AIG 2013 Annual Report Download - page 93

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TOTAL REVENUES
AIG PROPERTY CASUALTY AIG LIFE AND RETIREMENT
2013 2012 2011
$39,709 $39,954 $40,977
2013 2012 2011
$20,590
$17,645 $16,163
OTHER OPERATIONS
2013 2012 2011
$8,893
$14,563
$8,526
A discussion of significant items affecting pre-tax segment income follows. Factors that affect pre-tax operating
income for a specific business segment are discussed in the detailed business segment analysis.
Pre-tax Income Comparison for 2013 and 2012
AIG Property Casualty — Pre-tax income increased in 2013 compared to 2012, primarily as a result of improved
underwriting results. The improved underwriting results are attributable to lower catastrophe losses, an improvement
in current year losses, reflecting the continued shift to higher value business, enhanced risk selection and improved
pricing. The improvement in pre-tax income also reflected higher net investment income in 2013 compared to 2012
due to the strong performance of alternative investments and income associated with the PICC P&C shares that are
accounted for under the fair value option.
AIG Life and Retirement — Pre-tax income increased in 2013 compared to 2012, primarily due to increased fee
income from growth in our variable annuity account value and continued active spread management related to our
interest rate sensitive businesses, income from legal settlements and alternative investments. These increases were
partially offset by the absence of fair value gains recognized in 2012 from our investment in ML II, which was
liquidated in March 2012. Net realized capital gains increased in 2013 compared to 2012, primarily due to gains in
connection with our program to utilize capital loss carryforwards, which were partially offset by the triggering of
additional loss recognition reserves, reflected in Policyholder benefits and claims incurred, from the subsequent
reinvestment of the proceeds from these sales at lower yields.
Other Operations — Other Operations reported a decline in pre-tax loss in 2013 compared to 2012. The pre-tax
loss in 2013 included impairment on investments in life settlements, a loss on extinguishment of debt resulting from
the redemptions and repurchases of, and cash tender offers, for certain debt securities, and severance expense,
partially
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AIG 2013 Form 10-K 75
ITEM 7 / RESULTS OF OPERATIONS
(in millions)
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