Transcript
Introduction
Zack
Welcome back to Business Breakdowns. This is Zack Fuss. In today's conversation, we are diving into the insurance giant AIG. AIG's story is one of a remarkable turnaround—a tale of a global insurance giant emerging from near collapse during the Great Financial Crisis. Over nearly two decades, AIG has transformed itself into a more focused and efficient property and casualty insurer.
To grasp the magnitude of AIG's journey, consider this: during the financial crisis, the company required a $180 billion bailout from the U.S. government—a sum it fully repaid with interest. For those unfamiliar with P&C insurance, we'll explore the fundamentals: how the businesses are insured, how risks are assessed, premiums priced, and assets invested. AIG's turnaround has been remarkable. From 2009 to 2019, the company lost over $30 billion in underwriting losses. Put simply, it was consistently paying out more in claims than it collected in premiums.