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About American General Life & Accident Insurance Co

No question about it -- AIG is BIG. Based in the US but with operations reaching around the globe, American International Group (AIG) is one of the world's largest insurance firms. Its subsidiaries provide general property/casualty insurance, life insurance and retirement services, and financial services to some 90 million commercial, institutional, and individual customers in more than 80 countries around the world. General insurance products account for about 65% of the group's revenue. Best Buy, HP, and Nortek are among the notable firms that have been AIG's customers. The company traces its roots to 1919, when Cornelius Vander Starr established American Asiatic Underwriters in Shanghai.


AIG operates through three primary segments: General Insurance, Life and Retirement, and Other Operations.

The General Insurance segment provides personal and commercial property/casualty products and services. It accounts for nearly two-thirds of AIG's revenues. Products include general and professional liability, property, special risks, personal lines, and accident and health coverage. The segment is further broken down into North America and International segments. North America includes the US, Canada, and Bermuda, while International includes operations in Europe, the Asia/Pacific region, Latin America including Puerto Rico, the Middle East, and Africa. Its subsidiaries include National Union, American Home, Lexington, AIG Sonpo, AIG Asia Pacific, and AIG Europe.

AIG's Life and Retirement segment offers life insurance, retirement, and institutional products, primarily in the US. Representing about a third of total revenues, it has four sub-segments: Individual Retirement, Group Retirement, Life Insurance, and Institutional Markets. Their offerings include variable, index, and fixed annuities; retail mutual funds; group retirement products; and term life and universal life insurance. Among its operating subsidiaries are VALIC, American General Life, and U.S. Life.

The smallest segment, bringing in less than 5% of total revenues, Other Operations includes AIG's technology subsidiary Blackboard U.S. Holdings. For reporting purposes, it also includes certain divested entities and investments.

The group also has a legacy portfolio of run-off businesses that are non-core to its operations.

AIG companies serve more than 90 million customers, which includes commercial, institutional, and individual customers.

Geographic Reach

AIG and its subsidiaries have approximately 160 offices in the US, as well as 380 offices in 60 other countries in the Americas, Europe, Africa, the Middle East, and the Asia/Pacific region. About 70% of AIG's annual revenues come from sales in the domestic market.

Sales and Marketing

AIG distributes its products every way possible -- from specialty brokers, independent agents, financial advisors, banks, direct to the consumer, and through affinity groups. AIG maintains direct sales groups consisting of representatives affiliated with its VALIC and American General subsidiaries.

The group markets its retail products directly to individual consumers through independent and career insurance agents, retail banks, direct-to-consumer platforms, and national, regional, and independent broker-dealers.

Mortgage guaranty products are marketed to a variety of mortgage originators and through mortgage lenders, finance agencies, and credit unions. Institutional market products are primarily sold through specialized marketing and consulting firms and structured settlement brokers.

Financial Performance

AIG's revenue has been slipping for the past few years. In 2017 it fell 5% to $49.5 billion as premiums declined 9%. Net realized capital losses of $1.4 billion further impacted revenue.

AIG's net income has also been declining for the past five years, and the company suffered net losses in the past two years. In 2017, net loss increased to $6.1 billion, versus a loss of $849 million in 2016. That 2017 loss was primarily due to a $6.7 billion charge related to the enactment of that year's federal Tax Act. Higher catastrophe losses also contributed to the overall net loss, but other factors such as lower General Insurance losses, lower operating expenses, and higher net investment income helped the bottom line somewhat.

The $6.1 billion net loss led to an $8.6 billion operating cash outflow in 2017, compared to an inflow of $2.4 billion in 2016. A negative change to net reinsurance assets also drove that outflow.


Over the past few years, AIG has divested nearly all of its non-insurance operations, including mortgage insurance unit United Guaranty Corporation, as well as certain international insurance businesses, in its efforts to scale down to its core operations. In September 2017, new management announced another major restructuring: The company now has three primary segments-- General Insurance, Life and Retirement, and Other Operations. (The Commercial and Consumer Insurance businesses are separate.) The change reflects a greater focus on AIG's underwriting capabilities rather than the relationship AIG shares with its customers.

These divestitures fall short of the major breakup for which some shareholders are pushing. Until mid-2017, the group was dubbed a systemically important financial institution (SIFI), making AIG subject to increased scrutiny by regulators. Other non-bank SIFI's have been downsizing, refocusing on core operations and removing themselves from the heightened oversight. However, AIG has thus far resisted pressure to undergo a major split.

Going forward, the company's primary goals include creating an optimal balance and diversification of products, establishing an excellent underwriting structure, and structuring its workforce to deliver the best performance. It intends to enhance return on equity by simplifying its legal entity structure and improving operational efficiencies. (It reduced its general operating expenses by more than $3.6 billion in 2017 alone.) AIG is particularly focused on improving its business portfolio by using enhanced data and analytics to provide better pricing and underwriting.

Other key strategic efforts include leveraging its extensive distribution organization of more than 300,000 financial professionals and adopting a more customer-centric approach.

In its General Insurance segment, the company is open to making acquisitions into promising geographic markets and new customer segments. For example, growing personal wealth in North America creates greater demand for insurance protection and risk management offerings. Certain challenges that come with the company's sheer size and operating history, though, include heavy exposure to long-tail commercial lines and high levels of claims from catastrophes, such as those that occurred in 2017.

The Life and Retirement segment's strategy for growth involves deepening its relationships with distributors and customers by offering a broad range of products and utilizing technology to improve customer experience. The segment is also focused on providing financial planning services to clients, while its Institutional Markets arm continues to grow its assets under management.

Mergers and Acquisitions

With its reorganization all but complete, AIG has once again begun building up operations through acquisitions. In mid-2018 it acquired Bermuda-based reinsurance firm Validus for $5.56 billion. Announced shortly after AIG's being deemed no longer "too big to fail", the deal points to the group's plans to begin expansion activities in full force. It also marks the company's re-entry into the Lloyd's insurance market.

Also in 2018, AIG bought Ellipse, which provides group life risk protection in the UK, from Munich Re. Further, it acquired Glatfelter Insurance Group, which added to AIG's general insurance operations.

Company Background

AIG held the spotlight for staggering losses and government bailouts during the Great Recession. In exchange for $161.3 billion in bailouts, at one point the US government held more than 90% of the company. An exit plan of repayments and stock sales gradually shrunk that number. By 2013 the US Treasury sold all of its AIG shares.

Having crawled its way back from the edge of an abyss, AIG streamlined operations and was rewarded with nice black ink on its ledgers.

American General Life & Accident Insurance Co

Brentwood, TN 37027-4525
Phone: 1 (800) 265-5054

Firm Stats

Employer Type: Privately Owned
Vice President Purchasing: Bob Cobie
Vice President And Director of Finance: Carolyn Rowe
Director Financial Audit: Walt Vance
Employees (This Location): 1,000
Employees (All Locations): 9,000

Major Office Locations

Brentwood, TN

Other Locations

Foley, AL
Huntsville, AL
Mobile, AL
Bakersfield, CA
El Cajon, CA
San Jose, CA
Woodland Hills, CA
Pensacola, FL
Tampa, FL
Blakely, GA
Carrollton, GA
Fort Oglethorpe, GA
Macon, GA
Washington, GA
Wichita, KS
Hazard, KY
Hopkinsville, KY
Paintsville, KY
Baltimore, MD
Cumberland, MD
Farmington Hills, MI
Flint, MI
Monroe, MI
Warren, MI
Saint Louis, MO
Corinth, MS
Tupelo, MS
Dunn, NC
Cincinnati, OH
Maumee, OH
Ontario, OH
Johnstown, PA
Mc Kees Rocks, PA
Reading, PA
Washington, PA
Florence, SC
Greenville, SC
Walterboro, SC
Brentwood, TN
Cleveland, TN
Franklin, TN
Greeneville, TN
Kingsport, TN
Nashville, TN
Springfield, TN
Dallas, TX
Irving, TX
Longview, TX
Chesapeake, VA
Covington, VA
Franklin, VA
Mechanicsville, VA
South Prince George, VA
Lynden, WA
Bridgeport, WV
Huntington, WV