AIG Insurance

[netpicker9]

Hi,

What is AIG Insurance?

What are their Products? How they work?

I am intrested to know about them, Can anybody explain to me.

Thanks in advance
Seshu

 

[NHB_MMA]

AIG (American International Group) is a massive company that provides just about any kind of insurance and financial service imaginable, as far as their product line. There is no doubt they offer some good products at reasonable prices from what I've seen. I would certainly consider them for P&C coverage, as a consumer. As an agent, I doubt I would ever sell AIG.

I am not a particular fan of AIG, from the agent perspective. They market HEAVILY online, which essentially turns around and cuts their agents' throats and ultimately, IMHO, does a disservice to most clients with relatively little knowledge of the various products and options in the insurance/financial world. As far as insurance and financial products go, AIG is a publicly traded company so I wouldn't recommend them for any type of permanent life product, but that's just more my own philosophy (though I've heard it echoed). In addition, I'm pretty sure that AIG, while now rated A++, had some financial trouble a while back and slipped to a B rating from what I heard, which is pretty poor for a company of that size. That just doesn't happen to Northwestern, NYL, Guardian, etc. and I leaves me believeing that even though AIG meets the standards of the A++ today, you're comparing apples to oranges when it comes to holding them up to the major mutual companies for long-term protection and growth products.

Their term rates are great and I would consider such coverage myself at some point. I think they have a pretty good reputation in the P&C world and their name recognition is strong. There are certainly some positives about the company, but I probably wouldn't sell their products myself, if indy, and I have no idea why some indies seem to act as if AIG is the greatest company on the planet. I assume you were asking from an agent perspective, since you posted it in this agents forum.

 

[Sam]

To the best of my knowledge, AIG has NEVER had a B rating, by A&M best, which is who gave them the A++.
Also, term is not the only area in which they are competitive. Their price on a UL with a lifetime guarantee is also of the best in the business.

 

[NHB_MMA]

To the best of my knowledge, AIG has NEVER had a B rating, by A&M best, which is who gave them the A++.
Also, term is not the only area in which they are competitive. Their price on a UL with a lifetime guarantee is also of the best in the business.

I read about them being downgraded a while back several places, but that was sometime ago. There was a thread on the old forum somewhere where the topic was mentioned and someone else said something about "B rating" and I assumed they were talking A.M. Best, but it could have been another rating agency. I think A.M. Best is probably the most lenient, or simplified in terms of assessment criteria, agency out there, as everyone quotes their ratings and others seem more strict.

I'm sure they have many competitive products. My primary objection is their aggressive online marketing. I can imagine an agent every now and then goes to follow up and hears "Oh yeah. We went online to check out the company and saw where you could apply right there and went ahead and did it."

I never looked at the UL. Obviously, I don't have handy access to all their rates and only an absolute fool (general public) would buy a permanent policy online or over the phone, IMO. In terms of my advising not buying permanent from a stock company, it's just my personal philosophy. I am rather conservative in my risk taking across the board and that mentality reflects in my feelings towards permanent coverage and the companies to buy them from.

Anyway, AIG is a great company all things considered. To be honest, if I ever end up indy, I'll probably look into selling their P&C line and have their term available. I just have some things I don't like about them and I hate when people compare them to companies like NW, NYL, and Guardian for permanent just because they have the same A.M. Best rating now. I've just seen some stock companies go down the drain and when you talking about an asset someone is considering keeping for 50, 60 years or more with equity tied to it, it's comparing apples and oranges.

 

[Sam]

I haven't seen any stock companies with an A+ or A++ rating go down the drain.

 

[James]

AIG is a good company, the rating thing is something that happen two years ago. The CEO, a military hero of WWII took the company to all time hieghts since his appointment in the late 40's or early 50's when AIG wasn't a national name in Insurance Industry. Lead the company with a spotless record till the last year of his stewardship when one of his company Lt's did something (can't remember exactly) that shouldn't of happen. There was no connection to the CEO but he is the head of a major insurance carrier and the media attempted to give him extremely bad press at the time. I do believe they lost one notch and fell to A+ but went right back to A++ in the next rating cycle.

http://www.insurancejournal.com/news/national/2005/03/07/52184.htm

Here is a link, some big names involved, yet the name Spitzer of NY tells the story!

 

[sman]

I read about them being downgraded a while back several places, but that was sometime ago. There was a thread on the old forum somewhere where the topic was mentioned and someone else said something about "B rating" and I assumed they were talking A.M. Best, but it could have been another rating agency. I think A.M. Best is probably the most lenient, or simplified in terms of assessment criteria, agency out there, as everyone quotes their ratings and others seem more strict.

Your NYL bias is really showing in your comments. Yes, AIG was downgraded last year to A+ by A.M. Best. They are now back to A++ by A.M. Best. The downgrade had to do with the Elliot Spitzer probe into their commercial insurance unit which has all been cleared up now. To my knowledge they have never been B rated. In fact, in the nearly 18 years I've been in the business, I don't recall anything below A+.

You stated you were basing this information on something you "think" someone "may" have written on the old forum (that's a very dangerous way to conduct your due diligence). And then you state that you just assumed it was A.M Best they were speaking of and it could have been another agency since A.M. Best is the "most lenient". AIG has an AA+ rating with Standard & Poor's, AA+ with Fitch and Aa1 with Moody's all the second highest rating possible. I'm not attempting to compare them with NYL, Northwestern or any other mutual company. Just stating some facts that are very easy to come by without having to read it on a message board and make assumptions.

I never looked at the UL. Obviously, I don't have handy access to all their rates and only an absolute fool (general public) would buy a permanent policy online or over the phone, IMO. In terms of my advising not buying permanent from a stock company, it's just my personal philosophy. I am rather conservative in my risk taking across the board and that mentality reflects in my feelings towards permanent coverage and the companies to buy them from.

In addition, your comments about never getting permament coverage with a stock company further proves your bias. Purely an opinion and falsehood touted by those that work with mutual companies. Each has it's advantages and disadvantages.

How much more conservative can one get than a Lifetime Guarantee UL? Do you even understand the product?

I just have some things I don't like about them and I hate when people compare them to companies like NW, NYL, and Guardian for permanent just because they have the same A.M. Best rating now.

Oh, it's just because they have the same rating NOW? Truth be told, one really shouldn't compare a NYL whole life policy to and Lifetime Guarantee UL. The only thing they have in common is they are both life insurance. BUt I don;t recall anyone on this thread attempting to do that.

I've just seen some stock companies go down the drain and when you talking about an asset someone is considering keeping for 50, 60 years or more with equity tied to it, it's comparing apples and oranges.

Please name some of these highly rated stock companies that you have seen go down the drain.

I would recommend you get your facts straight before spreading false information about a company's ratings and products.

 

[somarco]

I don't have a dog in this fight, but I do recall a few "highly rated" carriers who are no longer with us.

Baldwin United was one. They may have been A or slightly lower at their height. They peddled a lot of annuities (group & individual) to retirement plans with some outrageous guarantees that were never fulfilled. No one lost money, but they ended up with much less in accumulation than expected. Also, they had to postpone receipt of their funds in order to preserve the principle.

The most noted carrier to fall from grace was Executive Life. Once an A+ (or maybe A++) carrier, they bit the dust in 1991. Lots of cheap term, very little in reserve.

CNA is another, a bit more recent. They were hurt mostly by their P&C side. The only thing making a profit was their life side which was bought by Swiss Re.

Probably a few other carriers, but these were the most noteworthy.

Of course mutual companies are not immune. Remember Mutual Benefit? Remember the "run" that made the 6 o'clock news where they actually closed the doors to the lobby to keep folks from cashing in their policies?

Other mutuals that are no more, not because of financial issues, include Canada Life, John Hancock, MONY, New England Mutual, Unionmutual, Pru & Met (both formerly mutual companies, now converted to stock companies).

And who would have thought that GE would become a powerhouse in financial services? They make light bulbs for crying out loud.

 

[Crabcake Johnny]

And what would it matter if the reason you have a high rating is because you're cooking the books - like Enron.

 

[somarco]

AM Best ratings cant be manipulated. Best uses differing formula's to measure net premium (after reinsurance) against reserves.