American International Group Inc. (AIG) announced Monday that it is making some major changes to its organizational structure.
The company will no longer have Commercial and Consumer segments, and will transition to: General Insurance, led by Peter Zaffino, as CEO; Life & Retirement, led by Kevin Hogan, CEO; and a stand-alone, technology-enabled platform, led by Seraina Macia, CEO.
General Insurance and Life & Retirement will each have distinct business units that reflect how business is marketed and underwritten. General Insurance will include Commercial, Personal Insurance, and U.S. and international field operations. Life & Retirement will include Group Retirement, Individual Retirement, Life, and Institutional Markets.
"These changes are designed to best position AIG for the future, as a growing, profitable leader in the insurance industry that is famous for its underwriting excellence," Brian Duperreault, AIG's President and CEO, said in a statement. "We believe this structure will maximize our global platform by empowering our local geographies, and provide our businesses with the greatest competitive advantage and ability to serve our clients."
The company expects its year-end financial reporting will reflect the new structure. The carrier also intends to align its incentive and performance management systems accordingly.
As a result of the structure changes, Rob Schimek, CEO of Commercial, will be leaving the company at the end of October to pursue other interests.
"I would like to thank Rob for his many contributions to AIG over his 12 years with the company," said Duperreault. "He has been a valued member of the leadership team, and a great colleague and friend to many. We wish him all the very best with his next endeavor."
Meanwhile, Reuters reported Friday that the Financial Stability Oversight Council, a panel of U.S. regulators, decided after a meeting on Sept. 22 to stick with its existing policy for stricter rules on several large financial institutions it deems "systemically important." AIG is one of them.
The regulators had discussed potentially removing the label of "systemically important financial institution (SIFI)," which carries increased oversight and regulatory requirements from the Federal Reserve. Reuters reported that sources familiar with the panel said regulators were debating easing regulations on AIG.
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