NEW YORK (Bloomberg) ? American International Group Inc., the world?s largest insurer, said third-quarter earnings more than doubled as the company passed the peak of hurricane season unscathed a year after Katrina.

Net income increased to $4.22 billion, or $1.61 a share, from $1.75 billion, or 66 cents, a year earlier, the New York- based company said yesterday in a regulatory filing.

Profit before investment losses and changes in the value of derivatives was $1.53 a share, higher than the $1.42 estimated by 20 analysts in a Thomson Financial poll.

AIG?s claims costs from property and casualty coverage dropped after neither of the third quarter?s two major Atlantic Ocean hurricanes made landfall in the US.

Earnings from overseas sales of life insurance and retirement savings products rose at the fastest quarterly pace in a year.

?This is a very, very good quarter for them,? said Rob Haines, an insurance analyst at New York-based CreditSights Inc. ?It looks encouraging that foreign life insurance is picking up.?

The company?s shares have risen 16 percent since the quarter began, almost twice the gain of the Standard & Poor?s 500 Insurance Index. The stock fell 34 cents to $68.04 in regular trading on the New York Stock Exchange yesterday. Results were released after the close of regular trading.

AIG, the largest overseas life insurer in Japan, said pretax earnings from life insurance and retirement savings products outside the US rose 18 percent to $1.69 billion, before investment losses. Haines had predicted growth of less than ten percent.

?The introduction of investment-linked products has been well received in a number of key markets and distribution channels,? chief executive officer Martin Sullivan said in a statement. ?Market conditions in Japan remain challenging due to increased competition. However, we are taking action with our product and distribution strategies.?

AIG?s overseas businesses reduce its dependence on the US property and casualty market, where prices on many types of policies have been falling for more than two years.

The average renewal rate for commercial insurance fell 5.3 percent in the third quarter, the steepest quarterly decline in a year, according to a survey by the Council of Insurance Agents & Brokers.

Record-high prices to cover hurricane-prone coastal properties were countered by declines for general liability policies and workers compensation coverage, the survey showed.

?Property and casualty pricing may be softening, but AIG?s earnings should hold up just fine given its large overseas life insurance business,? said Jeffrey Malcom, who doubled his AIG stake to 120,000 shares during the quarter. Malcom, who spoke before the earnings were released, helps manage $240 million for Horan Capital Management in Towson, Maryland.

An increase in the value of derivatives AIG held in the quarter boosted net income by $267 million and the company had $62 million in investment losses.