 2,149 $ 1,353 $ 217 $ 17,531 $ 18,482 $ 20,654 $ 60,386

Effect of changes in discount rate assumptions (AOCI) 441 132 ( 3 ) 2,745 1,906 437 5,658

Reclassified to Liabilities held for sale — — — 5,119 — — 5,119

Beginning balance at original discount rate 2,590 1,485 214 25,395 20,388 21,091 71,163

Effect of actual variances from expected experience (a)

( 2 ) ( 6 ) ( 1 ) ( 7 ) — ( 9 ) ( 25 )

Adjusted beginning of year balance 2,588 1,479 213 25,388 20,388 21,082 71,138

Issuances 32 34 5 350 1,726 2 2,149

Interest accrual 13 16 3 236 217 252 737

Benefit payments ( 141 ) ( 33 ) ( 7 ) ( 458 ) ( 283 ) ( 370 ) ( 1,292 )

Foreign exchange impact ( 119 ) — — ( 61 ) ( 82 ) — ( 262 )

Other — — — ( 3 ) — ( 3 ) ( 6 )

Ending balance at original discount rate 2,373 1,496 214 25,452 21,966 20,963 72,464

Effect of changes in discount rate assumptions (AOCI) ( 374 ) ( 153 ) — ( 3,149 ) ( 2,347 ) ( 959 ) ( 6,982 )

Reclassified to Liabilities held for sale — — — ( 5,078 ) — — ( 5,078 )

Balance, end of period $ 1,999 $ 1,343 $ 214 $ 17,225 $ 19,619 $ 20,004 $ 60,404

Net liability for future policy benefits, end of period $ 430 $ 1,343 $ 214 $ 8,919 $ 19,619 $ 19,062 $ 49,587

Liability for future policy benefits for certain participating contracts 1,302

Liability for universal life policies with secondary guarantees and similar features (b)

Deferred profit liability 2,553

Other reconciling items (c)

Future policy benefits for life and accident and health insurance contracts

Reinsurance recoverable ( 22,898 )

Net liability for future policy benefits after reinsurance recoverable $ 36,087

Weighted average liability duration of the liability for future policy benefits (d)(e)

9.1 7.7 6.7 12.6 12.2 11.2

AIG | First Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 12.

Insurance Liabilities

Three Months Ended March 31, 2023 General

Insurance Individual

Retirement Group

Retirement Life

Insurance Institutional

Markets Other (f)

Six Months Ended June 30,

(in millions, except for liability durations) 2024 2023

9 unchanged sentences

Foreign exchange impact ( 155 ) ( 88 )

Other — — — 3 — — 3

Ending balance at original discount rate 1,746 2,048

6 unchanged sentences

Effect of actual variances from expected experience (a)

( 2 ) ( 3 ) ( 1 ) 26 ( 5 ) — 15

Adjusted beginning of year balance 2,582 2,726

3 unchanged sentences

Foreign exchange impact ( 203 ) ( 121 )

Other — — — 1 — ( 3 ) ( 2 )

Ending balance at original discount rate 2,249 2,579

2 unchanged sentences

Net liability for future policy benefits, end of period $ 420 $ 438

Liability for future policy benefits for certain participating contracts 1,340

Liability for universal life policies with secondary guarantees and similar features (b)

Deferred profit liability 1 1

Other reconciling items (c)

Other reconciling items (b)

Future policy benefits for life and accident and health insurance contracts

1 unchanged sentence

Net liability for future policy benefits after reinsurance recoverable $ 594 $ 648

Weighted average liability duration of the liability for future policy benefits (d)

10.0 7.7 7.1 12.4 11.5 11.6

Weighted average liability duration of the liability for future policy benefits (c)

(a) Effect of changes in cash flow assumptions and variances from actual experience are partially offset by changes in the deferred profit liability.

(b) Additional details can be found in the table that presents the balances and changes in the liability for universal life policies with secondary guarantees and similar features.

(c) Other reconciling items primarily include the Accident and Health as well as Group Benefits (short-duration) contracts.

(d) The weighted average liability durations are calculated as the modified duration using projected future net liability cash flows that are aggregated at the segment level, utilizing the segment level weighted average interest rates and current discount rate, which can be found in the table below.

(e) Includes balances that were reclassified to Liabilities held for sale in the Condensed Consolidated Balance sheets.

For additional information, see Note 4.

(f) Represents Life and Retirement legacy insurance lines ceded to Fortitude Re.

AIG | First Quarter 2024 Form 10-Q

(b) Other reconciling items primarily include Accident and Health (short-duration) contracts and $ 724 million and $ 713 million at June 30, 2024 and 2023, respectively, of certain long-duration contracts that are 100 percent ceded.

(c) The weighted average liability durations are calculated as the modified duration using projected future net liability cash flows that are aggregated at the segment level, utilizing the segment level weighted average interest rates and current discount rate, which can be found in the table below.

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 12.

Insurance Liabilities

For the three months ended March 31, 2024 and 2023 in the traditional and term life insurance block, capping of net premium ratios at 100 percent caused a (credit)/charge to net income of $( 1 ) million and $ 7 million, respectively.

The discount rate was updated based on market observable information.

Relative to the prior period, the increase in upper-medium-grade fixed income yields resulted in a decrease in the liability for future policy benefits.

The following table presents the amount of undiscounted expected future benefit payments and undiscounted and discounted expected gross premiums for future policy benefits for nonparticipating contracts:

Three Months Ended March 31,

Six Months Ended June 30,

(in millions) 2024 2023

General Insurance (a)

Undiscounted expected future benefits and expense $ 2,760 $ 3,165

Undiscounted expected future gross premiums 3,791 4,383

Individual Retirement Undiscounted expected future benefits and expense $ 2,156 $ 2,048

Undiscounted expected future gross premiums — —

Group Retirement Undiscounted expected future benefits and expense $ 309 $ 317

Undiscounted expected future gross premiums — —

Life Insurance (b)

Undiscounted expected future benefits and expense $ 40,741 $ 39,028

Undiscounted expected future gross premiums 30,656 28,964

Institutional Markets Undiscounted expected future benefits and expense $ 42,519 $ 29,029

Undiscounted expected future gross premiums — —

Undiscounted expected future benefits and expense $ 42,701 $ 44,148

Undiscounted expected future gross premiums 2,106 2,225

(a) General Insurance discounted expected future gross premiums (at current discount rate) for the three months ended March 31, 2024 were $ 2.9 billion.

(b) Includes balances reclassified to Liabilities held for sale at March 31, 2024.

Life Insurance discounted expected future gross premiums (at current discount rate) for the three months ended March 31, 2024 were $ 20.0 billion.

Other discounted expected future gross premiums (at current discount rate) for the three months ended March 31, 2024 were $ 1.4 billion.

Discounted expected future gross premiums (at current discount rate) 2,737 3,109

The following table presents the amount of revenue and interest recognized in the Condensed Consolidated Statements of Income (Loss) for future policy benefits for nonparticipating contracts:

Three Months Ended March 31, Gross Premiums Interest Accretion

Six Months Ended June 30,

(in millions) 2024 2023

General Insurance $ 110 $ 95 $ 2 $ 1

Individual Retirement 39 75 16 12

Group Retirement 5 6 3 3

Life Insurance 618 575 119 118

Institutional Markets 1,805 1,581 217 139

Other* 52 54 241 245

Total $ 2,629 $ 2,386 $ 598 $ 518

* Represents Life and Retirement legacy insurance lines ceded to Fortitude Re.

Gross Premiums $ 209 $ 232

Interest Accretion $ 4 $ 4

The following table presents the weighted-average interest rate for future policy benefits for nonparticipating contracts:

Three Months Ended March 31, 2024 General

Insurance Individual

Retirement Group

Retirement Life

Insurance (a)

Institutional

Markets Other (b)

Weighted-average interest rate, original discount rate 1.84 % 3.79 % 5.13 % 4.12 % 4.25 % 4.86 %

Weighted-average interest rate, current discount rate 3.70 % 5.27 % 5.24 % 5.28 % 5.19 % 5.32 %

Three Months Ended March 31, 2023

Six Months Ended June 30, 2024 2023

Weighted-average interest rate, original discount rate 1.86 % 1.81 %

Weighted-average interest rate, current discount rate 3.56 % 3.59 %

(a) Weighted-average interest rates for Life Insurance include balances that have been reclassified to Liabilities held-for-sale at March 31, 2024.

(b) Represents Life and Retirement legacy insurance lines ceded to Fortitude Re.

The weighted average interest rates are calculated using projected future net liability cash flows that are aggregated to the segment level, and are represented as an annual rate.

AIG | First Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 12.

Insurance Liabilities

Additional Liabilities:

For universal-life type products, insurance benefits in excess of the account balance are generally recognized as expenses in the period incurred unless the design of the product is such that future charges are insufficient to cover the benefits, in which case an “additional liability” is accrued over the life of the contract.

These additional liabilities are included in Future policy benefits for life and accident and health insurance contracts in the Condensed Consolidated Balance Sheets.

Our additional liabilities primarily consist of universal life policies with secondary guarantees and these additional liabilities are recognized in addition to the Policyholder account balances.

For universal life policies with secondary guarantees, as well as other universal life policies for which profits followed by losses are expected at contract inception, a liability is recognized based on a benefit ratio of (a) the present value of total expected payments, in excess of the account value, over the life of the contract, divided by (b) the present value of total expected assessments over the life of the contract.

For universal life policies without secondary guarantees, for which profits followed by losses are first expected after contract inception, we establish a liability, in addition to policyholder account balances, so that expected future losses are recognized in proportion to the emergence of profits in the earlier (profitable) years.

Universal life account balances are reported within Policyholder contract deposits, while these additional liabilities are reported within the liability for future policy benefits in the Condensed Consolidated Balance Sheets.

These additional liabilities are also adjusted to reflect the effect of unrealized gains or losses on fixed maturity securities available for sale on accumulated assessments, with related changes recognized through OCI.

The policyholder behavior assumptions for these liabilities include mortality, lapses and premium persistency.

The capital market assumptions used for the liability for universal life secondary guarantees include discount rates and net earned rates.

The following table presents the balances and changes in the liability for universal life policies with secondary guarantees and similar features:

Three Months Ended March 31, 2024 2023

(in millions, except duration of liability) Life

Insurance Other (b)

Balance, beginning of year $ 3,731 $ 55 $ 3,786 $ 3,300 $ 55 $ 3,355

Effect of changes in experience 109 ( 1 ) 108 74 ( 1 ) 73

Adjusted beginning balance 3,840 54 3,894 3,374 54 3,428

Assessments 145 — 145 179 — 179

Excess benefits paid ( 232 ) — ( 232 ) ( 238 ) — ( 238 )

Interest accrual 38 1 39 28 1 29

Other — — — ( 5 ) — ( 5 )

Changes related to unrealized appreciation (depreciation) of investments 126 — 126 119 — 119

Balance, end of period 3,917 55 3,972 3,457 55 3,512

Reinsurance recoverable ( 172 ) ( 55 ) ( 227 ) ( 192 ) — ( 192 )

Balance, end of period, net of Reinsurance recoverable $ 3,745 $ — $ 3,745 $ 3,265 $ 55 $ 3,320

Weighted average duration of liability (a)

25.3 9.1 26.4 9.4

(a) The weighted average duration of liabilities is calculated as the modified duration using projected future net liability cash flows that are aggregated at the segment level, utilizing the segment level weighted average interest rates, which can be found in the table below.

(b) Represents Life and Retirement legacy insurance lines ceded to Fortitude Re.

The following table presents the amount of revenue and interest recognized in the Condensed Consolidated Statements of Income (Loss) for the liability for universal life policies with secondary guarantees and similar features:

Three Months Ended March 31, Gross Assessments Interest Accretion

(in millions) 2024 2023 2024 2023

Life Insurance $ 248 $ 299 $ 38 $ 28

Other* 10 10 1 1

Total $ 258 $ 309 $ 39 $ 29

* Represents Life and Retirement legacy insurance lines ceded to Fortitude Re.

The following table presents the calculation of weighted average interest rate for the liability for universal life policies with secondary guarantees and similar features:

Three Months Ended March 31, 2024 2023

Life Insurance Other* Life Insurance Other*

Weighted-average interest rate 3.92 % 4.20 % 3.76 % 4.24 %

* Represents Life and Retirement legacy insurance lines ceded to Fortitude Re.

AIG | First Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 12.

Insurance Liabilities

The weighted average interest rates are calculated using projected future net liability cash flows that are aggregated to the segment level, and are represented as an annual rate.

The following table presents details concerning our universal life policies with secondary guarantees and similar features:

Three Months Ended March 31,

(dollars in millions) 2024 2023

Account value $ 3,773 $ 3,556

Net amount at risk $ 73,092 $ 70,014

Average attained age of contract holders 53 53

POLICYHOLDER CONTRACT DEPOSITS

The liability for Policyholder contract deposits is primarily recorded at accumulated value (deposits received and net transfers from separate accounts, plus accrued interest credited, less withdrawals and assessed fees).

Deposits collected on investment-oriented products are not reflected as revenues.

They are recorded directly to Policyholder contract deposits upon receipt.

Amounts assessed against the contract holders for mortality, administrative, and other services are included as Policy fees in revenues.

In addition to liabilities for universal life, fixed annuities, fixed options within variable annuities, annuities without life contingencies, funding agreements and GICs, policyholder contract deposits also include our liability for (i) index features accounted for as embedded derivatives at fair value, (ii) annuities issued in a structured settlement arrangement with no life contingency and (iii) certain contracts we have elected to account for at fair value.

Changes in the fair value of the embedded derivatives related to policy index features and the fair value of derivatives hedging these liabilities are recognized in realized gains and losses.

For additional information on index credits accounted for as embedded derivatives, see Note 5.

Under a funding agreement-backed notes issuance program, an unaffiliated, non-consolidated statutory trust issues medium-term notes to investors, which are secured by funding agreements issued to the trust by one of our Life and Retirement companies through our Institutional Markets business.

The following table presents the balances and changes in Policyholder contract deposits account balances (a) :

Three Months Ended March 31, 2024 Individual

Retirement Group

Retirement Life

Insurance Institutional

Markets Other (d)

(in millions, except for average crediting rate)

Policyholder contract deposits account balance, beginning of year $ 94,896 $ 41,299 $ 10,231 $ 13,649 $ 3,333 $ 163,408

Deposits 4,878 1,349 407 798 11 7,443

Policy charges ( 186 ) ( 122 ) ( 377 ) ( 17 ) ( 15 ) ( 717 )

Surrenders and withdrawals ( 4,600 ) ( 2,466 ) ( 73 ) ( 31 ) ( 21 ) ( 7,191 )

Benefit payments ( 761 ) ( 494 ) ( 79 ) ( 181 ) ( 79 ) ( 1,594 )

Net transfers from (to) separate account 1,248 1,024 5 ( 27 ) — 2,250

Interest credited 816 303 121 157 40 1,437

Other ( 3 ) 2 6 ( 11 ) 3 ( 3 )

Policyholder contract deposits account balance, end of period 96,288 40,895 10,241 14,337 3,272 165,033

Other reconciling items (b)

( 1,225 ) ( 192 ) 134 33 ( 85 ) ( 1,335 )

Policyholder contract deposits $ 95,063 $ 40,703 $ 10,375 $ 14,370 $ 3,187 $ 163,698

Weighted average crediting rate 2.86 % 3.05 % 4.39 % 4.59 % 4.98 %

Cash surrender value (c)

$ 89,795 $ 39,746 $ 9,042 $ 2,585 $ 1,696 $ 142,864

AIG | First Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 12.

Insurance Liabilities

Three Months Ended March 31, 2023 Individual

Retirement Group

Retirement Life

Insurance Institutional

Markets Other (d)

(in millions, except for average crediting rate)

Policyholder contract deposits account balance, beginning of year $ 89,554 $ 43,395 $ 10,224 $ 11,734 $ 3,587 $ 158,494

Deposits 4,864 1,326 414 595 11 7,210

Policy charges ( 244 ) ( 110 ) ( 384 ) ( 17 ) ( 16 ) ( 771 )

Surrenders and withdrawals ( 3,171 ) ( 2,016 ) ( 56 ) ( 403 ) ( 20 ) ( 5,666 )

Benefit payments ( 1,036 ) ( 557 ) ( 49 ) ( 167 ) ( 88 ) ( 1,897 )

Net transfers from (to) separate account 728 592 ( 1 ) 443 — 1,762

Interest credited 377 270 88 105 43 883

Other ( 2 ) 3 ( 16 ) 4 ( 1 ) ( 12 )

Policyholder contract deposits account balance, end of period 91,070 42,903 10,220 12,294 3,516 160,003

Other reconciling items (b)

( 1,889 ) ( 279 ) 116 74 ( 129 ) ( 2,107 )

Policyholder contract deposits $ 89,181 $ 42,624 $ 10,336 $ 12,368 $ 3,387 $ 157,896

Weighted average crediting rate 2.52 % 2.78 % 4.24 % 3.55 % 4.95 %

Cash surrender value (c)

$ 84,906 $ 41,361 $ 8,874 $ 2,545 $ 1,781 $ 139,467

(a) Transactions between the general account and the separate account are presented in this table on a gross basis (e.g., a policyholder's funds are initially deposited into the general account and then simultaneously transferred to the separate account), thus, did not impact the ending balance of policyholder contract deposits.

(b) Includes MRBs that are bifurcated and reported separately, net of embedded derivatives recorded in Policyholder contract deposits.

Other also includes amounts related to Other Operations of $( 85 ) million and $( 129 ) million at March 31, 2024 and 2023, respectively.

(c) Cash surrender value is related to the portion of policyholder contract deposits that have a defined cash surrender value (e.g.

GICs, do not have a cash surrender value).

(d) Primarily represents Life and Retirement legacy insurance lines ceded to Fortitude Re.

For information related to net amount at risk, see Note 13.

The following table presents Policyholder contract deposits account balance by range of guaranteed minimum crediting rates and the related range of difference, in basis points, between rates being credited to policyholders and the respective guaranteed minimums:

March 31, 2024 At

Minimum 1 Basis Point -

50 Basis Points

Above More than 50

Basis Points Above

Minimum Guarantee Total

(in millions, except percentage of total)

Individual Retirement Range of Guaranteed Minimum Credited Rate

<=1% $ 6,251 $ 1,917 $ 28,202 $ 36,370

> 1% - 2% 3,556 21 1,490 5,067

> 2% - 3% 7,653 11 1,407 9,071

> 3% - 4% 6,342 36 5 6,383

> 4% - 5% 424 — 4 428

> 5% 32 — 3 35

Total $ 24,258 $ 1,985 $ 31,111 $ 57,354

Group Retirement Range of Guaranteed Minimum Credited Rate

<=1% $ 2,133 $ 1,895 $ 7,672 $ 11,700

> 1% - 2% 3,597 1,126 670 5,393

> 2% - 3% 11,686 215 110 12,011

> 3% - 4% 603 — — 603

> 4% - 5% 6,579 — — 6,579

> 5% 141 — — 141

Total $ 24,739 $ 3,236 $ 8,452 $ 36,427

Life Insurance Range of Guaranteed Minimum Credited Rate

<=1% $ — $ — $ — $ —

> 1% - 2% — 110 365 475

> 2% - 3% 9 1,072 856 1,937

> 3% - 4% 1,190 482 7 1,679

> 4% - 5% 2,820 — — 2,820

> 5% 214 — — 214

Total $ 4,233 $ 1,664 $ 1,228 $ 7,125

Total* $ 53,230 $ 6,885 $ 40,791 $ 100,906

Percentage of total 53 % 7 % 40 % 100 %

AIG | First Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 12.

Insurance Liabilities

March 31, 2023 At

Minimum 1 Basis Point -

50 Basis Points

Above More than 50

Basis Points Above

Minimum Guarantee Total

(in millions, except percentage of total)

Individual Retirement Range of Guaranteed Minimum Credited Rate

<=1% $ 7,776 $ 2,562 $ 23,263 $ 33,601

> 1% - 2% 3,994 24 2,163 6,181

> 2% - 3% 9,155 1 390 9,546

> 3% - 4% 7,359 40 6 7,405

> 4% - 5% 452 — 4 456

> 5% 32 — 4 36

Total $ 28,768 $ 2,627 $ 25,830 $ 57,225

Group Retirement Range of Guaranteed Minimum Credited Rate

<=1% $ 2,063 $ 2,713 $ 6,049 $ 10,825

> 1% - 2% 5,005 908 353 6,266

> 2% - 3% 13,561 40 — 13,601

> 3% - 4% 658 — — 658

> 4% - 5% 6,821 — — 6,821

> 5% 153 — — 153

Total $ 28,261 $ 3,661 $ 6,402 $ 38,324

Life Insurance Range of Guaranteed Minimum Credited Rate

<=1% $ — $ — $ — $ —

> 1% - 2% — 131 349 480

> 2% - 3% 28 862 1,079 1,969

> 3% - 4% 1,417 118 198 1,733

> 4% - 5% 2,946 — — 2,946

> 5% 222 — — 222

Total $ 4,613 $ 1,111 $ 1,626 $ 7,350

Total* $ 61,642 $ 7,399 $ 33,858 $ 102,899

Percentage of total 60 % 7 % 33 % 100 %

* Excludes policyholder contract deposits account balances that are not subject to guaranteed minimum crediting rates.

OTHER POLICYHOLDER FUNDS

Other policyholder funds include unearned revenue reserves (URR), consisting of front-end loads on investment-oriented contracts, representing those policy loads that are non-level and typically higher in initial policy years than in later policy years.

Amortization of URR is recorded in Policy fees.

URR for investment-oriented contracts are generally deferred and amortized into income using the same assumptions and factors used to amortize DAC (i.e., on a constant level basis).

The following table presents a rollforward of URR:

Insurance Institutional

Markets Other* Total

(in millions)

Three Months Ended March 31, 2024

Balance, beginning of year $ 1,770 $ 1 $ 94 $ 1,865

Revenue deferred 40 — — 40

Amortization ( 28 ) — ( 2 ) ( 30 )

Balance, end of period $ 1,782 $ 1 $ 92 $ 1,875

Three Months Ended March 31, 2023

Balance, beginning of year $ 1,727 $ 2 $ 105 $ 1,834

Revenue deferred 38 — — 38

Amortization ( 27 ) ( 1 ) ( 2 ) ( 30 )

Balance, end of period $ 1,738 $ 1 $ 103 $ 1,842

* Represents Life and Retirement legacy insurance lines ceded to Fortitude Re.

At March 31, 2024 and 2023, Other policyholder funds, excluding URR, totaled $ 1.4 billion and $ 1.6 billion, respectively.

AIG | First Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 13.

Market Risk Benefits

MRBs are defined as contracts or contract features that both provide protection to the contract holder from other-than-nominal capital market risk and expose AIG to other-than nominal capital market risk.

The MRB represents an amount that a policyholder receives in addition to the account balance upon the occurrence of a specific event or circumstance, such as death, annuitization, or periodic withdrawal that involves protection from other-than-nominal capital market risk.

Certain contract features, such as GMWBs, guaranteed minimum death benefits (GMDB) and guaranteed minimum income benefits (GMIBs) commonly found in variable, fixed index and fixed annuities, are MRBs.

MRBs are assessed at contract inception using a non-option method involving attributed fees that results in an initial fair value of zero or an option method that results in a fair value greater than zero.

MRBs are recorded at fair value, and AIG applies a non-option attributed fee valuation method for variable annuity products, and an option-based valuation method (host offset) for both fixed index and fixed products.

Changes in the fair value of MRBs, net represents changes in the fair value of market risk benefit liabilities and assets (with the exception of our own credit risk changes), and includes attributed rider fees and benefits, net of changes in the fair value of derivative instruments and fixed maturity securities that are used to economically hedge market risk from the variable annuity GMWB riders.

The following table presents the balances of and changes in MRBs:

Three Months Ended March 31, 2024 2023

Retirement Group

Retirement Total Individual

Retirement Group

Retirement Total

(in millions, except for attained age of contract holders)

Balance, beginning of year $ 4,562 $ 308 $ 4,870 $ 3,738 $ 296 $ 4,034

Effect of changes in our own credit risk ( 1,072 ) ( 88 ) ( 1,160 ) ( 441 ) ( 24 ) ( 465 )

Balance, beginning of year, before effect of changes in our own credit risk $ 3,490 $ 220 $ 3,710 3,297 272 3,569

Issuances 123 10 133 191 9 200

Interest accrual 45 3 48 38 4 42

Attributed fees 174 15 189 235 17 252

Expected claims ( 18 ) — ( 18 ) ( 25 ) ( 1 ) ( 26 )

Effect of changes in interest rates ( 474 ) ( 38 ) ( 512 ) 478 46 524

Effect of changes in interest rate volatility ( 14 ) — ( 14 ) ( 73 ) ( 4 ) ( 77 )

Effect of changes in equity markets ( 529 ) ( 50 ) ( 579 ) ( 391 ) ( 36 ) ( 427 )

Effect of changes in equity index volatility ( 15 ) — ( 15 ) 16 ( 3 ) 13

Actual outcome different from model expected outcome ( 63 ) 3 ( 60 ) 72 1 73

Effect of changes in other future expected assumptions ( 5 ) ( 1 ) ( 6 ) ( 94 ) ( 18 ) ( 112 )

Other, including foreign exchange — ( 2 ) ( 2 ) 1 — 1

Balance, end of period, before effect of changes in our own credit risk 2,714 160 2,874 3,745 287 4,032

Effect of changes in our own credit risk 1,100 89 1,189 339 32 371

Balance, end of period 3,814 249 4,063 4,084 319 4,403

Reinsured MRB, end of period ( 68 ) — ( 68 ) ( 89 ) — ( 89 )

Net Liability Balance after reinsurance recoverable $ 3,746 $ 249 $ 3,995 $ 3,995 $ 319 $ 4,314

Net amount at risk

GMDB only $ 623 $ 136 $ 759 $ 1,307 $ 266 $ 1,573

GMWB only $ 128 $ 12 $ 140 $ 63 $ 5 $ 68

Combined* $ 576 $ 13 $ 589 $ 1,726 $ 31 $ 1,757

Weighted average attained age of contract holders 71 64 71 64

* Certain contracts contain both guaranteed GMDB and GMWB features and are modeled together for the purposes of calculating the MRB.

The following is a reconciliation of MRBs by amounts in an asset position and in a liability position to the MRBs amount in the Condensed Consolidated Balance Sheets:

March 31, 2024 March 31, 2023

(in millions) Asset* Liability* Net Asset* Liability* Net

Individual Retirement $ 968 $ 4,714 $ 3,746 $ 685 $ 4,680 $ 3,995

Group Retirement 204 453 249 145 464 319

Total $ 1,172 $ 5,167 $ 3,995 $ 830 $ 5,144 $ 4,314

* Cash flows and attributed fees for MRBs are determined on a policy level basis and are reported based on their asset or liability position at the balance sheet date.

For additional information related to fair value measurements of MRBs, see Note 5.

AIG | First Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 14.

Separate Account Assets and Liabilities

We report variable contracts within the separate accounts when investment income and investment gains and losses accrue directly to, and investment risk is borne by, the contract holder and the separate account meets additional accounting criteria to qualify for separate account treatment.

The assets supporting the variable portion of variable annuity and variable universal life contracts that qualify for separate account treatment are carried at fair value and are reported as separate account assets, with an equivalent summary total reported as separate account liabilities.

The assets of separate accounts are legally segregated and are not subject to claims that arise from any of our other businesses.

Policy values for variable products and investment contracts are expressed in terms of investment units.

Each unit is linked to an asset portfolio.

The value of a unit increases or decreases based on the value of the linked asset portfolio.

The current liability at any time is the sum of the current unit value of all investment units in the separate accounts, plus any liabilities for MRBs.

Amounts assessed against the policyholders for mortality, administrative and other services are included in policy fees.

Investment performance (including investment income, net investment gains (losses) and changes in unrealized gains (losses)) and the corresponding amounts credited to policyholders of such separate accounts are offset within the same line in the Condensed Consolidated Statements of Income (Loss).

For discussion of the fair value measurement of guaranteed benefits that are accounted for as MRBs, see Note 5.

The following table presents fair value of separate account investment options:

March 31, 2024 December 31, 2023

(in millions) Individual

Retirement Group

Retirement Life

Insurance Institutional

Markets Total Individual

Retirement Group

Retirement Life

Insurance Institutional

Markets Total

Equity funds $ 26,945 $ 30,285 $ 900 $ 635 $ 58,765 $ 25,451 $ 28,675 $ 819 $ 593 $ 55,538

Bond funds 4,121 3,315 45 1,281 8,762 4,037 3,292 44 1,303 8,676

Balanced funds 18,179 5,663 55 2,062 25,959 17,711 5,479 53 1,923 25,166

Money market funds 693 802 16 176 1,687 694 742 16 173 1,625

Total $ 49,938 $ 40,065 $ 1,016 $ 4,154 $ 95,173 $ 47,893 $ 38,188 $ 932 $ 3,992 $ 91,005

The following table presents the balances and changes in Separate account liabilities:

Three Months Ended March 31, 2024 Individual

Retirement Group

Retirement Life

Insurance Institutional

Markets Total

(in millions)

Balance, beginning of year $ 47,893 $ 38,188 $ 932 $ 3,992 $ 91,005

Premiums and deposits 294 340 9 69 712

Policy charges ( 288 ) ( 115 ) ( 12 ) ( 24 ) ( 439 )

Surrenders and withdrawals ( 1,193 ) ( 1,052 ) ( 9 ) ( 31 ) ( 2,285 )

Benefit payments ( 239 ) ( 154 ) ( 2 ) ( 5 ) ( 400 )

Investment performance 3,451 2,934 98 139 6,622

Net transfers from (to) general account and other 20 ( 76 ) — 14 ( 42 )

Balance, end of period $ 49,938 $ 40,065 $ 1,016 $ 4,154 $ 95,173

Cash surrender value* $ 48,975 $ 39,865 $ 995 $ 4,150 $ 93,985

Three Months Ended March 31, 2023

Balance, beginning of year $ 45,178 $ 34,361 $ 799 $ 4,515 $ 84,853

Premiums and deposits 451 360 9 26 846

Policy charges ( 344 ) ( 110 ) ( 12 ) ( 24 ) ( 490 )

Surrenders and withdrawals ( 844 ) ( 669 ) ( 6 ) ( 404 ) ( 1,923 )

Benefit payments ( 215 ) ( 130 ) ( 1 ) ( 54 ) ( 400 )

Investment performance 2,131 2,186 53 99 4,469

Net transfers from (to) general account and other 73 ( 78 ) ( 1 ) 8 2

Balance, end of period $ 46,430 $ 35,920 $ 841 $ 4,166 $ 87,357

Cash surrender value* $ 45,388 $ 35,726 $ 794 $ 4,168 $ 86,076

* The cash surrender value represents the amount of the contract holder’s account balance distributable at the balance sheet date less applicable surrender charges.

AIG | First Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 14.

Separate Account Assets and Liabilities

Separate account liabilities primarily represent the contract holder's account balance in separate account assets and will be equal and offsetting to total separate account assets.

Contingencies, Commitments and Guarantees

11 unchanged sentences

In many instances, we are unable to determine whether a loss is probable or to reasonably estimate the amount of such a loss and, therefore, the potential future losses arising from legal proceedings may exceed the amount of liabilities that we have recorded in our financial statements covering these matters.

While such potential future charges could be material, based on information currently known to management, management does not believe, other than as may be discussed below, that any such charges are likely to have a material adverse effect on our financial position or results of operation.

Additionally, from time to time, various regulatory and governmental agencies review the transactions and practices of AIG and our subsidiaries in connection with industry-wide and other inquiries or examinations into, among other matters, the business practices of current and former operating insurance subsidiaries.

Such investigations, inquiries or examinations could develop into administrative, civil or criminal proceedings or enforcement actions, in which remedies could include fines, penalties, restitution or alterations in our business practices, and could result in additional expenses, limitations on certain business activities and reputational damage.

Moriarty Litigation

American General Life Insurance Company (AGL) continues to defend against Moriarty v.

American General Life Insurance Co.

Cal.), a putative class action involving Sections 10113.71 and 10113.72 of the California Insurance Code.

In general, those statutes require that for life-insurance policies issued and delivered in California:

(1) the policy must contain a 60-day grace period following nonpayment of premium during which the policy remains in force;

(2) the insurer must provide a 30-day pre-lapse notice;

and (3) the insurer must notify policy owners of the right to designate a secondary recipient for lapse notices.

The Moriarty plaintiff contends AGL did not comply with these requirements for a policy issued before these statutes went into effect.

The plaintiff seeks damages and other relief.

AGL asserts various defenses to the plaintiff’s claims and to class certification.

In 2022, the District Court held a trial was necessary to determine whether AGL was liable, and it denied class certification.

In May 2023, the case was reassigned to a new judge.

On August 14, 2023, the District Court granted the plaintiff’s motion for summary judgment on the plaintiff’s breach-of-contract claim.

On September 26, 2023, the District Court decided that good cause exists to allow the plaintiff to file a third motion for class certification.

At the same time, however, the District Court certified its August 14, 2023 order for interlocutory appeal to the Ninth Circuit and stayed trial-court proceedings pending the outcome of AGL’s appeal.

The Ninth Circuit granted AGL’s petition for interlocutory appeal on November 21, 2023, which remains pending.

AIG | First Quarter 2024 Form 10-Q

While such potential future charges could be material, based on information currently known to management, management does not believe that any such charges are likely to have a material adverse effect on our financial position or results of operation.

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 13.

Contingencies, Commitments and Guarantees

AGL is defending other actions in California involving similar issues:

Protective Life Insurance Co.

and AGL (E.D.

Cal.), in which the individual plaintiff filed a motion on August 11, 2023 seeking leave to amend the complaint to add class-action allegations against AGL;

American General Life Insurance Co.

Cal.), which was filed on September 6, 2023 as a putative class action.

These cases are in the early stages, and we expect their progress will be influenced by future developments in Moriarty and cases against other insurers involving the same statutes.

We have accrued our current estimate of probable loss with respect to these litigation matters.

OTHER COMMITMENTS

In the normal course of business, we enter into commitments to invest in limited partnerships, private equity funds and hedge funds and to purchase and develop real estate in the U.S.

These commitments totaled $ 6.0 billion and $ 6.1 billion at March 31, 2024 and December 31, 2023, respectively.

These commitments totaled $ 1.6 billion and $ 1.7 billion at June 30, 2024 and December 31, 2023, respectively.

We have issued unconditional guarantees with respect to the prompt payment, when due, of all present and future payment obligations and liabilities of AIGFP and certain of its subsidiaries.

We have also issued guarantees of all present and future payment obligations and liabilities of AIG Markets, Inc.

Due to the deconsolidation of AIGFP and its subsidiaries, as of March 31, 2024, a $ 92 million guarantee related to the obligations of AIGFP and certain of its subsidiaries was recognized, and is reported in Other liabilities.

Due to the deconsolidation of AIGFP and its subsidiaries, as of June 30, 2024, a $ 100 million guarantee related to the obligations of AIGFP and certain of its subsidiaries was recognized, and is reported in Other liabilities.

We continue to guarantee certain policyholder contracts issued by Corebridge subsidiaries as well as certain debt issued by Corebridge Life Holdings, Inc.

Pursuant to the Separation Agreement entered in by AIG and Corebridge on September 14, 2022, Corebridge must indemnify, defend and hold us harmless from and against any liability related to these guarantees.

Also, under a collateral agreement, in the event of:

(i) a ratings downgrade of Corebridge or the guaranteed debt below specified levels or (ii) the failure by CRBGLH to pay principal and interest on the guaranteed debt when due, Corebridge must collateralize an amount equal to the sum of:

(i) 100 percent of the principal amount outstanding, (ii) accrued and unpaid interest and (iii) 100 percent of the net present value of scheduled interest payments through the maturity dates of the debt.

Business and Asset Dispositions

11 unchanged sentences

After underwriting discounts and expenses, we received net proceeds of approximately $ 485 million.

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 14.

On March 15, 2024, we redeemed all 20,000 outstanding shares of our Series A Preferred Stock and all 20,000,000 of the corresponding Depositary Shares, each representing a 1/1,000th interest in a share of Series A Preferred Stock, for a redemption price of $ 25,000 per share (equivalent to $ 25.00 per Depositary Share) for an aggregate redemption price of $ 500 million, paid in cash.

The $ 15 million difference between the aggregate redemption price and the outstanding par and additional paid in capital amount of $ 485 million was recorded as a reduction of retained earnings and is presented on Dividends on preferred stock and preferred stock redemption premiums on the Condensed Consolidated Statements of Income.

AIG | First Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 16.

The following table presents a rollforward of outstanding shares:

Three Months Ended March 31, 2024

Six Months Ended June 30, 2024

Stock Issued Treasury

8 unchanged sentences

the capital resources available to support our insurance operations and business strategies, AIG’s funding capacity and capital resources in comparison to internal benchmarks, expectations for capital generation, rating agency expectations for capital, regulatory standards for capital and capital distributions, and such other factors as our Board of Directors may deem relevant.

The payment of dividends is also subject to the terms of AIG’s outstanding Series A Preferred Stock, pursuant to which no dividends may be declared or paid on any AIG Common Stock unless the full dividends for the latest completed dividend period on all outstanding shares of Series A Preferred Stock have been declared and paid or provided for.

For a discussion of restrictions on payments of dividends to AIG Parent by its subsidiaries, see Note 20 to the Consolidated Financial Statements in the 2023 Annual Report.

Subsidiary Dividend Restrictions

Payments of dividends to us by our insurance subsidiaries are subject to certain restrictions imposed by regulatory authorities.

With respect to our domestic insurance subsidiaries, the payment of any dividend requires formal notice to the insurance department in which the particular insurance subsidiary is domiciled.

For example, unless permitted by the Superintendent of Financial Services, property casualty companies domiciled in New York generally may not pay dividends to shareholders that, in any 12-month period, exceed the lesser of 10 percent of such company’s statutory policyholders’ surplus or 100 percent of its “adjusted net investment income,” for the previous year, as defined.

Generally, less severe restrictions applicable to both property and casualty insurance companies exist in most of the other states in which our insurance subsidiaries are domiciled.

Under state insurance laws, an insurer may pay a dividend without prior approval of the insurance regulator when the amount of the dividend is below certain regulatory thresholds.

Other foreign jurisdictions may restrict the ability of our foreign insurance subsidiaries to pay dividends.

Various other regulatory restrictions also limit cash loans and advances to us by our subsidiaries.

Largely as a result of these restrictions, approximately $ 28.7 billion and $ 28.5 billion of the statutory capital and surplus of our consolidated insurance subsidiaries were restricted from transfer to AIG Parent without prior approval of state insurance regulators at June 30, 2024 and December 31, 2023, respectively.

Repurchase of AIG Common Stock

3 unchanged sentences

The timing of any future repurchases will depend on market conditions, our business and strategic plans, financial condition, results of operations, liquidity and other factors.

Pursuant to an Exchange Act Rule 10b5-1 repurchase plan, from April 1, 2024 to April 26, 2024, we repurchased approximately 7 million shares of AIG Common Stock for an aggregate purchase price of approximately $ 558 million.

Pursuant to an Exchange Act Rule 10b5-1 repurchase plan, from July 1, 2024 to July 26, 2024, we repurchased approximately 6 million shares of AIG Common Stock for an aggregate purchase price of approximately $ 459 million.

DIVIDENDS DECLARED

On April 30, 2024, our Board of Directors declared a cash dividend on AIG Common Stock of $ 0.40 per share, an 11 percent increase from prior quarterly dividends on AIG Common Stock, payable on June 28, 2024 to shareholders of record on June 14, 2024.

AIG | First Quarter 2024 Form 10-Q

On July 31, 2024, our Board of Directors declared a cash dividend on AIG Common Stock of $ 0.40 per share, payable on September 30, 2024 to shareholders of record on September 16, 2024.

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 14.

21 unchanged sentences

Adjustment Total

Balance, March 31, 2024, net of tax $ ( 66 ) $ ( 11,702 ) $ ( 493 ) $ 1,535 $ ( 3,329 ) $ ( 814 ) $ ( 14,869 )

Change in unrealized appreciation (depreciation) of investments*

( 19 ) ( 1,036 ) — — — — ( 1,055 )

Change in other — ( 9 ) — — — — ( 9 )

Change in fair value of market risk benefits, net — — 159 — — — 159

Change in discount rates — — — 262 — — 262

Change in future policy benefits

— 67 — — — — 67

Change in foreign currency translation adjustments

— — — — 85 — 85

Change in net actuarial loss

— — — — — 10 10

Change in prior service cost

— — — — — 1 1

Change in deferred tax asset (liability)

3 52 ( 34 ) ( 72 ) 13 ( 2 ) ( 40 )

Corebridge deconsolidation, net of tax 42 8,513 330 ( 1,583 ) ( 88 ) — 7,214

Total other comprehensive income 26 7,587 455 ( 1,393 ) 10 9 6,694

Corebridge noncontrolling interests 2 693 38 ( 120 ) ( 3 ) — 610

Balance, June 30, 2024, net of tax $ ( 38 ) $ ( 3,422 ) $ — $ 22 $ ( 3,322 ) $ ( 805 ) $ ( 7,565 )

Balance, March 31, 2023, net of tax $ ( 134 ) $ ( 17,129 ) $ ( 226 ) $ 2,150 $ ( 3,094 ) $ ( 896 ) $ ( 19,329 )

Change in unrealized appreciation (depreciation) of investments*

104 ( 2,383 ) — — — — ( 2,279 )

Change in other — ( 159 ) — — — — ( 159 )

Change in fair value of market risk benefits, net — — ( 241 ) — — — ( 241 )

Change in discount rates — — — 531 — — 531

Change in future policy benefits

— 137 — — — — 137

Change in foreign currency translation adjustments

— — — — ( 25 ) — ( 25 )

Change in net actuarial loss

— — — — — 78 78

Change in prior service cost

— — — — — 2 2

Change in deferred tax asset (liability)

( 20 ) 407 51 ( 158 ) ( 34 ) ( 28 ) 218

Total other comprehensive income (loss) 84 ( 1,998 ) ( 190 ) 373 ( 59 ) 52 ( 1,738 )

Corebridge noncontrolling interests 4 2,125 54 ( 345 ) ( 10 ) ( 1 ) 1,827

Noncontrolling interests 14 ( 347 ) ( 47 ) 111 11 — ( 258 )

Balance, June 30, 2023, net of tax $ ( 60 ) $ ( 16,655 ) $ ( 315 ) $ 2,067 $ ( 3,174 ) $ ( 845 ) $ ( 18,982 )

(in millions) Unrealized

(Depreciation)

of Fixed Maturity

Securities on Which

Allowance for Credit

Losses Was Taken Unrealized

(Depreciation)

Investments Change in Fair

Value of Market

Risk Benefits

Attributable to

Credit Risk Change in the

discount rates

used to measure

traditional and

limited payment

long-duration

insurance contracts Foreign

Adjustments Retirement

Adjustment Total

Balance, December 31, 2023, net of tax $ ( 106 ) $ ( 10,888 ) $ ( 476 ) $ 1,233 $ ( 2,979 ) $ ( 821 ) $ ( 14,037 )

9 unchanged sentences

Change in deferred tax asset (liability) ( 12 ) 157 ( 28 ) ( 224 ) ( 1 ) ( 4 ) ( 112 )

Corebridge deconsolidation, net of tax 42 8,513 330 ( 1,583 ) ( 88 ) — 7,214

Total other comprehensive income (loss) 83 6,297 432 ( 848 ) ( 343 ) 16 5,637

1 unchanged sentence

Noncontrolling interests 17 ( 559 ) ( 11 ) 258 ( 3 ) — ( 298 )

Balance, March 31, 2024, net of tax $ ( 66 ) $ ( 11,702 ) $ ( 493 ) $ 1,535 $ ( 3,329 ) $ ( 814 ) $ ( 14,869 )

Balance, June 30, 2024, net of tax $ ( 38 ) $ ( 3,422 ) $ — $ 22 $ ( 3,322 ) $ ( 805 ) $ ( 7,565 )

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 14.

(in millions) Unrealized

(Depreciation)

of Fixed Maturity

Securities on Which

Allowance for Credit

Losses Was Taken Unrealized

(Depreciation)

Investments Change in Fair

Value of Market

Risk Benefits

Attributable to

Credit Risk Change in the

discount rates

used to measure

traditional and

limited payment

long-duration

insurance contracts Foreign

Adjustments Retirement

Adjustment Total

Balance, December 31, 2022, net of tax $ ( 136 ) $ ( 20,675 ) $ ( 284 ) $ 2,459 $ ( 3,056 ) $ ( 924 ) $ ( 22,616 )

6 unchanged sentences

Change in net actuarial loss — — — — — 105 105

Change in prior service cost — — — — — 2 2

Change in deferred tax asset (liability) ( 23 ) ( 343 ) 31 ( 51 ) ( 43 ) ( 27 ) ( 456 )

Total other comprehensive income (loss) 90 2,254 ( 115 ) ( 47 ) ( 87 ) 80 2,175

Corebridge noncontrolling interests 4 2,125 54 ( 345 ) ( 10 ) ( 1 ) 1,827

Noncontrolling interests 18 359 ( 30 ) — 21 — 368

Balance, March 31, 2023, net of tax $ ( 134 ) $ ( 17,129 ) $ ( 226 ) $ 2,150 $ ( 3,094 ) $ ( 896 ) $ ( 19,329 )

* Includes net unrealized gains and losses attributable to businesses held for sale at March 31, 2024.

The following table presents the other comprehensive income (loss) reclassification adjustments for the three months ended March 31, 2024 and 2023 , respectively:

Balance, June 30, 2023, net of tax $ ( 60 ) $ ( 16,655 ) $ ( 315 ) $ 2,067 $ ( 3,174 ) $ ( 845 ) $ ( 18,982 )

* Includes net unrealized gains and losses attributable to businesses held for sale or reclassified to discontinued operations at June 30, 2024 and 2023.

The following table presents the other comprehensive income (loss) reclassification adjustments for the three and six months ended June 30, 2024 and 2023 , respectively:

(in millions) Unrealized

19 unchanged sentences

Adjustment Total

Three Months Ended March 31, 2024

Three Months Ended June 30, 2024

Unrealized change arising during period $ ( 13 ) $ ( 811 ) $ 159 $ 262 $ 85 $ 3 $ ( 315 )

Reclassification adjustments included in net income ( 36 ) ( 8,346 ) ( 330 ) 1,583 88 ( 8 ) ( 7,049 )

Total other comprehensive income (loss), before of income tax expense (benefit) 72 ( 1,395 ) ( 29 ) 697 ( 339 ) 9 ( 985 )

Total other comprehensive income (loss), before income tax expense (benefit) 23 7,535 489 ( 1,321 ) ( 3 ) 11 6,734

Income tax expense (benefit) ( 3 ) ( 52 ) 34 72 ( 13 ) 2 40

Total other comprehensive income (loss), net of income tax expense (benefit) $ 26 $ 7,587 $ 455 $ ( 1,393 ) $ 10 $ 9 $ 6,694

Three Months Ended March 31, 2023

Three Months Ended June 30, 2023

Unrealized change arising during period $ 97 $ ( 2,739 ) $ ( 241 ) $ 531 $ ( 25 ) $ 72 $ ( 2,305 )

3 unchanged sentences

Total other comprehensive income (loss), net of income tax expense (benefit) $ 84 $ ( 1,998 ) $ ( 190 ) $ 373 $ ( 59 ) $ 52 $ ( 1,738 )

AIG | First Quarter 2024 Form 10-Q

(in millions) Unrealized

(Depreciation)

of Fixed Maturity

Securities on Which

Allowance for Credit

Losses Was Taken Unrealized

(Depreciation)

Investments Change in Fair

Value of Market

Risk Benefits

Attributable to

Changes in Our

Own Credit Risk Change in the

discount rates

used to measure

traditional and

limited payment

long-duration

insurance contracts Foreign

Adjustments Retirement

Adjustment Total

Six Months Ended June 30, 2024

Unrealized change arising during period $ 53 $ ( 2,643 ) $ 130 $ 959 $ ( 254 ) $ 5 $ ( 1,750 )

Reclassification adjustments included in net income ( 42 ) ( 8,783 ) ( 330 ) 1,583 88 ( 15 ) ( 7,499 )

Total other comprehensive income (loss), before of income tax expense (benefit) 95 6,140 460 ( 624 ) ( 342 ) 20 5,749

Income tax expense (benefit) 12 ( 157 ) 28 224 1 4 112

Total other comprehensive income (loss), net of income tax expense (benefit) $ 83 $ 6,297 $ 432 $ ( 848 ) $ ( 343 ) $ 16 $ 5,637

Six Months Ended June 30, 2023

Unrealized change arising during period $ 90 $ 1,827 $ ( 146 ) $ 4 $ ( 44 ) $ 90 $ 1,821

Reclassification adjustments included in net income ( 23 ) ( 770 ) — — — ( 17 ) ( 810 )

Total other comprehensive income (loss), before income tax expense (benefit) 113 2,597 ( 146 ) 4 ( 44 ) 107 2,631

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 14.

(in millions) Unrealized

(Depreciation)

of Fixed Maturity

Securities on Which

Allowance for Credit

Losses Was Taken Unrealized

(Depreciation)

Investments Change in Fair

Value of Market

Risk Benefits

Attributable to

Changes in Our

Own Credit Risk Change in the

discount rates

used to measure

traditional and

limited payment

long-duration

insurance contracts Foreign

Adjustments Retirement

Adjustment Total

Income tax expense (benefit) 23 343 ( 31 ) 51 43 27 456

Total other comprehensive income (loss), net of income tax expense (benefit) $ 90 $ 2,254 $ ( 115 ) $ ( 47 ) $ ( 87 ) $ 80 $ 2,175

The following table presents the effect of the reclassification of significant items out of AOCI on the respective line items in the Condensed Consolidated Statements of Income (Loss) (a) :

Amount Reclassified from AOCI Affected Line Item in the

Three Months Ended March 31, Condensed Consolidated

Three Months Ended June 30, Condensed Consolidated

(in millions) 2024 2023 Statements of Income (Loss)

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Total ( 8 ) ( 8 )

Corebridge deconsolidation, net of tax ( 7,214 ) — (c)

Total reclassifications for the period $ ( 7,049 ) $ ( 349 )

Amount Reclassified from AOCI Affected Line Item in the

Six Months Ended June 30, Condensed Consolidated

(in millions) 2024 2023 Statements of Income (Loss)

Unrealized appreciation (depreciation) of fixed maturity securities on which allowance for credit losses was taken

Investments $ — $ ( 23 ) Net realized gains (losses)

Total — ( 23 )

Unrealized appreciation (depreciation) of all other investments

Investments ( 270 ) ( 770 ) Net realized gains (losses)

Total ( 270 ) ( 770 )

Change in retirement plan liabilities adjustment

Prior-service credit ( 1 ) ( 1 ) (b)

Actuarial losses ( 14 ) ( 16 ) (b)

Total ( 15 ) ( 17 )

Corebridge deconsolidation, net of tax ( 7,214 ) — (c)

Total reclassifications for the period $ ( 7,499 ) $ ( 810 )

(a) The following items are not reclassified out of AOCI and included in the Condensed Consolidated Statements of Income (Loss) and thus have been excluded from the table:

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(b) These AOCI components are included in the computation of net periodic pension cost.

AIG | First Quarter 2024 Form 10-Q

(c) Represents adjustments related to the deconsolidation of Corebridge which is reflected in Income (loss) from discontinued operations, net of taxes.

See the rollforward of Accumulated other comprehensive income (loss) above for further details.

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 15.

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The following table presents the computation of basic and diluted EPS:

Three Months Ended March 31,

Three Months Ended

June 30, Six Months Ended

(dollars in millions, except per common share data) 2024 2023 2024 2023

Numerator for EPS:

Income (loss) from continuing operations $ 1,600 $ ( 87 )

Net income (loss) from continuing operations attributable to noncontrolling interests 384 ( 117 )

Income from continuing operations $ 475 $ 841 $ 1,272 $ 1,178

Preferred stock dividends and preferred stock redemption premiums — 8 22 15

Income (loss) attributable to AIG common shareholders from continuing operations 1,194 23

Income attributable to AIG common shareholders from continuing operations 475 833 1,250 1,163

Income (loss) from discontinued operations, net of income tax expense ( 4,359 ) 850 ( 3,556 ) 426

Net income attributable to noncontrolling interests 93 198 477 81

Income (loss) from discontinued operations, net of noncontrolling interest ( 4,452 ) 652 ( 4,033 ) 345

Net income (loss) attributable to AIG common shareholders $ ( 3,977 ) $ 1,485 $ ( 2,783 ) $ 1,508

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Income (loss) per common share attributable to AIG common shareholders:

Income (loss) from continuing operations $ 1.75 $ 0.03

Income from discontinued operations $ — $ —

Income from continuing operations $ 0.72 $ 1.15 $ 1.86 $ 1.59

Income (loss) from discontinued operations $ ( 6.74 ) $ 0.90 $ ( 6.00 ) $ 0.47

Income (loss) attributable to AIG common shareholders $ ( 6.02 ) $ 2.05 $ ( 4.14 ) $ 2.06

Income (loss) from continuing operations $ 1.74 $ 0.03

Income from discontinued operations $ — $ —

Income from continuing operations $ 0.71 $ 1.14 $ 1.85 $ 1.58

Income (loss) from discontinued operations $ ( 6.67 ) $ 0.89 $ ( 5.96 ) $ 0.47

Income (loss) attributable to AIG common shareholders $ ( 5.96 ) $ 2.03 $ ( 4.11 ) $ 2.05

(a) Potential dilutive common shares include our share-based employee compensation plans.

The number of potential common shares excluded from diluted shares outstanding was 0.1 million and 4.5 million for the three months ended March 31, 2024 and 2023, respectively, because the effect of including those common shares in the calculation would have been anti-dilutive.

The number of potential common shares excluded from diluted shares outstanding was 0.1 million and 0.1 million for the three and six months ended June 30, 2024, respectively, and 6.6 million and 5.5 million for the three and six months ended June 30, 2023, respectively, because the effect of including those common shares in the calculation would have been anti-dilutive.

For information regarding our repurchases of AIG Common Stock, see Note 14.

AIG | First Quarter 2024 Form 10-Q

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 16.

TAX LAW CHANGES

The Inflation Reduction Act of 2022 (H.R.

5376) includes a 15 percent corporate alternative minimum tax (CAMT) on adjusted financial statement income for corporations with average profits over $1 billion over a three-year period.

Although the U.S.

Treasury and Internal Revenue Service (IRS) issued interim CAMT guidance during 2023, many details and specifics of application of the CAMT remain subject to future guidance.

We expect to be subject to CAMT in 2024.

BASIS OF PRESENTATION

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and foreign laws.

Following the initial public offering of Corebridge on September 19, 2022, AIG’s remaining ownership in Corebridge decreased below 80 percent, resulting in tax deconsolidation of Corebridge parent and its subsidiaries from the AIG consolidated U.S.

federal income tax group as well as certain state and local jurisdictions where unitary returns are filed.

Subsequent to the tax deconsolidation from AIG, due to the application of relevant U.S.

tax laws, American General Corporation and its directly owned life insurance subsidiaries will not be permitted to join in the filing of a consolidated U.S.

federal income tax return with Corebridge parent and its non-life-insurance subsidiaries for a period of five years.

Corebridge’s net operating losses and tax credit carryforwards that have not been utilized prior to tax deconsolidation from AIG will remain with the relevant Corebridge entities and will be available for utilization by the respective Corebridge U.S.

federal income tax groups.

The realizability of the deferred tax assets related to such carryforwards is based on the positive and negative evidence applicable to each U.S.

federal income tax group.

TAX ACCOUNTING POLICIES

We use an item-by-item approach to release the stranded or disproportionate income tax effects in AOCI related to our available-for-sale securities.

Under this approach, a portion of the disproportionate tax effects is assigned to each individual security lot at the date the amount becomes lodged.

When the individual securities are sold, mature, or are otherwise impaired on an other-than-temporary basis, the assigned portion of the disproportionate tax effect is reclassified from AOCI to income (loss) from continuing operations.

We consider our foreign earnings with respect to certain operations in Canada, South Africa, Japan, Latin America, Bermuda as well as the European, Asia Pacific and Middle East regions to be indefinitely reinvested.

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Certain tax effects are also not reflected in the estimated annual effective tax rate, primarily certain changes in uncertain tax positions and realizability of deferred tax assets and are recorded in the period in which the change occurs.

AIG | First Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 18.

INTERIM TAX EXPENSE (BENEFIT)

For the three months ended March 31, 2024, the effective tax rate on income from continuing operations was 22.0 percent.

The effective tax rate on income from continuing operations differs from the statutory tax rate of 21 percent primarily due to tax charges associated with the effect of foreign operations, U.S.

federal and foreign valuation allowance changes, and state and local income taxes, partially offset by tax benefits related to tax exempt income and excess tax benefits related to share-based compensation payments recorded through the income statement.

For the three months ended June 30, 2024, the effective tax rate on income from continuing operations was 23.0 percent.

The effective tax rate on income from continuing operations differs from the statutory tax rate of 21 percent primarily due to tax charges associated with the effect of foreign operations, state and local income taxes and certain non-deductible expenses, partially offset by tax benefits related to the dividends received deduction applicable to post-deconsolidation Corebridge dividends and tax exempt income.

The effect of foreign operations is primarily related to income of our foreign operations taxed at statutory tax rates higher than 21 percent, other foreign taxes, and foreign income subject to U.S.

For the three months ended March 31, 2023, the effective tax rate on loss from continuing operations was 62.3 percent.

The effective tax rate on loss from continuing operations differs from the statutory tax rate of 21 percent primarily due to tax benefits associated with tax exempt income, excess tax benefits related to share based compensation payments recorded through the income statement, tax adjustments related to prior year returns and reclassifications from AOCI to income from continuing operations related to the disposal of available for sale securities.

These tax benefits were partially offset by tax charges associated with the effect of foreign operations, U.S.

federal valuation allowance changes and state and local income taxes.

For the six months ended June 30, 2024, the effective tax rate on income from continuing operations was 24.1 percent.

The effect of foreign operations is primarily related to income of our foreign operations taxed at statutory tax rates higher than 21 percent, other foreign taxes, and foreign income subject to U.S.

For the three months ended June 30, 2023, the effective tax rate on income from continuing operations was 5.1 percent.

The effective tax rate on income from continuing operations differs from the statutory tax rate of 21 percent primarily due to tax benefits related to the potential resolution of an IRS audit matter, net of an increase in associated uncertain tax benefits and tax exempt income, partially offset by tax charges associated with the effect of foreign operations, tax implications related to the announced sale of Validus Re, foreign valuation allowance changes, and state and local income taxes.

The effect of foreign operations is primarily related to income of our foreign operations taxed at statutory tax rates higher than 21 percent, other foreign taxes, and foreign income subject to U.S.

For the six months ended June 30, 2023, the effective tax rate on income from continuing operations was 8.5 percent.

The effective tax rate on income from continuing operations differs from the statutory tax rate of 21 percent primarily due to tax benefits related to the potential resolution of an IRS audit matter, net of an increase in associated uncertain tax benefits, tax exempt income, excess tax benefits related to share-based compensation payments recorded through the income statement and tax adjustments related to prior year returns.

These tax benefits were partially offset by tax charges associated with the effect of foreign operations, tax implications related to the announced sale of Validus Re, foreign valuation allowance changes, and state and local income taxes.

The effect of

AIG | Second Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 16.

foreign operations is primarily related to income of our foreign operations taxed at statutory tax rates higher than 21 percent, other foreign taxes, and foreign income subject to U.S.

ASSESSMENT OF DEFERRED TAX ASSET VALUATION ALLOWANCE

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The more negative evidence that exists, the more positive evidence is necessary and the more difficult it is to support a conclusion that a valuation allowance is not needed.

During the first quarter, taxable income projections were updated to reflect the latest projections of income for our insurance and non-insurance companies, and projections of taxable income generated from prudent and feasible tax planning strategies.

During the second quarter, taxable income projections were updated to reflect the latest projections of income for our insurance and non-insurance companies, and projections of taxable income generated from prudent and feasible tax planning strategies.

Given there is a shorter carryforward period to utilize remaining net operating losses, we continue to consider multiple data points and stresses.

Additionally, recent events, including changes in target interest rates by the Board of Governors of the Federal Reserve System, and significant market volatility, continue to impact actual and projected results of our business operations as well as our views on potential effectiveness of certain prudent and feasible tax planning strategies.

Additionally, significant market volatility continues to impact actual and projected results of our business operations as well as our views on potential effectiveness of certain prudent and feasible tax planning strategies.

In order to demonstrate the predictability and sufficiency of future taxable income necessary to support the realizability of the net operating losses and foreign tax credit carryforwards, we have considered forecasts of future income for each of our businesses, including assumptions about future macroeconomic and AIG-specific conditions and events, and any impact these conditions and events may have on our prudent and feasible tax planning strategies.

We also subjected the forecasts to a variety of stresses of key assumptions and evaluated the effect on tax attribute utilization.

The 2022 tax deconsolidation of Corebridge from the AIG consolidated U.S.

federal income tax group resulted in the formation of new federal tax filing groups requiring separate deferred tax asset realizability assessments.

To the extent that the valuation allowance is attributed to changes in forecast of current year taxable income, the impact is included in our estimated annualized effective tax rate.

A valuation allowance related to changes in forecasts of income in future periods as well as other items not related to the current year is recorded discretely.

After factoring in multiple data points and assessing the relative weight of all positive and negative evidence, we concluded that valuation allowance of $ 300 million should remain on a portion of AIG's U.S.

After factoring in multiple data points and assessing the relative weight of all positive and negative evidence, we concluded that a valuation allowance of $ 300 million should remain on a portion of AIG's U.S.

federal consolidated income tax group tax attribute carryforwards that are not more likely than not to be realized.

Accordingly, during the three months ended March 31, 2024, we recorded no change in valuation allowance.

As of March 31, 2024, we reported a valuation allowance of $ 177 million related to Corebridge.

The valuation allowance at Corebridge relates to a portion of both tax attribute carryforwards and certain other deferred tax assets of the Corebridge non-life insurance group that are not more-likely-than-not to be realized.

For the three months ended March 31, 2024, Corebridge recorded a $ 15 million increase in valuation allowance.

AIG | First Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 18.

For the three months ended March 31, 2024, recent changes in market conditions, including changes in interest rates, impacted the unrealized tax gains and losses in the available for sale securities portfolios of both our U.S.

life insurance and non-life insurance companies, resulting in an increase to deferred tax assets related to net unrealized tax capital losses.

The deferred tax assets relate to the unrealized tax capital losses for which the carryforward period has not yet begun, and as such, when assessing recoverability, we consider our ability and intent to hold the underlying securities to recovery.

As of March 31, 2024, based on all available evidence, we concluded that a valuation allowance of $ 1.8 billion is necessary on a portion of the deferred tax assets related to unrealized tax capital losses that are not more-likely-than-not to be realized.

Of the total valuation allowance, $ 1.2 billion relates to the unrealized tax capital losses in the U.S.

Life Insurance Companies' available for sale securities portfolio and $ 561 million relates to the unrealized tax capital losses in the non-life insurance companies' available for sale securities portfolio.

For the three months ended March 31, 2024, we recorded an increase in valuation allowance of $ 194 million associated with the unrealized tax capital losses in the U.S.

Life Insurance Companies’ available for sale securities portfolio and $ 11 million associated with the unrealized tax capital losses in the non-life insurance companies’ available for sale securities portfolio.

The valuation allowance increase was primarily allocated to other comprehensive income.

For the three months ended March 31, 2024, we recognized a net $ 3 million decrease in deferred tax asset valuation allowance associated with certain foreign jurisdictions.

Accordingly, during the six months ended June 30, 2024, we recorded no change in valuation allowance.

For the six months ended June 30, 2024, recent changes in market conditions, including changes in interest rates, impacted the unrealized tax gains and losses in the available for sale securities portfolios of our general insurance and non-insurance companies, resulting in an increase to deferred tax assets related to net unrealized tax capital losses.

The deferred tax assets relate to the unrealized tax capital losses for which the carryforward period has not yet begun.

As of June 30, 2024, based on all available evidence, we concluded that a valuation allowance of $ 0.6 billion is necessary on a portion of the deferred tax assets related to unrealized tax capital losses that are not more-likely-than-not to be realized.

For the three and six months ended June 30, 2024, we recorded an increase in valuation allowance of $ 12 million and $ 23 million, respectively, associated with the unrealized tax capital losses in AIG's available for sale securities portfolio.

The valuation allowance increase was allocated to other comprehensive income.

For the six months ended June 30, 2024, we recognized a net $ 6 million decrease in deferred tax asset valuation allowance associated with certain foreign jurisdictions.

TAX EXAMINATIONS

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ACCOUNTING FOR UNCERTAINTY IN INCOME TAXES

At both March 31, 2024 and December 31, 2023, our unrecognized tax benefits, excluding interest and penalties, were $ 1.4 billion.

At both March 31, 2024 and December 31, 2023, the amounts of unrecognized tax benefits that, if recognized, would favorably affect the effective tax rate were $ 1.4 billion.

At both June 30, 2024 and December 31, 2023, our unrecognized tax benefits, excluding interest and penalties, were $ 1.4 billion.

At both June 30, 2024 and December 31, 2023, the amounts of unrecognized tax benefits that, if recognized, would favorably affect the effective tax rate were $ 1.4 billion.

Unrecognized tax benefits that would not affect the effective tax rate generally relate to such factors as the timing, rather than the permissibility of the deduction.

Interest and penalties related to unrecognized tax benefits are recognized in income tax expense.

At both March 31, 2024 and December 31, 2023, we had accrued liabilities of $ 52 million, for the payment of interest (net of the federal benefit) and penalties.

For the three months ended March 31, 2024 and March 31, 2023, we accrued benefit of $ 0 million and $ 7 million, respectively, for the payment of interest and penalties.

At both June 30, 2024 and December 31, 2023, we had accrued liabilities of $ 52 million, for the payment of interest (net of the federal benefit) and penalties.

For the six months ended June 30, 2024 and June 30, 2023, we accrued benefit of $ 0 million and $ 4 million, respectively, for the payment of interest and penalties.

Although it is reasonably possible that a change in the balance of unrecognized tax benefits may occur within the next 12 months, based on the information currently available, we do not expect any change to be material to our consolidated financial condition.

AIG | First Quarter 2024 Form 10-Q

AIG | Second Quarter 2024 Form 10-Q

ITEM 2 | Management’s Discussion and Analysis of Financial Condition and Results of Operations

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Forward-looking statements are often preceded by, followed by or include words such as “will,” “believe,” “anticipate,” “expect,” “expectations,” “intend,” “plan,” “strategy,” “prospects,” “project,” “anticipate,” “should,” “guidance,” “outlook,” “confident,” “focused on achieving,” “view,” “target,” “goal,” “estimate” and other words of similar meaning in connection with a discussion of future operating or financial performance.

These statements may include, among other things, projections, goals and assumptions that relate to future actions, prospective services or products, future performance or results of current and anticipated services or products, sales efforts, expense reduction efforts, the outcome of contingencies such as legal proceedings, anticipated organizational, business or regulatory changes, such as the separation of the Life and Retirement business from AIG, the effect of catastrophic events, both natural and man-made, and macroeconomic and/or geopolitical events, anticipated dispositions, monetization and/or acquisitions of businesses or assets, the successful integration of acquired businesses, management succession and retention plans, exposure to risk, trends in operations and financial results, and other statements that are not historical facts.

AIG | First Quarter 2024 Form 10-Q

These statements may include, among other things, projections, goals and assumptions that relate to future actions, prospective services or products, future performance or results of current and anticipated services or products, sales efforts, expense reduction efforts, the outcome of contingencies such as legal proceedings, anticipated organizational, business or regulatory changes, such as the separation and accounting deconsolidation of the Life and Retirement business from AIG, the effect of catastrophic events, both natural and man-made, and macroeconomic and/or geopolitical events, anticipated dispositions, monetization and/or acquisitions of businesses or assets, the successful integration of acquired businesses, management succession and retention plans, exposure to risk, trends in operations and financial results, and other statements that are not historical facts.

AIG | Second Quarter 2024 Form 10-Q

All forward-looking statements involve risks, uncertainties and other factors that may cause AIG’s actual results and financial condition to differ, possibly materially, from the results and financial condition expressed or implied in the forward-looking statements.

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federal government shutdown and geopolitical events or conflicts, including the conflict between Russia and Ukraine and the conflict in Israel and the surrounding areas;

• occurrence of catastrophic events, both natural and man-made, including the effects of climate change, geopolitical events and conflicts and civil unrest;

• the occurrence of catastrophic events, both natural and man-made, including the effects of climate change, geopolitical events and conflicts and civil unrest;

• disruptions in the availability or accessibility of AIG's or a third party’s information technology systems, including hardware and software, infrastructure or networks, and the inability to safeguard the confidentiality and integrity of customer, employee or company data due to cyberattacks, data security breaches, or infrastructure vulnerabilities;

• AIG’s ability to successfully dispose of, monetize and/or acquire businesses or assets or successfully integrate acquired businesses, and the anticipated benefits thereof;

• AIG's ability to realize expected strategic, financial, operational or other benefits from the separation of Corebridge Financial, Inc.

(Corebridge) as well as AIG’s equity market exposure to Corebridge;

• AIG's ability to realize expected strategic, financial, operational or other benefits from the separation and accounting deconsolidation of Corebridge Financial, Inc.

(Corebridge) as well as AIG’s continuing equity market exposure to Corebridge;

• AIG's ability to effectively implement restructuring initiatives and potential cost-savings opportunities;

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• concentrations of AIG’s insurance, reinsurance and other risk exposures;

• nonperformance or defaults by counterparties, including Fortitude Reinsurance Company Ltd.

(Fortitude Re);

• nonperformance or defaults by counterparties;

• AIG's ability to adequately assess risk and estimate related losses as well as the effectiveness of AIG’s enterprise risk management policies and procedures, including with respect to business continuity and disaster recovery plans;

4 unchanged sentences

• changes in judgments or assumptions concerning insurance underwriting and insurance liabilities;

• changes in accounting principles and financial reporting requirements;

• changes in accounting principles and financial reporting requirements or their applicability to AIG, including as a result of the accounting deconsolidation of Corebridge;

• the effects of sanctions, including those related to the conflict between Russia and Ukraine, and the failure to comply with those sanctions;

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– Part I, Item 2.

MD&A of this Quarterly Report on Form 10‑Q;

MD&A and Part II, Item 1A.

Risk Factors of this Quarterly Report on Form 10‑Q;

– Part I, Item 1A.

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Additional information as to factors that may cause actual results to differ materially from those expressed or implied in any forward-looking statements is disclosed from time to time in other filings with the Securities and Exchange Commission (SEC).

AIG | First Quarter 2024 Form 10-Q

AIG | Second Quarter 2024 Form 10-Q

INDEX TO ITEM 2

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General Insurance

Life and Retirement

Other Operations

Investment Highlights in the Three Months Ended March 31, 2024

Investment Highlights in the Six Months Ended June 30, 2024

Investment Strategies

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Insurance Reserves

Loss Reserves

Life and Annuity Future Policy Benefits, Policyholder Contract Deposits and Market Risk Benefits

Liquidity and Capital Resources

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Enterprise Risk Management

AIG | First Quarter 2024 Form 10-Q

AIG | Second Quarter 2024 Form 10-Q

ITEM 2 | Use of Non-GAAP Measures

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When we use these measures, reconciliations to the most comparable GAAP measure are provided on a consolidated basis in the Consolidated Results of Operations section of this MD&A.

Book value per common share, excluding accumulated other comprehensive income (loss) (AOCI) adjusted for the cumulative unrealized gains and losses related to Fortitude Re funds withheld assets and deferred tax assets (DTA) (Adjusted book value per common share) is used to show the amount of our net worth on a per-common share basis after eliminating items that can fluctuate significantly from period to period including changes in fair value (1) of AIG’s available for sale securities portfolio, (2) of market risk benefits attributable to our own credit risk and (3) due to discount rates used to measure traditional and limited payment long-duration insurance contracts, foreign currency translation adjustments and U.S.

tax attribute deferred tax assets.

This measure also eliminates the asymmetrical impact resulting from changes in fair value of our available for sale securities portfolio wherein there is largely no offsetting impact for certain related insurance liabilities.

In addition, we adjust for the cumulative unrealized gains and losses related to Fortitude Re funds withheld assets held by AIG in support of Fortitude Re’s reinsurance obligations to AIG post deconsolidation of Fortitude Re (Fortitude Re funds withheld assets) since these fair value movements are economically transferred to Fortitude Re.

We exclude deferred tax assets representing U.S.

tax attributes related to net operating loss carryforwards and foreign tax credits as they have not yet been utilized.

Book value per share, excluding investments related cumulative unrealized gains and losses in accumulated other comprehensive income (loss) (AOCI) adjusted for the cumulative unrealized gains and losses related to Fortitude Re funds withheld assets (collectively, Investments AOCI) (Adjusted book value per share) is used to show the amount of our net worth on a per share basis after eliminating the fair value of investments that can fluctuate significantly from period to period due to changes in market conditions.

In addition, we adjusted for the cumulative unrealized gains and losses related to Fortitude Re funds withheld assets held by AIG in support of Fortitude Re’s reinsurance obligations to AIG (Fortitude Re funds withheld assets) since these fair value movements are economically transferred to Fortitude Re.

Adjusted book value per share is derived by dividing total AIG common shareholders’ equity, excluding Investments AOCI (AIG adjusted common equity) by total common shares outstanding.

Book Value per share, excluding Goodwill, Value of business acquired (VOBA), Value of distribution channel acquired (VODA) and Other intangible assets (Tangible book value per share) is used to provide a useful measure of the realizable shareholder value on a per share basis.

Tangible book value per share is derived by dividing Total AIG common shareholders’ equity, excluding intangible assets (AIG tangible common shareholders’ equity) by total common shares outstanding.

Book value per share, excluding Investments AOCI, deferred tax assets (DTA) and AIG’s ownership interest in Corebridge (Core operating book value per share) is used to show the amount of our net worth on a per share basis after eliminating Investments AOCI, DTA and AIG’s ownership interest in Corebridge.

We believe this measure is useful to investors because it eliminates fair value of investments that can fluctuate significantly from period to period due to changes in market conditions.

We also exclude only the portion of DTA representing U.S.

tax attributes related to net operating loss carryforwards (NOLs) and corporate alternative minimum tax credits (CAMTCs) and foreign tax credits (FTCs) that have not yet been utilized.

Amounts for interim periods are estimates based on projections of full-year attribute utilization.

As net operating loss carryforwards and foreign tax credits are utilized, the portion of the DTA utilized is included in these book value per common share metrics.

Adjusted book value per common share is derived by dividing total AIG common shareholders’ equity, excluding AOCI adjusted for the cumulative unrealized gains and losses related to Fortitude Re funds withheld assets, and DTA (Adjusted common shareholders’ equity), by total common shares outstanding.

Return on common equity – Adjusted after-tax income excluding AOCI adjusted for the cumulative unrealized gains and losses related to Fortitude Re funds withheld assets and DTA (Adjusted return on common equity) is used to show the rate of return on common shareholders’ equity.

We believe this measure is useful to investors because it eliminates items that can fluctuate significantly from period to period, including changes in fair value (1) of AIG’s available for sale securities portfolio, (2) of market risk benefits attributable to our own credit risk and (3) due to discount rates used to measure traditional and limited payment long-duration insurance contracts, foreign currency translation adjustments and U.S.

tax attribute deferred tax assets.

In addition, we adjust for the cumulative unrealized gains and losses related to Fortitude Re funds withheld assets since these fair value movements are economically transferred to Fortitude Re.

We exclude deferred tax assets representing U.S.

tax attributes related to net operating loss carryforwards and foreign tax credits as they have not yet been utilized.

As NOLs, CAMTCs and FTCs are utilized, the portion of the DTA utilized is included.

We exclude AIG’s ownership interest in Corebridge since it is not a core long-term investment for AIG.

Core operating book value per share is derived by dividing total AIG common shareholders’ equity, excluding Investments AOCI, DTA and AIG’s ownership interest in Corebridge (AIG core operating shareholders’ equity) by total common shares outstanding.

Return on equity – Adjusted after-tax income excluding Investments AOCI (Adjusted return on equity) is used to show the rate of return on common shareholders’ equity excluding Investments AOCI.

We believe this measure is useful to investors because it eliminates fair value of investments which can fluctuate significantly from period to period due to changes in market conditions.

Adjusted return on equity is derived by dividing actual or, for interim periods, annualized adjusted after-tax income attributable to AIG common shareholders by average AIG adjusted common shareholders’ equity.

Return on Equity – Adjusted After-tax Income, Excluding Goodwill, VOBA, VODA and Other Intangible assets (Return on tangible equity) is used to show the return on AIG tangible common shareholder’s equity, which we believe is a useful measure of realizable shareholder value.

We exclude Goodwill, VOBA, VODA and Other intangible assets from AIG common shareholders’ equity to derive AIG tangible common shareholders’ equity.

Return on AIG tangible common equity is derived by dividing actual or, for interim periods, annualized adjusted after-tax income attributable to AIG common shareholders by average AIG tangible common equity.

Return on equity – Adjusted after-tax income excluding Investments AOCI, DTA and AIG’s ownership interest in Corebridge (Core operating return on equity) is used to show the rate of return on common shareholders’ equity excluding Investments AOCI, DTA and AIG’s ownership interest in Corebridge.

We believe this measure is useful to investors because it eliminates fair value of investments that can fluctuate significantly from period to period due to changes in market conditions.

We also exclude only the portion of DTA representing U.S.

tax attributes related to NOLs and CAMTCs and FTCs that have not yet been utilized.

Amounts for interim periods are estimates based on projections of full-year attribute utilization.

As net operating loss carryforwards and foreign tax credits are utilized, the portion of the DTA utilized is included in Adjusted return on common equity.

Adjusted return on common equity is derived by dividing actual or annualized adjusted after-tax income attributable to AIG common shareholders by average Adjusted common shareholders’ equity.

Adjusted after-tax income attributable to AIG common shareholders is derived by excluding the tax effected adjusted pre-tax income (APTI) adjustments described below, dividends on preferred stock and preferred stock redemption premiums, noncontrolling interest on net realized gains (losses), other non-operating expenses and the following tax items from net income attributable to AIG:

• deferred income tax valuation allowance releases and charges;

• changes in uncertain tax positions and other tax items related to legacy matters having no relevance to our current businesses or operating performance;

• net tax charge related to the enactment of the Tax Cuts and Jobs Act.

Adjusted revenues exclude Net realized gains (losses), income from non-operating litigation settlements (included in Other income for GAAP purposes), changes in fair value of securities used to hedge guaranteed living benefits (included in Net investment income for GAAP purposes) and income from elimination of the international reporting lag.

Adjusted revenues is a GAAP measure for our segments.

AIG | First Quarter 2024 Form 10-Q

As NOLs, CAMTCs and FTCs are utilized, the portion of the DTA utilized is included.

We exclude AIG’s ownership interest in Corebridge since it is not a core long-term investment for AIG.

This metric will provide greater insight as to the underlying profitability of our property and casualty business.

Core operating return on equity is derived by dividing actual or, for interim periods, annualized adjusted after-tax income attributable to AIG common shareholders by average AIG core operating shareholders’ equity.

AIG | Second Quarter 2024 Form 10-Q

ITEM 2 | Use of Non-GAAP Measures

Adjusted revenues exclude Net realized gains (losses), income from non-operating litigation settlements (included in Other income for GAAP purposes) and income from elimination of the international reporting lag.

Adjusted revenues is a GAAP measure for our segments.

Adjusted pre-tax income is derived by excluding the items set forth below from income from continuing operations before income tax.

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Excluded items include the following:

• changes in fair value of securities used to hedge guaranteed living benefits;

• net change in market risk benefits (MRBs);

• changes in benefit reserves related to net realized gains and losses;

• changes in the fair value of equity securities;

• changes in the fair values of equity securities and AIG's ownership interest in Corebridge;

• net investment income on Fortitude Re funds withheld assets;

• following deconsolidation of Fortitude Re, net realized gains and losses on Fortitude Re funds withheld assets;

• net realized gains and losses on Fortitude Re funds withheld assets;

• loss (gain) on extinguishment of debt;

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Earned income on such economic hedges is reclassified from net realized gains and losses to specific APTI line items based on the economic risk being hedged (e.g.

net investment income and interest credited to policyholder account balances);

net investment income);

• income or loss from discontinued operations;

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• income from elimination of the international reporting lag.

• General Insurance

Adjusted after-tax income attributable to AIG common shareholders is derived by excluding the tax effected adjusted pre-tax income (APTI) adjustments described above, dividends on preferred stock and preferred stock redemption premiums, noncontrolling interest on net realized gains (losses), other non-operating expenses and the following tax items from net income attributable to AIG:

• deferred income tax valuation allowance releases and charges;

• changes in uncertain tax positions and other tax items related to legacy matters having no relevance to our current businesses or operating performance;

• net tax charge related to the enactment of the Tax Cuts and Jobs Act.

We, along with most property and casualty insurance companies, use the loss ratio, the expense ratio and the combined ratio as measures of underwriting performance.

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We also exclude prior year development to provide transparency related to current accident year results.

• Life and Retirement

– Premiums and deposits:

includes direct and assumed amounts received and earned on traditional life insurance policies, group benefit policies and life-contingent payout annuities, as well as deposits received on universal life, investment-type annuity contracts, Federal Home Loan Bank (FHLB) funding agreements and mutual funds.

We believe the measure of premiums and deposits is useful in understanding customer demand for our products, evolving product trends and our sales performance period over period.

Results from discontinued operations are excluded from all of these measures.

AIG | First Quarter 2024 Form 10-Q

Results from discontinued operations, including Corebridge, are excluded from all of these measures.

AIG | Second Quarter 2024 Form 10-Q

ITEM 2 | Critical Accounting Estimates

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• loss reserves;

• valuation of future policy benefit liabilities and recognition of measurement gains and losses;

• valuation of MRBs related to guaranteed benefit features of variable annuity, fixed annuity and fixed index annuity products;

• valuation of embedded derivative liabilities for fixed index annuity and index universal life products;

• reinsurance assets, including the allowance for credit losses and disputes;

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To the extent actual experience differs from the assumptions used, our consolidated financial condition, results of operations and cash flows could be materially affected.

For a complete discussion of our critical accounting estimates, see Part II, Item 7.

Certain critical accounting estimates were eliminated as a result of the Corebridge deconsolidation.

There were no changes to the remaining critical accounting estimates.

For further details, see Note 4 to the Condensed Consolidated Financial Statements.

For a detailed discussion of our critical accounting estimates, see Part II, Item 7.

MD&A – Critical Accounting Estimates in the 2023 Annual Report.

AIG | First Quarter 2024 Form 10-Q

ITEM 2 | Executive Summary

Executive Summary

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You should read this Quarterly Report on Form 10-Q, together with the 2023 Annual Report, in their entirety for a more detailed description of events, trends, uncertainties, risks and critical accounting estimates affecting us.

AIG | Second Quarter 2024 Form 10-Q

ITEM 2 | Executive Summary

OPERATING STRUCTURE

AIG reports the results of its businesses through three segments – General Insurance, Life and Retirement and Other Operations.