AIG 2005 Annual Report Download - page 33

AIG ■2005 Annual Report 31
Domestic Brokerage Group
Taken together, the businesses in AIG’s
Domestic Brokerage Group (DBG) make up the
nation’s preeminent property-casualty insurance
organization. DBG’s underwriting leadership is
built on a franchise that offers the industry’s
widest range of coverages, including many
specialty and difficult-to-place classes of busi-
ness, as well as some of the industry’s largest
capacity and financial resources.
(in millions, except ratios) 2005 2004
Net premiums written $23,128 $22,506
Combined ratio 113.83 106.02
Combined ratio, excluding
catastrophe losses 105.54 103.27
DBG serves a wide customer base,
ranging from the world’s largest multi-
national corporations to regional medium
sized companies and local small businesses
nationwide. In the U.S. market, DBG’s
commercial property-casualty operations
are virtually without peer. DBG’s 2005
growth was partially fueled by generally
improving renewal retention rates, reflect-
ing the importance to customers of placing
their business with the most financially
strong and experienced insurers. DBG’s
results in 2005 were affected by the tragic
losses resulting from Hurricanes Katrina,
Rita and Wilma, as well as other storm-
related activities. DBG claim teams were
on the scene in the immediate aftermath
of these tragic natural disasters, helping
customers recover and rebuild.
National Union has led the U.S. directors
and officers (D&O) insurance market for
more than 30 years. The ability to address
new and emerging management liability
issues, and being first to market to provide
the needed coverage, is a hallmark and key
driver of National Union’s success. During
2005, National Union introduced an inno-
vative coverage plan for hedge funds that
bundles comprehensive D&O, partnership
and professional liability insurance into a
single package. National Union also
launched new product packages for private
companies with revenues up to $100 mil-
lion and public companies with market
capitalization up to $75 million. In the
errors and omissions area, National Union
widened its offerings for professionals in
specific industry segments, including trusts
and real estate.
2005 was a year of strong achievement
throughout American Home. It reinforced
its industry leading position in the excess
casualty market. At AIG Specialty
Workers Compensation, online results
reached a new high in premiums through
a website serving small businesses.
With solid growth in net premiums
written in 2005, Lexington continues to far
outdistance its competitors and reaffirm its
position as the largest U.S.-based surplus
lines insurer. Lexington was also named
“Best Overall Surplus Lines Insurer” based
on service, value, quality and innovation by
the Business Insurance 2005 Readers’
Choice Awards.
Starr Excess Liability Insurance Company,
Ltd. is a leading writer of high-limit excess
liability and financial lines coverages, and
was one of the key providers to Fortune 500
companies in 2005.
In 2005, AIG Environmental celebrated
AIG’s 25th anniversary in the environ-
mental insurance industry. AIG Environ-
mental has long been the market leader
in the environmental insurance sector and
has introduced many innovative products.
Breakthroughs in environmental insurance
include single policy programs that provide
pollution coverage along with general
liability coverage. In addition, AIG
Environmental provides environmental
coverage for fixed facilities, brownfields
and military bases closed under the Base
Realignment and Closure program.
AIG Risk Management, Inc. (AIGRM) is one
of the leading underwriters of primary casu-
alty, excess workers compensation, surety
and risk financing programs for large and
medium sized corporations, as well as risk
management programs for major construc-
tion firms, complex building projects and
transportation entities. In 2005, AIGRM
focused on the real estate, temporary
staffing and financial institutions segments,
and emerged as the leading provider of
workers compensation coverage for major
U.S. commercial airlines.
AIG Worldsource, one of the largest
providers of Defense Base Act coverage,
expanded local service for contractors
engaged in reconstruction projects in the
Middle East with the opening of a Dubai
claims office.
AIG Global Energy, a leading provider of
insurance and alternative risk management
programs to energy companies worldwide,
expanded operations in 2005. It established
underwriting branch offices in Chicago
and Phoenix to increase penetration and
enhance services for Midwestern and
Western state brokerage customers.
AIG Small Business provides specialty
insurance products and services to the
small business segment. With operations
in Berkeley Heights, New Jersey and
Phoenix, Arizona, the unit services over
60,000 policyholders.
The Domestic Accident & Health Division
had favorable growth in 2005. The
Division is the largest U.S. provider of
group accident insurance in the employer
and specialty market segments.
Richard H. Booth
President and CEO
HSB Group, Inc.
Thomas R. Tizzio
Senior Vice Chairman
General Insurance
William V. Nutt, Jr.
President and CEO
United Guaranty Corporation