What changed in this filing

/stocks — the workspaceLOADING

Item 5. Other Information

2024-11-07 compared with 2024-08-01 · 832 added, 832 removed, 3168 unchanged (34% 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 | Second Quarter 2024 Form 10-Q

AIG | Third Quarter 2024 Form 10-Q

Part I – Financial Information

2 unchanged sentences

Condensed Consolidated Balance Sheets (unaudited)

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

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

2024 December 31,

34 unchanged sentences

Unearned premiums 18,926 17,375

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

Future policy benefits 1,471 1,467

Other policyholder funds 455 495

1 unchanged sentence

2023 - $( 148 ))

Premiums and other related payables 6,715 6,219

34 unchanged sentences

See accompanying Notes to Condensed Consolidated Financial Statements.

AIG | Second Quarter 2024 Form 10-Q

AIG | Third Quarter 2024 Form 10-Q

American International Group, Inc.

1 unchanged sentence

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

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

5 unchanged sentences

Net realized gains (losses):

Net realized losses - excluding Fortitude Re funds withheld assets and embedded derivative ( 187 ) ( 65 ) ( 246 ) ( 382 )

Net realized gains (losses) - excluding Fortitude Re funds withheld assets and embedded derivative 8 ( 189 ) ( 238 ) ( 571 )

Net realized losses on Fortitude Re funds withheld assets ( 18 ) ( 3 ) ( 38 ) ( 64 )

31 unchanged sentences

See accompanying Notes to Condensed Consolidated Financial Statements.

AIG | Second Quarter 2024 Form 10-Q

AIG | Third Quarter 2024 Form 10-Q

American International Group, Inc.

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

Three Months Ended Six Months Ended

June 30, June 30,

Three Months Ended Nine Months Ended

September 30, September 30,

(in millions) 2024 2023 2024 2023

1 unchanged sentence

Other comprehensive income (loss), net of tax

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 fixed maturity securities on which allowance for credit losses was taken 37 ( 18 ) 63 ( 1 )

Change in unrealized appreciation (depreciation) of all other investments 1,349 ( 620 ) 1,074 ( 92 )

9 unchanged sentences

See accompanying Notes to Condensed Consolidated Financial Statements.

AIG | Second Quarter 2024 Form 10-Q

AIG | Third Quarter 2024 Form 10-Q

American International Group, Inc.

10 unchanged sentences

controlling Interests Total

Three Months Ended June 30, 2024

Three Months Ended September 30, 2024

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

6 unchanged sentences

Net decrease due to divestitures and acquisitions — — — — — — — ( 6 ) ( 6 )

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

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

Other — — — 40 ( 1 ) — 39 8 47

Balance, end of period $ — $ 4,766 $ ( 63,744 ) $ 75,310 $ 34,429 $ ( 5,722 ) $ 45,039 $ 34 $ 45,073

Three Months Ended June 30, 2023

Three Months Ended September 30, 2023

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

7 unchanged sentences

Other comprehensive loss — — — — — ( 3,486 ) ( 3,486 ) ( 1,432 ) ( 4,918 )

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

Net decrease due to divestitures and acquisitions — — — 55 — ( 61 ) ( 6 ) ( 42 ) ( 48 )

Contributions from noncontrolling interests — — — — — — — 8 8

2 unchanged sentences

Balance, end of period $ 485 $ 4,766 $ ( 58,191 ) $ 77,764 $ 37,689 $ ( 22,529 ) $ 39,984 $ 3,229 $ 43,213

AIG | Second Quarter 2024 Form 10-Q

AIG | Third Quarter 2024 Form 10-Q

American International Group, Inc.

10 unchanged sentences

controlling Interests Total

Six Months Ended June 30, 2024

Nine Months Ended September 30, 2024

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

13 unchanged sentences

Balance, end of period $ — $ 4,766 $ ( 63,744 ) $ 75,310 $ 34,429 $ ( 5,722 ) $ 45,039 $ 34 $ 45,073

Six Months Ended June 30, 2023

Nine Months Ended September 30, 2023

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

6 unchanged sentences

— — — — ( 748 ) — ( 748 ) — ( 748 )

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

Other comprehensive loss — — — — — ( 1,679 ) ( 1,679 ) ( 1,064 ) ( 2,743 )

Net increase (decrease) due to divestitures and acquisitions — — — ( 1,858 ) — 1,766 ( 92 ) 1,219 1,127

4 unchanged sentences

See accompanying Notes to Condensed Consolidated Financial Statements.

AIG | Second Quarter 2024 Form 10-Q

AIG | Third Quarter 2024 Form 10-Q

American International Group, Inc.

Condensed Consolidated Statements of Cash Flows (unaudited)

Six Months Ended June 30,

Nine Months Ended September 30,

(in millions) 2024 2023

5 unchanged sentences

Net losses on sales of securities available for sale and other assets 132 578

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

(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

Net gain on divestitures and other ( 94 ) ( 89 )

Loss on extinguishment of debt 1 21

Unrealized (gains) losses in earnings - net ( 4 ) 564

Equity in income from equity method investments, net of dividends or distributions ( 57 ) ( 4 )

Depreciation and other amortization 2,607 2,893

27 unchanged sentences

Other, net ( 187 ) ( 1,292 )

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

Net cash provided by (used in) investing activities - continuing operations 3,190 ( 1,595 )

Net cash used in investing activities - discontinued operations ( 4,171 ) ( 2,478 )

14 unchanged sentences

Effect of exchange rate changes on cash and restricted cash ( 37 ) ( 37 )

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

Net increase in cash and restricted cash 71 275

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

1 unchanged sentence

Cash and restricted cash at end of period $ 1,559 $ 1,451

AIG | Second Quarter 2024 Form 10-Q

AIG | Third Quarter 2024 Form 10-Q

American International Group, Inc.

1 unchanged sentence

Supplementary Disclosure of Condensed Consolidated Cash Flow Information

Six Months Ended June 30,

Nine Months Ended September 30,

(in millions) 2024 2023

15 unchanged sentences

See accompanying Notes to Condensed Consolidated Financial Statements.

AIG | Second Quarter 2024 Form 10-Q

AIG | Third Quarter 2024 Form 10-Q

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

2 unchanged sentences

American International Group, Inc.

(AIG) is a leading global insurance organization.

is a leading global insurance organization.

AIG provides insurance solutions that help businesses and individuals in approximately 190 countries and jurisdictions protect their assets and manage risks through AIG operations and network partners.

5 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 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.

Operating results for the nine months ended September 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 September 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.

AMENDED AND RESTATED CREDIT AGREEMENT

On September 27, 2024, AIG entered into the amended and restated credit agreement (Amended Credit Agreement) that amends and restates AIG's credit agreement, dated as of November 19, 2021, which provides for a syndicated, multicurrency revolving credit facility as a potential source of liquidity for general corporate purposes.

The Amended Credit Agreement provides for a five-year total commitment of $ 3.0 billion, consisting of standby letters of credit and/or revolving credit borrowings.

Under the Amended Credit Agreement, the applicable rate, commitment fee and letter of credit fee are determined by reference to the credit ratings of AIG’s senior long-term unsecured debt.

The Amended Credit Agreement is scheduled to expire in September 2029.

As of September 30, 2024, there were no borrowings or letters of credit outstanding under the Amended Credit Agreement, so that a total of approximately $ 3.0 billion remains available under the Amended Credit Agreement.

SALES/DISPOSALS OF ASSETS AND BUSINESSES

3 unchanged sentences

For further details, see Note 4.

Separation of Life and Retirement Business

For further details, see Note 4.

USE OF ESTIMATES

8 unchanged sentences

• income taxes, in particular the recoverability of our deferred tax asset and establishment of provisions for uncertain tax positions.

AIG | Third Quarter 2024 Form 10-Q

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

Basis of Presentation

These accounting estimates require the use of assumptions about matters, some of which are highly uncertain at the time of estimation.

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.

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

(Corebridge), the holding company for AIG's former Life and Retirement business, in the second quarter of 2024.

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

17 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 will be applied retrospectively to all prior periods presented.

We are assessing the impact of this standard.

The company will adopt this guidance in our 2024 Annual Report on Form 10-K and the amendment will be applied retrospectively to all prior periods presented.

Segment Information

4 unchanged sentences

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

AIG | Third Quarter 2024 Form 10-Q

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

Segment Information

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:

5 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:

15 unchanged sentences

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

Three Months Ended June 30, 2024 2023

Three Months Ended September 30, 2024 2023

(in millions) Adjusted

3 unchanged sentences

General Insurance

North America $ 2,470 $ 163 (a)

North America - Underwriting income $ 2,638 $ 37 (a)

$ 3,079 $ 235 (a)

International 3,279 267 (a)

International - Underwriting income 3,309 400 (a)

3,343 376 (a)

9 unchanged sentences

Other income (expense) - net ( 1 ) — 17 —

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

Loss on extinguishment of debt — — — ( 21 )

Net investment income on Fortitude Re funds withheld assets 51 51 29 29

Net realized losses on Fortitude Re funds withheld assets ( 18 ) ( 18 ) ( 3 ) ( 3 )

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

Net realized losses (b)

Net realized gains (losses) on Fortitude Re funds withheld embedded derivative ( 157 ) ( 157 ) 57 57

Net realized gains (losses) (b)

8 7 ( 191 ) ( 190 )

Net gain (loss) on divestitures and other — ( 8 ) — 101

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

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

AIG | Third Quarter 2024 Form 10-Q

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

Segment Information

Three Months Ended September 30, 2024 2023

(in millions) Adjusted

Revenues Adjusted

(Loss) Adjusted

Revenues Adjusted

(Unfavorable) favorable prior year development and related amortization changes ceded under retroactive reinsurance agreements — ( 126 ) — 75

Net loss reserve discount charge — ( 29 ) — ( 5 )

1 unchanged sentence

Integration and transaction costs associated with acquiring or divesting businesses — ( 22 ) — ( 2 )

Restructuring and other costs (c)

— ( 426 ) — ( 125 )

Restructuring and other costs — ( 137 ) — ( 49 )

Non-recurring costs related to regulatory or accounting changes — ( 4 ) — ( 4 )

Revenues and pre-tax income $ 6,751 $ 649 $ 7,267 $ 1,100

AIG | Second Quarter 2024 Form 10-Q

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

Segment Information

Six Months Ended June 30, 2024 2023

Nine Months Ended September 30, 2024 2023

(in millions) Adjusted

3 unchanged sentences

General Insurance

North America $ 4,972 $ 387 (a)

North America - Underwriting income $ 7,610 $ 424 (a)

$ 9,254 $ 886 (a)

International 6,563 639 (a)

International - Underwriting income 9,872 1,039 (a)

9,924 821 (a)

21 unchanged sentences

Integration and transaction costs associated with acquiring or divesting businesses — ( 37 ) — ( 10 )

Restructuring and other costs — ( 493 ) — ( 215 )

Restructuring and other costs (c)

— ( 630 ) — ( 264 )

Non-recurring costs related to regulatory or accounting changes — ( 15 ) — ( 19 )

4 unchanged sentences

(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.

(c) In the three and nine months ended September 30, 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.

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.

For the three and nine months ended September 30, 2024, we recorded severance charges of $ 66 million and $ 351 million, respectively, and asset impairment of $ 53 million for the nine months ended September 30, 2024, as a result of restructuring activities.

AIG | Third Quarter 2024 Form 10-Q

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

Held-For-Sale Classification & Discontinued Operations Presentation

HELD-FOR-SALE CLASSIFICATION

3 unchanged sentences

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 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.

At September 30, 2024, businesses and assets reported and classified as held-for-sale primarily consisted of our global personal travel insurance and assistance business, described below.

On May 16, 2024, AIG entered into a stock purchase agreement with Corebridge and Nippon Life Insurance Company (Nippon), a mutual company (sougogaisha) organized under the laws of Japan, 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.

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

For further details, see — Discontinued Operations Presentation below.

4 unchanged sentences

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.

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

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.

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 (the 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.

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

3 unchanged sentences

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.

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.

On August 5, 2024, AIG entered into a Share Repurchase Agreement with Corebridge.

The per share purchase price was $ 24.90 , the closing price of Corebridge’s common stock on the New York Stock Exchange on August 5, 2024.

This repurchase was completed on August 7, 2024 for an aggregate purchase price of approximately $ 200 million.

Due to share repurchases by Corebridge and sale of shares by AIG after the Deconsolidation Date, as of September 30, 2024, AIG held 48.6 percent of the outstanding common stock of Corebridge.

AIG | Third Quarter 2024 Form 10-Q

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

Held-For-Sale Classification & Discontinued Operations Presentation

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).

In the second quarter of 2024, 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.

5 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(in millions) 2024 2023 2024 2023

1 unchanged sentence

Equity method income (loss) related to Corebridge (based on fair value) $ 11 $ 584 $ 2,094 $ ( 87 )

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

September 30, 2024 December 31, 2023

(in millions) Assets

for Sale Assets

for Sale Corebridge

Liabilities of

Operations) Assets and

Held for Sale

Fixed maturity securities:

19 unchanged sentences

Unearned premiums — 7 65

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

Future policy benefits — — 57,946

Policyholder contract deposits — — 161,979

3 unchanged sentences

Other liabilities 78 2 8,790

AIG | Third Quarter 2024 Form 10-Q

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

Held-For-Sale Classification & Discontinued Operations Presentation

September 30, 2024 December 31, 2023

(in millions) Assets

for Sale Assets

for Sale Corebridge

Liabilities of

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

5 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(in millions) 2024 2023 2024 2023

9 unchanged sentences

Interest credited to policyholder account balances — 1,135 2,184 3,237

AIG | Second Quarter 2024 Form 10-Q

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

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 — 268 465 779

10 unchanged sentences

Net income (loss) from discontinued operations attributable to AIG $ ( 22 ) $ 1,326 $ ( 4,055 ) $ 1,671

AIG | Third Quarter 2024 Form 10-Q

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

Held-For-Sale Classification & Discontinued Operations Presentation

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.

The loss recognized in the second quarter of 2024 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.

24 unchanged sentences

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

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.

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 | Third Quarter 2024 Form 10-Q

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

Fair Value Measurements

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:

June 30, 2024 Level 1 Level 2 Level 3 Counterparty

September 30, 2024 Level 1 Level 2 Level 3 Counterparty

Collateral Total

48 unchanged sentences

— 255 — — — 255

Equity contracts

— — 31 — — 31

Credit contracts

— — 34 — — 34

Other contracts — — 1 — — 1

Counterparty netting and cash collateral

3 unchanged sentences

Fortitude Re funds withheld payable

— — ( 154 ) — — ( 154 )

Other liabilities

1 unchanged sentence

Total $ — $ 588 $ 165 $ ( 276 ) $ ( 209 ) $ 268

AIG | Second Quarter 2024 Form 10-Q

AIG | Third Quarter 2024 Form 10-Q

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

62 unchanged sentences

(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 $ 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.

(b) Excludes investments that are measured at fair value using the net asset value (NAV) per share (or its equivalent), which totaled $ 3.4 billion and $ 3.8 billion as of September 30, 2024 and December 31, 2023, respectively.

As of September 30, 2024 , includes AIG's ownership interest in Corebridge of $ 8.1 billion on which AIG elected the fair value option.

(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

(d) Excludes $ 1 million and $ 15 million as of September 30, 2024 and December 31, 2023, respectively, of assets reclassified to Assets held for sale on the Condensed Consolidated Balance Sheets.

AIG | Third Quarter 2024 Form 10-Q

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

1 unchanged sentence

CHANGES IN LEVEL 3 RECURRING FAIR VALUE MEASUREMENTS

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:

The following tables present changes during the three and nine months ended September 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 September 30, 2024 and 2023:

(in millions) Fair Value

13 unchanged sentences

at End of Period

Three Months Ended June 30, 2024

Three Months Ended September 30, 2024

Bonds available for sale:

38 unchanged sentences

$ ( 3 ) $ — $ — $ 3 $ — $ — $ — $ — $ — $ —

Foreign exchange contracts

2 ( 2 ) — — — — — — — —

Equity contracts

( 35 ) — — ( 1 ) — — 36 — 2 —

Credit contracts

— 1 — — — — — 1 ( 1 ) —

Other contracts

5 unchanged sentences

Total $ ( 94 ) $ 158 $ — $ ( 1 ) $ — $ — $ 37 $ 100 $ ( 151 ) $ —

AIG | Second Quarter 2024 Form 10-Q

AIG | Third Quarter 2024 Form 10-Q

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

15 unchanged sentences

at End of Period

Three Months Ended June 30, 2023

Three Months Ended September 30, 2023

Bonds available for sale:

40 unchanged sentences

Total $ ( 908 ) $ ( 60 ) $ — $ 43 $ — $ — $ — $ ( 925 ) $ 141 $ —

AIG | Second Quarter 2024 Form 10-Q

AIG | Third Quarter 2024 Form 10-Q

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

15 unchanged sentences

at End of Period

Six Months Ended June 30, 2024

Nine Months Ended September 30, 2024

Bonds available for sale:

33 unchanged sentences

Equity contracts ( 48 ) ( 18 ) — 30 — — 36 — 10 —

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

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

4 unchanged sentences

Total $ ( 479 ) $ 197 $ — $ 345 $ — $ — $ 37 $ 100 $ ( 99 ) $ —

AIG | Second Quarter 2024 Form 10-Q

AIG | Third Quarter 2024 Form 10-Q

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

15 unchanged sentences

at End of Period

Six Months Ended June 30, 2023

Nine Months Ended September 30, 2023

Bonds available for sale:

41 unchanged sentences

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

AIG | Second Quarter 2024 Form 10-Q

AIG | Third Quarter 2024 Form 10-Q

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

4 unchanged sentences

Gains (Losses) Total

Three Months Ended June 30, 2024

Three Months Ended September 30, 2024

Bonds available for sale $ 25 $ ( 41 ) $ ( 16 )

Other bond securities 6 — 6

Equity securities 1 — 1

Other invested assets ( 3 ) — ( 3 )

Three Months Ended June 30, 2023

Three Months Ended September 30, 2023

Bonds available for sale $ 40 $ ( 38 ) $ 2

Other bond securities ( 1 ) — ( 1 )

Equity securities 2 — 2

Other invested assets 4 ( 1 ) 3

Six Months Ended June 30, 2024

Nine Months Ended September 30, 2024

Bonds available for sale $ 65 $ ( 49 ) $ 16

Other bond securities 7 — 7

Equity securities 1 — 1

Other invested assets ( 16 ) — ( 16 )

Six Months Ended June 30, 2023

Nine Months Ended September 30, 2023

Bonds available for sale $ 77 $ ( 54 ) $ 23

5 unchanged sentences

(Gains) Losses Total

Three Months Ended June 30, 2024

Three Months Ended September 30, 2024

Derivative liabilities, net $ — $ 1 $ 1

Fortitude Re funds withheld payable — 157 157

Other Liabilities — 28 28

Three Months Ended June 30, 2023

Three Months Ended September 30, 2023

Derivative liabilities, net $ — $ 3 $ 3

1 unchanged sentence

Other Liabilities — ( 6 ) ( 6 )

Six Months Ended June 30, 2024

Nine Months Ended September 30, 2024

Derivative liabilities, net $ — $ 41 $ 41

1 unchanged sentence

Other Liabilities — ( 2 ) ( 2 )

Six Months Ended June 30, 2023

Nine Months Ended September 30, 2023

Derivative liabilities, net $ — $ 18 $ 18

1 unchanged sentence

Other Liabilities — ( 20 ) ( 20 )

AIG | Second Quarter 2024 Form 10-Q

AIG | Third 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:

The following table presents the gross components of purchases, sales, issuances and settlements, net, shown above, for the three and nine months ended September 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 June 30, 2024

Three Months Ended September 30, 2024

Bonds available for sale:

governments $ 4 $ — $ ( 4 ) $ —

Corporate debt $ 10 $ ( 4 ) $ ( 2 ) $ 4

7 unchanged sentences

Total other bond securities — — ( 3 ) ( 3 )

Equity securities 2 — — 2

Other invested assets 17 — ( 12 ) 5

3 unchanged sentences

Fortitude Re funds withheld payable — — ( 3 ) ( 3 )

Other liabilities — — ( 21 ) ( 21 )

Total $ — $ — $ ( 1 ) $ ( 1 )

Three Months Ended June 30, 2023

Three Months Ended September 30, 2023

Bonds available for sale:

Obligations of states, municipalities and political subdivisions $ — $ ( 11 ) $ — $ ( 11 )

governments $ — $ — $ ( 3 ) $ ( 3 )

5 unchanged sentences

Other bond securities:

Corporate debt 20 — 24 44

RMBS — — ( 2 ) ( 2 )

1 unchanged sentence

Total other bond securities — ( 10 ) 7 ( 3 )

Equity securities — ( 2 ) — ( 2 )

Other invested assets — — ( 2 ) ( 2 )

4 unchanged sentences

Total $ ( 91 ) $ 3 $ 131 $ 43

AIG | Second Quarter 2024 Form 10-Q

AIG | Third Quarter 2024 Form 10-Q

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

5 unchanged sentences

Settlements, Net (a)

Six Months Ended June 30, 2024

Nine Months Ended September 30, 2024

Bonds available for sale:

10 unchanged sentences

Total other bond securities 14 ( 1 ) ( 11 ) 2

Equity securities 2 — — 2

Other invested assets 18 — ( 52 ) ( 34 )

5 unchanged sentences

Total $ — $ — $ 345 $ 345

Six Months Ended June 30, 2023

Nine Months Ended September 30, 2023

Bonds available for sale:

18 unchanged sentences

Total $ ( 407 ) $ 7 $ ( 36 ) $ ( 436 )

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

(a) There were no issuances during the three and nine months ended September 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 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

As a result, the unrealized gains (losses) on instruments held at September 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 | Third Quarter 2024 Form 10-Q

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

1 unchanged sentence

Transfers of Level 3 Assets and Liabilities

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.

The Net realized and unrealized gains (losses) included in income (loss) or Other comprehensive income (loss) (OCI) as shown in the table above excludes $ 0 million and $( 27 ) million of net gains (losses) related to assets and liabilities transferred into Level 3 during the three and nine months ended September 30, 2024, respectively, and includes $ 0 million and $ 1 million of net gains (losses) related to assets and liabilities transferred out of Level 3 during the three and nine months ended September 30, 2024, respectively.

The Net realized and unrealized gains (losses) included in income (loss) or OCI as shown in the table above excludes $( 5 ) million and $( 4 ) million of net gains (losses) related to assets and liabilities transferred into Level 3 during the three and nine months ended September 30, 2023, respectively, and includes $ 0 million and $( 9 ) million of net gains (losses) related to assets and liabilities transferred out of Level 3 during the three and nine months ended September 30, 2023, respectively.

Transfers of Level 3 Assets

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).

There were no transfers into Level 3 assets during the three months ended September 30, 2024.

During the nine months ended September 30, 2024 and three and nine months ended September 30, 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), collateralized loan obligations (CLO)/asset-backed securities (ABS) and equity securities.

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, 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.

There were no transfers out of Level 3 assets during the three months ended September 30, 2024.

During the nine months ended September 30, 2024 and three and nine months ended September 30, 2023, transfers out of Level 3 assets primarily included certain investments in private placement corporate debt, CMBS, RMBS, CLO/ABS, municipal bonds and equity securities.

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.

1 unchanged sentence

Transfers of Level 3 Liabilities

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.

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

QUANTITATIVE INFORMATION ABOUT LEVEL 3 FAIR VALUE MEASUREMENTS

2 unchanged sentences

(in millions) Fair Value at

June 30, 2024 Valuation

September 30, 2024 Valuation

Technique Unobservable Input (b)

8 unchanged sentences

CMBS 19 Discounted cash flow Yield 5.07 % - 15.74 % ( 10.41 %)

AIG | Second Quarter 2024 Form 10-Q

AIG | Third Quarter 2024 Form 10-Q

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

33 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 | Second Quarter 2024 Form 10-Q

AIG | Third 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.

June 30, 2024 December 31, 2023

September 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

10 unchanged sentences

Long-short Securities that the manager believes are undervalued, with corresponding short positions to hedge market risk 168 — 389 —

Macro Investments that take long and short positions in financial instruments based on a top-down view of certain economic and capital market conditions — — — —

Other Includes investments held in funds that are less liquid, as well as other strategies which allow for broader allocation between public and private investments 8 — 9 —

3 unchanged sentences

Private equity funds are generally expected to have 10-year lives at their inception, but these lives may be extended at the fund manager’s discretion, typically in one-year or two-year increments.

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 eight 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.

AIG | Second Quarter 2024 Form 10-Q

AIG | Third Quarter 2024 Form 10-Q

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

3 unchanged sentences

Gain (Loss) Three Months

Ended June 30, Gain (Loss) Six Months

Ended June 30,

Ended September 30, Gain (Loss) Nine Months

Ended September 30,

(in millions) 2024 2023 2024 2023

3 unchanged sentences

76 41 184 171

All other investments (c)

Retained investment in Corebridge (c)

( 35 ) — 30 —

Total gain (loss) $ 61 $ 36 $ 241 $ 175

9 unchanged sentences

(in millions) Level 1 Level 2 Level 3 Total

June 30, 2024

September 30, 2024

Mortgage and other loans receivable $ — $ 341 $ 3,935 $ 4,276 $ 4,286

19 unchanged sentences

Debt of consolidated investment entities — — 231 231 231

(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

(a) Excludes $ 10 million at September 30, 2024 reclassified to Assets held for sale on the Condensed Consolidated Balance Sheets.

(b) Excludes $ 85 million at September 30, 2024 reclassified to Assets held for sale on the Condensed Consolidated Balance Sheets.

AIG | Third Quarter 2024 Form 10-Q

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

2 unchanged sentences

(in millions) Amortized

June 30, 2024

September 30, 2024

Bonds available for sale:

25 unchanged sentences

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

(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.

(b) At September 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 $ 3.1 billion or 5 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

June 30, 2024

September 30, 2024

Bonds available for sale:

7 unchanged sentences

Total bonds available for sale $ 19,962 $ 193 $ 12,586 $ 2,574 $ 32,548 $ 2,767

AIG | Second Quarter 2024 Form 10-Q

AIG | Third Quarter 2024 Form 10-Q

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

11 unchanged sentences

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

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 September 30, 2024, we held 10,479 individual fixed maturity securities that were in an unrealized loss position and for which no allowance for credit losses has been recorded (including 8,111 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 June 30, 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 September 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.

2 unchanged sentences

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

June 30, 2024 Total Fixed Maturity Securities

September 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 June 30, Six Months Ended June 30,

Three Months Ended September 30, Nine Months Ended September 30,

2024 2023 2024 2023

1 unchanged sentence

Fixed maturity securities $ 11 $ 95 $ 3 $ 159 $ 54 $ 408 $ 121 $ 736

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.

For the three and nine months ended September 30, 2024, the aggregate fair value of available for sale securities sold was $ 1.9 billion and $ 6.9 billion, respectively, which resulted in net realized gains (losses) of $( 84 ) million and $( 354 ) million, respectively.

Included within the net realized gains (losses) are $( 18 ) million and $( 34 ) million of net realized gains (losses) for the three and nine months ended September 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

AIG | Third 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.

For the three and nine months ended September 30, 2023, the aggregate fair value of available for sale securities sold was $ 2.5 billion and $ 13.2 billion, respectively, which resulted in net realized gains (losses) of $( 156 ) million and $( 615 ) million, respectively.

Included within the net realized gains (losses) are $( 4 ) million and $( 63 ) million of net realized gains (losses) for the three and nine months ended September 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.

1 unchanged sentence

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) June 30, 2024 December 31, 2023

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

Value Percent

16 unchanged sentences

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

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

Alternative investments (a)(b)

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

Alternative investments (a)

$ 4,334 $ 4,345

Retained investment in Corebridge using fair value option 8,143 —

All other investments

All other investments (b)

Total $ 14,440 $ 6,368

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

(a) At September 30, 2024, includes hedge funds of $ 187 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.

AIG | Second Quarter 2024 Form 10-Q

Private equity funds investments include limited partnerships, direct equities and real estate partnerships.

Also includes investments in real estate, net of accumulated depreciation.

At September 30, 2024 and December 31, 2023, the accumulated depreciation was $ 167 million and $ 161 million, respectively.

(b) All other investments include mainly bank deposits with a maturity greater than one year and investments in joint ventures with strategic partners.

AIG | Third Quarter 2024 Form 10-Q

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

1 unchanged sentence

The following table presents the components of Net investment income:

Three Months Ended June 30, 2024 2023

Three Months Ended September 30, 2024 2023

(in millions) Excluding Fortitude

16 unchanged sentences

Net investment income $ 922 $ 51 $ 973 $ 827 $ 29 $ 856

Six Months Ended June 30, 2024 2023

Nine Months Ended September 30, 2024 2023

(in millions) Excluding Fortitude

16 unchanged sentences

Net investment income $ 2,819 $ 123 $ 2,942 $ 2,431 $ 106 $ 2,537

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

(a) Includes 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.

(b) Includes dividends received from Corebridge and changes in its stock price of $ 65 million and $( 35 ) million, respectively, for the three months ended September 30, 2024, and $ 133 million and $ 30 million, respectively, for the nine months ended September 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

Three Months Ended September 30, 2024 2023

(in millions) Excluding

9 unchanged sentences

Other 22 3 25 11 ( 3 ) 8

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) – excluding Fortitude Re funds withheld embedded derivative 8 ( 18 ) ( 10 ) ( 189 ) ( 3 ) ( 192 )

Net realized gains (losses) on Fortitude Re funds withheld embedded derivative — ( 157 ) ( 157 ) — 57 57

Net realized gains (losses) $ 8 $ ( 175 ) $ ( 167 ) $ ( 189 ) $ 54 $ ( 135 )

AIG | Second Quarter 2024 Form 10-Q

AIG | Third Quarter 2024 Form 10-Q

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

Six Months Ended June 30, 2024 2023

Nine Months Ended September 30, 2024 2023

(in millions) Excluding

15 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(in millions) 2024 2023 2024 2023

3 unchanged sentences

Total increase (decrease) in unrealized appreciation (depreciation) of investments* $ 1,597 $ ( 670 ) $ 1,441 $ 159

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

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

Three Months Ended September 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 recognized during the period on equity securities and other investments $ 60 $ 42 $ 102 $ 31 $ 46 $ 77

Net gains (losses) recognized during the period on equity securities and other investments sold during the period 8 — 8 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

Unrealized gains recognized during the reporting period on equity securities and other investments still held at the reporting date $ 52 $ 42 $ 94 $ 19 $ 54 $ 73

Nine Months Ended September 30, 2024 2023

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

1 unchanged sentence

Net gains recognized during the period on equity securities and other investments sold during the period 51 24 75 88 1 89

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.

Unrealized gains recognized during the reporting period on equity securities and other investments still held at the reporting date $ 93 $ 210 $ 303 $ 5 $ 188 $ 193

* Includes unrealized gains (losses) on AIG’s ownership interest in Corebridge of $( 35 ) million and $ 30 million in the three and nine months ended September 30, 2024, respectively.

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 | Second Quarter 2024 Form 10-Q

AIG | Third 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 June 30, 2024 2023

Three Months Ended September 30, 2024 2023

(in millions) Structured Non-

2 unchanged sentences

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

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

Securities for which allowance for credit losses was not previously recorded 2 — 2 2 19 21

Securities sold during the period — — — ( 1 ) ( 6 ) ( 7 )

3 unchanged sentences

Balance, end of period $ 12 $ 28 $ 40 $ 11 $ 19 $ 30

Six Months Ended June 30, 2024 2023

Nine Months Ended September 30, 2024 2023

(in millions) Structured Non-

2 unchanged sentences

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

Securities for which allowance for credit losses were not previously recorded 1 9 10 2 28 30

Securities for which allowance for credit losses was not previously recorded 3 9 12 4 47 51

Securities sold during the period — — — ( 3 ) ( 9 ) ( 12 )

15 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 six months ended June 30, 2024 and 2023.

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

AIG | Third Quarter 2024 Form 10-Q

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

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

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.

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

3 unchanged sentences

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

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

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

Fixed maturity securities available for sale $ — $ 106

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

At September 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:

15 unchanged sentences

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

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

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

Securities collateral pledged to us $ 957 $ 1,200

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

At September 30, 2024 and December 31, 2023, the carrying value of reverse repurchase agreements totaled $ 965 million 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.

We do not currently offset any such transactions.

AIG | Third Quarter 2024 Form 10-Q

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

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 $ 8.5 billion and $ 8.4 billion at June 30, 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 $ 8.2 billion and $ 8.4 billion at September 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 $ 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.

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 June 30, 2024 and December 31, 2023, respectively.

We owned an aggregate of $ 13 million and $ 15 million of stock in FHLBs at September 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 September 30, 2024 and $ 1.7 billion at December 31, 2023.

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

1 unchanged sentence

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

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

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

Commercial mortgages (a)

7 unchanged sentences

$ 4,286 $ 4,441

(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.

(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 September 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 September 30, 2024 and December 31, 2023.

(c) Excludes $ 37.6 billion at both September 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 $ 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.

(d) Does not include allowance for credit losses of $ 5 million and $ 9 million, respectively, at September 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 June 30, 2024 and December 31, 2023, $ 241 million and $ 73 million, respectively, of commercial mortgage loans were placed on nonaccrual status.

As of September 30, 2024 and December 31, 2023, $ 296 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 June 30, 2024 and December 31, 2023, accrued interest receivable was $ 20 million and $ 21 million, respectively, associated with commercial mortgage loans.

As of September 30, 2024 and December 31, 2023, accrued interest receivable was $ 21 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 | Third 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:

June 30, 2024 2024 2023 2022 2021 2020 Prior Total

September 30, 2024 2024 2023 2022 2021 2020 Prior Total

(in millions)

3 unchanged sentences

Total commercial mortgages $ 54 $ 510 $ 261 $ 605 $ 164 $ 2,102 $ 3,696

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:

June 30, 2024 2024 2023 2022 2021 2020 Prior Total

September 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 1.8 x at both periods ended June 30, 2024 and December 31, 2023.

Our weighted average debt service coverage ratio was 1.9 x and 1.8 x at September 30, 2024 and December 31, 2023, respectively.

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 64 percent and 62 percent at June 30, 2024 and December 31, 2023, respectively.

Our weighted average loan-to-value ratio was 64 percent and 62 percent at September 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

June 30, 2024

September 30, 2024

Past Due Status:

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Allowance for credit losses $ 5 $ 102 $ 35 $ 9 $ 13 $ 1 $ 165 4 %

AIG | Third Quarter 2024 Form 10-Q

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

Lending Activities

Loans Class Percent

10 unchanged sentences

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 June 30, 2024 (b)

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

Three Months Ended September 30, 2024

(in millions) Commercial

3 unchanged sentences

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

Loans charged off — — — ( 2 ) — ( 2 )

Net charge-offs — — — ( 2 ) — ( 2 )

Addition to (release of) allowance for loan losses 3 1 4 17 — 17

Allowance, end of period $ 165 $ 2 $ 167 $ 133 $ 3 $ 136

Six Months Ended June 30, 2024 (b)

Nine Months Ended September 30, 2024

(in millions) Commercial

8 unchanged sentences

$ 165 $ 2 $ 167 $ 133 $ 3 $ 136

(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.

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

(b) Excludes $ 37.6 billion 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.

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

LOAN MODIFICATIONS

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The starting point for the estimate of the allowance for credit losses is historical loss information, which includes losses from modifications of receivables to borrowers experiencing financial difficulty.

We use a probability of default/loss given default model to determine the allowance for credit losses for our commercial and residential mortgage loans.

We use a probability of default/loss given default model to determine the allowance for credit losses for our commercial mortgage loans.

An assessment of whether a borrower is experiencing financial difficulty is made on the date of a modification.

4 unchanged sentences

therefore, that portion of the loan is written off, resulting in a reduction of the amortized cost basis and a corresponding adjustment to the allowance for credit losses.

AIG | Third Quarter 2024 Form 10-Q

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

Lending Activities

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 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.

During the nine months ended September 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 nine months ended September 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 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.

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

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 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.

As of September 30, 2024, $ 3.5 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:

June 30, 2024 December 31, 2023

September 30, 2024 December 31, 2023

(in millions) Carrying

11 unchanged sentences

Total $ 3,496 $ 3,477 $ 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 $( 53 ) million ($( 42 ) million after-tax) and $ 21 million ($ 16 million after-tax), respectively for the six months ended June 30, 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 $ 31 million ($ 25 million after-tax) and $( 60 ) million ($( 47 ) million after-tax), respectively for the nine months ended September 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 $ 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 $ 3 million and $ 27 million, respectively, as of September 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.

1 unchanged sentence

AIG | Third Quarter 2024 Form 10-Q

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

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

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(in millions) 2024 2023 2024 2023

14 unchanged sentences

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.

13 unchanged sentences

An allowance for disputes is established for a reinsurance recoverable using the losses incurred model for contingencies.

The total reinsurance recoverables as of June 30, 2024 were $ 43.1 billion.

The total reinsurance recoverables as of September 30, 2024 were $ 42.8 billion.

As of that date, utilizing AIG’s ORRs, (i) approximately 82 percent of the reinsurance recoverables were investment grade;

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(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.

As of September 30, 2024 and December 31, 2023, approximately 81 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.

AIG | Third Quarter 2024 Form 10-Q

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

Reinsurance Recoverable Allowance

1 unchanged sentence

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(in millions) 2024 2023 2024 2023

9 unchanged sentences

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.

7 unchanged sentences

The following table presents a rollforward of DAC:

Six Months Ended June 30,

Nine Months Ended September 30,

(in millions) 2024 2023

11 unchanged sentences

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 | Third 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

1 unchanged sentence

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) June 30, 2024 December 31, 2023

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

Bonds available for sale $ 29 $ 72

6 unchanged sentences

* 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

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.

3 unchanged sentences

Assets On-Balance

June 30, 2024

September 30, 2024

Real estate and investment entities (a)

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(a) Comprised primarily of hedge funds and private equity funds.

(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.

(b) At September 30, 2024 and December 31, 2023, excludes approximately $ 1,925 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 $ 1,894 million and $ 1,941 million, respectively.

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

(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.

(c) At September 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.

2 unchanged sentences

For additional information on VIEs, see Note 10 to the Consolidated Financial Statements in the 2023 Annual Report.

AIG | Third Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 11.

Derivatives and Hedge Accounting

We use derivatives and other financial instruments as part of our financial risk management programs and as part of our investment operations.

4 unchanged sentences

We use credit derivatives to manage our credit exposures.

Commodity derivatives are used to hedge exposures within reinsurance contracts.

The derivatives are effective economic hedges of the exposures that they are meant to offset.

1 unchanged sentence

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:

June 30, 2024 December 31, 2023

September 30, 2024 December 31, 2023

Gross Derivative Assets Gross Derivative Liabilities Gross Derivative Assets Gross Derivative Liabilities

13 unchanged sentences

2,130 1 2,130 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 $ 6,417 $ 619 $ 7,079 $ 654 $ 59,589 $ 1,292 $ 10,973 $ 952

6 unchanged sentences

(a) Fair value amounts are shown before the effects of counterparty netting adjustments and offsetting cash collateral.

(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).

(b) As of September 30, 2024 and December 31, 2023, included CDSs on super senior multi-sector CLO with a net notional amount of $ 53 million and $ 50 million (fair value liability of $ 33 million and $ 32 million, respectively).

The net notional amount represents the maximum exposure to loss on the portfolio.

4 unchanged sentences

Derivative instrument assets and liabilities are recorded in Other assets and Other liabilities, respectively.

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.

Fair value of assets related to bifurcated embedded derivatives was $ 3.4 billion at September 30, 2024 and $ 3.4 billion at December 31, 2023.

Fair value of liabilities related to bifurcated embedded derivatives was zero at both September 30, 2024 and December 31, 2023.

A bifurcated embedded derivative is generally presented with the host contract in the Condensed Consolidated Balance Sheets.

Embedded derivatives are primarily related to guarantee features in fixed index annuities, index universal life products, and bonds available for sale, which include equity and interest rate components, and the funds withheld arrangement with Fortitude Re.

Embedded derivatives are primarily related to the funds withheld arrangement with Fortitude Re.

For additional information, see Note 8.

4 unchanged sentences

We minimize the risk that counterparties might be unable to fulfill their contractual obligations by monitoring counterparty credit exposure and collateral value and generally requiring additional collateral to be posted upon the occurrence of certain events or circumstances.

In addition, certain derivative transactions have provisions that require collateral to be posted by us upon a downgrade of our long-term debt ratings or give the counterparty the right to terminate the transaction.

AIG | Third Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 11.

Derivatives and Hedge Accounting

In the case of some of the derivative transactions, upon a downgrade of our long-term debt ratings, as an alternative to posting collateral and subject to certain conditions, we may assign the transaction to an obligor with higher debt ratings or arrange for a substitute guarantee of our obligations by an obligor with higher debt ratings or take other similar action.

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 $ 437 million and $ 593 million at June 30, 2024 and December 31, 2023, respectively.

Collateral posted by us to third parties for derivative transactions was $ 574 million and $ 593 million at September 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 $ 370 million and $ 856 million at June 30, 2024 and December 31, 2023, respectively.

Collateral provided to us from third parties for derivative transactions was $ 456 million and $ 856 million at September 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.

6 unchanged sentences

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 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.

2 unchanged sentences

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 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.

For the three and nine months ended September 30, 2024, we recognized gains (losses) of $( 41 ) million and $( 7 ) million, respectively, and for the three and nine months ended September 30, 2023, we recognized gains (losses) of $ 38 million and $ 7 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.

The following table presents the gain (loss) recognized in income on our derivative instruments in fair value hedging relationships in the Condensed Consolidated Statements of Income (Loss):

4 unchanged sentences

Items Net Impact

Three Months Ended June 30, 2024

Three Months Ended September 30, 2024

Foreign exchange contracts:

Net realized gains/(losses) $ 53 $ 6 $ ( 53 ) $ 6

Three Months Ended June 30, 2023

Three Months Ended September 30, 2023

Foreign exchange contracts:

Net realized gains/(losses) $ 8 $ ( 6 ) $ ( 8 ) $ ( 6 )

Six Months Ended June 30, 2024

Nine Months Ended September 30, 2024

Foreign exchange contracts:

Net realized gains/(losses) $ ( 62 ) $ ( 21 ) $ 62 $ ( 21 )

Six Months Ended June 30, 2023

Nine Months Ended September 30, 2023

Foreign exchange contracts:

2 unchanged sentences

(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 | Third 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

2 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(in millions) 2024 2023 2024 2023

5 unchanged sentences

Credit contracts 3 — 3 ( 1 )

Other contracts — ( 792 ) — ( 792 )

Embedded derivatives ( 157 ) 57 ( 158 ) ( 25 )

1 unchanged sentence

By Classification:

Net investment income - excluding Fortitude Re funds withheld assets $ — $ — $ — $ —

Net investment income - Fortitude Re funds withheld assets — 1 — —

Net realized losses - excluding Fortitude Re funds withheld assets

Net realized gains (losses) - excluding Fortitude Re funds withheld assets

7 ( 21 ) ( 62 ) ( 134 )

3 unchanged sentences

* 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 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.

We estimate that at September 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 June 30, 2024 and December 31, 2023, 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.

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 $ 33 million and $ 32 million at September 30, 2024 and December 31, 2023, respectively.

The aggregate fair value of assets posted as collateral under these contracts at September 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 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.

The fair value of these hybrid securities was under $ 1 million at both September 30, 2024 and December 31, 2023, respectively.

These securities have par amounts of $ 17 million at both September 30, 2024 and December 31, 2023, respectively, and have remaining stated maturity dates that extend to 2052.

AIG | Third Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 12.

Insurance Liabilities

LIABILITY FOR UNPAID LOSSES AND LOSS ADJUSTMENT EXPENSES (LOSS RESERVES)

5 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 $ 12.3 billion and $ 12.1 billion at June 30, 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 $ 12.8 billion and $ 12.1 billion at September 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.

2 unchanged sentences

Thus, these recoverable amounts represent a credit exposure to us.

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

At September 30, 2024 and December 31, 2023 we held collateral of approximately $ 8.6 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 September 30, 2024 and December 31, 2023.

The following table presents the rollforward of activity in loss reserves:

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(in millions) 2024 2023 2024 2023

15 unchanged sentences

Foreign exchange effect 891 ( 583 ) 237 ( 211 )

Losses and loss adjustment expenses recognized within gain on divestitures — 316 — 316

Retroactive reinsurance adjustment (net of discount) (b)

( 107 ) 121 71 180

Dispositions ( 5 ) — ( 5 ) —

Reclassified to held for sale, net of reinsurance recoverables (c)

6 unchanged sentences

Total $ 71,066 $ 69,823 $ 71,066 $ 69,823

AIG | Third Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 12.

Insurance Liabilities

(a) Includes $ 3 million and $ 9 million for the retroactive reinsurance agreement with National Indemnity Company (NICO), a subsidiary of Berkshire Hathaway Inc.

(Berkshire), covering U.S.

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.

asbestos exposures for the three months ended September 30, 2024 and 2023, respectively, and $ 47 million and $ 22 million for the nine months ended September 30, 2024 and 2023, respectively.

(b) Includes benefit (charge) from change in discount on retroactive reinsurance of $ 22 million and $ 24 million for the three months ended September 30, 2024 and 2023 respectively, and $ 100 million and $ 120 million for the nine months ended September 30, 2024 and 2023, respectively.

(c) Represents change in loss reserves included in Liabilities held for sale for the three months ended September 30, 2024 and 2023.

For additional information, see Note 4 .

(d) Excludes $ 1.5 billion of Reinsurance recoverable reclassified to Assets held for sale on the Condensed Consolidated Balance Sheets at June 30, 2023.

(d) Excludes $ 1.5 billion of Reinsurance recoverable reclassified to Assets held for sale on the Condensed Consolidated Balance Sheets at September 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 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.

During the three months ended September 30, 2024, we recognized unfavorable prior year loss reserve development of $ 187 million which does not reflect the benefit of recoveries under a retroactive adverse development cover, and excludes discount and amortization of deferred gain.

The development in this period was largely driven by adverse development in U.S.

Excess Casualty and UK/Europe Casualty and Financial Lines, offset by favorable development in Global Specialty and U.S.

Property and Special Risks.

During the nine months ended September 30, 2024, we recognized unfavorable prior year loss reserve development of $ 79 million excluding discount and amortization of deferred gain.

The development in this period was largely driven by adverse development in U.S.

Excess Casualty and UK/Europe Casualty and Financial Lines, offset by favorable development in Global Specialty, U.S.

Property and Special Risks and on our loss sensitive U.S.

Workers' Compensation business.

During the three months ended September 30, 2023, we recognized favorable prior year loss reserve development of $ 246 million excluding discount and amortization of deferred gain.

The development in this period was largely driven by favorable development on our U.S.

Workers' Compensation business, International Financial Lines in all regions except UK, which was adverse, and Japan Personal Insurance partially offset by unfavorable development on UK/Europe Casualty.

During the nine months ended September 30, 2023, we recognized favorable prior year loss reserve development of $ 380 million excluding discount and amortization of deferred gain.

The development in this period was largely driven by favorable development on our 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

Other Casualty and Other Product Lines, partially offset by unfavorable development on UK/Europe Casualty and UK Financial Lines.

Discounting of Loss Reserves

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:

At September 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 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).

At September 30, 2024 and December 31, 2023, the discount consists of $ 280 million and $ 294 million of tabular discount, respectively, and $ 922 million and $ 939 million of non-tabular discount for workers’ compensation, respectively.

During the nine months ended September 30, 2024 and 2023, the benefit / (charge) from changes in discount of $( 131 ) million and $( 85 ) million, respectively, were recorded as part of Policyholder benefits and losses incurred in the Condensed Consolidated Statements of Income (Loss).

AIG | Third Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 12.

Insurance Liabilities

The following table presents the components of the loss reserve discount discussed above:

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

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

workers' compensation $ 2,206 $ 2,337

2 unchanged sentences

$ 1,202 $ 1,233

(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.

(a) Excludes $ 197 million and $ 196 million of discount related to certain long-tail liabilities in the UK at September 30, 2024 and December 31, 2023, respectively.

(b) Includes gross discount of $ 665 million and $ 687 million, which was 100 percent ceded to Fortitude Re at September 30, 2024 and December 31, 2023, respectively.

The following table presents the net loss reserve discount benefit (charge):

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(in millions) 2024 2023 2024 2023

4 unchanged sentences

Net change in total reserve discount* $ ( 7 ) $ 19 $ ( 31 ) $ 35

* 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.

* Excludes $ 1 million and $ 7 million discount related to certain long-tail liabilities in the UK for the three months ended September 30, 2024 and 2023, respectively, and excludes $ 1 million and $ 15 million discount related to certain long-tail liabilities in the UK for the nine months ended September 30, 2024 and 2023, respectively.

Amortization of Deferred Gain on Retroactive Reinsurance

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.

Amortization of the deferred gain on retroactive reinsurance includes $ 209 million and $( 36 ) million related to the adverse development reinsurance cover with NICO for the three months ended September 30, 2024 and 2023, respectively, and $ 230 million and $ 36 million related to the adverse development reinsurance cover with NICO for the nine months ended September 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

Future policy benefits primarily include reserves for traditional life and annuity payout contracts, which represent an estimate of the present value of future benefits less the present value of future net premiums.

Included in Future policy benefits are liabilities for annuities issued in structured settlement arrangements whereby a claimant receives life contingent payments over their lifetime.

Also included are pension risk transfer arrangements whereby an upfront premium is received in exchange for guaranteed retirement benefits.

All payments under these arrangements are fixed and determinable with respect to their amounts and dates.

Structured settlement or other annuitization elections (e.g., certain single premium immediate annuities) that do not involve life contingent payments, but rather payments for a stated period are included in Policyholder contract deposits.

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.

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:

Six Months Ended June 30,

Nine Months Ended September 30,

(in millions, except for liability durations) 2024 2023

9 unchanged sentences

Foreign exchange impact ( 87 ) ( 62 )

Other — ( 63 )

Ending balance at original discount rate 1,776 1,984

1 unchanged sentence

Balance, end of period $ 1,583 $ 1,630

AIG | Third Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 12.

Insurance Liabilities

Nine Months Ended September 30,

(in millions, except for liability durations) 2024 2023

Present value of expected future policy benefits

2 unchanged sentences

Beginning balance at original discount rate 2,590 2,742

Effect of actual variances from expected experience (a)

Effect of actual variances from expected experience ( 8 ) ( 43 )

Adjusted beginning of year balance 2,582 2,699

3 unchanged sentences

Foreign exchange impact ( 107 ) ( 93 )

Other — ( 74 )

Ending balance at original discount rate 2,308 2,510

3 unchanged sentences

Deferred profit liability 1 1

Other reconciling items (b)

Future policy benefits for life and accident and health insurance contracts

Other reconciling items (a)

Future policy benefits 1,471 1,311

Reinsurance recoverable ( 813 ) ( 712 )

Net liability for future policy benefits after reinsurance recoverable $ 658 $ 599

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) 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

Weighted average liability duration of the liability for future policy benefits (b)

(a) Other reconciling items primarily include Accident & Health (short-duration) contracts of $ 776 million and $ 661 million at September 30, 2024 and 2023, respectively, of certain long-duration contracts that are 100 percent ceded.

(b) 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.

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:

Six Months Ended June 30,

Nine Months Ended September 30,

(in millions) 2024 2023

3 unchanged sentences

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:

Six Months Ended June 30,

Nine Months Ended September 30,

(in millions) 2024 2023

2 unchanged sentences

The following table presents the weighted-average interest rate for future policy benefits for nonparticipating contracts:

Six Months Ended June 30, 2024 2023

Nine Months Ended September 30, 2024 2023

Weighted-average interest rate, original discount rate 1.83 % 1.84 %

1 unchanged sentence

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 | Third Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 13.

Contingencies, Commitments and Guarantees

In the normal course of business, various contingent liabilities and commitments are entered into by AIG and our subsidiaries.

Contingencies, Commitments and Guarantees

In the normal course of business, we enter into various contingent liabilities and commitments.

In addition, AIG Parent guarantees various obligations of certain subsidiaries.

Although AIG cannot currently quantify its ultimate liability for unresolved litigation and investigation matters, including those referred to below, it is possible that such liability could have a material adverse effect on AIG’s consolidated financial condition or its consolidated results of operations or consolidated cash flows for an individual reporting period.

Although we cannot currently quantify our ultimate liability for unresolved litigation and investigation matters, including those referred to below, it is possible that such liability could have a material adverse effect on our consolidated financial condition or consolidated results of operations or consolidated cash flows for an individual reporting period.

LEGAL CONTINGENCIES

In the normal course of business, AIG and our subsidiaries are subject to regulatory and government investigations and actions, and litigation and other forms of dispute resolution in a large number of proceedings pending in various domestic and foreign jurisdictions.

In the normal course of business, we are subject to regulatory and government investigations and actions, and litigation and other forms of dispute resolution in a large number of proceedings pending in various domestic and foreign jurisdictions.

Certain of these matters involve potentially significant risk of loss due to potential for significant jury awards and settlements, punitive damages or other penalties.

2 unchanged sentences

In our insurance and reinsurance operations, litigation and arbitration concerning the scope of coverage under insurance and reinsurance contracts, and litigation and arbitration in which our subsidiaries defend or indemnify their insureds under insurance contracts, are generally considered in the establishment of our loss reserves.

Separate and apart from the foregoing matters involving insurance and reinsurance coverage, AIG, our subsidiaries and their respective officers and directors are subject to a variety of additional types of legal proceedings brought by holders of AIG securities, customers, employees and others, alleging, among other things, breach of contractual or fiduciary duties, bad faith, indemnification and violations of federal and state statutes and regulations.

Separate and apart from the foregoing matters involving insurance and reinsurance coverage, AIG Parent, our subsidiaries and their respective officers and directors are subject to a variety of additional types of legal proceedings brought by holders of AIG securities, customers, employees and others, alleging, among other things, breach of contractual or fiduciary duties, bad faith, indemnification and violations of federal and state statutes and regulations.

With respect to these other categories of matters not arising out of claims for insurance or reinsurance coverage, we establish reserves for loss contingencies when it is probable that a loss will be incurred and the amount of the loss can be reasonably estimated.

1 unchanged sentence

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

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.

Additionally, from time to time, various regulatory and governmental agencies review our transactions and practices 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.

1 unchanged sentence

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 $ 1.6 billion and $ 1.7 billion at June 30, 2024 and December 31, 2023, respectively.

These commitments totaled $ 1.5 billion and $ 1.7 billion at September 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 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.

Due to the deconsolidation of AIGFP and its subsidiaries, as of September 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.

1 unchanged sentence

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:

AIG | Third Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 13.

Contingencies, Commitments and Guarantees

(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.

12 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.

1 unchanged sentence

The following table presents a rollforward of outstanding shares:

Six Months Ended June 30, 2024

Nine Months Ended September 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.

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.

AIG | Third Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 14.

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 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.

Pursuant to an Exchange Act Rule 10b5-1 repurchase plan, from October 1, 2024 to October 30, 2024, we repurchased approximately 7 million shares of AIG Common Stock for an aggregate purchase price of approximately $ 500 million.

DIVIDENDS DECLARED

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.

On November 4, 2024, our Board of Directors declared a cash dividend on AIG Common Stock of $ 0.40 per share, payable on December 30, 2024 to shareholders of record on December 16, 2024.

ACCUMULATED OTHER COMPREHENSIVE INCOME (LOSS)

20 unchanged sentences

Adjustment Total

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 )

Change in unrealized appreciation (depreciation) of investments*

1 unchanged sentence

Change in other — 17 — — — — 17

Change in fair value of market risk benefits, net — — 159 — — — 159

Change in discount rates — — — ( 12 ) — — ( 12 )

Change in future policy benefits

— 67 — — — — 67

Change in foreign currency translation adjustments

6 unchanged sentences

( 8 ) ( 249 ) — 58 ( 13 ) — ( 212 )

Corebridge deconsolidation, net of tax 42 8,513 330 ( 1,583 ) ( 88 ) — 7,214

Total other comprehensive income 37 1,349 — 46 414 1 1,847

Corebridge noncontrolling interests 2 693 38 ( 120 ) ( 3 ) — 610

Noncontrolling interests — — — — 4 — 4

Balance, September 30, 2024, net of tax $ ( 1 ) $ ( 2,073 ) $ — $ 68 $ ( 2,912 ) $ ( 804 ) $ ( 5,722 )

Balance, June 30, 2023, net of tax $ ( 60 ) $ ( 16,655 ) $ ( 315 ) $ 2,067 $ ( 3,174 ) $ ( 845 ) $ ( 18,982 )

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*

16 unchanged sentences

Noncontrolling interests ( 17 ) ( 1,760 ) ( 29 ) 387 ( 13 ) — ( 1,432 )

Balance, June 30, 2023, net of tax $ ( 60 ) $ ( 16,655 ) $ ( 315 ) $ 2,067 $ ( 3,174 ) $ ( 845 ) $ ( 18,982 )

Balance, September 30, 2023, net of tax $ ( 110 ) $ ( 20,661 ) $ ( 369 ) $ 2,841 $ ( 3,430 ) $ ( 800 ) $ ( 22,529 )

AIG | Third Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 14.

(in millions) Unrealized

30 unchanged sentences

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

Total other comprehensive income 120 7,646 432 ( 802 ) 71 17 7,484

Corebridge noncontrolling interests 2 610 33 ( 105 ) ( 3 ) — 537

Noncontrolling interests 17 ( 559 ) ( 11 ) 258 1 — ( 294 )

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, September 30, 2024, net of tax $ ( 1 ) $ ( 2,073 ) $ — $ 68 $ ( 2,912 ) $ ( 804 ) $ ( 5,722 )

Balance, December 31, 2022, net of tax $ ( 136 ) $ ( 20,675 ) $ ( 284 ) $ 2,459 $ ( 3,056 ) $ ( 924 ) $ ( 22,616 )

11 unchanged sentences

Noncontrolling interests 1 ( 1,401 ) ( 59 ) 387 8 — ( 1,064 )

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:

Balance, September 30, 2023, net of tax $ ( 110 ) $ ( 20,661 ) $ ( 369 ) $ 2,841 $ ( 3,430 ) $ ( 800 ) $ ( 22,529 )

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

The following table presents the other comprehensive income (loss) reclassification adjustments for the three and nine months ended September 30, 2024 and 2023 , respectively:

(in millions) Unrealized

19 unchanged sentences

Adjustment Total

Three Months Ended June 30, 2024

Three Months Ended September 30, 2024

Unrealized change arising during period $ 45 $ 1,514 $ — $ ( 12 ) $ 427 $ ( 7 ) $ 1,967

3 unchanged sentences

Total other comprehensive income (loss), net of income tax expense (benefit) $ 37 $ 1,349 $ — $ 46 $ 414 $ 1 $ 1,847

Three Months Ended June 30, 2023

Three Months Ended September 30, 2023

Unrealized change arising during period $ ( 80 ) $ ( 6,998 ) $ ( 104 ) $ 1,470 $ ( 279 ) $ 57 $ ( 5,934 )

3 unchanged sentences

Total other comprehensive income (loss), net of income tax expense (benefit) $ ( 66 ) $ ( 5,694 ) $ ( 81 ) $ 1,147 $ ( 269 ) $ 45 $ ( 4,918 )

AIG | Third Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 14.

(in millions) Unrealized

19 unchanged sentences

Adjustment Total

Six Months Ended June 30, 2024

Nine Months Ended September 30, 2024

Unrealized change arising during period $ 98 $ ( 1,129 ) $ 130 $ 947 $ 173 $ ( 2 ) $ 217

3 unchanged sentences

Total other comprehensive income (loss), net of income tax expense (benefit) $ 120 $ 7,646 $ 432 $ ( 802 ) $ 71 $ 17 $ 7,484

Six Months Ended June 30, 2023

Nine Months Ended September 30, 2023

Unrealized change arising during period $ 10 $ ( 5,171 ) $ ( 250 ) $ 1,474 $ ( 323 ) $ 147 $ ( 4,113 )

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Total other comprehensive income (loss), before income tax expense (benefit) 33 ( 4,238 ) ( 250 ) 1,474 ( 323 ) 170 ( 3,134 )

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) 9 ( 798 ) ( 54 ) 374 33 45 ( 391 )

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Amount Reclassified from AOCI Affected Line Item in the

Three Months Ended June 30, Condensed Consolidated

Three Months Ended September 30, Condensed Consolidated

(in millions) 2024 2023 Statements of Income (Loss)

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Investments $ — $ — Net realized gains (losses)

Total 6 ( 7 )

Unrealized appreciation (depreciation) of all other investments

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Total ( 8 ) ( 6 )

Corebridge deconsolidation, net of tax ( 7,214 ) — (c)

Total reclassifications for the period $ ( 92 ) $ ( 169 )

Amount Reclassified from AOCI Affected Line Item in the

Six Months Ended June 30, Condensed Consolidated

Nine Months Ended September 30, Condensed Consolidated

(in millions) 2024 2023 Statements of Income (Loss)

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(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:

(a) Change in fair value of market risk benefits attributable to changes in our own credit risk (b) Change in the discount rates used to measure traditional and limited-payment long-duration insurance contracts, and (c) Fair value of liabilities under fair value option attributable to changes in own credit risk.

(a) Change in fair value of market risk benefits attributable to changes in our own credit risk and (b) Change in the discount rates used to measure traditional and limited-payment long-duration insurance contracts.

(b) These AOCI components are included in the computation of net periodic pension cost.

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See the rollforward of Accumulated other comprehensive income (loss) above for further details.

AIG | Second Quarter 2024 Form 10-Q

AIG | Third Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 15.

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Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

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

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Income (loss) from discontinued operations, net of income tax expense ( 24 ) 2,046 ( 3,580 ) 2,472

Net income attributable to noncontrolling interests 93 198 477 81

Net income (loss) attributable to noncontrolling interests ( 2 ) 720 475 801

Income (loss) from discontinued operations, net of noncontrolling interest ( 22 ) 1,326 ( 4,055 ) 1,671

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Income (loss) attributable to AIG common shareholders $ 0.71 $ 2.81 $ ( 3.48 ) $ 4.83

(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 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.

(a) Potential dilutive common shares are primarily due to our share-based employee compensation plans.

The number of potential common shares excluded from diluted shares outstanding was 0.1 million and 0.1 million for the three and nine months ended September 30, 2024, respectively, and 5.1 million and 5.4 million for the three and nine months ended September 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 | 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.

While the U.S.

Treasury and Internal Revenue Service (IRS) issued proposed regulations for CAMT during the third quarter of 2024, there are still certain details and specifics of application of the CAMT that remain unclear and we continue to evaluate the impact of the proposed regulations along with prior guidance.

BASIS OF PRESENTATION

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and foreign laws.

AIG | Third Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 16.

TAX ACCOUNTING POLICIES

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INTERIM TAX EXPENSE (BENEFIT)

For the three months ended June 30, 2024, the effective tax rate on income from continuing operations was 23.0 percent.

For the three months ended September 30, 2024, the effective tax rate on income from continuing operations was 25.9 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 six months ended June 30, 2024, the effective tax rate on income from continuing operations was 24.1 percent.

For the nine months ended September 30, 2024, the effective tax rate on income from continuing operations was 24.6 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.

For the three months ended September 30, 2023, the effective tax rate on income from continuing operations was 36.3 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 tax adjustments related to prior year returns, the effect of foreign operations, and state and local income taxes.

These tax charges were partially offset by tax benefits related to tax implications related to the announced sale of Validus Re 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 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.

For the nine months ended September 30, 2023, the effective tax rate on income from continuing operations was 21.3 percent.

These tax charges were partially offset by tax benefits related to the potential resolution of an IRS audit matter, net of an increase in associated uncertain tax benefits, tax exempt income and excess tax benefits related to share-based compensation payments recorded through the income statement.

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.

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 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.

AIG | Third Quarter 2024 Form 10-Q

ITEM 1 | Notes to Condensed Consolidated Financial Statements (unaudited) | 16.

During the third quarter, taxable income projections were updated to reflect the latest projections of income for our insurance and non-insurance companies, the filing of our 2023 U.S.

federal consolidated income tax return, 2024 transactions, 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.

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federal consolidated income tax group tax attribute carryforwards that are not more likely than not to be realized.

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.

Accordingly, during the nine months ended September 30, 2024, we recorded no change in valuation allowance.

For the nine months ended September 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 a decrease 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.

As of September 30, 2024, based on all available evidence, we concluded that a valuation allowance of $ 369 million 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 nine months ended September 30, 2024, we recorded a decrease in valuation allowance of $ 204 million and $ 181 million, respectively, associated with the unrealized tax capital losses in AIG's available for sale securities portfolio.

The valuation allowance decrease was allocated to other comprehensive income.

For the nine months ended September 30, 2024, we recognized a net $ 15 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 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.

At both September 30, 2024 and December 31, 2023, our unrecognized tax benefits, excluding interest and penalties, were $ 1.4 billion.

At both September 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 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.

At September 30, 2024 and December 31, 2023, we had accrued liabilities of $ 53 million and $ 52 million, respectively, for the payment of interest (net of the federal benefit) and penalties.

For the nine months ended September 30, 2024 and September 30, 2023, we accrued expense of $ 1 million and benefit of $ 5 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 | Second Quarter 2024 Form 10-Q

Subsequent Events

DEBT REDEMPTION

On October 21, 2024, AIG announced that we will redeem all of our outstanding Zero Coupon Callable Notes Due 2047 (the Notes) on November 22, 2024 (the Redemption Date) for a redemption price equal to 135.631 % of the face amount of the Notes outstanding on such Redemption Date.

As of October 21, 2024, $ 400,000,000 face amount of the Notes was outstanding.

AIG | Third Quarter 2024 Form 10-Q

ITEM 2 | Management’s Discussion and Analysis of Financial Condition and Results of Operations

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Cautionary Statement Regarding Forward-Looking Information and Factors That May Affect Future Results

This Quarterly Report on Form 10-Q and other publicly available documents may include, and members of AIG management may from time to time make and discuss, statements which, to the extent they are not statements of historical or present fact, may constitute “forward-looking statements” within the meaning of the U.S.

This Quarterly Report on Form 10-Q and other publicly available documents may include, and members of management may from time to time make and discuss, statements which, to the extent they are not statements of historical or present fact, may constitute “forward-looking statements” within the meaning of the U.S.

Private Securities Litigation Reform Act of 1995.

These forward‑looking statements are intended to provide management’s current expectations or plans for AIG’s future operating and financial performance, based on assumptions currently believed to be valid and accurate.

These forward‑looking statements are intended to provide management’s current expectations or plans for future operating and financial performance, based on assumptions currently believed to be valid and accurate.

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 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.

Factors that could cause AIG’s actual results to differ, possibly materially, from those in specific projections, targets, goals, plans, assumptions and other forward-looking statements include, without limitation:

• the impact of adverse developments affecting economic conditions in the markets in which AIG and its businesses operate in the U.S.

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, 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 | Third Quarter 2024 Form 10-Q

All forward-looking statements involve risks, uncertainties and other factors that may cause actual results and financial condition to differ, possibly materially, from the results and financial condition expressed or implied in the forward-looking statements.

Factors that could cause actual results to differ, possibly materially, from those in specific projections, targets, goals, plans, assumptions and other forward-looking statements include, without limitation:

• the impact of adverse developments affecting economic conditions in the markets in which we operate in the U.S.

and globally, including adverse developments related to financial market conditions, macroeconomic trends, fluctuations in interest rates and foreign currency exchange rates, inflationary pressures, including social inflation, pressures on the commercial real estate market, an economic slowdown or recession, any potential U.S.

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• 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 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;

• AIG's ability to effectively implement technological advancements, including the use of artificial intelligence (AI), and respond to competitors' AI and other technology initiatives;

• disruptions in the availability or accessibility of our 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;

• our ability to effectively implement restructuring initiatives and potential cost-savings opportunities;

• our ability to effectively implement technological advancements, including the use of artificial intelligence (AI), and respond to competitors' AI and other technology initiatives;

• the effectiveness of strategies to retain and recruit key personnel and to implement effective succession plans;

• concentrations in AIG’s investment portfolios;

• AIG’s reliance on third-party investment managers;

• changes in the valuation of AIG’s investments;

• AIG’s reliance on third parties to provide certain business and administrative services;

• our ability to successfully dispose of, monetize and/or acquire businesses or assets or successfully integrate acquired businesses, and the anticipated benefits thereof;

• concentrations in our investment portfolios, including our continuing equity market exposure to Corebridge Financial, Inc.

(Corebridge);

• our reliance on third-party investment managers;

• changes in the valuation of our investments, including Corebridge common stock;

• our reliance on third parties to provide certain business and administrative services;

• availability of adequate reinsurance or access to reinsurance on acceptable terms;

• concentrations of AIG’s insurance, reinsurance and other risk exposures;

• changes in judgments or assumptions concerning insurance underwriting and insurance liabilities;

• concentrations of our insurance, reinsurance and other risk exposures;

• 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;

• our ability to adequately assess risk and estimate related losses as well as the effectiveness of our enterprise risk management policies and procedures, including with respect to business continuity and disaster recovery plans;

• difficulty in marketing and distributing products through current and future distribution channels;

• actions by rating agencies with respect to AIG’s credit and financial strength ratings as well as those of its businesses and subsidiaries;

• changes to sources of or access to liquidity;

• actions by rating agencies with respect to our credit and financial strength ratings as well as those of its businesses and subsidiaries;

• changes in judgments concerning the recognition of deferred tax assets and the impairment of goodwill;

• changes in judgments or assumptions concerning insurance underwriting and insurance liabilities;

• 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;

• the effects of changes in laws and regulations, including those relating to the regulation of insurance, in the U.S.

and other countries in which AIG and its businesses operate;

• the effects of sanctions, including those related to the conflict in the Middle East and between Russia and Ukraine, and the failure to comply with those sanctions;

• our ability to address evolving stakeholder expectations and regulatory requirements with respect to environmental, social and governance matters;

• changes to sources of or access to liquidity;

• changes in accounting principles and financial reporting requirements or their applicability to us;

• the effects of changes in laws and regulations, including those relating to cybersecurity and data privacy, and the regulation of insurance, in the U.S.

and other countries in which we operate;

• changes to tax laws in the U.S.

and other countries in which AIG and its businesses operate;

and other countries in which we operate;

• the outcome of significant legal, regulatory or governmental proceedings;

• AIG’s ability to effectively execute on sustainability targets and standards;

• AIG’s ability to address evolving stakeholder expectations and regulatory requirements with respect to environmental, social and governance matters;

• our ability to effectively execute on sustainability targets and standards;

• the impact of epidemics, pandemics and other public health crises and responses thereto;

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– Part I, Item 2.

MD&A and Part II, Item 1A.

Risk Factors of this Quarterly Report on Form 10‑Q;

MD&A of this Quarterly Report on Form 10‑Q;

– Part I, Item 1A.

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MD&A of the 2023 Annual Report;

– our other filings with the Securities and Exchange Commission (SEC).

Forward-looking statements speak only as of the date of this report, or in the case of any document incorporated by reference, the date of that document.

We are not under any obligation to publicly update or revise any forward-looking statements, whether as a result of new information, future events or otherwise, except as required by applicable law.

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 | Second Quarter 2024 Form 10-Q

AIG | Third Quarter 2024 Form 10-Q

INDEX TO ITEM 2

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Other Operations

Investment Highlights in the Six Months Ended June 30, 2024

Investment Highlights in the Nine Months Ended September 30, 2024

Investment Strategies

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Enterprise Risk Management

AIG | Second Quarter 2024 Form 10-Q

AIG | Third Quarter 2024 Form 10-Q

ITEM 2 | Use of Non-GAAP Measures

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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

AIG | Third Quarter 2024 Form 10-Q

ITEM 2 | Use of Non-GAAP Measures

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Results from discontinued operations, including Corebridge, are excluded from all of these measures.

AIG | Second Quarter 2024 Form 10-Q

AIG | Third Quarter 2024 Form 10-Q

ITEM 2 | Critical Accounting Estimates

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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

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

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.

Due to share repurchases by Corebridge and sale of shares by AIG after the Deconsolidation Date, as of September 30, 2024, AIG held 48.6 percent of the outstanding common stock of Corebridge.

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.

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

As of June 30, 2024, AIG reports the results of its businesses through two segments – General Insurance and Other Operations.

As of September 30, 2024, AIG reports the results of its businesses through two segments – General Insurance and Other Operations.

General Insurance consists of two operating segments – North America and International.

Other Operations is primarily comprised of corporate and consolidation and eliminations.

AIG | Third Quarter 2024 Form 10-Q

ITEM 2 | Executive Summary

For additional information on our business segments, see Note 3 to the Condensed Consolidated Financial Statements, and for information regarding the separation of Life and Retirement and the sale of our global individual personal travel insurance and assistance business, see Notes 1 and 4 to the Condensed Consolidated Financial Statements.

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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, 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.

AIG | Second Quarter 2024 Form 10-Q

ITEM 2 | Executive Summary

REGULATORY, INDUSTRY AND ECONOMIC FACTORS

Regulatory Environment

Our operations around the world are subject to regulation by many different types of regulatory authorities, including insurance, securities, derivatives and investment advisory in the United States and abroad.

Our operations around the world are subject to regulation by many different types of regulatory authorities, including insurance and securities in the United States and abroad.

The insurance and financial services industries are generally subject to close regulatory scrutiny and supervision.

On March 6, 2024, the SEC adopted its climate-related disclosure rules, which require registrants to provide detailed climate-related disclosures in registration statements and periodic reports.

Other jurisdictions in which we operate, including the European Union, have adopted or are considering similar (and in some cases more stringent) climate-and sustainability-related requirements.

We are evaluating the potential impacts of these requirements at this time, including in connection with ongoing litigation challenging such requirements and the SEC's stay of its requirements pending judicial review.

If and when such requirements become effective, they may significantly increase the complexity of AIG’s periodic reporting as a U.S.

public company and/or in other jurisdictions.

In the European Union, the EU Digital Operational Resilience Act (DORA) will require covered entities, including insurance intermediaries, reinsurance intermediaries and ancillary insurance intermediaries, other than micro-, small, or medium enterprises, to comply with a wide range of organizational and technical requirements to identify, manage and mitigate operational risk arising from use of network and information systems and, in particular, the use of third party ICT service providers.

For example, on March 6, 2024, the SEC adopted its climate-related disclosure rules, which require registrants to provide detailed climate-related disclosures in registration statements and periodic reports, but the rules have been stayed pending the completion of judicial review.

Other jurisdictions in which we operate, including the European Union, have adopted or are considering similar (and in some cases more stringent) climate- and sustainability-related reporting requirements, including through the Corporate Sustainability Reporting Directive.

In addition, the Corporate Sustainability Due Diligence Directive imposes due diligence requirements for identifying and mitigating potential environmental and human rights impacts of covered entities and their value chains, along with requirements to adopt and disclose a climate transition plan.

Covered entities will be required to comply with DORA by January 2025.

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Business – Regulation and Part I, Item 1A.

Risk Factors – Regulation in the 2023 Annual Report.

Risk Factors – Regulation in the 2023 Annual Report and Note 16 to the Condensed Consolidated Financial Statements.

AIG | Third Quarter 2024 Form 10-Q

ITEM 2 | Executive Summary

Impact of Changes in the Interest Rate E nvironment

Certain key U.S.

benchmark rates continued to rise in 2024 as markets reacted to heightened inflation measures, geopolitical risk, and the Board of Governors of the Federal Reserve System implementing multiple increases to short term interest rates.

Our net investment income is significantly impacted by market interest rates as well as the deployment of asset allocation strategies to manage duration, enhance yield and manage interest rate risk.

As interest rates increase, so too does our ability to reinvest future cash inflows from premiums, as well as sales and maturities of existing investments, at more favorable rates.

benchmark rates continued to fluctuate in 2024 as markets reacted to change in inflation trends, geopolitical risk and the decisions of the Board of Federal Reserve System.

Our Net investment income is impacted by market interest rates as well as the deployment of asset allocation strategies to enhance yield, manage duration and interest rate risk.

The change in interest rates and credit spreads impact our ability to reinvest future cash flows at rates equal or greater than the rates on sales and maturities.

For additional information on our investment and asset-liability management strategies, see Investments.

While the impact of rising interest rates on our General Insurance segment increases the benefit of investment income, the current and medium-term inflationary environment may also translate into higher loss cost trends.

We monitor these trends closely, particularly loss cost trend uncertainty, to ensure that not only our pricing, but also our loss reserving assumptions are proactive to, and considerate of, current and future economic conditions.

For our General Insurance segment loss reserves, rising interest rates may favorably impact the statutory net loss reserve discount for workers’ compensation and its associated amortization.

Impact of Currency Volatility

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dollars, as well as financial statement line item comparability.

AIG | Second Quarter 2024 Form 10-Q

ITEM 2 | Executive Summary

General Insurance businesses are transacted in most major foreign currencies.

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Three Months Ended

June 30, Percentage Six Months Ended

June 30, Percentage

September 30, Percentage Nine Months Ended

September 30, Percentage

Rate for 1 USD 2024 2023 Change 2024 2023 Change

Major Currency:

GBP 0.78 0.79 (1) % 0.79 0.81 (2) %

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Consolidated Results of Operations

The following section provides a comparative discussion of our consolidated results of operations on a reported basis for the three and six months ended June 30, 2024 and 2023.

The following section provides a comparative discussion of our consolidated results of operations on a reported basis for the three and nine months ended September 30, 2024 and 2023.

Factors that relate primarily to a specific business are discussed in more detail within the business segment operations section.

3 unchanged sentences

Three Months Ended

June 30, Percentage

Change Six Months Ended

June 30, Percentage

September 30, Percentage

Change Nine Months Ended

September 30, Percentage

(in millions) 2024 2023 2024 2023

5 unchanged sentences

Net realized gains (losses):

Net realized losses - excluding Fortitude Re funds withheld assets and embedded derivative (187) (65) (188) (246) (382) 36

Net realized losses on Fortitude Re funds withheld assets (1) (7) 86 (20) (61) 67

Net realized gains (losses) on Fortitude Re funds withheld embedded derivative 8 58 (86) (1) (82) 99

Total net realized losses (180) (14) NM (267) (525) 49

Other income 2 (1) NM 2 (1) NM

Net realized gains (losses) - excluding Fortitude Re funds withheld assets and embedded derivative 8 (189) NM (238) (571) 58

Net realized losses on Fortitude Re funds withheld assets (18) (3) NM (38) (64) 41

Net realized gains (losses) on Fortitude Re funds withheld embedded derivative (157) 57 NM (158) (25) NM

Total net realized losses (167) (135) (24) (434) (660) 34

AIG | Third Quarter 2024 Form 10-Q

ITEM 2 | Consolidated Results of Operations

Three Months Ended

September 30, Percentage

Change Nine Months Ended

September 30, Percentage

(in millions) 2024 2023 2024 2023

Other income — 3 NM 2 2 —

Total revenues 6,751 7,267 (7) 20,074 21,412 (6)

4 unchanged sentences

Interest expense 112 138 (19) 353 391 (10)

Loss on extinguishment of debt 1 — NM 1 — NM

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

Loss on extinguishment of debt — 21 NM 1 21 (95)

Net (gain) loss on divestitures and other 8 (101) NM (94) (89) (6)

Total benefits, losses and expenses 6,102 6,167 (1) 17,750 19,024 (7)

3 unchanged sentences

Income (loss) from discontinued operations, net of income taxes (24) 2,046 NM (3,580) 2,472 NM

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

AIG | Second Quarter 2024 Form 10-Q

ITEM 2 | Consolidated Results of Operations

Three Months Ended

June 30, Percentage

Change Six Months Ended

June 30, Percentage

(in millions) 2024 2023 2024 2023

Net income attributable to noncontrolling interests 93 198 (53) 477 81 489

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

Net income (loss) 457 2,747 (83) (1,827) 4,351 NM

Net income (loss) attributable to noncontrolling interests (2) 720 NM 475 801 (41)

Net income (loss) attributable to AIG 459 2,027 (77) (2,302) 3,550 NM

Dividends on preferred stock and preferred stock redemption premiums — 7 NM 22 22 —

Net income (loss) attributable to AIG common shareholders $ (3,977) $ 1,485 NM % $ (2,783) $ 1,508 NM %

(in millions, except per share data) June 30, 2024 December 31, 2023

Net income (loss) attributable to AIG common shareholders $ 459 $ 2,020 (77) % $ (2,324) $ 3,528 NM %

(in millions, except per share data) September 30, 2024 December 31, 2023

Balance sheet data:

8 unchanged sentences

NET INCOME (LOSS) ATTRIBUTABLE TO AIG COMMON SHAREHOLDERS

Three Months Ended June 30, 2024 and 2023 Comparison

Three Months Ended September 30, 2024 and 2023 Comparison

Net income (loss) attributable to AIG common shareholders decreased $1.6 billion due to the following:

• a decrease in Income (loss) from discontinued operations, net of income taxes of $5.2 billion primarily as a result of the loss on deconsolidation of Corebridge of $4.7 billion as well as the decline in Corebridge net income;

• a decrease in underwriting income in General Insurance of $164 million, reflecting lower net favorable prior year reserve development and higher catastrophe losses and partially offset by improvement in the accident year loss ratio, as adjusted, primarily driven by changes in business mix along with continued positive rate change, focused risk selection and improved terms and conditions;

• a decrease in Net realized gains excluding Fortitude Re funds withheld assets and embedded derivative of $122 million, driven by a $71 million decrease in foreign exchange gains and higher losses on sales of securities of $80 million, partially offset by derivative and hedge activity gains of $68 million;

• an increase in General operating and other expenses primarily due to a severance charge of $285 million and asset impairment of $53 million as a result of restructuring activities;

• an increase in income tax expense of $97 million as a result of prior year discrete items partially offset by lower income from continuing operations.

• a decrease in Income (loss) from discontinued operations, net of income taxes of $2.1 billion primarily as a result of the inclusion of Corebridge net income in 2023;

• a decrease in underwriting income driven by unfavorable prior year loss reserve development of $187 million which does not reflect the benefit of recoveries under a retroactive adverse development cover, as well as the sale of AIG Re and the impact of mix change, partially offset by portfolio growth.

The decrease in Net income (loss) attributable to AIG common shareholders was partially offset by the following, on a pre-tax basis:

• an increase in Net investment income of $153 million primarily driven by dividends received from Corebridge of $68 million and changes in its stock price of $65 million, an increase in the fair value of fixed maturity securities where we elected the fair value option of $16 million as a result of the higher interest rate environment and higher available for sale fixed maturity sales of $5 million, partially offset by a decrease in the fair value of equity securities of $45 million and lower returns on our alternative investments of $12 million;

• a decrease in income attributable to noncontrolling interest of $105 million primarily driven by lower ownership interest in Corebridge.

Six Months Ended June 30, 2024 and 2023 Comparison

Net income (loss) attributable to AIG common shareholders decreased $4.3 billion due to the following:

• a decrease in Income (loss) from discontinued operations, net of income taxes of $4.0 billion primarily as a result of the loss on deconsolidation of Corebridge of $4.7 billion;

• an increase in income attributable to noncontrolling interest of $396 million primarily driven by increase in net income at Corebridge compared to 2023;

• a decrease in underwriting income in General Insurance of $70 million, reflecting lower net favorable prior year reserve development partially offset by lower catastrophe losses and improvement in the accident year loss ratio, primarily driven by changes in business mix along with continued positive rate change, focused risk selection and improved terms and conditions;

AIG | Second Quarter 2024 Form 10-Q

• an increase in Net realized gains excluding Fortitude Re funds withheld assets and embedded derivative of $197 million, primarily driven by a $95 million increase in foreign exchange gains and lower losses on sales of securities of $86 million and higher derivative and hedge activity gains of $27 million, partially offset by lower sales on alternative investments of $43 million;

• an increase in Net investment income of $117 million primarily driven by dividends received from Corebridge of $65 million, an increase in the fair value of equity securities of $29 million, an increase in the fair value of fixed maturity securities where we elected the fair value option of $25 million as a result of the higher interest rate environment and higher returns on our alternative investments of $23 million, partially offset by changes in Corebridge stock price of $(35) million;

• a decrease in income attributable to noncontrolling interest of $722 million primarily driven by the deconsolidation of Corebridge;

• a decrease in income tax expense of $231 million as a result of lower income from continuing operations.

AIG | Third Quarter 2024 Form 10-Q

ITEM 2 | Consolidated Results of Operations

• an increase in income tax expense $293 million as a result of prior year discrete items partially offset by lower income from continuing operations.

Nine Months Ended September 30, 2024 and 2023 Comparison

Net income (loss) attributable to AIG common shareholders decreased $5.9 billion due to the following:

• a decrease in Income (loss) from discontinued operations, net of income taxes of $6.1 billion primarily as a result of the loss on deconsolidation of Corebridge of $4.7 billion and Corebridge net income in 2023;

• a decrease in underwriting income driven by unfavorable prior year reserve development of $79 million, which does not reflect the benefit of recoveries under a retroactive adverse development cover, as well as the sales of AIG Re and Crop Risk Services, partially offset by improved portfolio performance and growth;

• an increase in income tax expense of $62 million as a result of prior year discrete items.

The decrease in Net income (loss) attributable to AIG common shareholders was partially offset by the following, on a pre-tax basis:

• an increase in Net investment income of $288 million primarily driven by dividends received from Corebridge of $68 million and changes in its stock price of $65 million, higher income on available for sale fixed maturity securities of $126 million, partially offset by lower returns on our alternative investments of $53 million;

• an increase in Net realized gains excluding Fortitude Re funds withheld assets and embedded derivative of $136 million, driven by a $146 million decrease in losses from sales of securities and a $44 million increase in derivative and hedge activity, partially offset by foreign exchange losses of $44 million;

• an increase in Net realized gains on Fortitude Re funds withheld embedded derivative of $81 million driven by interest rate movement and higher Net realized losses on Fortitude Re funds withheld assets of $41 million.

• an increase in Net investment income of $405 million primarily driven by dividends received from Corebridge of $133 million and changes in its stock price of $30 million, higher income on available for sale fixed maturity securities of $144 million and an increase in the fair value of equity securities of $51 million, partially offset by lower returns on our alternative investments of $30 million;

• an increase in Net realized gains excluding Fortitude Re funds withheld assets and embedded derivative of $333 million, primarily driven by a $232 million decrease in losses from sales of securities, lower derivative and hedge activity losses of $71 million and a $51 million increase in foreign exchange gains, partially offset by lower sales on alternative investments of $30 million;

• a decrease in net income attributable to noncontrolling interest of $326 million primarily driven by the deconsolidation of Corebridge.

INCOME TAX EXPENSE ANALYSIS

For the three months ended June 30, 2024 and 2023, the effective tax rate on income (loss) from continuing operations was 23.0 percent and 5.1 percent, respectively.

For the six months ended June 30, 2024 and 2023, the effective tax rate on income (loss) from continuing operations was 24.1 percent and 8.5 percent, respectively.

For the three months ended September 30, 2024 and 2023, the effective tax rate on income (loss) from continuing operations was 25.9 percent and 36.3 percent, respectively.

For the nine months ended September 30, 2024 and 2023, the effective tax rate on income (loss) from continuing operations was 24.6 percent and 21.3 percent, respectively.

For additional information, see Note 16 to the Condensed Consolidated Financial Statements.

NON-GAAP RECONCILIATIONS

The following tables present reconciliations of Book value per share to Adjusted book value per share, Tangible book value per share and Core operating book value per share, which are non-GAAP measures.

The following table presents reconciliations of Book value per share to Adjusted book value per share, Tangible book value per share and Core operating book value per share, which are non-GAAP measures.

For additional information, see Use of Non-GAAP Measures.

June 30, December 31,

September 30, December 31,

(in millions, except per share data) 2024 2023

6 unchanged sentences

Adjusted common shareholders' equity $ 46,582 $ 54,069

Total common shares outstanding 649.8 688.8

Book value per share $ 68.40 $ 65.14

Adjusted book value per share 72.78 78.50

June 30, December 31,

(in millions, except per share data) 2024 2023

Total AIG shareholders' equity $ 44,445 $ 45,351

Preferred equity — 485

Total AIG common shareholders' equity $ 45,039 $ 44,866

5 unchanged sentences

AIG tangible common shareholders' equity $ 41,205 $ 41,050

Total common shares outstanding 649.8 688.8

Book value per share $ 68.40 $ 65.14

Tangible book value per share 62.56 59.60

AIG | Second Quarter 2024 Form 10-Q

ITEM 2 | Consolidated Results of Operations

June 30, December 31,

(in millions, except per share data) 2024 2023

Total AIG shareholders' equity $ 44,445 $ 45,351

Preferred equity — 485

Total AIG common shareholders' equity $ 45,039 $ 44,866

5 unchanged sentences

AIG core operating shareholders' equity $ 34,464 $ 36,326

AIG | Third Quarter 2024 Form 10-Q

ITEM 2 | Consolidated Results of Operations

September 30, December 31,

(in millions, except per share data) 2024 2023

Total common shares outstanding 630.3 688.8

Book value per share $ 71.46 $ 65.14

Adjusted book value per share 73.90 78.50

Tangible book value per share 65.37 59.60

Core operating book value per share 54.68 52.74

The following tables present reconciliations of Return on equity to Adjusted return on equity, Tangible return on equity and Core operating return on equity, which are non-GAAP measures.

The following table presents reconciliations of Return on equity to Adjusted return on equity, Tangible return on equity and Core operating return on equity, which are non-GAAP measures.

For additional information, see Use of Non-GAAP Measures.

Three Months Ended

June 30, Six Months Ended

June 30, Year Ended

September 30, Nine Months Ended

September 30, Year Ended

(dollars in millions) 2024 2023 2024 2023 2023

3 unchanged sentences

Average investments AOCI (2,194) (16,091) (5,864) (16,244) (14,836)

Average adjusted AIG common shareholders' equity $ 50,270 $ 57,016 $ 51,536 $ 57,488 $ 56,766

Return on equity NM % 14.0 % NM % 7.2 % 8.6 %

Adjusted return on equity 6.2 % 5.5 % 6.4 % 5.4 % 5.6 %

Three Months Ended

June 30, Six Months Ended

June 30, Year Ended

(dollars in millions) 2024 2023 2024 2023 2023

Actual or annualized net income (loss) attributable to AIG common shareholders $ (15,908) $ 5,940 $ (5,566) $ 3,016 $ 3,614

Actual or annualized adjusted after-tax income attributable to AIG common shareholders 3,100 3,108 3,286 3,080 3,181

Average AIG adjusted common shareholders' equity $ 46,936 $ 56,825 $ 50,298 $ 57,440 $ 56,766

Average AIG common shareholders' equity $ 44,742 $ 40,734 $ 44,434 $ 41,196 $ 41,930

1 unchanged sentence

Average AIG tangible common shareholders' equity $ 40,929 $ 36,910 $ 40,623 $ 37,062 $ 37,860

Return on equity NM % 14.0 % NM % 7.2 % 8.6 %

Return on tangible equity 7.7 % 8.1 % 8.1 % 8.2 % 8.4 %

Three Months Ended

June 30, Six Months Ended

June 30, Year Ended

(dollars in millions) 2024 2023 2024 2023 2023

Actual or annualized net income (loss) attributable to AIG common shareholders $ (15,908) $ 5,940 $ (5,566) $ 3,016 $ 3,614

Actual or annualized adjusted after-tax income attributable to AIG common shareholders 3,100 3,108 3,286 3,080 3,181

Average AIG common shareholders' equity $ 44,742 $ 40,734 $ 44,434 $ 41,196 $ 41,930

3 unchanged sentences

Average AIG core operating shareholders' equity $ 34,564 $ 34,519 $ 35,186 $ 32,775 $ 33,486

Return on equity NM % 14.0 % NM % 7.2 % 8.6 %

Return on equity 4.1 % 19.8 % (7.0) % 11.4 % 8.6 %

Adjusted return on equity 6.8 5.3 6.5 5.3 5.6

Return on tangible equity 7.8 8.1 8.0 8.2 8.4

Core operating return on equity 9.2 8.6 9.3 9.3 9.5

AIG | Second Quarter 2024 Form 10-Q

ITEM 2 | Consolidated Results of Operations

The following table presents a reconciliation of revenues to adjusted revenues

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(in millions) 2024 2023 2024 2023

5 unchanged sentences

Net realized (gains) losses on Fortitude Re funds withheld embedded derivative 157 (57) 158 25

Net realized losses (a)

Net realized (gains) losses (a)

(8) 191 232 577

4 unchanged sentences

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

AIG | Third Quarter 2024 Form 10-Q

ITEM 2 | Consolidated Results of Operations

The following table presents a reconciliation of pre-tax income (loss)/net income (loss) attributable to AIG to adjusted pre-tax income (loss)/adjusted after-tax income (loss) attributable to AIG:

Three Months Ended June 30, 2024 2023

Three Months Ended September 30, 2024 2023

(in millions, except per common share data) Pre-tax Total Tax

Interests (d)

Interests (c)

Tax Pre-tax Total Tax

Interests (d)

Pre-tax income/net income (loss), including noncontrolling interests $ 617 $ 142 $ — $ (3,884) $ 886 $ 45 $ — $ 1,691

Interests (c)

Pre-tax income/net income, including noncontrolling interests $ 649 $ 168 $ — $ 457 $ 1,100 $ 399 $ — $ 2,747

Noncontrolling interests 2 2 (720) (720)

Pre-tax income/net income (loss) attributable to AIG - including discontinued operations $ 617 $ 142 $ (93) $ (3,977) $ 886 $ 45 $ (198) $ 1,493

Pre-tax income/net income attributable to AIG - including discontinued operations $ 649 $ 168 $ 2 $ 459 $ 1,100 $ 399 $ (720) $ 2,027

Dividends on preferred stock and preferred stock redemption premiums — 7

Net income (loss) attributable to AIG common shareholders $ (3,977) $ 1,485

Net income attributable to AIG common shareholders $ 459 $ 2,020

Changes in uncertain tax positions and other tax adjustments

6 unchanged sentences

Net realized losses on Fortitude Re funds withheld assets 18 4 — 14 3 — — 3

Net realized gains on Fortitude Re funds withheld embedded derivative (8) (2) — (6) (58) (12) — (46)

Net realized losses (a)

Net realized (gains) losses on Fortitude Re funds withheld embedded derivative 157 33 — 124 (57) (12) — (45)

Net realized (gains) losses (a)

(7) (27) — 20 190 42 — 148

(Income) loss from discontinued operations 24 (2,046)

Net loss (gain) on divestitures and other (102) (16) — (86) 15 3 — 12

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

Favorable prior year development and related amortization changes ceded under retroactive reinsurance agreements (62) (13) — (49) (18) (4) — (14)

Net gain on divestitures and other 8 28 — (20) (101) (21) — (80)

Unfavorable (favorable) prior year development and related amortization changes ceded under retroactive reinsurance agreements 126 27 — 99 (75) (16) — (59)

Net loss reserve discount charge 29 6 — 23 5 1 — 4

1 unchanged sentence

Integration and transaction costs associated with acquiring or divesting businesses 22 5 — 17 2 — — 2

Restructuring and other costs (b)

426 90 — 336 125 26 — 99

Restructuring and other costs 137 28 — 109 49 10 — 39

Non-recurring costs related to regulatory or accounting changes 4 1 — 3 4 1 — 3

Noncontrolling interests (d)

Noncontrolling interests (c)

(2) (2) 720 720

1 unchanged sentence

Weighted average diluted shares outstanding 647.4 718.7

Income (loss) per common share attributable to AIG common shareholders (diluted) $ (5.96) $ 2.03

Income per common share attributable to AIG common shareholders (diluted) $ 0.71 $ 2.81

Adjusted after-tax income per common share attributable to AIG common shareholders (diluted)

$ 1.23 $ 1.04

AIG | Second Quarter 2024 Form 10-Q

ITEM 2 | Consolidated Results of Operations

Six Months Ended June 30, 2024 2023

Nine Months Ended September 30, 2024 2023

(in millions, except per common share data) Pre-tax Total Tax

Interests (d)

Interests (c)

Tax Pre-tax Total Tax

Interests (d)

Interests (c)

Pre-tax income/net income (loss), including noncontrolling interests $ 2,324 $ 571 $ — $ (1,827) $ 2,388 $ 509 $ — $ 4,351

15 unchanged sentences

(Income) loss from discontinued operations 3,580 (2,472)

Net loss (gain) on divestitures and other (102) (16) — (86) 12 2 — 10

Non-operating litigation reserves and settlements — — — — — — — —

Favorable prior year development and related amortization changes ceded under retroactive reinsurance agreements (60) (13) — (47) (37) (8) — (29)

Net gain on divestitures and other (94) 12 — (106) (89) (19) — (70)

Unfavorable (favorable) prior year development and related amortization changes ceded under retroactive reinsurance agreements 66 14 — 52 (112) (24) — (88)

Net loss reserve discount charge 131 27 — 104 85 18 — 67

1 unchanged sentence

Integration and transaction costs associated with acquiring or divesting businesses 37 8 — 29 10 2 — 8

Restructuring and other costs 493 104 — 389 215 45 — 170

Restructuring and other costs (d)

630 132 — 498 264 55 — 209

Non-recurring costs related to regulatory or accounting changes 15 3 — 12 19 4 — 15

Net impact from elimination of international reporting lag (c)

Net impact from elimination of international reporting lag (b)

— — — — (12) (3) — (9)

Noncontrolling interests (d)

Noncontrolling interests (c)

475 475 801 801

Adjusted pre-tax income (loss)/Adjusted after-tax income (loss) attributable to AIG common shareholders $ 3,245 $ 797 $ — $ 2,441 $ 3,099 $ 791 $ — $ 2,286

AIG | Third Quarter 2024 Form 10-Q

ITEM 2 | Consolidated Results of Operations

Nine Months Ended September 30, 2024 2023

(in millions, except per common share data) Pre-tax Total Tax

Interests (c)

Tax Pre-tax Total Tax

Interests (c)

Weighted average diluted shares outstanding

4 unchanged sentences

(a) 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.

(b) 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) Noncontrolling interest primarily relates to Corebridge and is the portion of Corebridge earnings that AIG did not own.

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

(c) Noncontrolling interest primarily relates to Corebridge and is the portion of Corebridge earnings that AIG did not own.

Corebridge is consolidated until June 9, 2024.

The historical results of Corebridge owned by AIG are reflected in the Income (loss) from discontinued operations, net of income taxes.

(d) In the three and nine months ended September 30, 2024, Restructuring and other costs increased primarily as a result of employee-related costs, including severance, and real estate impairment charges.

PRE-TAX INCOME (LOSS) COMPARISON

Pre-tax income (loss) was $617 million and $886 million in the three months ended June 30, 2024 and 2023, respectively.

Pre-tax income (loss) was $1.7 billion and $1.3 billion in the six months ended June 30, 2024 and 2023, respectively.

Pre-tax income was $649 million and $1.1 billion in the three months ended September 30, 2024 and 2023, respectively.

Pre-tax income was $2.3 billion and $2.4 billion in the nine months ended September 30, 2024 and 2023, respectively.

For the main drivers impacting AIG’s results of operations, see – Net Income (Loss) Attributable to AIG Common Shareholders above.

ADJUSTED PRE-TAX INCOME (LOSS) COMPARISON

Adjusted pre-tax income (loss) was $1.0 billion and $1.0 billion in the three months ended June 30, 2024 and 2023, respectively.

Adjusted pre-tax income (loss) was $2.2 billion and $2.0 billion in the six months ended June 30, 2024 and 2023, respectively.

Adjusted pre-tax income was $1.1 billion and $1.1 billion in the three months ended September 30, 2024 and 2023, respectively.

Adjusted pre-tax income was $3.2 billion and $3.1 billion in the nine months ended September 30, 2024 and 2023, respectively.

For the main drivers impacting AIG’s adjusted pre-tax income (loss), see Business Segment Operations.

AIG | Second Quarter 2024 Form 10-Q

ITEM 2 | Business Segment Operations

Business Segment Operations

6 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(in millions) 2024 2023 2024 2023

9 unchanged sentences

Adjusted pre-tax income $ 1,067 $ 1,089 $ 3,245 $ 3,099

AIG | Second Quarter 2024 Form 10-Q

AIG | Third Quarter 2024 Form 10-Q

ITEM 2 | Business Segment Operations | General Insurance

31 unchanged sentences

that covers auto, homeowners, umbrella, yacht, fine art and collections.

AIG | Second Quarter 2024 Form 10-Q

AIG | Third Quarter 2024 Form 10-Q

ITEM 2 | Business Segment Operations | General Insurance

24 unchanged sentences

INDUSTRY AND ECONOMIC FACTORS

The results of General Insurance for the six months ended June 30, 2024 reflect continued strong performance from our Commercial Lines portfolio and focused execution on our portfolio management strategies within Personal Insurance.

The results of General Insurance for the nine months ended September 30, 2024 reflect continued strong performance from our Commercial Lines portfolio and focused execution on our portfolio management strategies within Personal Insurance.

Across our North America and International Commercial Lines of business we have seen increased demand for our insurance products and strong growth in new business.

1 unchanged sentence

Similarly, we are monitoring monetary policy actions taken or anticipated to be taken by central banks and the corresponding impact on market interest rates.

AIG | Second Quarter 2024 Form 10-Q

ITEM 2 | Business Segment Operations | General Insurance

General Insurance – North America

4 unchanged sentences

We continue to proactively identify segment growth areas as market conditions warrant through effective portfolio management, while non-renewing unprofitable business.

AIG | Third Quarter 2024 Form 10-Q

ITEM 2 | Business Segment Operations | General Insurance

Personal Insurance growth prospects are supported by the need for full life cycle products and coverage, increases in personal wealth accumulation, and awareness of insurance protection and risk management.

7 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(in millions) 2024 2023 Change 2024 2023 Change

1 unchanged sentence

Net premiums written $ 6,380 $ 6,462 (1) % $ 17,825 $ 20,964 (15) %

(Increase) decrease in unearned premiums (1,184) (1,040) (14) 90 (1,746) NM

Increase in unearned premiums (433) (40) NM (343) (1,786) 81

Net premiums earned 5,947 6,422 (7) 17,482 19,178 (9)

23 unchanged sentences

(a) Consistent with our definition of APTI, excludes net loss reserve discount and the portion of favorable or unfavorable prior year reserve development for which we have ceded the risk under retroactive reinsurance agreements and related changes in amortization of the deferred gain.

AIG | Second Quarter 2024 Form 10-Q

ITEM 2 | Business Segment Operations | General Insurance

The following table presents General Insurance net premiums written by operating segment, showing change on both reported and constant dollar basis:

Three Months Ended

June 30, Percentage Change in Six Months Ended

June 30, Percentage Change in

September 30, Percentage Change in Nine Months Ended

September 30, Percentage Change in

(in millions) 2024 2023 U.S.

5 unchanged sentences

Total net premiums written $ 6,380 $ 6,462 (1) % — % $ 17,825 $ 20,964 (15) % (14) %

AIG | Third Quarter 2024 Form 10-Q

ITEM 2 | Business Segment Operations | General Insurance

The following tables present General Insurance accident year catastrophes (a) by geography and number of events:

1 unchanged sentence

America International

Three Months Ended June 30, 2024

Three Months Ended September 30, 2024

Flooding, rainstorms and other 3 $ — $ 15 $ 15

1 unchanged sentence

Winter storms 2 2 2 4

Wildfires 1 36 — 36

Earthquakes 1 — — —

1 unchanged sentence

Total catastrophe-related charges 23 $ 324 $ 93 $ 417

Three Months Ended June 30, 2023

Three Months Ended September 30, 2023

Flooding, rainstorms and other 2 $ — $ 7 $ 7

5 unchanged sentences

Total catastrophe-related charges 30 $ 367 $ 95 $ 462

Six Months Ended June 30, 2024

Nine Months Ended September 30, 2024

Flooding, rainstorms and other 3 $ 2 $ 130 $ 132

1 unchanged sentence

Winter storms 2 52 2 54

Wildfires 1 36 — 36

Earthquakes 1 — 10 10

1 unchanged sentence

Total catastrophe-related charges 23 $ 578 $ 275 $ 853

Six Months Ended June 30, 2023

Nine Months Ended September 30, 2023

Flooding, rainstorms and other 2 $ 10 $ 85 $ 95

6 unchanged sentences

(a) Natural catastrophe losses are generally weather or seismic events, in each case, having a net impact on AIG in excess of $10 million and man-made catastrophe losses, such as terrorism and civil unrest that exceed the $10 million threshold.

AIG | Second Quarter 2024 Form 10-Q

ITEM 2 | Business Segment Operations | General Insurance

NORTH AMERICA RESULTS

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(in millions) 2024 2023 Change 2024 2023 Change

1 unchanged sentence

Net premiums written $ 3,077 $ 3,151 (2) % $ 7,771 $ 10,804 (28) %

(Increase) decrease in unearned premiums (890) (778) (14) 278 (1,478) NM

Increase in unearned premiums (439) (72) NM (161) (1,550) 90

Net premiums earned 2,638 3,079 (14) 7,610 9,254 (18)

14 unchanged sentences

98.6 92.3 6.3 94.5 90.4 4.1

AIG | Third Quarter 2024 Form 10-Q

ITEM 2 | Business Segment Operations | General Insurance

Three Months Ended

September 30, Nine Months Ended

September 30,

(in millions) 2024 2023 Change 2024 2023 Change

Adjustments for accident year loss ratio, as adjusted and accident year combined ratio, as adjusted:

7 unchanged sentences

Business and Financial Highlights

Net Premiums Written Comparison for the Three Months Ended June 30, 2024 and 2023

Net premiums written decreased by $613 million due to a decline in Commercial Lines ($660 million), primarily driven by the sale of AIG Re, partially offset by growth in Casualty and Property lines driven by pricing levels, strength of renewal retentions and new business production.

This decline was partially offset by higher production in Personal Insurance ($47 million), particularly in PCS driven by positive rate change.

Net Premiums Written Comparison for the Six Months Ended June 30, 2024 and 2023

Net Premiums Written Comparison for the Three Months Ended September 30, 2024 and 2023

Net premiums written decreased by $74 million due to a decline in Commercial Lines ($99 million), primarily driven by the sale of AIG Re, partially offset by growth in Casualty driven by pricing levels and new business production.

This decline in Commercial Lines was partially offset by higher production in Personal Insurance ($25 million), particularly in PCS driven by positive rate change and new business production.

Net Premiums Written Comparison for the Nine Months Ended September 30, 2024 and 2023

Net premiums written decreased by $3.0 billion due to a decline in Commercial Lines ($3.1 billion), driven by the sales of AIG Re and CRS.

Underwriting Income (Loss) Comparison for the Three Months Ended June 30, 2024 and 2023

Underwriting Income (Loss) Comparison for the Three Months Ended September 30, 2024 and 2023

Underwriting income decreased by $198 million primarily due to:

• lower net favorable prior year development (2.3 points or $73 million), primarily as a result of lower favorable development in Casualty and Programs;

• higher catastrophe losses (1.5 points or $3 million);

• the impact of the sale of AIG Re on accident year results;

• a higher expense ratio (0.2 points) reflecting an increase in general operating expense ratio (0.3 points), partially offset by a lower acquisition ratio (0.1 points), primarily driven by changes in business mix including the impact from the sales of AIG Re and CRS.

AIG | Second Quarter 2024 Form 10-Q

ITEM 2 | Business Segment Operations | General Insurance

Underwriting Income (Loss) Comparison for the Six Months Ended June 30, 2024 and 2023

• lower net favorable prior year development (3.2 points or $128 million), with higher favorable development from Property and Financial Lines, while Casualty turned unfavorable driven by a large settlement of a legacy mass tort claim with most of the gross loss in accident years covered under the Adverse Development Cover;

• the sale of AIG Re.

This decrease was partially offset by portfolio growth.

Underwriting Income (Loss) Comparison for the Nine Months Ended September 30, 2024 and 2023

Underwriting income decreased by $462 million primarily due to:

• lower net favorable prior year development (2.0 points or $131 million), primarily as a result of lower favorable development in Casualty and Programs;

• the impact of sale of AIG Re on accident year results.

This decrease was partially offset by:

• a lower expense ratio (0.4 points) reflecting a lower acquisition ratio (0.6 points), partially offset by an increase in general operating expense ratio (0.2 points), primarily driven by changes in business mix including the impact from the sales of AIG Re and CRS.

• lower net favorable prior year development (2.4 points or $259 million), primarily from Casualty development which turned unfavorable driven by a large settlement of a legacy mass tort claim with most of the gross loss in accident years covered under the Adverse Development Cover;

• the sales of AIG Re and Crop Risk Services.

This decrease was partially offset b y improved portfolio performance and growth.

INTERNATIONAL RESULTS

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(in millions) 2024 2023 Change 2024 2023 Change

1 unchanged sentence

Net premiums written $ 3,303 $ 3,311 — % $ 10,054 $ 10,160 (1) %

Increase in unearned premiums (294) (262) (12) (188) (268) 30

(Increase) decrease in unearned premiums 6 32 (81) (182) (236) 23

Net premiums earned 3,309 3,343 (1) 9,872 9,924 (1)

6 unchanged sentences

Underwriting income $ 400 $ 376 6 % $ 1,039 $ 821 27 %

AIG | Third Quarter 2024 Form 10-Q

ITEM 2 | Business Segment Operations | General Insurance

Three Months Ended

September 30, Nine Months Ended

September 30,

(in millions) 2024 2023 Change 2024 2023 Change

Loss ratio 53.3 55.4 (2.1) 55.1 57.4 (2.3)

8 unchanged sentences

Accident year combined ratio, as adjusted 88.0 86.0 2.0 87.7 87.6 0.1

AIG | Second Quarter 2024 Form 10-Q

ITEM 2 | Business Segment Operations | General Insurance

Business and Financial Highlights

Net Premiums Written Comparison for the Three Months Ended June 30, 2024 and 2023

Net Premiums Written Comparison for the Three Months Ended September 30, 2024 and 2023

Net premiums written, excluding the impact of unfavorable foreign exchange ($76 million), increased by $68 million due to:

• growth in Commercial Lines ($90 million), notably in Property, Specialty and Casualty driven by strength of renewal retentions and new business production, partially offset by the sale of AIG Re;

• growth in Personal Insurance ($44 million) driven by Personal Auto and Travel.

Net Premiums Written Comparison for the Six Months Ended June 30, 2024 and 2023

• growth in Commercial Lines ($34 million), notably in Specialty and Property driven by strength of renewal retentions and new business production, partially offset by the sale of AIG Re and lower production in Financial Lines;

• growth in Personal Insurance ($34 million) driven by Personal Auto.

Net Premiums Written Comparison for the Nine Months Ended September 30, 2024 and 2023

Net premiums written, excluding the unfavorable impact of foreign exchange ($250 million), increased by $144 million primarily due to:

• growth in Personal Insurance ($51 million) driven by Personal Auto and Travel, partially offset by lower production in Warranty and Accident & Health;

• growth in Commercial Lines ($26 million), notably in Property and Casualty driven by strength of renewal retentions and new business production, partially offset by the sale of AIG Re and lower production in Financial Lines.

Underwriting Income (Loss) Comparison for the Three Months Ended June 30, 2024 and 2023

• growth in Personal Insurance ($85 million) driven by Personal Auto and Travel, partially offset by lower production in Warranty;

• growth in Commercial Lines ($59 million), notably in Property, Specialty and Casualty driven by strength of renewal retentions and new business production, partially offset by the sale of AIG Re and lower production in Financial Lines.

Underwriting Income (Loss) Comparison for the Three Months Ended September 30, 2024 and 2023

Underwriting income increased by $24 million primarily due to:

• net favorable prior year reserve development of $5 million in 2024 compared to net adverse prior year reserve development in 2023 of $63 million (2.2 points or $68 million), primarily as a result of higher favorable development in Casualty and Property;

• a lower expense ratio (1.1 points) reflecting a lower acquisition ratio (0.9 points) primarily driven by changes in business mix as well as a lower general operating expense ratio (0.2 points).

This increase was partially offset by higher catastrophe losses (2.5 points or $77 million).

Underwriting Income (Loss) Comparison for the Six Months Ended June 30, 2024 and 2023

• net favorable prior year reserve development of $102 million in 2024 compared to net favorable prior year reserve development in 2023 of $19 million (2.8 points or $83 million), with higher favorable development in Specialty, and Property development which turned favorable, partially offset by Financial Lines development which turned unfavorable, and higher unfavorable development within Casualty driven by claim-specific emergence in European Excess Casualty on accident year 2016.

This incre ase was partially offset by a higher expense ratio (1.3 points) reflecting a higher acquisition ratio (0.9 points) and general operating expense ratio (0.4 points) primarily driven by changes in business mix.

Underwriting Income (Loss) Comparison for the Nine Months Ended September 30, 2024 and 2023

Underwriting income increased by $218 million primarily due to:

• net favorable prior year reserve development of $10 million in 2024 compared to net adverse prior year reserve development in 2023 of $84 million (1.3 points or $94 million), primarily as a result of favorable development in Casualty and Property;

• net favorable prior year reserve development of $112 million in 2024 compared to net unfavorable prior year reserve development in 2023 of $65 million (1.9 points or $177 million), primarily as a result of higher favorable development in Specialty, and Property which turned favorable, partially offset by Financial Lines development which turned unfavorable, and higher unfavorable development within Casualty driven by claim-specific emergence in European Excess Casualty on accident year 2016;

• lower catastrophe losses (0.5 points or $59 million).

• a lower expense ratio (0.6 points) reflecting a lower acquisition ratio (0.6 points) primarily driven by changes in business mix and improved commission terms;

• improvement in the accident year loss ratio, as adjusted (0.2 points) primarily driven by changes in business mix along with continued positive rate change, focused risk selection and improved terms and conditions.

AIG | Second Quarter 2024 Form 10-Q

AIG | Third Quarter 2024 Form 10-Q

ITEM 2 | Business Segment Operations | Other Operations

3 unchanged sentences

Three Months Ended

June 30, Six Months Ended

September 30, Nine Months Ended

September 30,

(in millions) 2024 2023 Change 2024 2023 Change

3 unchanged sentences

Interest and dividends 77 67 15 256 183 40

Other investment loss (2) (8) 75 (16) (23) 30

Other investment income (loss) 54 (9) NM 106 (32) NM

Investment expenses (6) (13) 54 (17) (21) 19

Total net investment income 125 45 178 345 130 165

Other income 4 3 33 4 3 33

Other income (1) 3 NM 3 6 (50)

Total adjusted revenues 123 171 (28) 431 490 (12)

Benefits, losses and expenses:

Losses and loss adjustment expenses incurred (4) 113 NM 71 215 (67)

Acquisition expenses 4 14 (71) 12 26 (54)

Losses and loss adjustment expenses incurred 7 114 (94) 78 329 (76)

Acquisition expenses (4) 16 NM 8 42 (81)

General operating expenses:

5 unchanged sentences

Adjusted pre-tax loss before consolidation and eliminations (141) (271) 48 (496) (815) 39

Consolidation and eliminations — (8) NM (1) (13) 92

Consolidation and eliminations (2) (7) 71 (3) (20) 85

Adjusted pre-tax loss $ (143) $ (278) 49 % $ (499) $ (835) 40 %

THREE MONTHS ENDED JUNE 30, 2024 AND 2023 COMPARISON

Adjusted pre-tax loss before consolidation and eliminations of $158 million in 2024 compared to $270 million in 2023, an decrease of $112 million, was primarily due to:

• higher net investment income due to dividend income from Corebridge and on AIG Parent portfolio due to higher yields and higher average balance;

THREE MONTHS ENDED SEPTEMBER 30, 2024 AND 2023 COMPARISON

Adjusted pre-tax loss before consolidation and eliminations was $141 million in 2024 compared to $271 million in 2023, a decrease of $130 million, primarily due to:

• higher net investment income of $80 million due to dividend income from Corebridge in 2024 compared to $0 in 2023 and on AIG Parent portfolio due to higher yields and higher average balance;

• lower interest expense of $22 million primarily driven by interest savings from $2.2 billion debt reduction, through cash tender offers and debt redemption and maturity in 2023 and 2024.

NINE MONTHS ENDED SEPTEMBER 30, 2024 AND 2023 COMPARISON

Adjusted pre-tax loss before consolidation and eliminations was $496 million in 2024 compared to $815 million in 2023, a decrease of $319 million, primarily due to:

• higher net investment income of $215 million due to dividend income from Corebridge in 2024 compared to $0 in 2023 and on AIG Parent portfolio due to higher yields and higher average balance;

• lower interest expense of $59 million primarily driven by interest savings from $2.6 billion debt repurchases, through cash tender offers and debt redemption and maturity in 2023 and 2024.

SIX MONTHS ENDED JUNE 30, 2024 AND 2023 COMPARISON

Adjusted pre-tax loss before consolidation and eliminations of $355 million in 2024 compared to $544 million in 2023, an decrease of $189 million, was primarily due to:

• higher net investment income due to dividend income from Corebridge and on AIG Parent portfolio due to higher yields and higher average balance;

• lower interest expense primarily driven by interest savings of $37 million from $2.6 billion debt repurchases, through cash tender offers and debt redemption and maturity in 2023 and 2024.

AIG | Second Quarter 2024 Form 10-Q

AIG | Third Quarter 2024 Form 10-Q

ITEM 2 | Investments

2 unchanged sentences

The majority of assets backing our insurance liabilities consist of fixed maturity securities.

Inflation remains elevated relative to the Federal Reserve target however it has decreased over the past several quarters.

Interest rates also remain elevated although credit spreads have narrowed for most asset classes as recession concerns began to recede and the likelihood of a soft landing increased.

Our Investment Management Agreements with BlackRock, Inc.

1 unchanged sentence

and its investment advisory affiliates (BlackRock).

Substantially all investment management agreements contemplated for AIG insurance company subsidiaries have been executed.

A small number of insurance companies remain under discussion and expect to be resolved in 2024.

As of June 30, 2024, BlackRock manages $57 billion of our investment portfolio, consisting of liquid fixed income and certain private placement assets.

As of September 30, 2024, BlackRock manages $64 billion of our investment portfolio, consisting of liquid fixed income, certain private placements and private equity assets.

In addition, liquid fixed income assets associated with the Fortitude Re funds withheld asset portfolio were separately transferred to BlackRock for management in 2022.

INVESTMENT HIGHLIGHTS IN THE SIX MONTHS ENDED JUNE 30, 2024

INVESTMENT HIGHLIGHTS IN THE NINE MONTHS ENDED SEPTEMBER 30, 2024

• Blended investment yields on new investments are higher than blended rates on investments that were sold, matured or called during this period.

We continued to make investments in structured securities and other fixed maturity securities with attractive risk-adjusted return characteristics to improve yields and increase net investment income.

• Total Net investment income increased for the six months ended June 30, 2024 compared to the same period in the prior year, primarily due to our equity investment in Corebridge, higher income of available for sale fixed maturity securities, partially offset by lower returns on our alternative investments.

• Total Net investment income increased for the nine months ended September 30, 2024 compared to the same period in the prior year, primarily due to dividend income from AIG's equity in Corebridge, higher income on available for sale fixed maturity securities and short term instruments, partially offset by lower income from alternative investments and mortgage loans.

INVESTMENT STRATEGIES

9 unchanged sentences

This strategy allows us to both diversify our sources of liquidity and reduce the cost of maintaining sufficient liquidity.

AIG | Second Quarter 2024 Form 10-Q

ITEM 2 | Investments

• Within the U.S., General Insurance investments are generally split between reserve backing and surplus portfolios.

3 unchanged sentences

Over the past few years, hedge fund investments have been reduced.

AIG | Third Quarter 2024 Form 10-Q

ITEM 2 | Investments

• Outside of the U.S., fixed maturity securities held by our insurance companies consist primarily of investment-grade securities generally denominated in the currencies of the countries in which we operate.

22 unchanged sentences

The following table presents the fixed maturity security portfolio categorized by NAIC Designation, at fair value:

June 30, 2024

September 30, 2024

(in millions)

5 unchanged sentences

* Excludes $38 million of fixed maturity securities for which no NAIC Designation is available.

AIG | Second Quarter 2024 Form 10-Q

ITEM 2 | Investments

The following table presents the fixed maturity security portfolio categorized by composite AIG credit rating, at fair value:

June 30, 2024

September 30, 2024

(in millions)

5 unchanged sentences

* Excludes $38 million of fixed maturity securities for which no NAIC Designation is available.

AIG | Third Quarter 2024 Form 10-Q

ITEM 2 | Investments

CREDIT RATINGS

At June 30, 2024, approximately 61 percent of our fixed maturity securities were held by our U.S.

At September 30, 2024, approximately 64 percent of our fixed maturity securities were held by our U.S.

Approximately 93 percent of these securities were rated investment grade by one or more of the principal rating agencies.

4 unchanged sentences

We closely monitor the credit quality of the foreign portfolio’s non-rated fixed maturity securities.

At June 30, 2024, approximately 93 percent of such investments were either rated investment grade or, on the basis of analysis of our investment managers, were equivalent from a credit standpoint to securities rated investment grade.

At September 30, 2024, approximately 83 percent of such investments were either rated investment grade or, on the basis of analysis of our investment managers, were equivalent from a credit standpoint to securities rated investment grade.

Approximately 30 percent of the foreign entities’ fixed maturity securities portfolio is comprised of sovereign fixed maturity securities supporting policy liabilities in the country of issuance.

7 unchanged sentences

Available for Sale Other Total

(in millions) June 30,

(in millions) September 30,

2024 December 31,

2023 June 30,

2023 September 30,

2024 December 31,

2023 June 30,

2023 September 30,

2024 December 31,

17 unchanged sentences

AA 17,577 18,840 214 253 17,791 19,093

AIG | Second Quarter 2024 Form 10-Q

ITEM 2 | Investments

Available for Sale Other Total

(in millions) June 30,

2024 December 31,

2023 June 30,

2024 December 31,

2023 June 30,

2024 December 31,

A 16,080 15,372 155 102 16,235 15,474

3 unchanged sentences

Total $ 65,980 $ 65,242 $ 763 $ 663 $ 66,743 $ 65,905

AIG | Third Quarter 2024 Form 10-Q

ITEM 2 | Investments

Available-for-Sale Investments

The following table presents the fair value of our available-for-sale securities:

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

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

Bonds available for sale:

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Total bonds available for sale* $ 65,980 $ 65,242

* 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 and $5.2 billion, respectively.

* At September 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 $3.1 billion and $5.2 billion, respectively.

The following table presents the fair value of our aggregate credit exposures to non-U.S.

governments for our fixed maturity securities:

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

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

Canada $ 1,466 $ 1,340

4 unchanged sentences

Australia 384 314

Korea, Republic of 301 293

Israel 340 201

Denmark 209 227

Korea, Republic of 311 293

Malaysia 248 183

Denmark 230 227

Other 3,292 3,326

Total $ 8,760 $ 8,420

AIG | Second Quarter 2024 Form 10-Q

ITEM 2 | Investments

The following table presents the fair value of our aggregate European credit exposures by major sector for our fixed maturity securities:

June 30, 2024 December 31,

September 30, 2024 December 31,

(in millions) Sovereign Financial

3 unchanged sentences

Euro-Zone countries:

Germany $ 923 $ 230 $ 806 $ 82 $ 2,041 $ 2,042

France $ 401 $ 1,241 $ 518 $ 13 $ 2,173 $ 2,068

Germany 964 249 855 63 2,131 2,042

Netherlands 161 497 278 35 971 940

Ireland 10 64 133 454 661 231

Italy 23 112 276 — 411 420

Denmark 209 54 7 — 270 297

Spain 10 126 108 62 306 353

Denmark 230 49 8 — 287 297

Belgium 35 110 94 14 253 276

Luxembourg 19 64 70 — 153 227

Ireland 9 30 119 54 212 231

Finland 20 75 7 1 103 95

6 unchanged sentences

Norway 85 39 16 — 140 150

Croatia 15 — — — 15 16

AIG | Third Quarter 2024 Form 10-Q

ITEM 2 | Investments

September 30, 2024 December 31,

(in millions) Sovereign Financial

Institution Non-Financial

Corporates Structured

Products Total

Jersey (Channel Islands) 3 12 10 52 77 5

Other - Remainder of Europe 20 3 9 2 34 31

2 unchanged sentences

Investments in Municipal Bonds

At June 30, 2024, the U.S.

At September 30, 2024, the U.S.

municipal bond portfolio was composed primarily of essential service revenue bonds and high-quality tax-exempt bonds with 99 percent of the portfolio rated A or higher.

1 unchanged sentence

municipal bond portfolio by state and municipal bond type:

June 30, 2024

September 30, 2024

(in millions) State

7 unchanged sentences

Illinois 27 43 191 261 301

Florida 3 1 221 225 227

Massachusetts 53 20 163 236 209

Florida 4 — 227 231 227

Pennsylvania 58 1 141 200 203

Connecticut 58 3 88 149 109

New Jersey 3 2 135 140 200

Georgia 67 26 38 131 159

Connecticut 57 3 50 110 109

Washington 9 11 87 107 140

Ohio 12 — 75 87 89

Hawaii 79 — 7 86 89

Oregon 20 40 25 85 83

All other states

1 unchanged sentence

$ 758 $ 721 $ 3,172 $ 4,651 $ 4,833

AIG | Second Quarter 2024 Form 10-Q

ITEM 2 | Investments

Investments in Corporate Debt Securities

1 unchanged sentence

Industry Category

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

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

Financial institutions:

15 unchanged sentences

Total* $ 33,034 $ 32,346

* At June 30, 2024 and December 31, 2023, approximately 90 percent and 90 percent, respectively, of these investments were rated investment grade.

* At September 30, 2024 and December 31, 2023, approximately 91 percent and 90 percent, respectively, of these investments were rated investment grade.

AIG | Third Quarter 2024 Form 10-Q

ITEM 2 | Investments

Investments in RMBS

The following table presents the fair value of AIG’s RMBS available for sale securities:

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

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

Agency RMBS $ 3,026 $ 2,827

5 unchanged sentences

$ 6,419 $ 6,207

(a) Includes approximately $1.3 billion and $1.3 billion at June 30, 2024 and December 31, 2023, respectively, of certain RMBS that had experienced deterioration in credit quality since their origination.

(a) Includes approximately $1.3 billion and $1.3 billion at September 30, 2024 and December 31, 2023, respectively, of certain RMBS that had experienced deterioration in credit quality since their origination.

This excludes impact of U.S.

1 unchanged sentence

For additional information on purchased credit deteriorated securities, see Note 6 to the Condensed Consolidated Financial Statements.

(b) The weighted average expected life was six years and seven years at June 30, 2024 and December 31, 2023, respectively.

(b) The weighted average expected life was six years and seven years at September 30, 2024 and December 31, 2023, respectively.

Our investments guidelines for investing in RMBS, CLO and other asset-backed securities (ABS) take into consideration the quality of the originator, the manager, the servicer, security credit ratings, underlying characteristics of the mortgages, borrower characteristics, and the level of credit enhancement in the transaction.

1 unchanged sentence

The following table presents the fair value of our CMBS available for sale securities:

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

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

CMBS (traditional) $ 3,075 $ 3,604

1 unchanged sentence

Total $ 4,106 $ 4,147

The fair value of CMBS holdings remained stable during the six months ended June 30, 2024.

The fair value of CMBS holdings remained stable during the nine months ended September 30, 2024.

The majority of our investments in CMBS are in tranches that contain substantial credit protection features through collateral subordination.

The majority of CMBS holdings are traditional conduit transactions, broadly diversified across property types and geographical areas.

AIG | Second Quarter 2024 Form 10-Q

ITEM 2 | Investments

Investments in CLO/ABS

The following table presents the fair value of our CLO/ABS available for sale securities by collateral type:

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

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

Collateral Type:

2 unchanged sentences

Total $ 4,523 $ 4,918

AIG | Third Quarter 2024 Form 10-Q

ITEM 2 | Investments

Unrealized Losses of Fixed Maturity Securities

The following table shows the aging of the unrealized losses of fixed maturity securities, the extent to which the fair value is less than amortized cost or cost, and the number of respective items in each category:

June 30, 2024 Less Than or Equal Greater Than 20% Greater Than 50%

September 30, 2024 Less Than or Equal Greater Than 20% Greater Than 50%

to 20% of Cost (b)

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(d) Item count is by CUSIP by subsidiary.

The allowance for credit losses was $1 million for investment grade bonds and $32 million for below investment grade bonds as of June 30, 2024.

The allowance for credit losses was $3 million for investment grade bonds and $37 million for below investment grade bonds as of September 30, 2024.

Commercial Mortgage Loans

At June 30, 2024, we had direct commercial mortgage loan exposure of $3.7 billion.

At September 30, 2024, we had direct commercial mortgage loan exposure of $3.7 billion.

The following table presents the commercial mortgage loan exposure by location and class of loan based on amortized cost:

1 unchanged sentence

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

June 30, 2024

September 30, 2024

California 21 $ 94 $ 245 $ 30 $ 56 $ 33 $ — $ 458 12 %

New York 19 38 211 76 20 32 — 377 10

Texas 20 78 243 2 31 22 — 376 10

New York 19 40 212 70 20 32 — 374 10

Massachusetts 9 94 149 49 7 — — 299 8

New Jersey 21 125 7 — 50 — 10 192 5

AIG | Second Quarter 2024 Form 10-Q

ITEM 2 | Investments

of Loans Class Percent

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

Florida 11 67 — 63 — 38 — 168 5

2 unchanged sentences

Ohio 5 62 — 30 — — — 92 2

Colorado 5 7 32 16 — 6 — 61 2

Washington 5 49 — — — 11 — 60 2

Other states 34 153 47 74 47 12 — 333 9

1 unchanged sentence

Total* 204 $ 1,198 $ 1,194 $ 461 $ 444 $ 272 $ 127 $ 3,696 100 %

AIG | Third Quarter 2024 Form 10-Q

ITEM 2 | Investments

December 31, 2023

16 unchanged sentences

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

Three Months Ended June 30, 2024 2023

Three Months Ended September 30, 2024 2023

(in millions) Excluding

9 unchanged sentences

Other 22 3 25 11 (3) 8

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) – excluding Fortitude Re funds withheld embedded derivative 8 (18) (10) (189) (3) (192)

Net realized gains (losses) on Fortitude Re funds withheld embedded derivative — (157) (157) — 57 57

Net realized gains (losses) $ 8 $ (175) $ (167) $ (189) $ 54 $ (135)

AIG | Second Quarter 2024 Form 10-Q

ITEM 2 | Investments

Six Months Ended June 30, 2024 2023

Nine Months Ended September 30, 2024 2023

(in millions) Excluding

12 unchanged sentences

Net realized gains (losses) $ (238) $ (196) $ (434) $ (571) $ (89) $ (660)

Higher Net realized losses excluding Fortitude Re funds withheld assets in the three months ended June 30, 2024 were primarily due to higher losses on sales of fixed maturity securities and lower gains on foreign exchange transactions compared to the prior year period.

Lower Net realized losses excluding Fortitude Re funds withheld assets in the six months ended June 30, 2024 compared to 2023 were primarily due to lower losses on sales of fixed maturity securities derivatives gains in the current period compared to the prior year period.

Higher Net realized gains excluding Fortitude Re funds withheld assets in the three months ended September 30, 2024 were primarily due to lower losses on sales of fixed maturity securities, higher gains on foreign exchange transactions and all other derivatives and hedge accounting compared to the prior year period.

Lower Net realized losses excluding Fortitude Re funds withheld assets in the nine months ended September 30, 2024 compared to 2023 were primarily due to lower losses on sales of fixed maturity securities and higher derivatives gains compared to the prior year period.

AIG | Third Quarter 2024 Form 10-Q

ITEM 2 | Investments

Net realized gains (losses) on Fortitude Re funds withheld assets primarily reflect changes in the valuation of the modified coinsurance and funds withheld assets.

4 unchanged sentences

Change in Unrealized Gains and Losses on Investments

The change in net unrealized gains and losses on investments in the three and six months ended June 30, 2024 was primarily attributable to a change in the fair value of fixed maturity securities.

For the three months ended June 30, 2024, net unrealized gains related to fixed maturity securities were $15 million due primarily to narrowing of credit spreads.

For the six months ended June 30, 2024, net unrealized losses were $117 million due to higher interest rates, partially offset by tighter credit spreads.

The change in net unrealized gains and losses on investments in the three and six months ended June 30, 2023 was primarily attributable to a change in the fair value of fixed maturity securities.

For the three months ended June 30, 2023, net unrealized losses related to fixed maturity securities were $180 million due primarily to an increase in interest rates.

For the six months ended June 30, 2023, net unrealized gains were $829 million primarily due to widening of credit spreads.

The change in net unrealized gains and losses on investments in the three and nine months ended September 30, 2024 was primarily attributable to a change in the fair value of fixed maturity securities.

For the three months ended September 30, 2024, net unrealized gains related to fixed maturity securities were $1.6 billion due primarily to lower interest rates and narrowing of credit spreads.

For the nine months ended September 30, 2024, net unrealized gains were $1.5 billion due to lower interest rates and narrowing of credit spreads.

The change in net unrealized gains and losses on investments in the three and nine months ended September 30, 2023 was primarily attributable to a change in the fair value of fixed maturity securities.

For the three months ended September 30, 2023, net unrealized losses related to fixed maturity securities were $670 million due primarily to an increase in interest rates.

For the nine months ended September 30, 2023, net unrealized gains were $159 million primarily due to widening of credit spreads.

For additional information on our investment portfolio, see Note 6 to the Condensed Consolidated Financial Statements.

AIG | Second Quarter 2024 Form 10-Q

ITEM 2 | Insurance Reserves

Insurance Reserves

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The following table presents the components of our gross and net loss reserves by segment and major lines of business (a) :

June 30, 2024 December 31, 2023

September 30, 2024 December 31, 2023

(in millions) Net liability for

10 unchanged sentences

recoverable on

unpaid losses and

loss adjustment

expenses Gross liability

losses and loss

adjustment expenses

General Insurance:

Workers' Compensation (net of discount) $ 2,598 $ 4,087 $ 6,685 $ 2,655 $ 4,099 $ 6,754

Excess Casualty 3,241 3,258 6,499 3,321 3,272 6,593

Other Casualty 4,289 3,599 7,888 4,112 3,676 7,788

Financial Lines 5,519 1,729 7,248 5,672 1,622 7,294

Property and Special Risks 4,218 1,357 5,575 4,403 1,494 5,897

Personal Insurance 838 2,098 2,936 767 2,163 2,930

UK/Europe Casualty and Financial Lines 8,021 2,075 10,096 7,447 1,951 9,398

UK/Europe Property and Special Risks 3,095 1,819 4,914 2,913 1,665 4,578

UK/Europe and Japan Personal Insurance 1,432 692 2,124 1,483 671 2,154

Other product lines (b)

5,512 5,134 10,646 5,416 5,182 10,598

Unallocated loss adjustment expenses (b)

1,711 659 2,370 1,298 841 2,139

Total General Insurance 40,474 26,507 66,981 39,487 26,636 66,123

Other Operations Run-Off:

run-off long tail insurance lines (net of discount) 277 3,229 3,506 283 3,360 3,643

Other run-off product lines 225 64 289 228 60 288

Blackboard U.S.

Holdings, Inc.

50 115 165 91 119 210

Unallocated loss adjustment expenses 11 114 125 15 114 129

Total Other Operations Run-Off 563 3,522 4,085 617 3,653 4,270

Total $ 41,037 $ 30,029 $ 71,066 $ 40,104 $ 30,289 $ 70,393

(a) Includes net loss reserve discount of $1.2 billion and $1.2 billion at September 30, 2024 and December 31, 2023, respectively.

For information regarding loss reserve discount, see Note 12 to the Condensed Consolidated Financial Statements.

(b) Other product lines and Unallocated loss adjustment expenses includes Gross liability for unpaid losses and loss adjustment expense and Reinsurance recoverable on unpaid losses and loss adjustment expense for the Fortitude Re reinsurance of $2.7 billion and $2.9 billion at September 30, 2024 and December 31, 2023, respectively.

AIG | Third Quarter 2024 Form 10-Q

ITEM 2 | Insurance Reserves

Prior Year Development

The following table summarizes incurred (favorable) unfavorable prior year development net of reinsurance by segment:

Three Months Ended

September 30, Nine Months Ended

September 30,

(in millions) 2024 2023 2024 2023

General Insurance:

North America $ (63) $ (154) $ (165) $ (408)

International (90) 15 (101) 86

Total General Insurance* $ (153) $ (139) $ (266) $ (322)

Other Operations Run-Off 2 (3) 2 (3)

Total prior year favorable development $ (151) $ (142) $ (264) $ (325)

* Includes the amortization attributed to the deferred gain at inception from the National Indemnity Company (NICO) adverse development reinsurance agreement of $34 million and $41 million for the three months ended September 30, 2024 and 2023, respectively, and $102 million and $123 million for the nine months ended September 30, 2024 and 2023, respectively.

Consistent with our definition of APTI, the amount excludes the portion of (favorable)/unfavorable prior year reserve development for which we have ceded the risk under the NICO reinsurance agreements of $304 million and $(145) million for the three months ended September 30, 2024 and 2023, respectively, and $241 million and $(178) million for the nine months ended September 30, 2024 and 2023, respectively.

Also excludes the related changes in amortization of the deferred gain, which were $178 million and $(68) million for the three months ended September 30, 2024 and 2023, respectively, and $175 million and $(65) million for the nine months ended September 30, 2024 and 2023, respectively.

Net Loss Development

In the three months ended September 30, 2024, we recognized favorable prior year loss reserve development of $151 million.

The key components of this development were:

North America

• Favorable development on U.S.

Property and Special Risks reflecting favorable loss experience in Retail and Wholesale Property.

• Favorable development on Financial Lines in U.S.

and Canada, reflecting favorable experience across most reserving classes, offset by unfavorable development in M&A and High Excess classes.

• Amortization benefit related to the deferred gain on the adverse development cover.

• Adverse development on U.S.

Excess Casualty driven by a large settlement of a legacy mass tort claim with most of the gross loss in accident years covered under the Adverse Development Cover.

International

Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-Q

Item 5. Other Information