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New York - AIG Insurance Addresses Policyholder Concerns

Published on: September 16, 2008 05:27 PM
By: AIG Press Release
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n employee exits the American International Group Inc Headquarters building in New York\'s financial district, September 16, 2008. New York - American International Group, Inc. (AIG) today said that AIG’s life insurance, general insurance and retirement services businesses, including its extensive Asian operations, continue to operate normally and remain adequately capitalized and fully capable of meeting their obligations to policyholders.

AIG continues to pursue alternatives to increase short-term liquidity in the parent company. Those plans do not include any effort to reduce the capital of any of its subsidiaries or to tap into Asian operations for liquidity.

The insurance policies written by AIG companies are direct obligations of its regulated subsidiary insurance companies around the world. These companies are well capitalized and meet or exceed local regulatory capital requirements. The companies continue to operate in the normal course to meet obligations to policyholders. In particular, AIG noted its long tradition of service in Asian markets, which are key to AIG’s future growth. Founded in Shanghai in 1919, Asia is home to some of AIG’s oldest and most valued clients.

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The AIG companies are fully committed to maintaining required capital levels in all of its subsidiaries and to meeting the needs of their customers around the world.

American International Group, Inc. (AIG), a world leader in insurance and financial services, is the leading international insurance organization with operations in more than 130 countries and jurisdictions. AIG companies serve commercial, institutional and individual customers through the most extensive worldwide property-casualty and life insurance networks of any insurer. In addition, AIG companies are leading providers of retirement services, financial services and asset management around the world. AIG’s common stock is listed on the New York Stock Exchange, as well as the stock exchanges in Ireland and Tokyo.



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Read Comments (5)  —  Post Yours »

1

 Sep 16, 2008 at 05:56 PM cycletrader Says:

if AIG files relief under chapter 11 policy holders can forget about their policies just like conseco insurance about 10 years ago unless some company steps in to buy policies from them

2

 Sep 16, 2008 at 06:12 PM Anonymous Says:

I don't think you have to worry, and this is why. Insurance companies are regulated largely through state law. New York State regulates AIG. There are extremely strict divisions within AIG to cover all of the kinds of insurance they write, and the different books of business are kept completely separate from each other.

So if you purchased an insurance product from AIG (like an annuity or a property-casualty policy), they are required to maintain a pool of safe assets that are related specifically to that underwriting pool. And those assets can't be used for any other purpose (including keeping the overall holding company from going bankrupt).

This is how the law ensures that AIG will be able to pay its obligations to its insureds.

Now if you had gone to AIG to buy a credit-default swap on a few hundred million dollars' worth of Ford Motor bonds or something like that, then I'd be worried. :-)

3

 Sep 16, 2008 at 06:11 PM political analyst Says:

forgive me if I'm wrong, but my understanding is AIG has more than enough liquidity to pay off claims. funds for claims come from reserves which are untouchable except for this purpose. their problem is they don't have enough working capital to cover their basic overhead & day to day expenses. I don't think policyholders need be concerned. they have over $3 trillion in assets. if they ever had a problem covering claims you can be assured not only will the US govt step in but so will the int' community step in. there is not a company in the world with insurance that doesn't have somehow someway even indirect with AIG.

4

 Sep 16, 2008 at 11:10 PM rebbetzin hockstein Says:

so if I understand correctly, a retirement/pension account from a job held many years ago is ok, and not at risk?

5

 Sep 17, 2008 at 02:58 PM Diane Says:

Yes--in any case it would be further insured by the PBGC--unless it is in a 401(k) type account.

6

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