Global insurance giant AIG (NYSE: AIG) missed Wall Street’s revenue expectations in Q2 CY2026 as sales rose 3.9% year on year to $7.11 billion. Its non-GAAP profit of $2 per share was 3.7% above analysts’ consensus estimates.

Is now the time to buy AIG? Find out in our full research report (it’s free for active Edge members).

StockStory’s Take

AIG’s second quarter results reflected a mix of disciplined underwriting, selective portfolio growth, and targeted capital deployment. While revenue growth lagged behind analyst forecasts due to softening in certain property lines, non-GAAP earnings per share surpassed expectations, driven by improved underwriting income and expense controls. CEO Eric Andersen attributed the quarter’s performance to strong momentum in accident and health, high net worth personal lines, and a series of strategic transactions, stating, "Our team is executing well on delivering the financial commitments we outlined at our 2025 Investor Day." Management emphasized deliberate contraction in North American property portfolios to preserve risk-adjusted returns amid greater market competition.

Looking forward, AIG’s management remains focused on balancing growth opportunities with profitability across a shifting insurance landscape. The company is prioritizing disciplined capital deployment, continued expansion in accident and health, and leveraging artificial intelligence to improve underwriting and claims processes. Andersen highlighted, “Our growth plan is built around five strategic priorities: delivering exceptional underwriting performance, using our balance sheet and reinsurance program efficiently, expanding our AI capabilities, maintaining expense discipline, and investing in our team and talent.” Management cautioned that competitive pressures in property and certain specialty lines could constrain growth, but sees ongoing opportunities in casualty and international markets.

Key Insights from Management’s Remarks

AIG’s leadership credited the quarter’s earnings resilience to underwriting discipline, selective growth in profitable segments, and investments in technology and talent to support long-term value creation.

• Strategic portfolio shifts: Management continued to contract the North American property portfolio, especially in the Lexington segment, to counteract pricing pressures from increased market capacity. This led to a 9 percentage point reduction in premium retention for Lexington property, with focus shifted to areas offering stronger risk-adjusted returns.

• Accident & Health momentum: The Global Personal Insurance business saw notable growth in accident and health products, supported by new client wins and a robust pipeline. High net worth personal lines also contributed to improved profitability through underwriting actions and expense reductions.

• AI-driven operational efficiency: AIG is scaling its proprietary AI platforms—Underwriting by AIG Assist and Claims by AIG Assist—to enhance decision-making, accelerate submissions processing, and capture broker-level insights. These tools are improving productivity and providing data-driven visibility into distribution trends.

• Expense discipline and leverage: The company remains on track to reduce its general insurance expense ratio below 30% by 2027. Management highlighted operating leverage from premium growth and ongoing cost controls as key contributors to margin improvement.

• International expansion and M&A: The announced acquisition of Everest Insurance operations in Colombia positions AIG to access high-growth markets in Latin America. Management emphasized a balanced approach to growth, combining targeted transactions with organic opportunities, especially in regions with favorable risk dynamics.

Drivers of Future Performance

AIG expects future performance to hinge on sustained underwriting discipline, AI-driven productivity gains, and prudent capital deployment amid evolving market conditions.

• Selective growth focus: Management plans to prioritize organic growth in attractive segments like accident and health, while remaining disciplined in property and specialty markets facing competitive rate pressures. The company is prepared to walk away from unprofitable business and deploy capital only where risk-adjusted returns meet internal standards.

• AI and technology expansion: Scaling AI-powered underwriting and claims platforms is expected to drive operational efficiencies, support better risk selection, and improve client and broker experiences. Management believes these investments will enable AIG to process more business with higher consistency and speed, benefiting both margins and customer satisfaction.

• Expense and capital management: Continued progress toward lowering the expense ratio below 30% is a strategic priority. Management is leveraging operating scale and maintaining a conservative leverage profile, while balancing capital returns to shareholders with selective investments in talent and strategic M&A.

Catalysts in Upcoming Quarters

Looking ahead, the StockStory team will be monitoring (1) signs of underwriting discipline and profitability in property and specialty portfolios given ongoing rate pressure, (2) measurable improvements in expense ratios as AI and technology investments scale, and (3) successful integration and growth stemming from the Everest Colombia acquisition. Progress in expanding accident and health business and sustaining margin improvement amid competitive dynamics will also be important markers of execution.

AIG currently trades at $78.84, down from $79.97 just before the earnings. At this price, is it a buy or sell? See for yourself in our full research report (it’s free).

High Quality Stocks for All Market Conditions

ALSO WORTH WATCHING: Top 5 Momentum Stocks. The best time to own a great stock is when the market is finally noticing it. These aren’t just high-quality businesses. Something is happening with them right now. Elite fundamentals meet near-term momentum — both boxes checked at the same time.

Find out which stocks our AI platform is flagging this week. See this week’s Strong Momentum stocks — FREE. Get Our Strong Momentum Stocks for Free HERE.

Stocks that have made our list include now familiar names such as Nvidia (+1,460% between June 2020 and June 2025) as well as under-the-radar businesses like the once-small-cap company Comfort Systems (+1,154% between June 2020 and June 2025). Find your next big winner with StockStory today.