American International Group, Inc.
American International Group, Inc. provides insurance products for commercial, institutional, and individual customers in North America and internationally. It operates through three segments: North America Commercial, International Commercial, and Global Personal. The company offers commercial and industrial property insurance, including business interruption and package insurance that cover exposure to made and natural disasters; general liability, environmental, commercial automobile liability, workers' compensation, excess casualty, and crisis management insurance products; risk-sharing and other customized structured programs for large corporate and multinational customers; professional liability insurance; and marine, energy-related property insurance products, aviation, political risk, trade credit, and trade finance products. It also provides group personal accident and business travel products for employees, associations, and other organizations; voluntary and sponsor-paid personal accident and supplemental health products for individuals; and personal auto and homeowners in selected markets, comprehensive extended warranty, device protection insurance, home warranty and related services, and insurance for high net-worth individuals. In addition, the company offers mortgage and other loans receivable, such as commercial mortgages, life insurance policy loans, commercial loans, and other loans and notes receivable. American International Group, Inc. was founded in 1919 and is headquartered in New York, New York.
What does it do?
AIG is one of the world's largest insurance companies. Think of it as a safety net for businesses and individuals — if a factory burns down, a ship sinks, or a major lawsuit hits a corporation, AIG is often the one paying out. They sell insurance across North America and dozens of other countries, covering everything from hurricanes destroying office buildings to a company getting sued by a customer. You may not interact with AIG directly, but the airline you fly on, the hospital you visit, or the skyscraper you work in is likely insured by them.
AIG is one of the few insurance giants with truly global reach, which matters a lot when businesses are expanding internationally and want one insurer to cover everything. The company became infamous for nearly collapsing in 2008 and receiving a massive government bailout — so its recovery and transformation into a leaner, more profitable insurer is a closely watched story on Wall Street. Rising interest rates in recent years have also been a tailwind for insurers like AIG, since they invest the premiums they collect and earn more when rates are high.
How does it make money?
AIG makes money primarily by collecting insurance premiums — the regular payments customers make to stay insured. In its latest full year, it brought in $26.8 billion in revenue. It operates in three main buckets: North America Commercial (covering big U.S. businesses), International Commercial (covering businesses abroad), and Global Personal (covering individual customers like high-net-worth individuals). AIG also earns investment income by taking the premiums it holds and investing them in bonds and other assets while waiting to pay out claims.
Why do investors care?
AIG has been on a multi-year turnaround — shedding riskier business lines and focusing on core, profitable insurance. Investors are watching to see if that leaner version of AIG can grow profit margins even if overall revenue has dipped slightly, from $27.3 billion last year to $26.8 billion this year. The company posted $3.1 billion in net profit, which suggests the cleanup is working. If management can keep cutting costs, grow in high-margin commercial insurance, and benefit from a strong investment portfolio, earnings could climb meaningfully from here.
Deep Dive
MemberA full investor briefing on American International Group, Inc. — history, leadership, risks, and outlook.