that its third-quarter earnings rose 16 percent as the insurance company collected more premiums.

The New York-based firm said profit excluding gains from investment sales rose to $717.2 million, or $1.53 a share, from $619.4 million, or $1.30.

The latest results exceeded Wall Street's expectations of $1.51 a share excluding the gains, based on an analyst survey by Zacks Investment Research.

AIG stock fell $1 to 104.63 and slipped to $104.25 on Friday.

"The results were a little better than my expectations,'' as strong premium growth let the company fight off higher catastrophe costs, said Everen Securities analyst Frederick Sandburg.

Revenue rose 9.7 percent to $7.18 billion from a year earlier.

In the recent quarter, a $14.2 million gain from investment sales resulted in net income of $731.4 million, or $1.56 a share. A year earlier, an $11.3 million gain from investment sales produced net income of $630.7 million, or $1.33.

Operating income in AIG's property and casualty business rose 4.8 percent to $539.9 million. Premiums written rose 6.1 percent to $3.23 billion.

Catastrophe losses increased to $22.1 million from $15.1 million a year earlier.

Life insurance operating income rose 23.2 percent to $345.4 million. Income from life premiums rose 9.2 percent to $2.21 billion.

Financial services operating income rose 40.3 percent to $133.9 million.

"In spite of modestly higher catastrophe losses than in the prior year, we posted a very good quarter in general insurance,'' said chairman and chief executive Maurice Greenberg.

AIG is the 16th-largest US company, based on the $49.6 billion value of its shares outstanding. It eclipses No. 1 US automaker General Motors Corp.'s market value of $41.05 billion.

AIG has generated profits through international expansion and keeping its insured risk low, typically by capping its potential losses from an individual catastrophe at $100 million.

Last October, it received a sales license in Slovakia, and got a general insurance license earlier this year in Uruguay. In February, the company's political risk insurance company received its operating license in Uzbekistan.

It has a number of insurance subsidiaries in Bermuda, including American International Company Ltd. and is a major investor in excess liability reinsurer Srarr Excess and catastrophe reinsurer International Property Catastrophe Ltd. (IPC).

For the nine months, profit excluding investment sales rose 15 percent to $2.08 billion, or $4.42 a share, from $1.80 billion, or $3.80. Net income rose 16 percent to $2.13 billion, or $4.51 a share.

Revenue for the nine months rose 9.3 percent to $20.78 billion.