(Bloomberg) — New York City-based American International Group Inc., which is shrinking under pressure from activist investors, is committed to retaining operations in both Life insurance and Property & Casualty coverage, Chairman Doug Steenland said.

“We remain of the view that that is the right long-term position for AIG,” Steenland said Wednesday at the company’s annual meeting in New York. “Although, the specific components of what’s in each of those businesses may change.”

Billionaire Carl Icahn said last year that AIG is too big and should split into separate companies. Chief Executive Officer Peter Hancock instead is selling smaller units as part of a plan to free up $25 billion in capital to be returned to shareholders over two years. That has helped ease tension with activists including John Paulson, who was elected to the insurer’s board Wednesday along with a representative of Icahn’s firm.

Hancock reached a deal in January to sell a broker-dealer operation, and AIG’s mortgage insurance unit filed in March for an initial public offering. The CEO has also been cutting jobs.

“This is hard and sometimes painful work,” he said at the meeting. “We have much left to accomplish.”

AIG advanced 14 cents to $56.49 at 12:15 p.m. in New York. That compares with the closing price of $60.92 on Oct. 27, the day before Icahn disclosed a stake in the insurer and publicly called on Hancock to break up the company.

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AIG chairman: Property & Casualty business fits with Life unit

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