Insurance giant AIG has suffered yet another setback after a surprise buildup in reserves on its property and casualty book, resulting in a $5.6 billion pretax charge.
Back in the fourth quarter of 2016, AIG upped reserves against this book dramatically, resulting in a $5.6 billion pretax charge. That contributed to the downfall of then Chief Executive Officer Peter Hancock. The announcement had followed a $3.6 billion charge in the fourth quarter of 2015.
It came as something of a shock to investors on Wednesday, then, that AIG had uncovered still more problems, requiring an additional $365 million pretax charge. This, along with losses from hurricanes and wildfires, contributed to a $622 million net loss for the quarter—far worse than analyst estimates. Shares were down over 8% in morning trading.The Wall Street Journal