BestWeek Looks at AIG and Its Latest Dealings

The past week was another high profile one for American International Group Inc. (AIG) as it dealt with personnel departures, market rumors and the potential sell-offs of their insurance units, this week’s BestWeek U.S./Canada reports.

The embattled giant, the recipient of a recent $150 billion federal bailout, saw two top executives suddenly leave Lexington Insurance Co., its excess and surplus lines carrier. It also had to publicly address its exposure to about $9.8 billion in trades involving synthetic securities and its new chief executive officer talked about the potential sale of some of its Asian assets.

In the latest issue of BestWeek Europe, as China continues to develop as a global economic powerhouse, the insurance industry is taking notice. Announcements by the China Insurance Regulatory Commission of licenses granted to foreign insurers and brokers have become regular occurrences. U.K. linked insurance names with growing Chinese profiles include Kiln, Standard Life, Prudential and Aviva.

Also in BestWeek U.S./Canada:

The National Association of Insurance Commissioners is staunchly opposed to federal regulation of the insurance industry, including proposals for an optional federal charter system. But state regulators could be in danger of being left behind.

When AIG imploded in September, state insurance commissioners made a strong case that their responsibilities provided for a secure core: the parent corporation’s state-regulated property/casualty companies.

Still, as 2009 approaches, AIG relies on federal checks to stay out of bankruptcy. A handful of publicly traded insurance companies—including Prudential Financial Inc. and Hartford Financial Services Group Inc.—have applied for bailout funds through the U.S. Treasury.

And in both editions of BestWeek:

As of the close of the U.S. market on Thursday, Dec. 11, the AMBG stood at 666.97, a one-week increase of 7.33%.

BestWeek is published by A.M. Best Co. for insurance professionals. To subscribe, visit http://www.ambest.com/sales/BestWeek, or e-mail your request to customer_service@ambest.com.