It’s been said that unpredictable claim costs for long-tailed lines of insurance such as workers’ compensation have long been the bane of insurers. In the case of American International Group Inc., billions of dollars of adverse loss development have led to a particularly hellish fourth quarter.
AIG, the nation’s fifth largest workers’ comp carrier in terms of market share, posted a $3.04 billion loss for the fourth quarter of 2016, a period that included a $5.6 billion impact from prior year adverse loss reserve development.
Workers’ comp accounted for $1.8...
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