AIG 2005 Annual Report Download - page 56

The following table shows the general development of the business of AIG on a consolidated basis, the contributions made to
AIG’s consolidated revenues and operating income and the assets held, in the periods indicated, by its General Insurance, Life
Insurance & Retirement Services, Financial Services and Asset Management operations and other realized capital gains (losses).
For additional information, see Selected Financial Data, Management’s Discussion and Analysis of Financial Condition and
Results of Operations and Notes 1 and 2 of Notes to Consolidated Financial Statements.
Years Ended December 31,
(in millions) 2005 2004 2003 2002 2001
General Insurance operations:
Gross premiums written $ 52,725 $ 52,046 $ 46,938 $ 36,678 $ 28,341
Net premiums written 41,872 40,623 35,031 26,718 19,793
Net premiums earned 40,809 38,537 31,306 23,595 18,661
Underwriting profit (loss)(a) (2,050) (247) 1,975 (1,082)(c) (777)
(d)
Net investment income 4,031 3,196 2,566 2,350 2,551
Realized capital gains (losses) 334 228 (39) (345) (189)
Operating income 2,315 3,177 4,502 923(c) 1,585(d)
Identifiable assets 150,667 131,658 117,511 105,891 88,250
Loss ratio 81.1 78.8 73.1 83.1 79.3
Expense ratio 23.6 21.5 19.6 21.8 24.3
Combined ratio(b) 104.7 100.3 92.7 104.9(c) 103.6(d)
Life Insurance & Retirement Services operations:
GAAP premiums 29,400 28,088 23,496 20,694 19,600
Net investment income 18,134 15,269 12,942 11,243 10,451
Realized capital gains (losses)(e) (218) 43 240 (372) (400)
Operating income 8,844 7,923 6,807 5,181 4,633(f)
Identifiable assets 480,622 447,841 372,126 289,914 256,767
Insurance in-force at end of year(g) 1,852,833 1,858,094 1,583,031 1,298,592 1,228,501
Financial Services operations:
Interest, lease and finance charges(h) 10,525 7,495 6,242 6,822 6,321
Operating income(g) 4,276 2,180 1,182 2,125 1,769
Identifiable assets 166,488 165,995 141,667 128,104 107,719
Asset Management operations:
Advisory and management fees and net investment
income from GICs 5,325 4,714 3,651 3,467 3,565
Operating income 2,253 2,125 1,316 1,125 1,019
Identifiable assets 81,080 80,075 64,047 53,732 42,961
Other realized capital gains (losses) 225 (227) (643) (936) (321)
Revenues(i) 108,905 97,666 79,421 66,171 59,958
Total operating income(j) 15,213 14,845 11,907 7,808 5,917
Total assets 853,370 801,145 675,602 561,598 490,614
(a) Underwriting profit (loss), a Generally Accepted Accounting Principles (GAAP) measure, is statutory underwriting profit (loss) adjusted primarily for
changes in the deferral of policy acquisition costs. This adjustment is necessary to present the financial statements in accordance with GAAP.
(b) Calculated on a statutory basis, includes catastrophe losses of $2.63 billion, $1.05 billion, $83 million, $61 million and $867 million (including World
Trade Center and related losses (WTC losses) of $769 million) in 2005, 2004, 2003, 2002 and 2001, respectively.
(c) In the fourth quarter of 2002, after completion of its annual review of General Insurance loss and loss adjustment expense reserves, AIG increased its
net loss reserves relating to accident years 1997 through 2001 by $2.1 billion.
(d) Includes $867 million of catastrophe losses.
(e) Includes the effect of hedging activities that do not qualify for hedge accounting treatment under FAS 133 and the application of FAS 52. For 2005,
2004, 2003, 2002, and 2001, respectively, the amounts included are $(437) million, $(140) million, $78 million, $(91) million and $(219) million.
(f) Includes $100 million in WTC losses.
(g) 2005 includes the effect of the non-renewal of a single large group life case of $36 billion. Also, the foreign in-force is translated to U.S. dollars at the
appropriate balance sheet exchange rate in each period.
(h) Includes the effect of hedging activities that do not qualify for hedge accounting treatment under FAS 133, including the related foreign exchange gains
and losses. For 2005, 2004, 2003, 2002 and 2001, respectively, the amounts included in interest, lease and finance charges are $2.01 billion,
$(122) million, $(1.01) billion, $220 million and $56 million, and the amounts included in Financial Services operating income are $1.98 billion,
$(149) million, $(964) million, $240 million and $75 million.
(i) Represents the sum of General Insurance net premiums earned, Life Insurance & Retirement Services GAAP premiums, net investment income,
Financial Services interest, lease and finance charges, Asset Management advisory and management fees and net investment income from Guaranteed
Investment Contracts (GICs), and realized capital gains (losses).
(j) Represents income before income taxes, minority interest and cumulative effect of accounting changes. Includes segment operating income and other
realized capital gains (losses) presented above, as well as AIG Parent and other operations of $(2.70) billion, $(333) million, $(1.26) billion,
$(610) million and $(751) million in 2005, 2004, 2003, 2002 and 2001, respectively, and acquisition, restructuring and related charges of
$(2.02) billion in 2001.
4AIG m Form 10-K