I’m not a financial person so can someone explain the results in common-folk speak and why does it seem all the number don’t include CAT? By including CAT, are all the numbers worse or look bad?
6 replies (most recent on top)
I'm into claims and I'm getting 10 CAT notifications a week so don't know if cat can be considered exceptions anymore
Serious answer: CAT is highly volatile and it's pretty normal to report results on a CAT-smoothed basis, meaning that in years with large CATs, you would remove some of them on the theory that they would be unusual. And in years without large CATs, you would add some "expected CATs" on the theory that you spread the CATs out over more years than they actually happen in.
Hope this helps.
No idea what AIG actually does, sorry, not in the mood of looking at their financial statement.
There are other posts in other threads as well indicating how GI is a disaster. Can someone explain what about GI is a disaster? Not challenging the point, just wanna have a better understanding.
The one post was a good way explaining that AIG is a dumpster fire that can’t manage risk, so stay far away from it like you would a dumpster fire.
Or maybe more like if a fireworks warehouse cause on fire, stay far away
AIG always omits CAT because AIG doesn't know how to handle a changing world with changing risks. A 6 billion dollar injection of capital from L&R can be distributed to make any number look good. Stock buy backs are then used to prop up the price per share. Execs can do this as long as they can keep the capital flowing by selling assets and cutting expenses. We all know you can't keep selling assets and cutting expenses forever. Execs are leveraging short term gains in the hopes that they can somehow fix the long term problem of GI. When they realize they can't, they will retire while the stock is still artificially inflated.
Anyone that works at AIG knows the company is in trouble.
Perfect example: One of the darling companies PZ loves to discuss is PCG. PCG reports a combined ratio in the 90's excluding CAT; however the CEO of PCG just announced a massive non-renewal initiative because the true combined ratio is 134% including CAT. The CEO of PCG has been in place for several years and is still putting up 134% combined ratio? What an utter failure. This is AIG, smoke and mirrors.
It means PZ bought a new boat but forgot to give his employees meaningful raises