AIG 2013 Annual Report Download - page 140

16FEB201411434176
The following table presents Mortgage Guaranty results:
Underwriting results:
Net premiums written $ 858 $ 801 22% 7%
Increase in unearned premiums (143) (9) (67) NM
Net premiums earned 715 792 13 (10)
Claims and claims adjustment expenses incurred 659 834 (22) (21)
Underwriting expenses 193 187 15 3
Underwriting income (loss) (137) (229) NM 40
Net investment income 146 132 (10) 11
Pre-tax operating income (loss) 9 (97) NM NM
Net realized capital gains 6 20 33 (70)
Pre-tax income (loss) $ 15 $ (77) NM% NM%
Key metrics:
New insurance written $ 37,509 $ 18,792 33% 100%
Domestic first-lien:
Risk in force $ 28,967 $ 25,635
60+ day delinquency ratio on primary loans(a) 8.8% 13.9%
Domestic second-lien:
Risk in force(b) $ 1,261 $ 1,504
(a) Based on number of policies.
(b) Represents the full amount of second-lien loans insured reduced for contractual aggregate loss limits on certain pools of loans, usually
10 percent of the full amount of loans insured in each pool. Certain second-lien pools have reinstatement provisions, which will expire as the loan
balances are repaid.
PRE-TAX OPERATING INCOME (LOSS)
(in millions)
NEW INSURANCE WRITTEN
(in millions)
2013 2012 2011 2013 2012 2011
$49,933
$37,509
$18,792
$9
$205
$(97)
Pre-tax operating income in 2013 increased compared to the prior year due to improved underwriting income as a
result of an increase in net premiums earned in the first-lien business, and decreases in claims and claims
adjustment expenses incurred. Partially offsetting these increases were declines in net premiums earned in
second-lien, student loan and international businesses, all of which were placed into run-off during 2008, and an
increase in underwriting expenses related to higher volumes of new business.
The first-lien net premiums earned increased $127 million resulting from a 32 percent growth of the book of business
and a decline in premium refunds as a result of lower rescissions during 2013 compared to 2012. The decline in
claims and claims adjustment expenses incurred reflected decreases in first-lien and student loan claims and claims
Mortgage Guaranty Results
2013 and 2012 Comparison
..................................................................................................................................................................................................................................
AIG 2013 Form 10-K122
ITEM 7 / RESULTS OF OPERATIONS / OTHER OPERATIONS
Percentage Change
Years Ended December 31,
(dollars in millions) 2013 2012 2011 2013 vs. 2012 2012 vs. 2011
$ 1,048
(239)
809
514
222
73
132
205
8
$ 213
$ 49,933
$ 36,367
5.9%
$ 1,026
..................................................................................................................................................................................
............................................................................................................................................................................................