AIG Financial Catastrophe Explained
I was toasting the work of our legal team following a hard fought resolution to a very complex matter last Friday evening. One of the attorneys working with me as outside co-counsel's husband worked for AIG. He briefly joined us, and I commented that I was certain his wife cursed me for all the late nights and weekends she gave as part of the effort. I asked him how the AIG bailout would effect him. He responded that he truly did not know and seemed amazed that such a strong company unravelled so quickly. He said it was very hard to believe, considering how well the property and casualty subsidiaries, such as Lexington, were doing. The Sunday New York Times ran an excellent article explaining how such a large and profitable insurer could be taken down by greed and dabbling in non-regulated finance. We need our insurers to be regulated, so our insurance is protected, now more than ever. These are tough lessons to learn all over again.
