The Shanghai-based China unit of troubled US insurance giant American International Group, AIG, yesterday assured Chinese policyholders that it's business as usual.
American International Assurance (AIA), a wholly owned subsidiary of AIG and China's largest foreign-owned life insurer by premium, said in a statement that it is well capitalized and able to meet local regulatory capital requirements.
The statement said AIG's liquidity problem would not affect the interests of Chinese policyholders, and AIA "remains confident in the future of the Chinese market while continuing to operate normally to meet its obligations to policyholders".
In a statement issued earlier by AIG, the underwriter also assured its policyholders that it would "remain adequately capitalized" and "continue to seek alternatives to increase short-term liquidity".
In particular, AIG noted its long tradition of service in Asian markets. Asia is home to some of AIG's oldest and most valued clients, it said.
In China, the insurer operates two subsidiaries, AIA and AIG General Insurance Co China Ltd, both of which are headquartered in Shanghai.
The US Federal Reserve's move to bail out the insurer with $85 billion has ended speculation about the possible sale of AIG's subsidiaries, said Shen Wei from AIA's corporate communications department.
Wang Xiaogang, an analyst from Oriental Securities, also said the bailout could help restore consumer confidence and would have a positive impact on the company and its China business.
In China, AIA reported a total premium of over 4.5 billion yuan in the first seven months of this year, down 4.6 percent year-on-year, according to the China Insurance Regulatory Commission.
AIG General Insurance Co China Ltd reported a total premium of 536 million yuan in the same period, up 19 percent.
(China Daily September 18, 2008)
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