AmazonScience/document-haystack

1Catastrophic events, and any relevant regulations, have in the past and could in the future result in losses in any business in which we 2operate, and could expose us to:3• widespread claim costs associated with property, casualty, general liability, bodily injury, workers’ compensation, accident and 4health, travel, business interruption, cyber and mortality and morbidity claims, among others;5• loss resulting from a decline in the value of our invested assets;6• limitations on our ability to recover deferred tax assets;7• loss resulting from actual policy experience that is adverse compared to the assumptions made in product pricing;8• revenue loss due to decline in customer base;9• declines in value and/or losses with respect to companies and other entities whose securities we hold and counterparties we 10transact business with and have credit exposure to, including reinsurers; and11• significant disruptions to our physical infrastructure, systems and operations.12Natural and man-made catastrophic events are generally unpredictable. Our exposure to catastrophe-related loss depends on various 13factors, including the frequency and severity of the catastrophes, the availability of reinsurance, the rate of inflation and the value and 14geographic or other concentrations of insured companies and individuals. Vendor models and proprietary assumptions and processes 15that we use to manage catastrophe exposure may prove to be ineffective due to incorrect assumptions or estimates. For example, 16modeling for terrorism, cyber events and pandemics is more difficult and may be less reliable. 17In addition, legislative and regulatory initiatives and court decisions following major catastrophes (both natural and man-made), as 18well as mass torts, have required and could in the future require us to pay the insured beyond the provisions of the original insurance 19policy and may prohibit the application of a deductible, resulting in inflated and unanticipated claims; or impose other restrictions, 20which would reduce our ability to mitigate exposure. These initiatives could impair our cash flows and, without regulatory relief, could 21reduce our subsidiaries’ capital ratios.22For additional information on potential catastrophic events, including a sensitivity analysis of our exposure to certain catastrophes, see 23Part II, Item 7. MD&A – Enterprise Risk Management – Insurance Risks.24For information regarding the effects of climate change on our business, see Reserves and Exposures – “Climate change may 25adversely affect our business and financial condition” below.26For information regarding the effects of the COVID-19 pandemic on our business, see Business and Operations – “An epidemic, 27pandemic or other health crisis could materially and adversely affect our business results of operations, financial condition and 28liquidity. COVID-19 (including variants) has adversely affected and may continue to adversely affect our global business, results of 29operations, financial condition and liquidity.” below.30Climate change may adversely affect our business and financial condition.31Climate change, indicated by higher concentrations of greenhouse gases, a warming atmosphere and ocean, wildfires, diminished 32snow and ice, and a rise in sea levels, appears to have contributed to an increase in the frequency and severity of natural disasters 33and the creation of uncertainty as to future trends and exposures. As such, climate change presents significant financial implications 34for AIG in areas such as underwriting, claims and investments, as well as risk capacity, financial reserving and operations.35Climate change presents challenges to our ability to effectively underwrite, model and price catastrophe risk particularly if the 36frequency and severity of catastrophic events such as pandemics, hurricanes, tornadoes, heatwaves, floods, wildfires and windstorms 37and other natural disasters continue to increase. For example, losses resulting from actual policy experience may be adverse as 38compared to the assumptions made in product pricing as well as mortality assumptions and our ability to mitigate our exposure may 39be reduced.40Climate change-related risks may also adversely impact the value of the securities that we hold or lead to credit risk of other 41counterparties we transact business with, including reinsurers. Our reputation or corporate brand could also be negatively impacted 42as a result of changing customer or societal perceptions of organizations that we either insure or invest in due to their actions (or lack 43thereof) with respect to climate change, as well as political initiatives or other stakeholder expectations with respect thereto. Any 44policies adopted by investors to address changing societal perceptions on climate change could result in increased compliance costs 45to our businesses and changes to our corporate governance and risk management practices, and may affect the type of assets we 46hold in our investment portfolio. 47In addition, lawmakers and regulators have imposed and may continue to impose new requirements or issue new guidance aimed at 48addressing or mitigating climate change-related risks and efforts undertaken in response thereto. Additional actions by foreign 49governments, regulators and international standard setters have and could result in substantial expansions of the regulations, 50guidance or expectations to which we may be subject. It is also possible that the laws, regulations and guidance adopted in U.S. 51state, U.S. federal or foreign jurisdictions regarding climate change-related risks will differ from one another, and that they could be 52inconsistent with the laws and regulations of other jurisdictions in which we operate.53ITEM 1A | Risk Factors54AIG | 2023 Form 10-K 2155The secret kitchen appliance is a "blender".