(Bloomberg) -- AmericanInternational Group Inc. posted its fourth loss in sixquarters, burned again by higher-than-expected claims costs as struggles to sustain profitability.

The net loss widened to $3.04 billion, or $2.96 a share, from a$1.84 billion, or $1.50, a year earlier, the New York-based insurersaid Tuesday in a statement. The fourth quarter’s operating loss,which excludes some investment results, was $2.72 a share, missingthe average estimate in a survey of 18 analysts for a profit of 42cents.

Selling units to free up cash

Hancock is seeking to stabilize results by being more selectiveabout the risks that AIG takes through both insurance underwritingand investing. He has been selling units to free up cash for shareholderbuybacks and to simplify the company while focusing on theincreased use of analytics to gain an edge in specialized lines,such as guarding commercial clients against cyber breaches.

“We took decisive actions in 2016 to dramatically reduceuncertainty and deliver higher quality, more sustainable earningsin the future,” Hancock said in the statement. He reiterated thetwo-year goal from January 2016 to return $25 billion toshareholders, adding that the commitment is “subject to regulatoryand rating agency considerations and future profitabilityimprovements.”

AIG fell 4.3 percent to $64 in extended trading at 4:59 p.m. inNew York. The shares had climbed 2.4 percent this year by the closeof regular trading in New York, compared with a 4.4 percent rallyin the S&P 500. The insurer also trailed the index in 2016.Results were released after the close of regular trading.

AIG also announced that it increased its buyback authorizationby $3.5 billion to $4.7 billion. The company repurchased more than$11 billion of stock in 2016 and another $1.2 billion this yearthrough Tuesday, according to the statement.

Rating downgrade

S&P Global Ratings downgraded the company on Jan. 31, citing “operational challenges” after Hancock announced earlier in themonth that there was a reserve shortfall in the fourth quarter,without specifying the size of the gap. On Tuesday, the companyreported a charge of $5.6 billion due to swelling claims at thecommercial insurance unit.

The insurer has been suffering for years on contracts tied toworkers’ compensation, commercial-vehicle coverage. Hancockannounced Jan. 20 that AIG would pay about $10 billion to Warren Buffett’sBerkshire Hathaway Inc. to assume risks of further losses onsome of those policies. The company said that reinsurance dealcould generate a pretax gain of about $2.6 billion in the firstquarter of this year.

Normalized return on equity was 4.8 percent for the fourthquarter, down from 6.6 percent in the last three months of 2015.For the full year, the figure climbed to 7.5 percent from about 6.9percent. Hancock has announced a target of 9 percent for 2017.Investor Carl Icahn had faulted the CEO for failing to hit 10percent, before the activist billionaire’s firm won boardrepresentation last year.

Hancock became CEO in late 2014 after previously running theproperty-and-casualty business since 2011.

Doing deals

Book value, a measure of assets minus liabilities, was $76.66 ashare at the end of December, compared with $85.02 threemonths earlier. Large insurers including MetLife Inc. andPrudential Financial Inc. endured declines in the period as higherinterest rates pushed down the market price of bond holdings.

The pretax operating loss at the commercial unit run by RobSchimek widened to $5.02 billion from $2.43 billion a year earlier,pressured by the reserve charge. The division under Schimek hasbeen shrinking, partly through reinsurance deals and also throughsales of assets such as a mortgage guarantor and businesses inBrazil and Turkey. Policy sales dropped 20 percent to $3.7billion.

Related: AIG plans to cut at least 3% of annual expensesthrough 2017

At the individual retirement business overseen by ConsumerInsurance CEO Kevin Hogan, pretax operating profit advanced 37percent to $542 million, while group retirement rose to $261million, from $228 million. The life segment posted a loss of $10million, compared with a profit of $24 million in the last periodof 2015. The contribution from personal insurance was $176 million,compared with a $27 million loss in the year-earlier period.

Net investment income, which includes results from various unitson a bond-dominated portfolio, climbed 13 percent to $3.59 billionfrom $3.18 billion, according to a supplemental filing on AIG’swebsite. Chief Investment Officer Doug Dachille last year slashedsome poorly performing hedge fund holdings and shifted funds towagers on U.S. mortgages.

Private equity and hedge funds combined contributed $314million.

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