State Regulators See No Trickle-Down from AIG Parent to Insurance Units

State regulators from across the country say that the problems at parent company American International Group are unlikely to trickle down to affect its insurance operations that come under their regulatory supervision.

The commissioners also maintain that conservative, state-based regulation has been responsible for keeping any issues in check.

³The underwriting affiliates today remain as sound and solvent as they were weeks ago,² said Thomas Sullivan, Connecticut¹s insurance commissioner. ³The enterprises that we as state regulators have direct supervision over are performing as well today as they were weeks ago. So that¹s a good story for consumers.”

Sullivan is one of several state regulators speaking in a series of
exclusive interviews that Insurance Journal conducted during the recent National Association of Insurance Commissioners meeting in Washington, D.C.

Mississippi Insurance Commissioner Mike Chaney agrees. “All (of AIG¹s) insurance companies are very solid and on solid ground,” he said, adding that “AIG is important to Mississippi ­ they write over $400 million in our state, and that does not include surplus lines.”

Scott Kipper, head of Oregon¹s insurance Department, said individual AIG companies ³were never ever in peril — they¹re seen as the gold bricks in the vault of AIG that will enable the company prosper eventually as they sell of good pieces to pay off that federal loan.²

Sharon Clark, Kentucky¹s top insurance regulator, said that insurers in her state ³are solvent, able to meet their claims ­ the book of business goes on.² The loan to AIG¹s parent company ³was a federal decision but the impact it would have had worldwide would have been very significant, so the federal intervention was understandable,² she said.

The video report is available at www.insurancejournal.tv.