Image by Mike Licht, NotionsCapital.com via Flickr
In the Insurance world your image and brand is just as important as the financial stability and claims paying ability of the carrier. AIG Insurance Company and their brand has been so tarnished from their eventual collapse to Executive retreat’s trips and now bonuses, it will be a miracle if the company can recover and ever sell off it’s assets to repay the American public.
Read the New York Times article…
The government’s fourth round of assistance to the American International Group this month was a play for time — for languishing markets to rebound, for pockets to fill up again and for buyers to emerge for the sturdy insurance companies under A.I.G.’s tattered corporate umbrella.
Only when those insurance companies are sold will there be money to repay American taxpayers.
But after the latest uproar, time does not look like A.I.G.’s friend. The problem now is not a toxic spiral of derivatives like the one that crippled the company last fall, but the damage done to A.I.G.’s brand, first by the financial troubles and then by the recent wave of hearings, subpoenas, late-night television jokes and even a bus tour past executives’ homes.
“Why would we do business with a company that’s constantly in the news, even if the ratings are still supposedly O.K.?” wondered Greg Theis, a financial planner with Legacy Investment Services in Homer Glen, Ill. He helps 55-to-70-year-olds select variable annuities from a bewildering array of carriers.
Let’s hope that we can at least end up getting a part of our tax money back from the sale of the companies assets. The Life Insurance Division of AIG is at least strong and should be able to be sold off for a nice chunk of change.