Question

We all know that insurance companies play a vital role in the United States economy. There are life, health, auto, homeowners among others. Select any one insurance company (even by type or specific name) briefly discussing the company and its role in the markets these days especially. How is that company (or type) doing and are they successful with what we are going though in your opinion. Keep in mind that they are also big players in the capital markets investing heavily. Discuss a positive and negative about the company.

Answer 1

ALG ( AMERICAN INVESTMENT GROUP )

AIG is a leading insurance company spread across 130 countries. In United States AIG is the largest underwriter of commercial and industrial insurance. The product portfolio in its marketing mix includes property casualty insurance, life insurance, retirement products, mortgage insurance and other financial services.

Role of ALG in market these days -

Almost a decade after it was handed a government bailout worth about $150 billion, the U.S. Financial Stability Oversight Council (FSOC) voted to remove AIG from its list of institutions that are systemic risks, or in headline terms, "too big to fail." In 2013, the company repaid the last installment on its debt to taxpayers, and the U.S. government relinquished its stake in AIG.In quarterly earnings announced in August 2019, AIG posted a nearly 18% increase in revenue, and the company's turnaround was deemed to be well underway. But it had been forced to cut itself in half, including selling off a valuable Asia unit, in order to repay its massive debt to U.S. taxpayers.

In my opinion companies are sucessful in what they are doing after recovering as a victim of the biggest financial crisis AIG come back on the track in a business and recovered it's reputation back in the market and again become the biggest insurance player in the US economy.

Positive points about company

AIG serves 87% of the Fortune Global 500 and 83% of the Forbes 2000.[11] AIG was ranked 60th on the 2018 Fortune 500 list.[12] According to the 2016 Forbes Global 2000 list, AIG is the 87th largest public company in the world.[13] On December 31, 2017, AIG had $65.2 billion in shareholder equity.

Negative point of company

During the financial crisis of 2008, the Federal Reserve bailed the company out for $180 billion and assumed control, with the Financial Crisis Inquiry Commission correlating AIG's failure with the mass sales of unhedged insurance.In 2011 the nationalization of AIG was ruled illegal.