AIG powered ahead in the second quarter, boosted by a 40% surge in premium rates.
Announcing its second quarter results, AIG said premium rates were up in the general insurance business by 30-40%.
It also reported rising prices in other important classes of business.
AIG chairman Maurice Greenberg said that competition and price-cutting had not taken hold in property insurance.
Three months ago Greenberg had warned that AIG's competitors were starting a price war that could threaten AIG's profitability.
Overall net income in the quarter, before realised capital losses, was $2.5 billion (£1.6 billion).
