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More than a year after American International Group (AIG) reached the brink of collapse, insurance buyers are still using it to lay off their risk. A survey by Barclays Capital (BCS) find that 80% of commercial buyers use Chartis, the property/casualty unit of AIG.
Since the damage to AIG in 2008 was precipitated by the company's financial products group rather than its insurance operation, the use of Chartis to cover a company's risk isn't a problem, as the division has long been successful for AIG, regardless of the name used.
Chartis has been affected significantly by the broader AIG woes. Its current market penetration represents a decline from the 90% threshold reached in July 2009, indicating a loss of market share but not a vote of "no confidence" by the market. In July, only 40% of respondents said they planned to stay with Chartis -- now up 75%.
"Risk managers appear less concerned about Chartis' financial strength and, in some cases, Chartis was able to offer more capacity than its competitors," Barclays reported.
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