AIG’s general insurance business improved in the third quarter and the company expects to deliver underwriting profitability for the full year, helped by lower catastrophe losses, revised underwriting and reinsurance practices and a crackdown on costs.

Pre-tax net catastrophe losses were down by $US1.1 billion ($1.6 billion) in the third quarter compared with a year earlier.

General Insurance posted a combined ratio of 103.7% in the three months to September 30, an improvement on 124.4% a year earlier.

“Results are in line with our expectations, particularly in general insurance, which demonstrated a significant improvement…driven by our focus on underwriting excellence, expense discipline and enhanced reinsurance strategy,” Brian Duperreault, AIG’s President and CEO, said.

“We remain confident we will deliver underwriting profitability for the full year 2019,” he said.

Catastrophe losses of $US497 million ($721.22 million), net of reinsurance, compared with $US1.57 billion ($2.28 billion) a year earlier and included $US254 million ($368.59 million) from Typhoon Faxai and $US135 million ($195.9 million) from Hurricane Dorian.

Rate increases and terms and conditions “continue to firm”, AIG said.