AIG restructure: holding clients will test its mettle
The restructure of AIG in the wake of a $US61.7 billion ($95.8 billion) fourth-quarter loss appears to be providing a more positive way forward for the Australian and New Zealand businesses.
Brokers say clients are less uncertain about the company’s products than they were in September when AIG came close to collapse, but it appears AIG’s former bullet-proof reputation is no more and it’s going to have to compete hard to hold clients.
As detailed in insuranceNEWS.com.au Breaking News on Tuesday, AIG will form a rebranded general insurance holding company comprising all its general insurance businesses. This includes American International Underwriters (AIU), of which AIG’s Australasian businesses are a part.
Kristian Moore, CEO of AIG Property Casualty Group, will be President of AIU Holdings, and current American International Underwriters CEO Nicholas Walsh will be Vice Chairman.
Aon Australia GM Carrier Management Ross Castle says AIG continues to be an approved trading partner, and that the new separate entity is a positive move.
“Despite the large loss that the parent company announced there certainly hasn’t been the same sense of urgency on the part of clients as we experienced back in September,” Mr Castle said.
He says people are more aware now that AIG’s underlying insurance operations are performing reasonably well, are not out of kilter with peer groups and have the support of ratings agencies.
“Having said that, the general feedback we’re getting from clients and policyholders with AIG is that they do want to look at alternatives as they come up,” Mr Castle told insuranceNEWS.com.au.
He says AIG, as with everyone else, is competing reasonably solidly to try and maintain quality business.
While the sense of urgency has dissipated, he says there is “some degree of caution”.
“Policyholders are not wanting to be overly exposed to any one market, including AIG.”
Marsh GM Placement Services Scott Leney says his company is still in the process of collecting client feedback, so no trend has yet been identified.
“Because it has been a continuing saga and because it hasn’t been abrupt and a big surprise, clients have had the opportunity – if they take a balanced view of things – to educate themselves about what is the true risk of being with a company in the sort of state that AIG finds itself in,” Mr Leney said.
“The reality is that Australian insurance regulations do offer our clients a lot of protection, even in the event of the AIG parent filing for bankruptcy.”
He says that following the speculation which has surrounded AIG, the creation of a rebranded general insurance holding company in Australia is a positive step.
“It’s the first step in providing some direction on what is going to happen with the general insurance company.”
Brokers say clients are less uncertain about the company’s products than they were in September when AIG came close to collapse, but it appears AIG’s former bullet-proof reputation is no more and it’s going to have to compete hard to hold clients.
As detailed in insuranceNEWS.com.au Breaking News on Tuesday, AIG will form a rebranded general insurance holding company comprising all its general insurance businesses. This includes American International Underwriters (AIU), of which AIG’s Australasian businesses are a part.
Kristian Moore, CEO of AIG Property Casualty Group, will be President of AIU Holdings, and current American International Underwriters CEO Nicholas Walsh will be Vice Chairman.
Aon Australia GM Carrier Management Ross Castle says AIG continues to be an approved trading partner, and that the new separate entity is a positive move.
“Despite the large loss that the parent company announced there certainly hasn’t been the same sense of urgency on the part of clients as we experienced back in September,” Mr Castle said.
He says people are more aware now that AIG’s underlying insurance operations are performing reasonably well, are not out of kilter with peer groups and have the support of ratings agencies.
“Having said that, the general feedback we’re getting from clients and policyholders with AIG is that they do want to look at alternatives as they come up,” Mr Castle told insuranceNEWS.com.au.
He says AIG, as with everyone else, is competing reasonably solidly to try and maintain quality business.
While the sense of urgency has dissipated, he says there is “some degree of caution”.
“Policyholders are not wanting to be overly exposed to any one market, including AIG.”
Marsh GM Placement Services Scott Leney says his company is still in the process of collecting client feedback, so no trend has yet been identified.
“Because it has been a continuing saga and because it hasn’t been abrupt and a big surprise, clients have had the opportunity – if they take a balanced view of things – to educate themselves about what is the true risk of being with a company in the sort of state that AIG finds itself in,” Mr Leney said.
“The reality is that Australian insurance regulations do offer our clients a lot of protection, even in the event of the AIG parent filing for bankruptcy.”
He says that following the speculation which has surrounded AIG, the creation of a rebranded general insurance holding company in Australia is a positive step.
“It’s the first step in providing some direction on what is going to happen with the general insurance company.”