I’ve received a number of calls from clients and potential clients asking about AIG’s financial situation and the federal government’s loan.
AIG’s millions of insurance policyholders appear to be considerably less at risk. That’s because of how the company is structured and regulated. Its insurance policies are issued by separate subsidiaries of AIG, highly regulated units that have assets available to pay claims. In the U.S., those assets can’t be shifted out of the subsidiaries without regulatory approval, and insurance is also regulated strictly abroad.
I’m certainly no Wall Street expert but I think the Wall Street Journal’s writers know their stuff.