Since AIG hit the skids last fall I have been keeping clients and readers on top of the “what ifs” with their life insurance branch, American General. AIG’s recession slide has been a boondoggle of epic proportions with nearly $150 billion of bail out money coming their way and their just announced $60 billion loss.
I’ve mentioned several times that at some point AIG will put their life insurance branch up for sale. They have to. It’s profitable and can bring a large chunk of change to start paying down the enormous debt they have to you and me. Today two companies announced an interest in purchasing that branch. There may be more interest, but at this point it appears that Met Life and European giant AXA have expressed an interest.
Both companies are financially stable and have the assets to pony up billions. For AIG life policy owners it is important to remember that the policy guarantees in their current policy, by law, have to be carried over by any company to acquires that block of business. The swing issue to watch is the conversion option. AXA has a history of offering horrible products for conversion.
Bottom line. I think it is past due for AIG to start to un-jumble its’ assets and get to work either righting the ship or paying back the taxpayers and sinking the ship.