The Retail operating segment reported quarterly pre-tax operating income of $846 million, an increase of 54 percent, driven by higher fee income on variable annuity separate account assets, active spread management on interest rate sensitive products and the net positive impact of adjustments to reflect updated estimated gross profit assumptions.
The Institutional operating segment reported quarterly pre-tax operating income of $298 million, an increase of 7 percent. Results were driven by higher fee income and lower interest crediting rates due to active spread management, which were offset by lower net investment income and the negative impact of adjustments to reflect updated estimated gross profit assumptions. The favorable comparison to the prior-year quarter is partially attributable to a charge related to guaranteed investment contracts.
In the third quarter of 2013, AIG Life and Retirement distributed $1.2 billion in cash dividends to AIG Parent.
| Three Months Ended
|New insurance written||$||14,437||$||10,741||34||
|Net premiums written||272||219||24|
|Net premiums earned||204||177||15|
|Underwriting income (loss)||11||(35)||NM|
|Net investment income||32||38||(16)|
|Pre-tax operating income||$||43||$||3||NM||
United Guaranty Corporation (UGC) reported pre-tax operating income of $43 million for the third quarter of 2013, compared to pre-tax operating income of $3 million in the third quarter of 2012. Current quarter results reflected increased net premiums earned from business written after 2008 using UGC’s risk-based pricing underwriting approach along with minimal reserve development in its first-lien book of business.