AIG's P&C arm eager to split, new name in question

TOUGH TIMES

For now, AIG's property-casualty arm is going by the name AIU Holdings, in keeping with a name that has long been used by AIG outside of the United States, said Liddy.

"Foreign general (the non-U.S. business) is holding up really quite well, and it has traveled under a name, AIU, that is independent from AIG," said Liddy in an interview at AIG's downtown Manhattan headquarters.

Business is not as strong at AIG's U.S. commercial insurance business, with the economic downturn shrinking demand.

"There is not much new business," Liddy said, adding that slack demand for commercial insurance is being felt across the industry. Liddy expects the stimulus package to eventually boost demand.

Insurance buyers have also been more skittish since massive mortgage losses nearly toppled the institution.

"We have found that insurance buyers still want AIG in the mix, but they don't want us to have 100 percent of their risk. Now we may get 60 percent or 75 percent," said Liddy.

"They are spreading the risk" among more than one carrier, he added.

Last month, AIG removed signs outside its property-casualty offices as part of its plan to change the operation's name.

The 90-year-old AIG has become the scorn of America after taking the financial rescue package from U.S. taxpayers. About $80 billion of the $180 billion is loans that the company is working to repay. (Reporting by Lilla Zuill; Editing by Brian Moss)