Dear Friends,
I am sure many of you have watched the scenario with AIG play out over the last few days. Finally, after much speculation, assistance has been provided by the US Government. Throughout the duration of this wild and interesting development, the ability of AIG to pay its insurance claims has never been in question. Below, please find updates I have received from AIG over the last two days. Additionally, please find an article from CNN which addresses how insured's are affected in these situations. As always, feel free to ask away with any questions you may have.
Kind regards,
Adam Gurdus
Insurance Guru
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I am sure many of you have watched the scenario with AIG play out over the last few days. Finally, after much speculation, assistance has been provided by the US Government. Throughout the duration of this wild and interesting development, the ability of AIG to pay its insurance claims has never been in question. Below, please find updates I have received from AIG over the last two days. Additionally, please find an article from CNN which addresses how insured's are affected in these situations. As always, feel free to ask away with any questions you may have.
Kind regards,
Adam Gurdus
Insurance Guru
SEPTEMBER 17th AIG UPDATE
(Update: September 17, 2008)
(Update: September 17, 2008)
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Last night, AIG’s Board of Directors approved a transaction with the Federal Reserve Bank of New York to provide a 24-month liquidity facility to AIG in the amount of $85 billion. Access to this facility will allow the parent company, AIG, to address its immediate liquidity needs, which is clearly a positive development for policyholders, brokers, employees and shareholders.
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In connection with this transaction, the Federal government will receive a 79.9 percent equity interest in AIG.
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In addition, AIG Chairman and Chief Executive Officer, Robert Willumstad, has resigned his position with AIG. Edward M. Liddy, former Chairman of the Allstate Corporation, has been named AIG’s new Chief Executive Officer.
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Although the New York and Pennsylvania insurance departments were prepared to allow AIG to exchange certain liquid investment holdings of the insurance companies for high-valued, less liquid holdings of the parent company, this transaction was not necessary. The regulators’ consideration of this option demonstrates their confidence in the financial strength of our property/casualty insurance subsidiaries.
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The Federal government’s willingness to act highlights AIG’s critical role in the global financial
markets.
Please refer to our
September 16 update for details on AIG Private Client Group’s unwavering
AIG Private Client Group, 70 Pine Street, 21st Floor, New York, NY 10270
SEPTEMBER 16th UPDATE
AIG, Inc. continues to work with regulators during this difficult time for financial markets. As has been stated many times publicly, AIG is not a solvency risk; the value of its assets exceeds its liabilities.
AIG Private Client Group is continuing to write new business.
In addition, here are a few more important facts to note:
•AIG Private Client Group, which operates as part of AIG Property Casualty Insurance, faces no such liquidity concerns.
oAIG Property Casualty Insurance has $26.7 billion in policyholder surplus, as well as invested assets of $65 billion. These assets are protected by law and cannot be taken from policyholders!
oAs a point of reference, a leading AIG Private Client Group competitor has policyholder surpluses of $14 billion.
oAs you likely know, yesterday AIG reached an agreement in principle with the New York State regulators to exchange illiquid assets from the parent company with more liquid assets in operating insurance companies. These assets are of like kind and quality to one another; the only difference is duration.
•AIG Property Casualty Insurance has the resources to pay policyholder claims and will continue to do so. On average, we are paying $73 million in claims each day.
•AIG Property Casualty Insurance was downgraded by A.M. Best yesterday. Even with this downgrade, our insurance companies carry a rating of “A” or “Excellent.” This rating compares favorably with most major companies.
•AIG Property Casualty Insurance results:
oAIG Commercial Insurance continues to exhibit strong financial performance with 2008 second quarter operating income of nearly $1 billion, net written premiums of $5.99 billion and a profitable combined ratio of 93.7%.
oAIG Private Client Group’s year-to-date results: $87.3 million in operating income; $520 million in net written premium; combined ratio of 81.4%.
We remain committed to, and capable of, serving the needs of our policyholders. If you have any questions, please contact your local representative. Thank you for your continued support of AIG Private Client Group.
Copyright ? 2008 American International Group, Inc. All rights reserved.
AIG Private Client Group, 70 Pine Street, 21st Floor, New York, NY 10270
ARTICLE from CNN- http://money.cnn.com/2008/09/16/news/companies/aig_questions/index.htm
ability to serve our producers and policyholders.
Copyright ? 2008 American International Group, Inc. All rights reserved.
AIG Private Client Group, 70 Pine Street, 21st Floor, New York, NY 10270
SEPTEMBER 16th UPDATE
AIG, Inc. continues to work with regulators during this difficult time for financial markets. As has been stated many times publicly, AIG is not a solvency risk; the value of its assets exceeds its liabilities.
AIG Private Client Group is continuing to write new business.
In addition, here are a few more important facts to note:
•AIG Private Client Group, which operates as part of AIG Property Casualty Insurance, faces no such liquidity concerns.
oAIG Property Casualty Insurance has $26.7 billion in policyholder surplus, as well as invested assets of $65 billion. These assets are protected by law and cannot be taken from policyholders!
oAs a point of reference, a leading AIG Private Client Group competitor has policyholder surpluses of $14 billion.
oAs you likely know, yesterday AIG reached an agreement in principle with the New York State regulators to exchange illiquid assets from the parent company with more liquid assets in operating insurance companies. These assets are of like kind and quality to one another; the only difference is duration.
•AIG Property Casualty Insurance has the resources to pay policyholder claims and will continue to do so. On average, we are paying $73 million in claims each day.
•AIG Property Casualty Insurance was downgraded by A.M. Best yesterday. Even with this downgrade, our insurance companies carry a rating of “A” or “Excellent.” This rating compares favorably with most major companies.
•AIG Property Casualty Insurance results:
oAIG Commercial Insurance continues to exhibit strong financial performance with 2008 second quarter operating income of nearly $1 billion, net written premiums of $5.99 billion and a profitable combined ratio of 93.7%.
oAIG Private Client Group’s year-to-date results: $87.3 million in operating income; $520 million in net written premium; combined ratio of 81.4%.
We remain committed to, and capable of, serving the needs of our policyholders. If you have any questions, please contact your local representative. Thank you for your continued support of AIG Private Client Group.
Copyright ? 2008 American International Group, Inc. All rights reserved.
AIG Private Client Group, 70 Pine Street, 21st Floor, New York, NY 10270
ARTICLE from CNN- http://money.cnn.com/2008/09/16/news/companies/aig_questions/index.htm
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