(Reuters) – Insurer American International Group Inc (NYSE 🙂 announced a 17% increase in its quarterly profit Tuesday. This was well above market expectations. Strong underwriting gains, lower catastrophe losses and a decrease in investment income helped to offset the decline.

According to the company, which is one of the most important commercial insurance companies in the world and has written over $11.51 billion in gross premiums for its general insurance business, it saw a 7% increase in total premiums during the first three months.

These strong results are coming at a moment when insurance companies face hefty claims due to the long-running war in Ukraine, which has led to wide-ranging sanctions.

AIG reported that the adjusted after tax income attributable by AIG to its common shareholder rose to $1.07Billion. It said this was due to “focused risk selection.”

Reuters reported last month, that the company might reduce its coverage for Russia or Ukraine in order to protect itself against the possibility of high claims.

According to data from Refinitiv IBES, AIG made an adjusted profit $1.30 per share compared to the average analyst expectation $1.18 per shares.

The company also saw a dramatic decrease in the number of catastrophic losses within its general insurance units, following a similar trend at sector bellwether Travelers Companies NYSE:) Inc.

Over the last two years, the insurance industry had been inundated by claims from companies that lost revenue as a result of the COVID-19 crises. But this has all changed with the opening up of the economy.

As compared to the 92.4% in 2012, the general insurance accident-year combined ratio stood at 89.5%. This metric does not include catastrophe losses. A ratio lower than 100 indicates that an insurer makes more money from its premiums than what it pays in claims.

AIG’s consolidated net investments income fell 11% after months of large investment gains. The market turmoil caused by Ukraine and Federal Reserve tightening had a devastating effect on its portfolio.