FOR IMMEDIATE RELEASE
September 25, 2008
Contact: Jason Moon  517-335-1700

LANSING – AIG's insurance companies are financially sound, with substantially more in assets than they need to pay all valid present and projected claims, the Office of Financial and Insurance Regulation (OFIR) today reassured Michigan’s AIG policyholders. OFIR Commissioner Ken Ross explained that the trouble with AIG is largely with AIG's non-insurance parent company, which is not regulated by the states and therefore not held to the same investment, accounting and capital adequacy standards as its state-regulated insurance subsidiaries. The insurance subsidiaries are solvent and able to pay their obligations

"Consumers should think twice before making any rash decisions if they have a policy issued by an AIG insurance company," Ross said. "As state insurance regulators, it is our number one job to protect insurance policyholders and enforce strict solvency standards and the AIG insurance companies are strong and solvent. We are working with state insurance regulators across the country to ensure that keen financial oversight - based on conservative investment and accounting rules - continues to be the backbone of state-based insurance regulation.”

“Replacing or liquidating a life insurance policy or an annuity can have significant hidden costs and tax consequences. That’s why Michigan insurance laws require that consumers get all the information they need to make an educated decision,” Ross added. “If someone tells a consumer to replace any policy because an AIG insurance company is in trouble, that is not only untrue, it’s against the law.”

If consumers have a life insurance or annuity policy and someone tells them to replace it because of the troubles at AIG's parent company, they should immediately call OFIR’s toll-free hotline 877-999-6442.

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AIG Frequently Asked Questions and Answers

Question: Is AIG going bankrupt?

Answer: AIG is an international financial holding company with numerous businesses.
Your insurance and annuity policies are written by AIG's insurance companies. Those companies are financially strong and their assets are protected by state regulators.

Question: Are the insurance and annuity policies I purchased from AIG safe or am I going to lose my money?

Answer: Your policies are safe. AIG's insurance companies are financially strong and fully able to honor all policyholders' claims. OFIR will continue to closely monitor the situation to ensure policyholders are protected and that there will continue to be sufficient assets to pay claims.

Question: Should I cash in my insurance and annuity policies and purchase insurance from another insurer?

Answer: As stated above, the AIG insurance companies are financially strong so your policies are not in jeopardy. Whether you should cash in your insurance policy or switch insurance to another insurer is, as always, a personal decision. Please be aware that some policies may contain surrender charges and/or cancellation penalties. Call OFIR’s toll-free hotline 877-999-6442 to find out all the information your agent or broker should give you before you make a decision.

Question: Should I pay the insurance premium bill that I just received from AIG?

Answer: Yes, in order for your coverage with AIG to continue, you will need to pay the insurance premiums. Failure to pay your premiums can result in the termination of your insurance policies by the insurance company.

Question: I heard the government may take over AIG. What are state regulators doing to make sure AIG insurance companies will continue to be able to pay claims?

Answer: The agreement between AIG and the Federal Reserve protects the assets of the insurance companies so they will be available to pay claims. Any significant transaction affecting an AIG insurance company will need approval from state regulators.

Question: What can I do if I am having difficulty getting through to AIG on the telephone?

Answer: You may obtain information about filing a complaint with OFIR by visiting http://www.michigan.gov/dleg/0,1607,7-154-10555_12902_12907---,00.html, or by calling 877-999-6442.

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