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Japanese cat losses take toll on AIG

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AIG made a third-quarter loss of $US1.3 billion ($1.8 billion) as catastrophes in Japan and North America dented earnings.

Japan accounted for more than half of catastrophe losses in the period, while North America’s share was slightly lower. AIG previously flagged a $US1.6 billion ($2.2 billion) pre-tax catastrophe bill for the quarter.

The insurer has exhausted about $US700 million ($972 million) of the $US750 million ($1.04 billion) retention under its North America aggregate catastrophe reinsurance program.

AIG says losses reflect the “unique severity and frequency of one of Japan’s worst catastrophe seasons in 25 years and AIG’s footprint as the largest foreign-based insurer in the country”.

The general insurance arm recorded a 3% rise in gross written premium to $US8.7 billion ($12.1 billion) but remained in the red with a $US825 million ($1.15 billion) pre-tax loss.