AIG 2014 Annual Report Download - page 6

We can now focus more strategically and diligently on
serving our clients and delivering what they value most in the
quickest and most efficient way.
Our simplified business model preserves the benefits of scale
and diversification, which distinguish us from our peers, and
better enables us to deliver sustainable value to shareholders
at an appropriate risk level by:
• Balancing risk across products, geographies, and clients,
and promoting overall credit strength.
• Enabling more dynamic allocation of capital while mini-
mizing friction costs.
• Positioning us to better absorb the growing costs of compli-
ance, risk management, and investment in technology.
• Enabling us to use our valuable $16 billion in net operating
loss and foreign tax credit carryforwards to offset future
taxable income and tax liabilities.
As we sculpt the future AIG, we will implement initiatives
including:
• Applying science to better price and select risk through
enhanced data, analytics, and evidence-based decision
making, to deliver superior risk-adjusted returns.
• Making necessary investments in IT, including new global
claims and underwriting platforms, and improved global
call center and exposure analysis resources, to deliver first-
class client service and decrease our loss ratio.
• Reducing costs and deploying capital more efficiently by
integrating our Japanese businesses and building a new
distribution platform for our Japanese agency network.
• Floating or selling businesses that lack current or realizable
potential synergy with our core operations.
AIG’s diversified status, and thus our ability to be taxed as a
Life and Non-Life company, enables us to use our valuable
net operating loss and foreign tax credit carryforwards to
offset future taxable income and tax liabilities. Changes
to AIG’s diversified corporate structure would significantly
reduce our ability to use our valuable tax assets, and the
company would forfeit a significant economic benefit.
AIG Employees: Driving Everything We Do
I’ve set out an ambitious plan for 2015 and beyond. This plan
will require discipline, focus, and a willingness to continuously
revisit and enhance the way we work so that we stay competi-
tive in an ever-changing and ever-challenging marketplace.
Our 65,000 employees are up to the task. The professionals
who brought AIG through unparalleled challenge continue to
deliver industry-leading service to our clients. Those who have
joined AIG more recently bring new insights and experiences
for us to advance our business.
Our employees are the source of our clients’ trust – whether
in new and growing relationships, or those established over
decades. They are building on that deep level of client en-
gagement, taking an increasingly integrated approach to the
client experience.
Within the insurance industry, AIG’s talent differentiates us,
with our professionals being recognized as industry leaders
around the world. We will continue to invest in individuals but
are increasing our emphasis on building teams that bring the
full scale, breadth of capability, and diversity of perspective
to clients.
This is a new chapter for AIG. In this letter, I’ve set out goals –
and I’m accountable to you for them. With the industry’s best
team, I’m confident that together we’ll achieve or exceed them.
Bring on tomorrow.
Peter D. Hancock
4