Item 2. Use of Non-GAAP Measures

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Item 2. Use of Non-GAAP Measures

The following table presents a reconciliation of pre-tax income (loss)/net income (loss) attributable to AIG to adjusted pre-tax income (loss)/adjusted after-tax income (loss) attributable to AIG:



Three Months Ended June 30,	2026					2025
(in millions, except per common share data)		Pre-tax	Total Tax (Benefit) Charge		After Tax		Pre-tax	Total Tax (Benefit) Charge			After Tax
Pre-tax income/Net income, including noncontrolling interests	$	1,264	$	316	$	948	$	1,544	$	400		$	1,144
Noncontrolling interests						—							—


Pre-tax income/Net income attributable to AIG common shareholders		1,264		316	$	948		1,544		400		$	1,144
Changes in uncertain tax positions and other tax adjustments				(7)		7				(2)			2
Deferred income tax valuation allowance (releases) charges				2		(2)				(11)			11
Changes in the fair values of equity securities, AIG's investment in Corebridge and gain/loss on sale of shares		(173)		(37)		(136)		(464)		(97)			(367)
Gain on extinguishment of debt		—		—		—		(5)		(1)			(4)
Net investment income on Fortitude Re funds withheld assets		(36)		(7)		(29)		(39)		(9)			(30)
Net realized losses on Fortitude Re funds withheld assets		6		1		5		52		11			41
Net realized losses on Fortitude Re funds withheld embedded derivative		51		11		40		14		3			11
Net realized losses(a)		208		38		170		191		33			158

Net (gain) loss on divestitures and other		6		1		5		(50)		(10)			(40)
Non-operating litigation reserves and settlements		—		—		—		(2)		(1)			(1)
Unfavorable (favorable) prior year development and related amortization changes ceded under retroactive reinsurance agreements		(67)		(14)		(53)		53		11			42
Net loss reserve discount charge		28		6		22		12		3			9
Net results of businesses in run-off(b)		1		—		1		(2)		—			(2)
Non-operating pension expenses		(1)		—		(1)		5		1			4
Integration and transaction costs associated with acquiring or divesting businesses		41		9		32		1		—			1
Restructuring and other costs		71		15		56		78		16			62
Non-recurring costs related to regulatory or accounting changes		5		1		4		3		—			3

Adjusted pre-tax income/Adjusted after-tax income attributable to AIG common shareholders	$	1,404	$	335	$	1,069	$	1,391	$	347		$	1,044
Weighted average diluted shares outstanding						533.6							577.9
Income per common share attributable to AIG common shareholders (diluted)					$	1.78						$	1.98
Adjusted after-tax income per common share attributable to AIG common shareholders (diluted)					$	2.00						$	1.81



Six Months Ended June 30,	2026					2025
(in millions, except per common share data)		Pre-tax	Total Tax (Benefit) Charge		After Tax		Pre-tax	Total Tax (Benefit) Charge			After Tax
Pre-tax income/Net income, including noncontrolling interests	$	2,251	$	540	$	1,711	$	2,504	$	662		$	1,842
Noncontrolling interests						—							—


Pre-tax income/Net income attributable to AIG common shareholders		2,251		540		1,711		2,504		662			1,842
Changes in uncertain tax positions and other tax adjustments				86		(86)				4			(4)
Deferred income tax valuation allowance charges				(81)		81				(9)			9
Changes in the fair values of equity securities, AIG's investment in Corebridge and gain/loss on sale of shares		64		13		51		(681)		(143)			(538)
Gain on extinguishment of debt		—		—		—		(5)		(1)			(4)
Net investment income on Fortitude Re funds withheld assets		(59)		(12)		(47)		(79)		(17)			(62)
Net realized losses on Fortitude Re funds withheld assets		19		4		15		54		11			43
Net realized losses on Fortitude Re funds withheld embedded derivative		41		9		32		55		12			43
Net realized losses(a)		344		81		263		257		(5)			262

Net (gain) loss on divestitures and other(c)		133		28		105		(53)		(11)			(42)
Non-operating litigation reserves and settlements		—		—		—		(13)		(3)			(10)
Unfavorable (favorable) prior year development and related amortization changes ceded under retroactive reinsurance agreements		(75)		(16)		(59)		62		13			49
Net loss reserve discount (benefit) charge		(20)		(4)		(16)		29		6			23
Net results of businesses in run-off(b)		6		1		5		(7)		(1)			(6)
Non-operating pension expenses		(2)		—		(2)		10		2			8
Integration and transaction costs associated with acquiring or divesting businesses		48		10		38		6		1			5
Restructuring and other costs		147		31		116		154		32			122
Non-recurring costs related to regulatory or accounting changes		10		2		8		7		1			6


Adjusted pre-tax income (loss)/Adjusted after-tax income (loss) attributable to AIG common shareholders	$	2,907	$	692	$	2,215	$	2,300	$	554		$	1,746
Weighted average diluted shares outstanding						537.8							588.5
Income per common share attributable to AIG common shareholders (diluted)					$	3.18						$	3.13
Adjusted after-tax income per common share attributable to AIG common shareholders (diluted)					$	4.12						$	2.97

(a)Includes all net realized gains and losses except earned income (periodic settlements and changes in settlement accruals) on derivative instruments used for non-qualifying (economic) hedging or for asset replication and net realized gains and losses on Fortitude Re funds withheld assets.

(b)In the third quarter of 2025, AIG began excluding the net results of run-off businesses previously reported in General Insurance from Adjusted pre-tax income.


54			AIG \| Second Quarter 2026 Form 10-Q

ITEM 2 | Use of Non-GAAP Measures

(c)In the six months ended June 30, 2026, Net (gain) loss on divestitures and other primarily relates to a change in estimate for earn-out considerations associated with the dispositions of Validus Reinsurance, Ltd. and global personal travel and assistance business.

The following table presents a reconciliation of General Insurance and Other Operations Net investment income and other/pre-tax income (loss) to Net investment income and other, APTI basis/adjusted pre-tax income (loss):


General Insurance	Three Months Ended June 30,							Six Months Ended June 30,
	2026				2025			2026				2025

(in millions)	Net Investment Income and Other		Pre-tax Income (Loss)			Net Investment Income and Other		Pre-tax Income (Loss)		Net Investment Income and Other			Pre-tax Income (Loss)		Net Investment Income and Other		Pre-tax Income (Loss)
Net investment income and other/Pre-tax income (loss)(a)	$	942	$	(522)		$	872	$	1,137	$	1,726		$	819	$	1,628	$	1,986

Other income (expense) - net	(1)		—			—		—		(3)			—		—		—
Changes in the fair values of equity securities, AIG's investment in Corebridge and gain/loss on sale of shares	(70)		(70)			(4)		(4)		12			12		(24)		(24)

Net investment income on Fortitude Re funds withheld assets	—		—			—		—		—			—		1		1
Net realized (gains) losses on Fortitude Re funds withheld assets	—		(1)			—		5		—			(1)		—		7

Net realized losses	—		2,067			3		270		—			2,223		2		323
Net (gain) loss on divestitures and other	—		14			—		(43)		—			11		—		(37)

Unfavorable (favorable) prior year development and related amortization changes ceded under retroactive reinsurance agreements	—		(57)			—		60		—			(52)		—		74
Net loss reserve discount (benefit) charge	—		28			—		12		—			(20)		—		29

Non-operating pension expenses	—		1			—		5		—			2		—		9
Integration and transaction costs associated with acquiring or divesting businesses	—		33			—		—		—			65		—		—
Restructuring and other costs	—		48			—		47		—			105		—		92
Non-recurring costs related to regulatory or accounting changes	—		5			—		3		—			10		—		7

Net investment income and other, APTI basis/Adjusted pre-tax income (loss)	$	871	$	1,546		$	871	$	1,492	$	1,735		$	3,174	$	1,607	$	2,467


Other Operations	Three Months Ended June 30,							Six Months Ended June 30,
	2026				2025			2026				2025

(in millions)	Net Investment Income and Other		Pre-tax Income (Loss)			Net Investment Income and Other		Pre-tax Income (Loss)		Net Investment Income and Other			Pre-tax Income (Loss)		Net Investment Income and Other		Pre-tax Income (Loss)
Net investment income and other/Pre-tax income (loss)(a)	$	186	$	1,786		$	600	$	407	$	115		$	1,432	$	960	$	518
Consolidation and Eliminations	(1)		—			4		—		—			—		3		—
Other income (expense) - net	2		—			(2)		—		3			—		(11)		—
Changes in the fair values of equity securities, AIG's investment in Corebridge and gain/loss on sale of shares	(103)		(103)			(460)		(460)		52			52		(657)		(657)
Gain on extinguishment of debt	—		—			—		(5)		—			—		—		(5)
Net investment income on Fortitude Re funds withheld assets	(36)		(36)			(39)		(39)		(59)			(59)		(80)		(80)
Net realized (gains) losses on Fortitude Re funds withheld assets	—		7			—		47		—			20		—		47
Net realized losses on Fortitude Re funds withheld embedded derivative	—		51			—		14		—			41		—		55
Net realized gains	—		(1,859)			(3)		(79)		—			(1,879)		—		(66)
Net (gain) loss on divestitures and other	—		(8)			—		(7)		—			122		—		(16)
Non-operating litigation reserves and settlements	—		—			—		(2)		—			—		—		(13)
Unfavorable (favorable) prior year development and related amortization changes ceded under retroactive reinsurance agreements	—		(10)			—		(7)		—			(23)		—		(12)

Net results of businesses in run-off	(9)		1			(8)		(2)		(18)			6		(13)		(7)
Non-operating pension expenses	—		(2)			—		—		—			(4)		—		1
Integration and transaction costs associated with acquiring or divesting businesses	—		8			—		1		—			(17)		—		6
Restructuring and other costs	—		23			—		31		—			42		—		62


Net investment income and other, APTI basis/Adjusted pre-tax income (loss)	$	39	$	(142)		$	92	$	(101)	$	93		$	(267)	$	202	$	(167)

(a)In the first quarter of 2026, AIG realigned and began reporting Amortization of intangible assets in General Insurance from Other Operations; historical results have been recast to reflect these changes.

Book value per share, excluding investments related cumulative unrealized gains and losses recorded in Accumulated other comprehensive income (loss) (AOCI) adjusted for the cumulative unrealized gains and losses related to Fortitude Re funds withheld assets (collectively, Investments AOCI) (Adjusted book value per share) is used to show the amount of our net worth on a per share basis after eliminating the fair value of investments that can fluctuate significantly from period to period due to changes in market conditions. In addition, we adjust for the cumulative unrealized gains and losses related to Fortitude Re funds withheld assets since these fair value movements are economically transferred to Fortitude Re. Adjusted book value per share is derived by dividing total AIG common shareholders’ equity, excluding Investments AOCI (AIG adjusted common shareholders' equity) by total common shares outstanding.


AIG \| Second Quarter 2026 Form 10-Q			55

ITEM 2 | Use of Non-GAAP Measures

Book value per share, excluding Investments AOCI, deferred tax assets (DTA) and AIG’s ownership interest in Corebridge (Core operating book value per share) is used to show the amount of our net worth on a per share basis after eliminating Investments AOCI, DTA and AIG’s ownership interest in Corebridge. We believe this measure is useful to investors because it eliminates the fair value of investments that can fluctuate significantly from period to period due to changes in market conditions. We also exclude the portion of DTA representing U.S. tax attributes related to net operating loss carryforwards (NOLs), corporate alternative minimum tax credits (CAMTCs) and foreign tax credits (FTCs) that have not yet been utilized. Amounts for interim periods are estimates based on projections of full-year attribute utilization. As NOLs, CAMTCs and FTCs are utilized, the corresponding portion of the DTA utilized is included. We exclude AIG’s ownership interest in Corebridge since it is not a core long-term investment for AIG. Core operating book value per share is derived by dividing total AIG common shareholders’ equity, excluding Investments AOCI, DTA and AIG’s ownership interest in Corebridge (AIG core operating shareholders’ equity) by total common shares outstanding.

The following table presents reconciliations of Book value per share to Adjusted book value per share and Core operating book value per share, which are non-GAAP measures**.**



	June 30,		December 31,
(in millions, except per share data)	2026		2025


Total AIG common shareholders' equity	$	40,606	$	41,139
Less: Investments related AOCI	(1,884)		(1,376)
Add: Cumulative unrealized gains and losses related to Fortitude Re funds withheld assets	(522)		(523)
Subtotal: Investments AOCI	(1,362)		(853)
AIG adjusted common shareholders' equity	$	41,968	$	41,992













Total AIG common shareholders' equity	$	40,606	$	41,139
Less: AIG's ownership interest in Corebridge	—		1,512
Less: Investments related AOCI - AIG	(1,884)		(1,376)
Add: Cumulative unrealized gains and losses related to Fortitude Re funds withheld assets - AIG	(522)		(523)
Subtotal: Investments AOCI - AIG	(1,362)		(853)
Less: Deferred tax assets	2,912		3,278
AIG core operating shareholders' equity	$	39,056	$	37,202

Total common shares outstanding	524.7		538.2

Book value per share	$	77.39	$	76.44
Adjusted book value per share	79.98		78.02


Core operating book value per share	74.43		69.12

Return on equity – Adjusted after-tax income excluding Investments AOCI (Adjusted return on equity) is used to show the rate of return on common shareholders’ equity excluding Investments AOCI. We believe this measure is useful to investors because it eliminates the fair value of investments which can fluctuate significantly from period to period due to changes in market conditions. Adjusted return on equity is derived by dividing actual or, for interim periods, annualized adjusted after-tax income attributable to AIG common shareholders by average AIG adjusted common shareholders’ equity.

Return on equity – Adjusted after-tax income excluding Investments AOCI, DTA and AIG’s ownership interest in Corebridge (Core operating return on equity) is used to show the rate of return on common shareholders’ equity excluding Investments AOCI, DTA and AIG’s ownership interest in Corebridge. We believe this measure is useful to investors because it eliminates the fair value of investments that can fluctuate significantly from period to period due to changes in market conditions. We also exclude the portion of DTA representing U.S. tax attributes related to NOLs, CAMTCs and FTCs that have not yet been utilized. Amounts for interim periods are estimates based on projections of full-year attribute utilization. As NOLs, CAMTCs and FTCs are utilized, the corresponding portion of the DTA utilized is included. We exclude AIG’s ownership interest in Corebridge since it is not a core long-term investment for AIG. We believe this metric provides investors with greater insight as to the underlying profitability of our property and casualty business. Core operating return on equity is derived by dividing actual or, for interim periods, annualized adjusted after-tax income attributable to AIG common shareholders by average AIG core operating shareholders’ equity.


56			AIG \| Second Quarter 2026 Form 10-Q

ITEM 2 | Use of Non-GAAP Measures

The following table presents reconciliations of Return on equity to Adjusted return on equity and Core operating return on equity, which are non-GAAP measures.



	Three Months Ended June 30,						Six Months Ended June 30,
(dollars in millions)	2026			2025			2026			2025
Actual or annualized net income (loss) attributable to AIG common shareholders	$	3,792		$	4,576		$	3,422		$	3,684

Actual or annualized adjusted after-tax income attributable to AIG common shareholders	$	4,276		$	4,176		$	4,430		$	3,492

Average AIG common shareholders' equity	$	40,506		$	41,466		$	40,717		$	41,818
Less: Average investments AOCI	(1,409)			(1,585)			(1,224)			(1,791)
Average AIG adjusted common shareholders' equity	$	41,915		$	43,051		$	41,941		$	43,609





Average AIG common shareholders' equity	$	40,506		$	41,466		$	40,717		$	41,818
Less: Average AIG's ownership interest in Corebridge	304			4,031			706			3,957
Less: Average Investments AOCI - AIG	(1,409)			(1,585)			(1,224)			(1,791)
Less: Average deferred tax assets	3,022			3,277			3,107			3,347
Average AIG core operating shareholders' equity	$	38,589		$	35,743		$	38,128		$	36,305

Return on equity	9.4		%	11.0		%	8.4		%	8.8		%
Adjusted return on equity	10.2			9.7			10.6			8.0

Core operating return on equity	11.1			11.7			11.6			9.6

Ratios: We, along with most property and casualty insurance companies, use the loss ratio, the expense ratio and the combined ratio as measures of underwriting performance. These ratios are relative measurements that describe, for every $100 of net premiums earned, the amount of losses and loss adjustment expenses (which for General Insurance excludes net loss reserve discount), and the amount of other underwriting expenses that would be incurred. A combined ratio of less than 100 indicates underwriting income and a combined ratio of over 100 indicates an underwriting loss. Our ratios are calculated using the relevant segment information calculated under GAAP, and thus may not be comparable to similar ratios calculated for regulatory reporting purposes. The underwriting environment varies across countries and products, as does the degree of litigation activity, all of which affect such ratios. In addition, investment returns, local taxes, cost of capital, regulation, product type and competition can have an effect on pricing and consequently on profitability as reflected in underwriting income and associated ratios.

Accident year loss and accident year combined ratios, as adjusted (Accident year loss ratio, ex-CAT and Accident year combined ratio, ex-CAT): both the accident year loss and accident year combined ratios, as adjusted, exclude catastrophe losses and related reinstatement premiums, net of reinsurance, and prior year development, net of prior year premiums, net of reinsurance, and the impact of reserve discounting. Natural catastrophe losses are generally weather or seismic events, in each case, having a net impact on AIG in excess of $10 million and man-made catastrophe losses, such as terrorism and civil unrest that exceed the $10 million threshold. We believe that as adjusted ratios are meaningful measures of our underwriting results on an ongoing basis as they exclude catastrophes and the impact of reserve discounting which are outside of management’s control. We also exclude prior year development to provide transparency related to current accident year results.

Results from discontinued operations are excluded from all of these measures.

Investments

OVERVIEW

Our investment strategies are tailored to the specific business needs of each segment by targeting an asset allocation mix that supports estimated cash flow needs of our outstanding liabilities and provides diversification from an asset class, sector, issuer, and geographic perspective. The primary objectives are generation of investment income, preservation of capital, liquidity management and growth of surplus. The majority of assets backing our insurance liabilities consist of fixed maturity securities.

Strategic Investments

On February 6, 2026, AIG closed its previously announced acquisitions of (i) a 35 percent equity interest in Convex Group Limited (Convex), a global specialty insurer, for $2.1 billion and (ii) a 9.9 percent ownership stake in Onex Corporation (Onex), a global asset manager, for $642 million. AIG reflects its interest in Convex as an equity method investment in Other invested assets. The difference between the purchase price and the value of the underlying net assets acquired is primarily comprised of intangible assets and other basis differences of $520 million and goodwill of $440 million. AIG records its proportionate share of Convex’s net income less amortization of the basis differences described above as a component of Net investment income reported in General Insurance.


AIG \| Second Quarter 2026 Form 10-Q			57

ITEM 2 | Investments

INVESTMENT HIGHLIGHTS

Blended investment yields on new investments were higher than blended rates on investments that were sold, matured or called during this period. We continued to make investments in structured securities and other fixed maturity securities with attractive risk-adjusted return characteristics to improve yields and increase net investment income.

Total Net investment income decreased for the six months ended June 30, 2026 compared to the prior year, primarily due to changes in the fair value of AIG's investment in Corebridge and Equity securities and lower income from alternative investments and mortgage loans, partially offset by higher income on available for sale fixed maturity securities.

INVESTMENT STRATEGIES

Investment strategies are assessed at the segment level and involve considerations that include local and general market and economic conditions, duration and cash flow management, risk appetite and volatility constraints, rating agency and regulatory capital considerations, tax, regulatory and legal investment limitations, and, where appropriate, environmental, social and governance considerations.

Some of our key investment strategies are as follows:

Our fundamental strategy across the portfolios is to seek investments with similar duration and cash flow characteristics to the associated insurance liabilities to the extent practicable.
Within General Insurance, investments generally consist of a split between reserve backing and surplus portfolios.

–Insurance reserves are backed mainly by investment grade fixed maturity securities that meet our duration, currency, risk-return, capital, tax, liquidity, credit quality and diversification objectives. We assess asset classes based on their fundamental underlying risk factors, including credit (public and private), commercial real estate and residential real estate, regardless of whether such investments are bonds, loans, or structured products.

–Surplus investments seek to enhance portfolio returns and are generally comprised of a mix of fixed maturity investment grade and below investment grade securities and various alternative asset classes, including private equity and private credit.

We seek to purchase private equity and private credit assets that offer enhanced yield through illiquidity premiums and other portfolio diversification benefits. The private credit assets typically provide credit protections such as covenants along with other features that support insurance company needs.
Given our global presence, we seek investments that provide diversification from investments available in local markets. To the extent we purchase these investments, we generally hedge any currency risk using derivatives, which could provide opportunities to earn higher risk adjusted returns compared to investments in the functional currency.
AIG Parent, included in Other Operations, actively manages its assets and liabilities, counterparties and duration. AIG Parent’s liquidity sources are held primarily in the form of cash and short-term investments. This strategy allows us to both diversify our sources of liquidity and reduce the cost of maintaining sufficient liquidity.

Asset-Liability Management

The investment strategy within the General Insurance companies focuses on growth of surplus, maintenance of sufficient liquidity for unanticipated insurance claims, and preservation of capital. General Insurance invests primarily in fixed maturity securities issued by corporations, municipalities and other governmental agencies; structured securities collateralized by, among other assets, residential and commercial real estate; and commercial mortgage loans. Fixed maturity securities of the General Insurance companies have an average duration of 4 years.

While assets backing reserves of the General Insurance companies are primarily invested in conventional liquid fixed maturity securities, we have also continued to allocate a portion of our portfolio to asset classes that offer higher yields through structural and illiquidity premiums, particularly in our North America operations. In addition, we continue to invest in both fixed rate and floating rate asset-backed investments to manage our exposure to potential changes in interest rates and inflation. We seek to diversify the portfolio across asset classes, sectors and issuers to mitigate idiosyncratic portfolio risks.

In addition, a portion of the surplus of General Insurance companies is invested in a diversified portfolio of alternative investments that seek to balance liquidity, volatility and growth of surplus. Although these alternative investments are subject to periodic earnings fluctuations, they have historically achieved yields in excess of the fixed maturity portfolio yields and have provided added diversification to the broader portfolio.


58			AIG \| Second Quarter 2026 Form 10-Q

ITEM 2 | Investments

Available-for-Sale Investments

The following table presents the fair value of our available-for-sale securities:


(in millions)		June 30, 2026		December 31, 2025
Bonds available for sale:
U.S. government and government sponsored entities	$	2,779	$	3,298
Obligations of states, municipalities and political subdivisions		2,684		2,775
Non-U.S. governments		6,078		6,516
Corporate debt		38,277		37,235
Mortgage-backed, asset-backed and collateralized:
RMBS - agency		6,271		5,988
RMBS - non-agency		4,797		4,180
CMBS		4,939		4,616
CLO/ABS		5,647		6,424
Total mortgage-backed, asset-backed and collateralized		21,654		21,208
Total bonds available for sale*	$	71,472	$	71,032

*At June 30, 2026 and December 31, 2025, the fair value of bonds available for sale we held that were below investment grade or not rated totaled $5.7 billion and $5.9 billion, respectively.

The following table presents the fair value of our aggregate credit exposures to non-U.S. governments for our fixed maturity securities:


(in millions)		June 30, 2026		December 31, 2025
Canada	$	1,047	$	1,207
Japan		437		489
Germany		398		444
Australia		327		284
Israel		314		322
United Kingdom		307		344
Korea, Republic of		219		214
Malaysia		217		216
Singapore		190		206
Denmark		160		241
Other		2,484		2,572
Total	$	6,100	$	6,539

The following table presents the fair value of our aggregate European credit exposures by major sector for our fixed maturity securities:


		June 30, 2026										December 31, 2025 Total
(in millions)		Sovereign		Financial Institution		Non-Financial Corporates		Structured Products		Total
Euro-Zone countries:
France	$	146	$	1,533	$	576	$	39	$	2,294	$	2,258
Germany		398		306		878		47		1,629		1,660
Netherlands		66		609		225		49		949		1,061
Ireland		5		152		105		405		667		733
Italy		13		117		350		27		507		480
Spain		7		395		80		24		506		494
Denmark		160		110		48		—		318		337
Luxembourg		19		104		74		18		215		205
Belgium		9		88		54		14		165		216
Finland		9		68		1		1		79		93
Other Euro-Zone		199		39		31		39		308		310
Total Euro-Zone	$	1,031	$	3,521	$	2,422	$	663	$	7,637	$	7,847
Remainder of Europe:
United Kingdom	$	307	$	1,747	$	1,725	$	406	$	4,185	$	4,017
Switzerland		19		177		272		—		468		534
Sweden		89		195		29		—		313		372


AIG \| Second Quarter 2026 Form 10-Q			59

ITEM 2 | Investments


		June 30, 2026										December 31, 2025 Total
(in millions)		Sovereign		Financial Institution		Non-Financial Corporates		Structured Products		Total
Norway		63		84		—		—		147		136
Jersey (Channel Islands)		3		3		8		43		57		58
Other - Remainder of Europe		39		14		4		—		57		59
Total - Remainder of Europe	$	520	$	2,220	$	2,038	$	449	$	5,227	$	5,176
Total	$	1,551	$	5,741	$	4,460	$	1,112	$	12,864	$	13,023

Investments in Municipal Bonds

At June 30, 2026, the U.S. municipal bond portfolio was composed primarily of essential service revenue bonds and high-quality tax-exempt bonds with 98 percent of the portfolio rated A or higher.

The following table presents the fair values of our available for sale U.S. municipal bond portfolio by state and municipal bond type:


	June 30, 2026
(in millions)		State General Obligation		Local General Obligation		Revenue		Total Fair Value		December 31, 2025 Total Fair Value
California	$	207	$	138	$	321	$	666	$	690
New York		28		86		240		354		401
Massachusetts		40		12		105		157		167
Florida		1		—		129		130		127
Texas		10		30		88		128		144
Connecticut		26		2		86		114		111
Pennsylvania		34		—		72		106		118
Georgia		48		—		27		75		73
Illinois		4		17		52		73		84
Oregon		7		47		16		70		67
Michigan		—		—		69		69		51
Hawaii		63		—		1		64		66
Virginia		—		3		54		57		60
All other states		31		32		558		621		616
Total	$	499	$	367	$	1,818	$	2,684	$	2,775

Investments in Corporate Debt Securities

The following table presents the fair value of our available for sale corporate debt securities by industry categories:



(in millions)		June 30, 2026		December 31, 2025
Financial institutions:
Banks	$	8,305	$	8,086
Insurance		1,476		1,378
Securities firms and other finance companies		966		856
Other financial institutions		5,818		5,733
Utilities		3,369		3,231
Communications		2,334		2,188
Consumer noncyclical		2,737		2,706
Capital goods		1,724		1,805
Energy		2,182		2,010
Consumer cyclical		3,599		3,649
Basic materials		2,308		2,093
Other		3,459		3,500
Total*	$	38,277	$	37,235

*At June 30, 2026 and December 31, 2025, approximately 89 percent and 88 percent, respectively, of these investments were rated investment grade.


60			AIG \| Second Quarter 2026 Form 10-Q

ITEM 2 | Investments

Commercial Mortgage Loans

At June 30, 2026, we had direct commercial mortgage loan exposure of $2.3 billion.

The following table presents the commercial mortgage loan exposure by location and class of loan based on amortized cost:


	Number of Loans		Class													Percent of Total
(dollars in millions)		Apartments		Offices		Retail		Industrial		Hotel		Others		Total
June 30, 2026
State:
California	16	$	88	$	192	$	26	$	17	$	15	$	—	$	338	15	%
New York	17		50		183		44		19		32		—		328	14
Texas	18		62		134		1		30		—		40		267	12
Massachusetts	6		—		123		48		7		—		—		178	8
Florida	11		67		—		59		7		38		—		171	8
Pennsylvania	9		30		58		15		18		—		—		121	5
Illinois	5		88		9		—		—		—		5		102	5
New Jersey	4		56		—		—		—		—		9		65	3
Washington	3		49		—		—		—		—		—		49	2
Colorado	3		7		20		15		—		—		—		42	2
Other states	20		99		3		66		3		—		—		171	7
Foreign	20		133		153		40		26		79		—		431	19
Total*	132	$	729	$	875	$	314	$	127	$	164	$	54	$	2,263	100	%




December 31, 2025
State:
California	17	$	89	$	190	$	27	$	18	$	31	$	—	$	355	14	%
New York	17		48		188		44		19		33		—		332	13
Texas	19		72		135		1		30		10		—		248	10
Massachusetts	7		—		175		48		7		—		—		230	9
Florida	11		68		—		60		8		37		—		173	7
Pennsylvania	9		28		57		15		18		—		—		118	5
Illinois	5		88		13		—		—		—		—		101	4
New Jersey	8		55		—		—		3		—		10		68	3
Washington	3		49		—		—		—		—		—		49	2
Colorado	3		7		20		16		—		—		—		43	2
Other states	23		109		12		68		28		—		—		217	9
Foreign	23		180		196		78		27		80		—		561	22
Total*	145	$	793	$	986	$	357	$	158	$	191	$	10	$	2,495	100	%

*Does not reflect allowance for credit losses.

For additional information on commercial mortgage loans, see Note 6 to the Condensed Consolidated Financial Statements.


AIG \| Second Quarter 2026 Form 10-Q			61

ITEM 2 | Investments

Net Realized Gains and Losses

The following table presents the components of Net realized gains (losses):


Three Months Ended June 30,		2026						2025
(in millions)	Excluding Fortitude Re Funds Withheld Assets		Fortitude Re Funds Withheld Assets			Total	Excluding Fortitude Re Funds Withheld Assets		Fortitude Re Funds Withheld Assets			Total
Sales and impairments of fixed maturity securities	$	(59)	$	(4)	$	(63)	$	(102)	$	(49)	$	(151)

Change in allowance for credit losses on fixed maturity securities		3		—		3		(15)		—		(15)
Change in allowance for credit losses on loans		(1)		—		(1)		45		5		50
Foreign exchange transactions		(8)		1		(7)		(27)		13		(14)
Derivatives and hedge accounting		(20)		(2)		(22)		(98)		(16)		(114)
Sales of alternative investments		(38)		—		(38)		3		—		3
Other*		(85)		(1)		(86)		2		(5)		(3)
Net realized losses – excluding Fortitude Re funds withheld embedded derivative		(208)		(6)		(214)		(192)		(52)		(244)
Net realized losses on Fortitude Re funds withheld embedded derivative		—		(51)		(51)		—		(14)		(14)
Net realized losses	$	(208)	$	(57)	$	(265)	$	(192)	$	(66)	$	(258)


Six Months Ended June 30,	2026						2025
(in millions)	Excluding Fortitude Re Funds Withheld Assets		Fortitude Re Funds Withheld Assets			Total	Excluding Fortitude Re Funds Withheld Assets		Fortitude Re Funds Withheld Assets			Total
Sales and impairments of fixed maturity securities	$	(174)	$	(19)	$	(193)	$	(357)	$	(56)	$	(413)

Change in allowance for credit losses on fixed maturity securities		1		1		2		(7)		—		(7)
Change in allowance for credit losses on loans		32		1		33		50		9		59
Foreign exchange transactions		(27)		(2)		(29)		193		19		212
Derivatives and hedge accounting		(18)		2		(16)		(126)		(22)		(148)
Sales of alternative investments		(16)		—		(16)		3		—		3
Other*		(138)		(2)		(140)		(8)		(4)		(12)
Net realized gains (losses) – excluding Fortitude Re funds withheld embedded derivative		(340)		(19)		(359)		(252)		(54)		(306)
Net realized losses on Fortitude Re funds withheld embedded derivative		—		(41)		(41)		—		(55)		(55)
Net realized losses	$	(340)	$	(60)	$	(400)	$	(252)	$	(109)	$	(361)

*Other includes impairments on investments in private equity and real estate funds.

Higher Net realized losses excluding Fortitude Re funds withheld assets in the three months ended June 30, 2026 compared to 2025 were primarily due to losses on foreign exchange, partially offset by lower losses on fixed maturity securities. Higher Net realized losses excluding Fortitude Re funds withheld assets in the six months ended June 30, 2026 compared to 2025 were primarily due to losses on foreign exchange, partially offset by lower losses on fixed maturity securities.

Net realized gains (losses) on Fortitude Re funds withheld assets primarily reflect changes in the valuation of the modified coinsurance and funds withheld assets. Increases in the valuation of these assets result in losses to AIG as the appreciation on the assets under those reinsurance arrangements must be transferred to Fortitude Re. Decreases in valuation of the assets result in gains to AIG as the depreciation on the assets under those reinsurance arrangements must be transferred to Fortitude Re. For additional information on the impact of the funds withheld arrangements with Fortitude Re, see Note 7 to the Condensed Consolidated Financial Statements.

For additional information on our investment portfolio, see Note 5 to the Condensed Consolidated Financial Statements.

Unrealized Gains and Losses on Investments

Net unrealized investment losses included in shareholders’ equity were $1.9 billion at June 30, 2026 compared with $2.0 billion at June 30, 2025. The change in net unrealized gains and losses on investments in the six months ended June 30, 2026 was primarily attributable to a change in the fair value of fixed maturity securities mainly due to higher interest rates offset by slight narrowing of credit spreads. The change in net unrealized gains and losses on investments in the six months ended June 30, 2025 was primarily attributable to a change in the fair value of fixed maturity securities mainly due to lower interest rates and narrowing of credit spreads.

At June 30, 2026, the Company had $1.5 billion fixed maturity investments reported at fair value for which fair value was less than 80 percent of amortized cost. At December 31, 2025, the Company had $1.4 billion fixed maturity investments reported at fair value for which fair value was less than 80 percent of amortized cost.


62			AIG \| Second Quarter 2026 Form 10-Q

ITEM 2 | Investments

At June 30, 2026 and December 31, 2025, below investment grade securities comprised 8 percent and 8 percent, respectively, of the fair value of our fixed maturity investment portfolio. Included in below investment grade securities at June 30, 2026 were securities in an unrealized loss position that, in the aggregate, had an amortized cost of $2.3 billion and a fair value of $2.2 billion, resulting in a net pre-tax unrealized investment loss of $100 million.

For additional information on our investment portfolio, see Note 5 to the Condensed Consolidated Financial Statements.

CREDIT RATINGS

Moody’s Investors Service, Inc. (Moody’s), Standard & Poor’s Financial Services LLC, a subsidiary of S&P Global Inc. (S&P), Fitch Ratings Inc. (Fitch), or similar foreign rating services rate a significant portion of our foreign entities’ fixed maturity securities portfolio. Rating services are not available for some foreign-issued securities. We closely monitor the credit quality of the foreign portfolio’s non-rated fixed maturity securities.

At June 30, 2026, approximately 63 percent of our fixed maturity securities were held by our U.S. entities. Approximately 92 percent of these securities were rated investment grade by one or more of the major rating agencies.

At June 30, 2026, approximately 93 percent of our fixed maturity securities held by our foreign entities were either rated investment grade or, on the basis of analysis of our investment managers, were equivalent from a credit standpoint to securities rated investment grade. Approximately 16 percent of the foreign entities’ fixed maturity securities portfolio is comprised of sovereign fixed maturity securities supporting policy liabilities in the country of issuance.

Composite AIG Credit Ratings

With respect to our fixed maturity securities, the credit ratings in the table below reflect: (i) a composite of the ratings of the three major rating agencies, or when agency ratings are not available, the National Association of Insurance Commissioners (NAIC) Designation assigned by the NAIC Securities Valuation Office (SVO) (96 percent of total fixed maturity securities), or (ii) our internal ratings when these investments have not been rated by any of the major rating agencies or the NAIC. The “Non-rated” category consists of fixed maturity securities that have not been rated by any of the major rating agencies, the NAIC or us.

For information regarding credit risks associated with investments, see Part II, Item 7. MD&A – Enterprise Risk Management in the 2025 Annual Report.

The following table presents the composite AIG credit ratings of our fixed maturity securities calculated on the basis of their fair value:


	Available for Sale				Other Bond Securities				Total
(in millions)	June 30, 2026		December 31, 2025		June 30, 2026		December 31, 2025		June 30, 2026		December 31, 2025
Rating:
Other fixed maturity securities
AAA	$	3,507	$	4,063	$	14	$	14	$	3,521	$	4,077
AA	8,257		8,693		50		50		8,307		8,743
A	17,473		17,679		115		173		17,588		17,852
BBB	15,819		14,565		98		100		15,917		14,665
Below investment grade	4,701		4,730		2		11		4,703		4,741
Non-rated	61		94		—		—		61		94
Total	$	49,818	$	49,824	$	279	$	348	$	50,097	$	50,172
Mortgage-backed, asset-backed and collateralized
AAA	$	11,488	$	11,198	$	82	$	102	$	11,570	$	11,300
AA	7,842		7,468		48		49		7,890		7,517
A	1,015		1,030		160		135		1,175		1,165
BBB	356		411		65		77		421		488
Below investment grade	953		1,101		31		30		984		1,131
Non-rated	—		—		2		—		2		—
Total	$	21,654	$	21,208	$	388	$	393	$	22,042	$	21,601
Total
AAA	$	14,995	$	15,261	$	96	$	116	$	15,091	$	15,377
AA	16,099		16,161		98		99		16,197		16,260
A	18,488		18,709		275		308		18,763		19,017
BBB	16,175		14,976		163		177		16,338		15,153
Below investment grade	5,654		5,831		33		41		5,687		5,872
Non-rated	61		94		2		—		63		94
Total	$	71,472	$	71,032	$	667	$	741	$	72,139	$	71,773


AIG \| Second Quarter 2026 Form 10-Q			63

ITEM 2 | Insurance Reserves

Insurance Reserves

LIABILITY FOR UNPAID LOSSES AND LOSS ADJUSTMENT EXPENSES (LOSS RESERVES)

The following table presents the components of our gross and net loss reserves by segment and major lines of business**(a)****:**


	June 30, 2026								December 31, 2025
(in millions)	Net Loss Reserves		Reinsurance Recoverable			Gross Loss Reserves			Net Loss Reserves		Reinsurance Recoverable			Gross Loss Reserves
General Insurance:
North America Commercial:
U.S. Workers' Compensation (net of discount)	$	2,285		$	3,462		$	5,747	$	2,273		$	3,742		$	6,015
U.S. Excess Casualty	3,163			2,794			5,957		3,153			2,961			6,114
U.S. Other Casualty	4,987			3,141			8,128		4,651			3,170			7,821
U.S. Financial Lines	5,108			1,403			6,511		5,270			1,516			6,786
U.S. Property and Special Risks	4,222			932			5,154		4,142			990			5,132
Other product lines(b)	3,768			2,632			6,400		4,356			2,947			7,303
Total North America Commercial	23,533			14,364			37,897		23,845			15,326			39,171
International Commercial:
UK/Europe Casualty and Financial Lines	7,947			3,150			11,097		8,288			2,376			10,664
UK/Europe Property and Special Risks	3,188			1,424			4,612		2,176			2,214			4,390
Other product lines(b)	1,967			1,374			3,341		1,882			1,272			3,154
Total International Commercial	13,102			5,948			19,050		12,346			5,862			18,208
Global Personal:
U.S. Personal Insurance	786			1,934			2,720		705			1,986			2,691
UK/Europe and Japan Personal Insurance	1,168			724			1,892		1,240			733			1,973
Other product lines(b)	1,177			822			1,999		1,109			750			1,859
Total Global Personal	3,131			3,480			6,611		3,054			3,469			6,523
Unallocated loss adjustment expenses(b)	1,620			547			2,167		1,965			629			2,594
Total General Insurance	41,386			24,339			65,725		41,210			25,286			66,496





Other Operations	608			3,519			4,127		585			3,585			4,170
Total	$	41,994		$	27,858		$	69,852	$	41,795		$	28,871		$	70,666

(a)Includes net loss reserve discount of $1.3 billion and $1.2 billion at June 30, 2026 and December 31, 2025, respectively. For information regarding loss reserve discount, see Note 11 to the Condensed Consolidated Financial Statements.

(b)Other product lines and Unallocated loss adjustment expenses includes Gross liability for unpaid losses and loss adjustment expense and Reinsurance recoverable on unpaid losses and loss adjustment expense for the Fortitude Re reinsurance of $2.3 billion and $2.3 billion at June 30, 2026 and December 31, 2025, respectively.

Prior Year Development

The following table summarizes incurred (favorable) unfavorable prior year development net of reinsurance by segment and major lines of business:



	Three Months Ended June 30,				Six Months Ended June 30,
(in millions)		2026		2025		2026		2025
General Insurance:
North America Commercial:
U.S. Workers' Compensation	$	(177)	$	(107)	$	(185)	$	(117)
U.S. Excess Casualty		74		106		68		99
U.S. Other Casualty		17		32		11		25
U.S. Financial Lines		(4)		(5)		(27)		(10)
U.S. Property and Special Risks		(79)		(56)		(147)		(77)
Other Product Lines		1		(89)		8		(89)
Total North America Commercial	$	(168)	$	(119)	$	(272)	$	(169)
International Commercial:
UK/Europe Casualty and Financial Lines	$	2	$	—	$	1	$	—
UK/Europe Property and Special Risks		(1)		(1)		27		(14)
Other Product Lines		(4)		(7)		(56)		(8)
Total International Commercial	$	(3)	$	(8)	$	(28)	$	(22)


64			AIG \| Second Quarter 2026 Form 10-Q

ITEM 2 | Insurance Reserves



	Three Months Ended June 30,				Six Months Ended June 30,
(in millions)		2026		2025		2026		2025
Global Personal:
U.S. Personal Insurance	$	7	$	—	$	(15)	$	—
UK/Europe and Japan Personal Insurance		(7)		—		(10)		(1)
Other Product Lines		(1)		(1)		—		—
Total Global Personal	$	(1)	$	(1)	$	(25)	$	(1)
Total Prior Year (Favorable) Unfavorable Development*	$	(172)	$	(128)	$	(325)	$	(192)

*Includes the amortization attributed to the deferred gain at inception from the National Indemnity Company (NICO) adverse development reinsurance agreement of $26 million and $31 million for the three months ended June 30, 2026 and 2025, respectively, and $52 million and $62 million for the six months ended June 30, 2026 and 2025, respectively. Consistent with our definition of APTI, the amount excludes the portion of (favorable)/unfavorable prior year reserve development for which we have ceded the risk under the NICO reinsurance agreements of $(100) million and $122 million for the three months ended June 30, 2026 and 2025, respectively, and $(100) million and $122 million for the six months ended June 30, 2026 and 2025, respectively. Also excludes the related changes in amortization of the deferred gain, which were $(34) million and $69 million for the three months ended June 30, 2026 and 2025, respectively, and $(25) million and $60 million for the six months ended June 30, 2026 and 2025, respectively.

Net Loss Development

In the three months ended June 30, 2026, we recognized favorable prior year loss reserve development of $172 million, primarily driven by:

North America Commercial

Favorable development in U.S. Workers’ Compensation driven by Excess of Loss Sensitive and Primary business.
Favorable development in U.S. Property and Special Risks primarily reflecting favorable experience in Programs.
Adverse development in U.S. Excess Casualty reflecting unfavorable experience in first-layer umbrella and high excess casualty.
Benefit from the amortization of the deferred gain on the adverse development cover.

In the six months ended June 30, 2026, we recognized favorable prior year loss reserve development of $325 million, primarily driven by:

North America Commercial

Favorable development in U.S. Workers’ Compensation driven by Excess of Loss Sensitive and Primary business.
Favorable development in U.S. Property and Special Risks primarily reflecting development in Programs, along with lower than expected non-CAT loss experience in Property Lines.
Favorable development in U.S. Financial Lines reflecting favorable experience in Directors and Officers in more mature accident years.
Benefit from the amortization of the deferred gain on the adverse development cover.

International Commercial

Favorable development in Other Product Lines primarily driven by Energy and Cargo.
Adverse development in UK/Europe Property and Special Risks due to adverse development on prior year catastrophes, partially offset by favorable experience primarily concentrated in EMEA Property.

Global Personal

Favorable development in U.S. Personal Insurance attributable to favorable development on prior year catastrophes.

In the three months ended June 30, 2025, we recognized favorable prior year loss reserve development of $128 million, primarily driven by:

North America Commercial

Favorable development in U.S. Workers’ Compensation primarily driven by favorable experience within Excess of Loss Sensitive offset by adverse development within Primary Guaranteed Cost and Defense Base Act business.
Adverse development in U.S. Excess Casualty primarily driven by unfavorable development in Mass Tort.
Favorable Development in U.S. Property and Special Risks primarily driven by Programs.
Benefit from the amortization of the deferred gain on the adverse development cover.


AIG \| Second Quarter 2026 Form 10-Q			65

ITEM 2 | Insurance Reserves

In the six months ended June 30, 2025, we recognized favorable prior year loss reserve development of $192 million, primarily driven by:

North America Commercial

Favorable development in U.S. Workers’ Compensation primarily driven by favorable experience within Excess of Loss Sensitive offset by adverse development within Primary Guaranteed Cost and Defense Base Act business.
Adverse development in U.S. Excess Casualty primarily driven by unfavorable development in Mass Tort.
Favorable Development in U.S. Property and Special Risks primarily driven by Programs.
Benefit from the amortization of the deferred gain on the adverse development cover.

International Commercial

Favorable development in Global Specialty.

For certain categories of claims (e.g., construction defect claims and environmental claims) and for reinsurance recoverable, losses may sometimes be reclassified to an earlier or later accident year as more information about the date of occurrence becomes available to us.

Significant Reinsurance Agreements

NICO

In the first quarter of 2017, we entered into an adverse development reinsurance agreement with NICO, under which we transferred to NICO 80 percent of the reserve risk on substantially all of our U.S. Commercial long-tail exposures for accident years 2015 and prior. Under this agreement, we ceded to NICO 80 percent of the losses on subject business paid on or after January 1, 2016 in excess of $25 billion of net paid losses, up to an aggregate limit of $25 billion. We account for this transaction as retroactive reinsurance. This transaction resulted in a gain, which under GAAP retroactive reinsurance accounting is deferred and amortized into income over the settlement period. NICO created a collateral trust account as security for their claim payment obligations to us, into which they deposited the consideration paid under the agreement, and Berkshire Hathaway Inc. has provided a parental guarantee to secure NICO’s obligations under the agreement.

For a description of AIG’s catastrophe reinsurance protection for 2026, see Part II, Item 7. MD&A – Enterprise Risk Management – Insurance Risk – Natural Catastrophe Risk in the 2025 Annual Report.

The table below shows the calculation of the deferred gain on the adverse development reinsurance agreement, the effect of discounting of loss reserves and amortization of the deferred gain.


(in millions)	June 30, 2026		December 31, 2025
Gross Covered Losses
Covered reserves before discount	$	8,275	$	8,907
Inception to date losses paid	33,095		32,588
Attachment point	(25,000)		(25,000)
Covered losses above attachment point	$	16,370	$	16,495
Deferred Gain Development
Covered losses above attachment ceded to NICO (80%)	$	13,096	$	13,196
Consideration paid including interest	(10,188)		(10,188)
Pre-tax deferred gain before discount and amortization	2,908		3,008
Discount on ceded losses(a)	(819)		(891)
Pre-tax deferred gain before amortization	2,089		2,117
Inception to date amortization of deferred gain at inception	(1,740)		(1,688)
Inception to date amortization attributed to changes in deferred gain(b)	(108)		(156)
Deferred gain liability reflected in AIG's balance sheet	$	241	$	273

(a)The accretion of discount and a reduction in effective interest rates is offset by changes in estimates of the amount and timing of future recoveries.

(b)Excluded from APTI.


66			AIG \| Second Quarter 2026 Form 10-Q

ITEM 2 | Insurance Reserves

The following table presents the rollforward of activity in the deferred gain from the adverse development reinsurance agreement:



	Three Months Ended June 30,				Six Months Ended June 30,
(in millions)		2026		2025		2026		2025
Balance at beginning of period, net of discount	$	306	$	268	$	273	$	284
(Favorable) unfavorable prior year reserve development ceded to NICO(a)		(100)		122		(100)		122
Amortization attributed to deferred gain at inception(b)		(26)		(31)		(52)		(62)
Amortization attributed to changes in deferred gain(c)		42		(62)		48		(48)
Changes in discount on ceded loss reserves		19		19		72		20
Balance at end of period, net of discount	$	241	$	316	$	241	$	316

(a)Prior year reserve development ceded to NICO under the retroactive reinsurance agreement is deferred under GAAP.

(b)Represents amortization of the deferred gain recognized in APTI.

(c)Excluded from APTI.

The lines of business subject to this agreement include those with longer tails, which carry a higher degree of uncertainty. Since inception, there have been periods of both favorable and unfavorable prior year development. This agreement will continue to reduce the impact of volatility in the development on our ultimate loss estimates over time.

Fortitude Re

Fortitude Re was established during the first quarter of 2018 in a series of reinsurance transactions related to our run-off operations. Those reinsurance transactions were designed to consolidate most of our insurance run-off lines into a single legal entity. As of June 30, 2026, $3.0 billion of reserves related to business written by multiple wholly-owned AIG subsidiaries had been ceded to Fortitude Re under these reinsurance transactions.

Liquidity and Capital Resources

OVERVIEW

Liquidity refers to the ability to generate sufficient cash resources to meet the cash requirements of our business operations and payment obligations.

Capital refers to the long-term financial resources available to support the operation of our businesses, fund business growth and cover financial and operational needs that arise from adverse circumstances. Our primary source of ongoing capital generation is derived from the profitability of our insurance subsidiaries. We must comply with numerous constraints on our capital positions. These constraints drive the requirements for capital adequacy at AIG and the individual businesses and are based on internally defined risk tolerances, regulatory requirements, rating agency and creditor expectations and business needs.

For information regarding our liquidity risk framework, see Part II, Item 7. MD&A – Enterprise Risk Management and Part II, Item 7. MD&A – Enterprise Risk Management – Liquidity Risk in the 2025 Annual Report.

We believe that we have sufficient liquidity and capital resources to satisfy future requirements and meet our obligations to policyholders, customers, creditors and debt-holders, including those arising from reasonably foreseeable contingencies or events. Nevertheless, some circumstances may cause our cash or capital needs to exceed projected liquidity or readily deployable capital resources.

For information regarding risks associated with our liquidity and capital resources, see Part I, Item 1A. Risk Factors – Liquidity, Capital and Credit in the 2025 Annual Report.

Depending on market conditions, regulatory and rating agency considerations and other factors, we may take various liability and capital management actions. Liability management actions may include, but are not limited to, repurchasing or redeeming outstanding debt, issuing new debt or engaging in debt exchange offers. Capital management actions may include, but are not limited to, issuing preferred stock, paying dividends to our shareholders on AIG common stock, par value $2.50 per share (AIG Common Stock) and repurchases of AIG Common Stock.


AIG \| Second Quarter 2026 Form 10-Q			67

ITEM 2 | Liquidity and Capital Resources

LIQUIDITY AND CAPITAL RESOURCES HIGHLIGHTS

Sources

Liquidity to AIG Parent from Subsidiaries

During the six months ended June 30, 2026, our General Insurance companies distributed dividends of $1.8 billion to AIG Parent or applicable intermediate holding companies.

Sales of Corebridge Shares by AIG

In February 2026, we sold 24.7 million shares of Corebridge common stock at a per share purchase price of $30.42. The aggregate proceeds to AIG Parent were $750 million.

In May 2026, we sold 25.5 million shares of Corebridge common stock, representing our remaining interest in Corebridge, at a per share purchase price of $27.90. The aggregate proceeds to AIG Parent were approximately $710 million.

Uses

General Borrowings

We made interest payments on our general borrowings totaling $202 million during the six months ended June 30, 2026.

Dividends

We made cash dividend payments in the amount of $0.50 per share on AIG Common Stock for the three month period ended June 30, 2026 (an increase of 11 percent from prior dividend payments), and $0.45 per share for the three months ended March 31, 2026, totaling $504 million in the aggregate.

Repurchases of Common Stock

During the six months ended June 30, 2026, AIG Parent repurchased approximately 15 million shares of AIG Common Stock, for an aggregate purchase price of approximately $1.2 billion. Pursuant to a Rule 10b5-1 plan, from July 1, 2026 to July 31, 2026, AIG Parent repurchased approximately 2 million shares of AIG Common Stock for an aggregate purchase price of approximately $195 million.

Acquisition of Convex Group Limited (Convex) and Onex Corporation (Onex)

On February 6, 2026, AIG closed its previously announced acquisitions of (i) a 35 percent equity interest in Convex for $2.1 billion and (ii) a 9.9 percent ownership stake in Onex, for $642 million.

ANALYSIS OF SOURCES AND USES OF CASH

Operating Cash Flow Activities

Insurance companies generally receive most premiums in advance of the payment of claims or policy benefits. The ability of insurance companies to generate positive cash flow is affected by the frequency and severity of losses under their insurance policies, policy retention rates, effective management of their investment portfolio and operating expense discipline.

Interest payments totaled $205 million and $200 million in the six months ended June 30, 2026 and 2025, respectively. Excluding interest payments, AIG had operating cash inflows of $2.1 billion and $1.5 billion in the six months ended June 30, 2026 and 2025, respectively.

Investing Cash Flow Activities

Net cash provided by investing activities in the six months ended June 30, 2026 was $81 million compared to $3.3 billion in the prior year period.

Financing Cash Flow Activities

Net cash used in financing activities in the six months ended June 30, 2026 totaled $1.7 billion, reflecting:

$504 million to pay dividends of $0.50 per share in the three months ended June 30, 2026, and $0.45 per share for the three months ended March 31, 2026 on AIG Common Stock; and
$1.2 billion to repurchase approximately 15 million shares of AIG Common Stock.

Net cash used in financing activities in the six months ended June 30, 2025 totaled $4.2 billion reflecting:

$488 million to pay dividends of $0.45 per share in the three months ended June 30, 2025, and $0.40 per share for the three months ended March 31, 2025 on AIG Common Stock;
$4.0 billion to repurchase approximately 50 million shares of AIG Common Stock; and
$154 million in net inflows from the issuance and repayment of long-term debt.


68			AIG \| Second Quarter 2026 Form 10-Q

ITEM 2 | Liquidity and Capital Resources

LIQUIDITY AND CAPITAL RESOURCES OF AIG PARENT AND SUBSIDIARIES

AIG Parent

As of June 30, 2026 and December 31, 2025, respectively, AIG Parent had approximately $7.4 billion and $9.3 billion in liquidity sources held in the form of cash, short-term investments and AIG Parent's committed, revolving syndicated credit facility of $3.0 billion. AIG Parent’s primary sources of liquidity are dividends, distributions, loans and other payments from subsidiaries and credit facilities. AIG Parent’s primary uses of liquidity are for debt service, capital and liability management, operating expenses and dividends on AIG Common Stock.

We expect to access the debt and preferred equity markets from time to time to meet funding requirements as needed.

We utilize our capital resources to support our businesses, with the majority of capital allocated to our insurance operations. Should we have or generate more capital than is needed to support our business strategies (including organic or inorganic growth opportunities) or mitigate risks inherent to our business, we may develop plans to distribute such capital to shareholders via dividends or AIG Common Stock repurchase authorizations or deploy such capital towards liability management.

Insurance Companies

We expect that our insurance companies will be able to continue to satisfy reasonably foreseeable future liquidity requirements and meet their obligations, including those arising from reasonably foreseeable contingencies or events, through cash from operations and, to the extent necessary, monetization of invested assets.

Our insurance companies’ liquidity resources are primarily held in the form of cash, short-term investments and publicly traded, investment grade rated fixed maturity securities. Each of our material insurance companies’ liquidity is monitored through various internal liquidity risk measures. The primary sources of liquidity are premiums, fees, reinsurance recoverables and investment income and maturities. Certain of our insurance companies have access to Federal Home Loan Bank (FHLB) borrowings as an additional source of funding.

The primary uses of liquidity are paid losses, reinsurance payments, interest payments, dividends, expenses, investment purchases and collateral requirements. Payments of dividends to AIG Parent or intermediate holding companies by insurance subsidiaries are subject to certain restrictions imposed by regulatory authorities. For information regarding restrictions on payments of dividends by our subsidiaries, see Note 18 to the Consolidated Financial Statements in the 2025 Annual Report.

Our insurance companies may require additional funding to meet capital or liquidity needs under certain circumstances. For example, large catastrophes may require us to provide additional support to the affected operations of our insurance companies.

We are party to several letter of credit agreements with various financial institutions, which issue letters of credit from time to time in support of our insurance companies. These letters of credit are subject to reimbursement by us in the event of a drawdown. Letters of credit issued in support of our insurance companies totaled approximately $2.2 billion at June 30, 2026.

CREDIT FACILITIES

We maintain a syndicated, multicurrency revolving credit facility (the Facility) as a potential source of liquidity for general corporate purposes with aggregate commitments by the bank syndicate to provide AIG Parent with unsecured revolving loans and/or standby letters of credit of up to $3.0 billion. The Facility is scheduled to expire in September 2029.

Our ability to utilize the Facility is conditioned on the satisfaction of certain legal, operating, administrative and financial covenants and other requirements contained in the Facility. These include covenants relating to our maintenance of a specified total consolidated net worth and total consolidated debt to total consolidated capitalization. Failure to satisfy these and other requirements contained in the Facility would restrict our access to the Facility and could have a material adverse effect on our financial condition, results of operations and liquidity.

As of June 30, 2026, a total of $3.0 billion remained available under the Facility.

CONTRACTUAL OBLIGATIONS

As of June 30, 2026, there have been no material changes in our contractual obligations from December 31, 2025, a description of which may be found in Part II, Item 7. MD&A – Liquidity and Capital Resources – Contractual Obligations in the 2025 Annual Report.

OFF-BALANCE SHEET ARRANGEMENTS AND COMMERCIAL COMMITMENTS

As of June 30, 2026, there have been no material changes in our off-balance sheet arrangements and commercial commitments from December 31, 2025, a description of which may be found in Part II, Item 7. MD&A – Liquidity and Capital Resources – Off-Balance Sheet Arrangements and Commercial Commitments in the 2025 Annual Report.


AIG \| Second Quarter 2026 Form 10-Q			69

ITEM 2 | Liquidity and Capital Resources

DEBT

We expect to service and repay general borrowings through maturing investments and dispositions of invested assets, future cash flows from operations, cash flows generated from invested assets, future debt or preferred stock issuances and other financing arrangements.

The following table provides the rollforward of our total debt outstanding:


Six Months Ended June 30, 2026	Balance, Beginning of Year			Issuances		Maturities and Repayments		Effect of Foreign Exchange		Other Changes		Balance, End of Period
(in millions)
General borrowings:
Notes and bonds payable	$	8,529	$	—	$	—	$	(50)	$	3	$	8,482
Junior subordinated debt		481		—		—		—		—		481
Total general borrowings		9,010		—		—		(50)		3		8,963
Borrowings supported by assets		25		—		(15)		—		—		10

Total long-term debt	$	9,035	$	—	$	(15)	$	(50)	$	3	$	8,973
Debt of consolidated investment entities - not guaranteed by AIG(a)	$	156	$	—	$	—	$	—	$	(2)	$	154

(a)Includes debt of consolidated investment entities related to real estate investments.

Debt Maturities

The following table summarizes maturing long-term debt at June 30, 2026 of AIG for the next four quarters:


	Third Quarter		Fourth Quarter		First Quarter		Second Quarter
(in millions)	2026		2026		2027		2027		Total
General borrowings	$	—	$	28	$	—	$	938	$	966

The following table presents maturities of long-term debt (including unamortized original issue discount, hedge accounting valuation adjustments and fair value adjustments, when applicable):


June 30, 2026				Remainder		Year Ending
(in millions)		Total		of 2026		2027		2028		2029		2030		2031	Thereafter
General borrowings:
Notes and bonds payable	$	8,482	$	28	$	938	$	675	$	203	$	959	$	—	$	5,679
Junior subordinated debt		481		—		—		—		—		—		—	481

Total general borrowings		8,963		28		938		675		203		959		—	6,160
Borrowings supported by assets		10		—		—		—		—		—		—	10

Total long-term debt*	$	8,973	$	28	$	938	$	675	$	203	$	959	$	—	$	6,170

*Does not reflect $154 million of notes issued by consolidated investment entities, for which recourse is limited to the assets of the respective investment entities and for which there is no recourse to the general credit of AIG.

FINANCIAL STRENGTH RATINGS

Financial Strength ratings estimate an insurance company’s ability to pay its obligations under an insurance policy. The following table presents the ratings of our significant insurance subsidiaries as of the date of this filing.


	A.M. Best	S&P	Fitch	Moody’s
National Union Fire Insurance Company of Pittsburgh, Pa.	A	AA-	AA-	A1
Lexington Insurance Company	A	AA-	AA-	A1
American Home Assurance Company	A	AA-	AA-	A1
AIG Europe S.A.	NR	AA-	AA-	A1
American International Group UK Limited	A	AA-	AA-	A1
AIG General Insurance Company, Ltd.	NR	AA-	NR	NR

In July 2026, Fitch assigned a financial strength rating of AA- to AIG Europe S.A. and American International Group UK Limited, the outlook of the ratings assigned is Stable for both subsidiaries. Both entities were previously unrated by Fitch.


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ITEM 2 | Liquidity and Capital Resources

These financial strength ratings are current opinions of the rating agencies. They may be changed, suspended or withdrawn at any time by the rating agencies as a result of changes in, or unavailability of, information or based on other circumstances.

CREDIT RATINGS

Credit ratings estimate a company’s ability to meet its obligations and may directly affect the cost and availability of financing to that company. The following table presents the credit ratings of AIG Parent as of the date of this filing. Figures in parentheses indicate the relative ranking of the ratings within the agency’s rating categories; that ranking refers only to the major rating category and not to the modifiers assigned by the rating agencies.


	Short-Term Debt		Senior Debt Rating
	Moody's	S&P	Moody's(a)	S&P(b)	Fitch(c)
American International Group, Inc.	P-2 (2nd of 4)	A-2 (2nd of 5)	Baa 1 (4th of 9) / Stable	A- (3rd of 9) / Stable	A- (3rd of 9) / Stable

(a)Moody’s appends numerical modifiers 1, 2 and 3 to the generic rating categories to show relative position within the rating categories.

(b)S&P ratings may be modified by the addition of a plus or minus sign to show relative standing within the major rating categories.

(c)Fitch ratings may be modified by the addition of a plus or minus sign to show relative standing within the major rating categories.

These credit ratings are current opinions of the rating agencies. They may be changed, suspended or withdrawn at any time by the rating agencies as a result of changes in, or unavailability of, information or based on other circumstances. Ratings may also be withdrawn at our request.

We are party to some agreements that contain “ratings triggers.” Depending on the ratings maintained by one or more rating agencies, these triggers could result in (i) the termination or limitation of credit availability or a requirement for accelerated repayment, (ii) the termination of business contracts or (iii) a requirement to post collateral for the benefit of counterparties.

In the event of a downgrade of our long-term senior debt ratings, certain AIG entities would be required to post additional collateral under some derivative and other transactions, or certain of the counterparties of such entities would be permitted to terminate such transactions early.

The actual amount of collateral that we would be required to post to counterparties in the event of such downgrades, or the aggregate amount of payments that we could be required to make, depends on market conditions, the fair value of outstanding affected transactions and other factors prevailing at the time of the downgrade.

For information regarding the effects of downgrades in our credit ratings and financial strength ratings, see Part I, Item 1A. Risk Factors – Liquidity, Capital and Credit – “A downgrade by one or more of the rating agencies in the Insurer Financial Strength ratings of our insurance companies could limit their ability to write or prevent them from writing new business and impair their retention of customers and in-force business, and a downgrade in our credit ratings could adversely affect our business, results of operations, financial condition and liquidity” in the 2025 Annual Report and Note 10 to the Condensed Consolidated Financial Statements.

REGULATION AND SUPERVISION

For a discussion of our regulation and supervision by different regulatory authorities in the United States and abroad, including with respect to our liquidity and capital resources, see Part I, Item 1. Business – Regulation and Part I, Item 1A. Risk Factors – Regulation in the 2025 Annual Report.

DIVIDENDS

On August 6, 2026, our Board of Directors (the Board) declared a cash dividend on AIG Common Stock of $0.50 per share, payable on September 30, 2026 to shareholders of record as of September 16, 2026.

The payment of any future dividends will be at the discretion of our Board of Directors and will depend on various factors. For further detail on our dividends, see Note 13 to the Condensed Consolidated Financial Statements.

REPURCHASES OF AIG COMMON STOCK

The Board has authorized the repurchase of shares of AIG Common Stock and as of July 31, 2026, $2.6 billion remained under the Board's authorization. During the six months ended June 30, 2026, AIG Parent repurchased approximately 15 million shares of AIG Common Stock for an aggregate purchase price of $1.2 billion. Pursuant to a Rule 10b5-1 plan, from July 1, 2026 to July 31, 2026, AIG Parent repurchased approximately 2 million shares of AIG Common Stock for an aggregate purchase price of approximately $195 million.

The timing of any future share repurchases will depend on market conditions, our business and strategic plans, financial condition, results of operations, liquidity and other factors, as discussed further in Note 13 to the Condensed Consolidated Financial Statements.


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ITEM 2 | Enterprise Risk Management

Enterprise Risk Management

Risk management is an integral part of our business strategy and a key element of our approach to corporate governance. We have an integrated process for managing risks throughout our organization in accordance with our firm-wide risk appetite. Our Board of Directors has oversight responsibility for the management of risk. Our Enterprise Risk Management (ERM) Department oversees and integrates the risk management functions in our business and embeds risk management in our day-to-day business processes, providing senior management with a consolidated view of AIG’s major risk positions. Nevertheless, our risk management efforts may not always be successful and material adverse effects on our business, results of operations, cash flows, liquidity or financial condition may occur. For further information regarding the risks associated with our business and operations, see Part I, Item 1A. Risk Factors in the 2025 Annual Report.

AIG employs a Three Lines model. AIG’s business leaders assume full accountability for the risks and controls in their segments and functions, and ERM and other second line functions have review, challenge and oversight function. The third line consists of our Internal Audit Group that provides independent assurance to AIG’s Board of Directors.

For additional information on AIG’s risk management program, see Part II, Item 7. MD&A ─ Enterprise Risk Management in the 2025 Annual Report.

The scope and magnitude of our market risk exposures is managed under a robust framework that contains defined risk limits and minimum standards for managing market risk in a manner consistent with our risk appetite statement. As of June 30, 2026, there have been no material changes in our market risk exposures, which may be found in Part II, Item 7. MD&A ─ Enterprise Risk Management in the 2025 Annual Report. See Part I, Item 1A. Risk Factors in the 2025 Annual Report on how difficult conditions in the financial markets and the economy generally may materially adversely affect our business and results of our operations.


72			AIG \| Second Quarter 2026 Form 10-Q

Glossary

Glossary

Accident year The annual calendar accounting period in which loss events occurred, regardless of when the losses are actually reported, booked or paid.

Accident year combined ratio, as adjusted (Accident year combined ratio, ex-CAT) The combined ratio excluding catastrophe losses and related reinstatement premiums, net of reinsurance, and prior year development, net of prior year premiums, net of reinsurance, and the impact of reserve discounting.

Accident year loss ratio, as adjusted (Accident year loss ratio, ex-CAT) The loss ratio excluding catastrophe losses and related reinstatement premiums, net of reinsurance, and prior year development, net of prior year premiums, net of reinsurance, and the impact of reserve discounting.

Acquisition ratio Acquisition costs divided by net premiums earned. Acquisition costs are those costs incurred to acquire new and renewal insurance contracts and also include the amortization of VOBA and DAC. Acquisition costs vary with sales and include, but are not limited to, commissions, premium taxes, direct marketing costs and certain costs of personnel engaged in sales support activities such as underwriting.

Attritional losses are losses recorded in the current accident year, which are not catastrophe losses.

Casualty insurance Insurance that is primarily associated with the losses caused by injuries to third persons, i.e., not the insured, and the legal liability imposed on the insured as a result.

Combined ratio Sum of the loss ratio and the acquisition and general operating expense ratios.

Credit Support Annex A legal document generally associated with an ISDA Master Agreement that provides for collateral postings which could vary depending on ratings and threshold levels.

DAC Deferred Policy Acquisition Costs Deferred costs that are incremental and directly related to the successful acquisition of new business or renewal of existing business.

Deferred gain on retroactive reinsurance Retroactive reinsurance is a reinsurance contract in which an assuming entity agrees to reimburse a ceding entity for liabilities incurred as a result of past insurable events. If the amount of premium paid by the ceding reinsurer is less than the related ceded loss reserves, the resulting gain is deferred and amortized over the settlement period of the reserves. Any related development on the ceded loss reserves recoverable under the contract would increase the deferred gain if unfavorable, or decrease the deferred gain if favorable.

Expense ratio Sum of acquisition expenses and general operating expenses, divided by net premiums earned.

General operating expense ratio General operating expenses divided by net premiums earned. General operating expenses are those costs that are generally attributed to the support infrastructure of the organization and include but are not limited to personnel costs, projects and bad debt expenses. General operating expenses exclude losses and loss adjustment expenses incurred, acquisition expenses, and investment expenses.

IBNR Incurred But Not Reported Estimates of claims that have been incurred but not reported to us.


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Glossary

ISDA Master Agreement An agreement between two counterparties, which may have multiple derivative transactions with each other governed by such agreement, that generally provides for the net settlement of all or a specified group of these derivative transactions, as well as pledged collateral, through a single payment, in a single currency, in the event of a default on, or affecting any, one derivative transaction or a termination event affecting all, or a specified group of, derivative transactions.

Loan-to-value ratio Principal amount of loan amount divided by appraised value of collateral securing the loan.

Loss Adjustment Expenses The expenses directly attributed to settling and paying claims of insureds and include, but are not limited to, legal fees, adjuster’s fees and the portion of general expenses allocated to claim settlement costs.

Loss ratio Losses and loss adjustment expenses incurred divided by net premiums earned.

Loss reserve development The increase or decrease in incurred losses and loss adjustment expenses related to prior years as a result of the re-estimation of loss reserves at successive valuation dates for a given group of claims.

Loss reserves Liability for unpaid losses and loss adjustment expenses. The estimated ultimate cost of settling claims relating to insured events that have occurred on or before the balance sheet date, whether or not reported to the insurer at that date.

Master netting agreement An agreement between two counterparties who have multiple derivative contracts with each other that provides for the net settlement of all contracts covered by such agreement, as well as pledged collateral, through a single payment, in a single currency, in the event of default on or upon termination of any one such contract.

Natural catastrophe losses are generally weather or seismic events having a net impact on AIG in excess of $10 million each and man-made catastrophe losses, such as terrorism and civil unrest that exceed the $10 million threshold.

Net premiums written represent the sales of an insurer, adjusted for reinsurance premiums assumed and ceded, during a given period. Net premiums earned are the revenue of an insurer for covering risk during a given period. Net premiums written are a measure of performance for a sales period, while net premiums earned are a measure of performance for a coverage period.

Noncontrolling interests The portion of equity ownership in a consolidated subsidiary not attributable to the controlling parent company.

Pool A reinsurance arrangement whereby all of the underwriting results of the pool members are combined and then shared by each member in accordance with its pool participation percentage.

Prior year development See Loss reserve development.

Reinstatement premiums Premiums on an insurance policy over and above the initial premium imposed at the beginning of the policy payable to reinsurers or receivable from insurers to restore coverage limits that have been reduced or exhausted as a result of reinsured losses under certain excess of loss reinsurance contracts.

Reinsurance The practice whereby one insurer, the reinsurer, in consideration of a premium paid to that insurer, agrees to indemnify another insurer, the ceding company, for part or all of the liability of the ceding company under one or more policies or contracts of insurance which it has issued.

Reinsurance recoverables are comprised of paid losses recoverable, ceded loss reserves, ceded reserves for unearned premiums.

Retroactive reinsurance See Deferred gain on retroactive reinsurance.

Subrogation The amount of recovery for claims we have paid our policyholders, generally from a negligent third party or such party’s insurer.

Unearned premium reserve Liabilities established by insurers and reinsurers to reflect unearned premiums, which are usually refundable to policyholders if an insurance or reinsurance contract is canceled prior to expiration of the contract term.

VOBA Value of Business Acquired Present value of future pre-tax profits from in-force policies of acquired businesses discounted at yields applicable at the time of purchase. VOBA is reported in DAC in the Condensed Consolidated Balance Sheets.


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Acronyms

Acronyms


A&H	Accident and Health Insurance	ISDA	International Swaps and Derivatives Association, Inc.
ABS	Asset-Backed Securities	Moody's	Moody's Investors Service, Inc.
APTI	Adjusted pre-tax income	NAIC	National Association of Insurance Commissioners
CDS	Credit Default Swap	NM	Not Meaningful
CLO	Collateralized Loan Obligations	ORR	Obligor Risk Ratings
CMBS	Commercial Mortgage-Backed Securities	RMBS	Residential Mortgage-Backed Securities
ERM	Enterprise Risk Management	S&P	Standard & Poor's Financial Services LLC
FASB	Financial Accounting Standards Board	SEC	Securities and Exchange Commission
GAAP	Accounting Principles Generally Accepted in the United States of America	VIE	Variable Interest Entity

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