American International Group Inc.

AIG ·Financial, Insurance - Property & Casualty, United States

American International Group (AIG)

Overview

American International Group, Inc. is a global property and casualty insurance company headquartered at 1271 Avenue of the Americas in New York City. Founded in 1919 by Cornelius Vander Starr in Shanghai as American Asiatic Underwriters, AIG grew over the 20th century into one of the world's largest insurers, survived a near-collapse and $180 billion federal bailout during the 2008 financial crisis (which it repaid in full by 2012), and has since undergone a multi-year strategic simplification. As of its most recent annual filings, AIG employs roughly 22,000 people across about 45 countries and generates on the order of $25-28 billion in annual total revenues (premiums plus investment income), serving the large majority of the Fortune Global 500 and Forbes 2000 as commercial and personal insurance clients. Since completing the separation of its life and retirement business (Corebridge Financial) in 2024-2025, AIG now operates as a focused, pure-play global property and casualty (P&C) insurer.

What They Do & How They Make Money

AIG's core business is underwriting risk: it collects premiums from businesses and individuals in exchange for promising to pay covered losses (property damage, liability claims, accidents, specialty risks, and so on). Revenue comes from two main sources — net premiums earned on policies it writes, and net investment income earned on the large pool of premium float (reserves held to pay future claims) that it invests in bonds, equities, and other assets before claims come due. Profitability hinges on disciplined underwriting (pricing risk accurately relative to the losses that eventually materialize, reflected in the "combined ratio" — claims and expenses as a percentage of premiums), prudent loss-reserve estimation, effective investment management of the float, and control of operating expenses. AIG sells both through its own teams and through a vast global network of independent brokers and agents, and it increasingly uses reinsurance to lay off large or catastrophic risks (such as hurricanes and wildfires) to other insurers, smoothing its own earnings volatility.

Business Segments

Following the deconsolidation of Corebridge Financial (life insurance, annuities, and retirement services, in which AIG retains a minority equity stake but no longer consolidates on its financial statements), AIG now reports through three core general insurance segments plus a Corporate/Other category:

North America Commercial — Property, casualty, financial lines (management and professional liability), and specialty insurance sold to U.S. and Canadian businesses; historically AIG's largest single segment by premium volume.
International Commercial — The same broad categories of commercial P&C and specialty coverage sold outside North America, spanning Europe, Asia-Pacific, Latin America, and the Middle East/Africa, reflecting AIG's historically strong international distribution network (roughly half of AIG's workforce is based in Asia-Pacific).
Global Personal — Personal insurance lines including high-net-worth homeowners and auto coverage (through AIG Private Client Group), travel insurance, and personal accident and health products, sold both directly and through affinity partners.
Other Operations — Corporate-level items, legacy run-off liabilities, and results not allocated to the three underwriting segments, including interest expense on corporate debt and certain divested-business residuals.

North America and International Commercial together make up the large majority of AIG's net premiums, with commercial lines generally larger than the Global Personal segment.

Competitors

AIG competes in a crowded global commercial and specialty insurance market. Key rivals include:

Large global P&C/multiline insurers: Chubb, Zurich Insurance Group, Allianz, AXA, and Travelers, all of which compete directly for large commercial accounts, specialty lines, and multinational programs.
Specialty and excess/surplus lines carriers: W. R. Berkley, Markel, and Lloyd's of London syndicates, which compete for harder-to-place and niche commercial risks.
Personal lines competitors (for Global Personal): Chubb's high-net-worth business, PURE Insurance, and Progressive/Allstate at the broader personal-auto end.
Reinsurers and alternative capital providers (Swiss Re, Munich Re, and catastrophe bond markets) that both compete with and supply capacity to AIG.

Competitive Position

AIG's principal advantages are its global scale and brand recognition, an extensive multinational distribution and broker network built over a century of international operations, and deep expertise in complex commercial and specialty risk underwriting that smaller regional insurers cannot easily replicate. Its post-Corebridge simplification into a pure-play P&C insurer is intended to sharpen management focus and improve capital efficiency, and the company has been actively working to modernize underwriting technology and reduce expense ratios under CEO Peter Zaffino's multi-year turnaround.

That said, AIG has historically lagged best-in-class peers such as Chubb and Travelers on key profitability metrics: its combined ratio has generally run higher (worse) than those competitors, and its return on equity has trailed top-tier rivals, reflecting a legacy of reserve strengthening, catastrophe losses, and expense inefficiencies inherited from its pre-crisis conglomerate structure. Key risks going forward include: elevated and increasingly frequent catastrophe losses tied to climate change (hurricanes, wildfires, severe convective storms); reserve adequacy for long-tail liability lines; intensifying price competition in commercial P&C as the market cycle softens; interest-rate and credit risk on its large investment portfolio; regulatory complexity across dozens of jurisdictions (U.S. state insurance regulators, EU Solvency II, international standard-setters); and execution risk in continuing to improve underwriting margins while operating with a leaner, more focused corporate structure than during its conglomerate era.