AIG 2015 Annual Report Download - page 91

ITEM 7 / RESULTS OF OPERATIONS / COMMERCIAL INSURANCE
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The general operating expense ratio increased by 0.9 points in 2015 compared to 2014, primarily due to an increase in
technology-related expenses, customer service initiatives and severance.
2014 and 2013 Comparison
The combined ratio decreased by 41.1 points in 2014 compared to 2013. The decrease was driven primarily by a reduction in
the loss ratio due to lower losses and loss adjustment expenses incurred from fewer new delinquencies, favorable prior year
loss reserve development, and higher cure rates.
The acquisition ratio decreased by 2.1 points in 2014 compared to 2013. Acquisition expenses decreased compared to an
increase in net premiums earned, driven by the decreases in new insurance written in 2014 due to lower mortgage
originations.
The general operating expense ratio decreased by 0.2 points in 2014 compared to 2013. The decrease was driven primarily
by growth in net premiums earned.
Institutional Markets Results
The following table presents Institutional Markets results:
Years Ended December 31, Percentage Change
(in millions) 2015 2014 2013 2015 vs. 2014 2014 vs. 2013
Revenues:
Premiums $1,580 $432 $610 266 %(29)%
Policy fees 199 187 113 665
Net investment income 1,739 1,957 2,090 (11) (6)
Benefits and expenses:
Policyholder benefits and losses incurred 2,583 1,396 1,616 85 (14)
Interest credited to policyholder account balances 408 410 413 -(1)
Amortization of deferred policy acquisition costs 34 4 (25) -
Other acquisition expenses 32 30 36 7(17)
General operating expenses 77 66 64 17 3
Pre-tax operating income $415 $670 $680 (38) (1)