AIG 2008 Annual Report Download - page 13

At December 31, 2008, AIG and its subsidiaries had approximately 116,000 employees.
AIG’s Internet address for its corporate website is www.aigcorporate.com. AIG makes available free of charge,
through the Investor Information section of AIG’s corporate website, Annual Reports on Form 10-K, Quarterly
Reports on Form 10-Q, Current Reports on Form 8-K and Proxy Statements on Schedule 14A and amendments to
those reports or statements filed or furnished pursuant to Section 13(a), 14(a) or 15(d) of the Securities Exchange
Act of 1934 (the Exchange Act) as soon as reasonably practicable after such materials are electronically filed with,
or furnished to, the Securities and Exchange Commission (SEC). AIG also makes available on its corporate website
copies of the charters for its Audit, Nominating and Corporate Governance and Compensation and Management
Resources Committees, as well as its Corporate Governance Guidelines (which include Director Independence
Standards), Director, Executive Officer and Senior Financial Officer Code of Business Conduct and Ethics,
Employee Code of Conduct and Related-Party Transactions Approval Policy. Except for the documents specifically
incorporated by reference into this Annual Report on Form 10-K, information contained on AIG’s website or that
can be accessed through its website is not incorporated by reference into this Annual Report on Form 10-K.
Throughout this Annual Report on Form 10-K, AIG presents its operations in the way it believes will be
most meaningful, as well as most transparent. Certain of the measurements used by AIG management are
“non-GAAP financial measures” under SEC rules and regulations. Statutory underwriting profit (loss) is
determined in accordance with accounting principles prescribed by insurance regulatory authorities. For an
explanation of why AIG management considers this “non-GAAP measure” useful to investors, see Man-
agement’s Discussion and Analysis of Financial Condition and Results of Operations.
General Insurance Operations
AIG’s General Insurance subsidiaries are multiple line companies writing substantially all lines of property
and casualty insurance and various personal lines both domestically and abroad and constitute the AIG Property
Casualty Group (formerly known as Domestic General Insurance) and the Foreign General Insurance Group.
AIG Property Casualty Group is comprised of Commercial Insurance, Transatlantic, Personal Lines and
Mortgage Guaranty businesses.
AIG is diversified both in terms of classes of business and geographic locations. In General Insurance,
workers’ compensation business is the largest class of business written and represented approximately 11 percent of
net premiums written for the year ended December 31, 2008. During 2008, 9 percent, 5 percent and 5 percent of the
direct General Insurance premiums written (gross premiums less return premiums and cancellations, excluding
reinsurance assumed and before deducting reinsurance ceded) were written in California, New York and Texas,
respectively. No other state or foreign country accounted for more than five percent of such premiums.
The majority of AIG’s General Insurance business is in the casualty classes, which tend to involve longer
periods of time for the reporting and settling of claims. This may increase the risk and uncertainty with respect to
AIG’s loss reserve development.
Commercial Insurance
AIG’s primary property casualty division is Commercial Insurance. Commercial Insurance’s business in the
United States and Canada is conducted through American Home, National Union, Lexington, HSB and certain
other General Insurance company subsidiaries of AIG. During 2008, Commercial Insurance accounted for
47 percent of AIG’s General Insurance net premiums written.
Commercial Insurance writes substantially all classes of business insurance, accepting such business mainly
from insurance brokers. This provides Commercial Insurance the opportunity to select specialized markets and
retain underwriting control. Any licensed broker is able to submit business to Commercial Insurance without the
traditional agent-company contractual relationship, but such broker usually has no authority to commit Commercial
Insurance to accept a risk.
In addition to writing substantially all classes of business insurance, including large commercial or industrial
property insurance, excess liability, inland marine, environmental, workers’ compensation and excess and umbrella
coverages, Commercial Insurance offers many specialized forms of insurance such as aviation, accident and health,
AIG 2008 Form 10-K 7
American International Group, Inc., and Subsidiaries