What You Need to Know
- Money continued to flow into AIG's indexed annuities.
- COVID-19 continued to reduce Genworth's long-term care insurance benefits spending.
- Aetna's parent vaccinated 3 million people against COVID-19.
Managers of American International Group Inc. said Tuesday that they’re still thinking about how to split the life and retirement operations from the company’s property and casualty insurance operations.
AIG announced Oct. 26, 2020, that it intends to start with a disposition of up to a 19.9% interest in the life and retirement business.
“Any separation transaction will be subject to the satisfaction of various conditions and approvals, including approval by the board of directors, receipt of insurance and other required regulatory approvals, and satisfaction of any applicable requirements of the Securities and Exchange Commission,” AIG said in its earnings announcement for the fourth quarter of 2020.
“No assurance can be given regarding the form that a separation transaction may take or the specific terms or timing thereof, or that a separation will in fact occur.”
AIG (NYSE: AIG) is reporting a $16 million net loss for the fourth quarter of 2020 on $9.7 billion in revenue, compared with $869 million in net income on $12 billion in revenue for the fourth quarter of 2019.
The New York-based company’s life and retirement unit is reporting $1 billion in adjusted pre-tax income on $4.3 billion in adjusted revenue, up from $858 million in adjusted pre-tax income on $4.1 billion in revenue for the year-earlier quarter.
The individual retirement unit is reporting $552 million in adjusted pre-tax income on $1.5 billion in revenue, up from $500 million in adjusted pre-tax income on $1.4 billion in revenue.
Here’s what happened to net flows of assets for several individual retirement products, in the United States, between the fourth quarter of 2019 and the latest quarter:
- Indexed Annuities: An $832 million inflow (down from a $1.1 billion inflow)
- Variable Annuities: A $326 million outflow (compared with a $433 million outflow)
- Fixed Annuities: A $695 million outflow (compared with a $673 million outflow)
At the life insurance unit, premiums increased to $491 million, from $450 million, and benefits and losses increased to $895 million, from $751 million.
Genworth Financial (NYSE: GNW)
Genworth is reporting $266 million in net income for the fourth quarter of 2020 on $2.3 billion in revenue, up from $24 million in net income on $2 billion in revenue for the fourth quarter of 2019.
The Richmond, Virginia-based company’s life insurance unit is reporting $129 million in adjusted operating income on $1.8 billion in revenue, compared with a $115 million adjusted operating loss on $1.6 billion in revenue for the year-earlier quarter.
The company’s long-term care insurance (LTCI) unit produced $129 million in adjusted operating income for the quarter on $1.3 billion in revenue, up from $19 million in adjusted operating income on $1.1 billion in revenue for the year-earlier quarter. Net investment gains at the unit increased to $118 million, from $19 million.