Former AIG reinsurance Vice President Christian Milton has been jailed by a US district court for four years and fined $US200,000 ($315,000) following his conviction in the AIG/Gen Re reinsurance scandal.

Mr Milton, 61, who was in the role from 1982 to 2005, becomes the second insurance executive to be jailed after former Gen Re CEO Ronald Ferguson last month received a two-year jail term and $US 200,000 fine.

Five former Gen Re and AIG executives were convicted in March last year on conspiracy charges in a US district court after prosecutors proved a sham reinsurance deal sought to inflate AIG loss reserves.

In sentencing Mr Milton, Judge Christopher Droney described his behaviour as “disturbing”, saying the deal with Gen Re was “designed to cook the books of AIG”.

Three former Gen Re executives await sentencing. They are former Senior Vice President Christopher Garand, Senior Counsel Robert Graham and CFO Elizabeth Monrad.

In another New York court, mega-broker Marsh has agreed to pay an additional $US7 million ($10.6 million) on top of the $US850 million ($1.3 billion) it paid in a nationwide bid-rigging settlement with New York authorities four years ago.

The payments relate to allegations Marsh entered into agreements with insurers to earn undisclosed contingent commissions and to rig bids.