American International Group’s decision to buy two GE-owned insurance businesses at once gives some idea of the group’s awesome financial strength. Its purchase of the GE Edison Life Insurance Company in Japan and GE’s US personal lines insurance business will cost it up to $3.3 billion.

AIG is the world’s largest insurance and financial services company, and the GE deal gives it a strong presence in the Japanese life insurance market. Despite its massive problems – mainly confined to Japanese-owned companies – the Japanese life insurance market remains the second-largest in the world.

Chairman Maurice Greenberg, said the combination of the GE interests with AIG’s present Japan-based companies “will provide AIG with the leading foreign life insurance presence in the marketplace”.

AIG companies have been operating in Japan for more than 50 years.