Posts Tagged ‘AIG’

Depressing but important article on AIG

February 28, 2009

Of all the financial debacles of September 2008, the most infuriating has to be AIG.  One, because as an insurance company it was suppose to be in the business of providing stability for the risk-laden world of financial wheeling and dealing but instead it destroyed that stability and two because its the the debt that keeps on giving.   Taxpayers have spent $150 billion already on this monster and there is talk that we will spend another $100 billion more before the company stabilizes.

Worse, as Joe Nocera explains in his great column about AIG, the government is propping up the insurer’s bad lending practice because if it doesn’t, it risks destroying the fragile modicum of stability in the financial markets.

Article

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Lawsuit: $43 mil to AIG unit CEO for trashing company and economy

January 18, 2009

This shareholder derivative action filed in Delaware against AIG FP, their officers and Joseph Cassano, the CEO who got the sweet retirement package. This was after he had driven this small AIG financial products subsidiary to a $33 billion loss which had the potential of crashing the global economy leading the U.S. federal government to take over all of AIG and provide them funds to the tune of more than $100 billion and counting.  Is this the biggest scam of this entire financial meltdown?  An AIG unit goes rogue, avoids regulation, trashes the entire company and potentially the economy and the CEO gets $43 million and the company as whole get hundreds of billions while the rest of us lose trillions in our 401-Ks and possibly our jobs?

Complaint courtesy Courthousenews

Duke lacrosse incident ends up in suit against insurer

November 30, 2008

Seems National Union Fire Insurance Company of Pittsburgh didn’t want to cover damages resulting from litigation involving the Duke lacross team.   This not an unusual or particularly interesting lawsuit but it does provide insight into the National Union as a company and the kind of products it provides to what kind of clients.

Insurance companies are particularly opaque entities when it comes to determining what they do for whom.  Many aren’t public companies or like National Union they are subsidiaries of much larger companies, in this case, joy of joys, AIG.  How did I figure that out?  Not from the complaint which in this case doesn’t provide us much  except for the fact that its principal place of business is New York State which provides good public information about insurance companies.  In this case, it tells us that National Union is a subsidary of AIG.  It also give a laundry list of they types of insurance National Union provides, everything from accident and health to glass insurance (not sure what that means, insuring windows?).  But it doesn’t give us any notion that it would insure Duke University against claims like this one.  Here we must rely on the complaint to learn that.  Specifically, we are told that National Union sold Duke two non-for-profit Individual and Organization Policies.  This is the kind of competitive intelligence, that is very difficult to come by except anecdotally or through complaints.

Complaint courtesy Courthousenews

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