AIG - Insurance Company or something Else?

  • And we were told that it was the intention of the Federal Reserve, with the full support of the Administration, to make $80 billion available for the insurance company AIG. 

-- Barney Frank

2009 0210 - GOV - Extraordinary Efforts by the Federal Reserve Bank to Provide Liquidity in Current Financial Crisis

  • 2009 0305 - Perspectives on Systemic Risk (Part 1 of 2)
    • 4:30 - Terri Vaughan - AIG wasn't an Insurance Company
    • House - Committee on Financial Services - Subcommittee on Capital Markets, Insurance, and Government Sponsored Enterprises

Mr. ROSS (DENNIS A. ROSS, Florida)

  • And would it not be just as likely, then, because of the precedent set there, that such packages, TARP packages would now be considered for nonfinancial institutions; insurance companies?
  • We saw that with AIG, but I guess my question is does this not set a precedent that goes well beyond assisting the too big to fail financial institutions and to any entity that may be deemed to be too big to fail, regardless of what their commercial purpose is? (p38)

Mr. BAROFSKY.  (SIGTARP - Special Inspector General for the Troubled Asset Relief Program)

  • The moral hazard generated by TARP wasn’t just limited to banks, it was, as you said, to insurance companies like AIG... (p38)

2011 0325 - GOV - Has Dodd-Frank Ended Too Big To Fail?

    • [PDF-103p, Video-Part 1 and Part 2]
    • Ross, Massad
    • House - COMMITTEE ON OVERSIGHT AND GOVERNMENT REFORM - SUBCOMMITTEE ON TARP, FINANCIAL SERVICES AND BAILOUTS OF PUBLIC AND PRIVATE PROGRAMS 
  • 14AIG Financial Products (AIGFP) is an example of a firm that does not fit neatly into the microprudential regulatory framework.
  • Although it was an insurance company subsidiary, it was supervised by a domestic housing regulator, the Office of Thrift Supervision (OTS), without deep expertise in the credit derivatives that were AIGFP’s specialty. (p19)

2012 0105 - OFR - A Survey of Systemic Risk Analytics - [PDF-165p]

  • However, after the financial crisis in 2008, the bankruptcy crisis at AIG, the world’s largest insurer, raised concerns about systemic risks in the insurance industry, realizing that insurance industry may also give rise to systemic risks.  (p8)

2020 02 -  Systemic Risk in China’s Insurance Industry, Society of Actuaries - [PDF-55p]