Well, it looks like Spitzer’s pursuit of AIG has validity. All you AIG Loyalists can crap in your hats because your man is going down!
Kudos to Eliot for doing the job he’s paid to do, and all you people who are defending Hank Greenberg because he built AIG into a monster of an organization can sit back and stew. Spitzer is the only one who had the nerve to take on the Giant. All the Insurance Commissioners in this country who are afraid of Hank’s power should look for other work.
It looks like Hank’s building blocks were made of straw. I just feel sorry for all the people he stepped on during his ruthless and greedy career.
??? I don’t see your name in your email, Outsider. Does that imply that you too are a coward?
Way to go guys, rather than address the issue (Hank), launch a personal attack on the poster of the comment. That’s a much better approach than using logic or reason.
When it suits people like “slim” they feed at the trough of companies like AIG;go around pretending they know “Hank” and Tom and otherwise bask in the success of entrepreneurs they can never be.
I didn’t always agree,or even like,all the moves AIG made as sometimes I ,or my clients were on the wrong side of the opportunity and lost out.
But as far as I can remember,AIG never pretended they were a non-profit.They made a market for products when therre were none available.And after every new exposure created by a sympathethic judge or jury they came to fill the void.
If Mr. Spitzer is allowed to destroy one of the most imitated companies the insurance industry has ever spawned then we all should consider another less creative career.
AIG gets used because they are there- or here… Certainly not because they have expertise, provide good service, give good commissions, staff adequately to handle their producer loads… I could go on.
No one would imitate that mess.
There seems to be a frightful lot of unenlightened AIG supporters.
Very well said Slim. We’re on the same team. All those complainers about how Spitzer overstepped his boundaries and is using his investigations a a political tool are eating crow since the corrupt and greedy egomanics are falling by the wayside. Those cry babies are most likely ripping off their clients as well.
I’d like to review their ten largest accounts and see how they’ve been serviced.
Spitzer deserves a medal-our elected representatives in Washington were afraid to call AIG on their fraud; but then, those in the House and Senate probably don’t know the first thing about a Homeowners policy.
Why has AIG only restated their accounting for the past four years? I’ve been in the business over 40 years and AIG was doing the same stuff in the 60’s, 70’s, 80’s, and 90’s.
Slim, thanks for saying what I would have said-I guarantee you there are more like us out there than those crying babies.
You had a bit of trouble spelling “unique.” And it looks like Mike gets it.
Sorry if I can’t defend Hank. And, I’m not so bitter, really. I’m just enjoying watching all the people apologizing for Hank because he built AIG to what it has become (he did have help). I guess the builders of the Robber Baron companies of today are forgiven for the cheating and lying and skirting the law, because people make money . . . but then it’s gone. Eventually I will crow.
Go ahead, shoot the messenger. But, you are only using words.
By the way, my name is Phil, but who really uses their actual name in these postings?
I suggest all of you start thinking in terms of both the SEC, Justice and IRS taking a hard look at AIG’s numbers over a protracted period of time. This isn’t going to be over this year, next year or the year after. Gee, so AIG lied when they filed their “Yellow Perils”, that means that they lied when they filed their 10K’s, does that mean that they lied to the IRS, surely not their shareholders, and certainly not their employess, excluding of course the Star Partners!
When all is said and done, when some 2,000 reinsurance deals are really investigated, not only between Richmond, Transatlantic, Union, the old Coral crowd; the question of whether AIG has actually reserved adequately over a protracted period of time, no one said at the 95% confidence level, just adequately, and – they start looking at the Gen Re/Cologne deals amonst others –
then, and only then, will anyone have any idea as to whether their current $17 billion surplus, exists, and if so, how much does exist against a net written of $35 billion give or take.
I’ve heard all the dooms day scenarios from “people in the know”..what will be known when all of this is fleshed out, is whether AIG will or will not survive in the same manner as it has over these many years.
Best lunch in town folks, it’s going to be one hell of a different institution.
Excellent points Peter. However, I think the one thing missing from the IRS, SEC, DoJ is a Spitzer type that, for either noble or selfish reasons, has a desire to go after the wrongdoers. I’m in agreement with you that AIG will undergo some change, and probably to the detriment of its shareholders, but no one at the major agencies you cite seems to have much interest in prosecuting this type of crime. I’m guessing the big change is that AIG’s old bullying tactics with regulators and markets will be a thing of the past. Think their reserves are going to get a little extra attention by state regulators this year? Think their auditors are going to want a little extra cushion going forward?
I can understand the agencies’ frustration, that white collar crime is notoriously difficult to win prosecutions on (try explaining finite insurance to a “jury of your peers”), but as far as I can tell those agencies have been asleep at the switch for the last 10 years. I think it’s a travesty that it’s the AG from NY that’s finally cracking down on these crimes – Federal enforcement should have been all over this a long time ago.
I think a good number of us who work internally within insurance companies take a much more “balanced” (my opinion) view on the AIG/Greenburg issues. Many of us are of course disappointed to see the investigations and prosecutions against such a pillar of the industry, but that’s really because the practices that are being unearthed are terrible news. It all means more work for the rest of us, not only to ensure our own companies are operating above board, but also to convince the public (and possibly, regulators) that we’re not an industry of crooks.
I’m sure there are probably other companies in the industry that may have been dancing on the grey line between “shady” and “above reproach”, but I really don’t think they’re the norm. What doesn’t help, unfortunately, are those who appear to be trying to *excuse* alleged criminal behavior on the basis of how much money was made and how large a market share was gained. Is this really the argument we want to be putting before regulators, and the public? Is this really the image we want to project?
These are rhetorical questions, of course, because if anyone’s answer is “yes”, I think I’d really rather not know…
If you feel the AIG debacle is disturbing,
try visiting the sites mentioned below for some interesting, problematic and insightful homeowner insurance issues regarding why hundreds and hundreds of families are still out of their Hurricane Isabel (9-2003) damaged homes on the east coast.
A large unanswered question behind the masse underpaying of homeowner claims is-
Can insurers-stockholders profit more, and will loss ratio and reserve books look better by intentionally underpaying massive amounts of catastrophe and daily claims in the US, Canada and elsewhere?
Mike – don’t believe for one moment that SEC, Justice and eventually the IRS aren’t going to be dramatically interested in the ongoing investigation. There is good reason to believe that AIG could well make Enron look like childs play. Just consider the number of illicit potential deals that have already been uncovered. Not to mention the fact that many people with AIG knowledge have felt for years that they are at least 15 to 20% under reserved.
Government interest will peake when more discovery becomes known.
Roger – if AIG were say 20% under reserved, that would mean that their $17 billion would be reduced to about $13.6 billion. $13.6 versus $35 billion in net written would put AIG at a ratio of 2.7 surplus to net written which is starting to get a bit dicey. At that point, or a lower one, they are going to have to shore up reserves, which obviously will put a drain, albeit, not a large one, on their capital. The market S&P, Fitch, Moody’s isn’t going to wait long to have them make a move. If, by any chance, surplus starts to get down in the $11 to $12 billion range, then they’re going to need to make some rather interesting fiscal moves.
If you take just that segment of concern, and start adding adjustments, which are coming in the future, AIG’s market cap of some $88 billion has the potential of taking some substantial hits. None of this bodes well for shareholders, who have already filed a class action suit, as well as employees under ERISA, which is not funny.
Time will tell, it will all come out in the wash, it will be interesting.
I’ve said for years that the insurance market is an industry where the language has been either misunderstood, or not understood. So called experts have been fooled any number of times, and being an industry of so called “cash cows” it would appear that it has, in some significant cases, gotten away with some potentially spectacular cooking of the books. As it all plays out, it may well ultimately decide the shape of the industry that we are in, perhaps for a very long time.
Why are you attacking Slim, when it is Hank Greenberg that is being accused of fruad? Also The outsider… you can’t be serious about Slim not posting his real name and being a coward for that… You do realize you did the same thing?
My guess is The Outster has some connection to AIG and is just defending his ex-boss or perhaps he’s Jeffrey in disguise protecting Dad. If someone attacked my father I’d give him or her grief, too. I wonder when Jeff will be up on charges for his guidance of Marsh?
Outster, I know it hurts when people say disparaging things about Hank, but he brought it on himself. Entrepreneurial ship does not necessarily include theft and greed.
Oh, and Not-so-slim, I am anything but a eunich. Funny how losers tend to attack sexuality when they have nothing else to say. When was the last time you were even able to see yours in the shower? Oops, guess I resorted to the same thing. Sorry, Tiny.
Look around guys! At least Spitzer is going after the right person this time. These types of things occur in all insurance companies, because as earlier stated, they are “cash cows.”
But, beware of companies such as Combined Insurance Company of America who use established company practices to insure huge Executive bonuses and to, at the same time, defraud company stockholders. The government does not look at the CEO’S nor the Executives; they go after the “little people” as they did in Federal Court in Columbus, Ohio. General Reinsurance personnel are extremely lucky that somebody cares enough to know where the buck stops and place blame appropriately.
And, being closely involved with the case in Columbus, Ohio; I am not ashamed to state my name nor my position on what is happening.
Another question-
When will the other apple that didn’t fall far from the tree- Evan at ACE, get the heave ho?
We know the kind of guy Hank was/is, Jeffrey is dangerous (remember the internal memo he sent around a day after the devastation in FL in ’92)and where would Evan be if he had another last name?
EXACTLY. DON’T YOU GET TIRED OF DESTROYING THIS COUNTRY. ARE YOU SO MUCH A PART OF THE MATRIX THAT YOU DON’T EVEN RECOGNIZE THE ROLE YOU ARE PLAYING IN THE DEMISE OF THE FREE MARKET SYSTEM AND WITH IT THE ECONOMY OF THE WESTERN WORLD. NO, MAYBE EVEN THE ENTIRE WORLD.
Jeffrey Greenberg sent around an AIG internal memo a day after Andrew hit South Florida in 1992. The memo called for immediate rate increases, you know,the “hit em while their down” kind of mentality.
He was called on the carpet for that but he’ll never live it down in my mind.
For some new and interesting news regarding intentional (Hurricane Isabel) claim underpayments, go to http://www.femainfo.us
FEMA-NFIP-major insurers are facing a (June 2005) 2 BILLON dollar insurance claim settlement-fraud based lawsuit by citizens-clients.
What may come out in discovery is that insurance agents use RECONSTRUCTION data to estimate-factor (underwrite) the value of homeowners insurance coverage-payments, and insurance claim adjusters use NEW CONSTRUCTION data to estimated replacement cost values.
The difference between Reconstruction costs and NEW Construction costs can throw off a homeowners (hurricane, hail, fire, wind, flood, earthquake, etc.) claim by a minimum of 35-50% alone.
Also, leaving out primary-general contractor overhead and profit margins-values, and sub-contractors’s, in a insurer’s claim estimate, can undervalue claim values another 20-49%.
Ask an Allstate, State Farm, Farmers, Hartford, USAA, Travelers, Etc. insurance agent-broker to verify those premium value-claim value facts mentioned above as you shop for / pay for insurance coverage.
Have them prove, in plain language and in writing, that a potential claim will be paid equal to the structure REPLACEMENT (Reconstruction) loss values they anticipated in your premium values, in an insurer’s-adjuster’s claim loss RESERVE dollar estimate.
See Google search keywords–the claim file exhibit a in bad faith litigation–
Well, it looks like Spitzer’s pursuit of AIG has validity. All you AIG Loyalists can crap in your hats because your man is going down!
Kudos to Eliot for doing the job he’s paid to do, and all you people who are defending Hank Greenberg because he built AIG into a monster of an organization can sit back and stew. Spitzer is the only one who had the nerve to take on the Giant. All the Insurance Commissioners in this country who are afraid of Hank’s power should look for other work.
It looks like Hank’s building blocks were made of straw. I just feel sorry for all the people he stepped on during his ruthless and greedy career.
Maybe soon we can dance on his grave.
Well Slim – aren’t you a bitter little man!
Hey Slim:
Why don’t you have the COURAGE to put your real name to the comments about MRG nad AIG?
what a Coward !!!!!!
hard to do when you are a eunich
??? I don’t see your name in your email, Outsider. Does that imply that you too are a coward?
Way to go guys, rather than address the issue (Hank), launch a personal attack on the poster of the comment. That’s a much better approach than using logic or reason.
And my name is Mike.
Bravo Mike. You are right!!
When it suits people like “slim” they feed at the trough of companies like AIG;go around pretending they know “Hank” and Tom and otherwise bask in the success of entrepreneurs they can never be.
I didn’t always agree,or even like,all the moves AIG made as sometimes I ,or my clients were on the wrong side of the opportunity and lost out.
But as far as I can remember,AIG never pretended they were a non-profit.They made a market for products when therre were none available.And after every new exposure created by a sympathethic judge or jury they came to fill the void.
If Mr. Spitzer is allowed to destroy one of the most imitated companies the insurance industry has ever spawned then we all should consider another less creative career.
AIG gets used because they are there- or here… Certainly not because they have expertise, provide good service, give good commissions, staff adequately to handle their producer loads… I could go on.
No one would imitate that mess.
There seems to be a frightful lot of unenlightened AIG supporters.
Very well said Slim. We’re on the same team. All those complainers about how Spitzer overstepped his boundaries and is using his investigations a a political tool are eating crow since the corrupt and greedy egomanics are falling by the wayside. Those cry babies are most likely ripping off their clients as well.
I’d like to review their ten largest accounts and see how they’ve been serviced.
Spitzer deserves a medal-our elected representatives in Washington were afraid to call AIG on their fraud; but then, those in the House and Senate probably don’t know the first thing about a Homeowners policy.
Why has AIG only restated their accounting for the past four years? I’ve been in the business over 40 years and AIG was doing the same stuff in the 60’s, 70’s, 80’s, and 90’s.
Slim, thanks for saying what I would have said-I guarantee you there are more like us out there than those crying babies.
You had a bit of trouble spelling “unique.” And it looks like Mike gets it.
Sorry if I can’t defend Hank. And, I’m not so bitter, really. I’m just enjoying watching all the people apologizing for Hank because he built AIG to what it has become (he did have help). I guess the builders of the Robber Baron companies of today are forgiven for the cheating and lying and skirting the law, because people make money . . . but then it’s gone. Eventually I will crow.
Go ahead, shoot the messenger. But, you are only using words.
By the way, my name is Phil, but who really uses their actual name in these postings?
Wait, I am Phil!
I suggest all of you start thinking in terms of both the SEC, Justice and IRS taking a hard look at AIG’s numbers over a protracted period of time. This isn’t going to be over this year, next year or the year after. Gee, so AIG lied when they filed their “Yellow Perils”, that means that they lied when they filed their 10K’s, does that mean that they lied to the IRS, surely not their shareholders, and certainly not their employess, excluding of course the Star Partners!
When all is said and done, when some 2,000 reinsurance deals are really investigated, not only between Richmond, Transatlantic, Union, the old Coral crowd; the question of whether AIG has actually reserved adequately over a protracted period of time, no one said at the 95% confidence level, just adequately, and – they start looking at the Gen Re/Cologne deals amonst others –
then, and only then, will anyone have any idea as to whether their current $17 billion surplus, exists, and if so, how much does exist against a net written of $35 billion give or take.
I’ve heard all the dooms day scenarios from “people in the know”..what will be known when all of this is fleshed out, is whether AIG will or will not survive in the same manner as it has over these many years.
Best lunch in town folks, it’s going to be one hell of a different institution.
Excellent points Peter. However, I think the one thing missing from the IRS, SEC, DoJ is a Spitzer type that, for either noble or selfish reasons, has a desire to go after the wrongdoers. I’m in agreement with you that AIG will undergo some change, and probably to the detriment of its shareholders, but no one at the major agencies you cite seems to have much interest in prosecuting this type of crime. I’m guessing the big change is that AIG’s old bullying tactics with regulators and markets will be a thing of the past. Think their reserves are going to get a little extra attention by state regulators this year? Think their auditors are going to want a little extra cushion going forward?
I can understand the agencies’ frustration, that white collar crime is notoriously difficult to win prosecutions on (try explaining finite insurance to a “jury of your peers”), but as far as I can tell those agencies have been asleep at the switch for the last 10 years. I think it’s a travesty that it’s the AG from NY that’s finally cracking down on these crimes – Federal enforcement should have been all over this a long time ago.
Mike/Slim –
I think a good number of us who work internally within insurance companies take a much more “balanced” (my opinion) view on the AIG/Greenburg issues. Many of us are of course disappointed to see the investigations and prosecutions against such a pillar of the industry, but that’s really because the practices that are being unearthed are terrible news. It all means more work for the rest of us, not only to ensure our own companies are operating above board, but also to convince the public (and possibly, regulators) that we’re not an industry of crooks.
I’m sure there are probably other companies in the industry that may have been dancing on the grey line between “shady” and “above reproach”, but I really don’t think they’re the norm. What doesn’t help, unfortunately, are those who appear to be trying to *excuse* alleged criminal behavior on the basis of how much money was made and how large a market share was gained. Is this really the argument we want to be putting before regulators, and the public? Is this really the image we want to project?
These are rhetorical questions, of course, because if anyone’s answer is “yes”, I think I’d really rather not know…
If you feel the AIG debacle is disturbing,
try visiting the sites mentioned below for some interesting, problematic and insightful homeowner insurance issues regarding why hundreds and hundreds of families are still out of their Hurricane Isabel (9-2003) damaged homes on the east coast.
A large unanswered question behind the masse underpaying of homeowner claims is-
Can insurers-stockholders profit more, and will loss ratio and reserve books look better by intentionally underpaying massive amounts of catastrophe and daily claims in the US, Canada and elsewhere?
1.) http://www.catadjuster.org/forum/%22Isabel%22%2C_is_a_Hot_Potato_headed_behind%3F/m_899/tm.htm
2.) http://www.femainfo.us
Roger Poe
therdp5@yahoo.com
Mike – don’t believe for one moment that SEC, Justice and eventually the IRS aren’t going to be dramatically interested in the ongoing investigation. There is good reason to believe that AIG could well make Enron look like childs play. Just consider the number of illicit potential deals that have already been uncovered. Not to mention the fact that many people with AIG knowledge have felt for years that they are at least 15 to 20% under reserved.
Government interest will peake when more discovery becomes known.
How does, or could, being 15-20% low on reserves benefit an insurer or investors?
Why is being 15-20% low on reserves not a good thing for homeowners or investors?
Roger – if AIG were say 20% under reserved, that would mean that their $17 billion would be reduced to about $13.6 billion. $13.6 versus $35 billion in net written would put AIG at a ratio of 2.7 surplus to net written which is starting to get a bit dicey. At that point, or a lower one, they are going to have to shore up reserves, which obviously will put a drain, albeit, not a large one, on their capital. The market S&P, Fitch, Moody’s isn’t going to wait long to have them make a move. If, by any chance, surplus starts to get down in the $11 to $12 billion range, then they’re going to need to make some rather interesting fiscal moves.
If you take just that segment of concern, and start adding adjustments, which are coming in the future, AIG’s market cap of some $88 billion has the potential of taking some substantial hits. None of this bodes well for shareholders, who have already filed a class action suit, as well as employees under ERISA, which is not funny.
Time will tell, it will all come out in the wash, it will be interesting.
I’ve said for years that the insurance market is an industry where the language has been either misunderstood, or not understood. So called experts have been fooled any number of times, and being an industry of so called “cash cows” it would appear that it has, in some significant cases, gotten away with some potentially spectacular cooking of the books. As it all plays out, it may well ultimately decide the shape of the industry that we are in, perhaps for a very long time.
Why are you attacking Slim, when it is Hank Greenberg that is being accused of fruad? Also The outsider… you can’t be serious about Slim not posting his real name and being a coward for that… You do realize you did the same thing?
Thanks, Garrett.
My guess is The Outster has some connection to AIG and is just defending his ex-boss or perhaps he’s Jeffrey in disguise protecting Dad. If someone attacked my father I’d give him or her grief, too. I wonder when Jeff will be up on charges for his guidance of Marsh?
Outster, I know it hurts when people say disparaging things about Hank, but he brought it on himself. Entrepreneurial ship does not necessarily include theft and greed.
Oh, and Not-so-slim, I am anything but a eunich. Funny how losers tend to attack sexuality when they have nothing else to say. When was the last time you were even able to see yours in the shower? Oops, guess I resorted to the same thing. Sorry, Tiny.
Look around guys! At least Spitzer is going after the right person this time. These types of things occur in all insurance companies, because as earlier stated, they are “cash cows.”
But, beware of companies such as Combined Insurance Company of America who use established company practices to insure huge Executive bonuses and to, at the same time, defraud company stockholders. The government does not look at the CEO’S nor the Executives; they go after the “little people” as they did in Federal Court in Columbus, Ohio. General Reinsurance personnel are extremely lucky that somebody cares enough to know where the buck stops and place blame appropriately.
And, being closely involved with the case in Columbus, Ohio; I am not ashamed to state my name nor my position on what is happening.
Another question-
When will the other apple that didn’t fall far from the tree- Evan at ACE, get the heave ho?
We know the kind of guy Hank was/is, Jeffrey is dangerous (remember the internal memo he sent around a day after the devastation in FL in ’92)and where would Evan be if he had another last name?
EXACTLY. DON’T YOU GET TIRED OF DESTROYING THIS COUNTRY. ARE YOU SO MUCH A PART OF THE MATRIX THAT YOU DON’T EVEN RECOGNIZE THE ROLE YOU ARE PLAYING IN THE DEMISE OF THE FREE MARKET SYSTEM AND WITH IT THE ECONOMY OF THE WESTERN WORLD. NO, MAYBE EVEN THE ENTIRE WORLD.
Good for you Jodie Hill.—
big E,
Other’s greed and prideful ego’s is affecting other’s inalienable rights.
It should come as no surprise that people will resist such disgusting injustice to themselves, their loved ones and others.
> (remember the internal memo he sent around a day after the devastation in FL in ’92)
What did the 1992 FL memo say?
Jeffrey Greenberg sent around an AIG internal memo a day after Andrew hit South Florida in 1992. The memo called for immediate rate increases, you know,the “hit em while their down” kind of mentality.
He was called on the carpet for that but he’ll never live it down in my mind.
What a slimy thing to do. Thanks for the response on the FL memo.
The following (jeffrey greenberg hurricane andrew memo) Google search words pulled up some interesting info.
http://www.google.com/search?hl=en&rls=GGLG,GGLG:2005-23,GGLG:en&q=Jeffrey+Greenberg+hurricane+andrew+Memo&spell=1
For some new and interesting news regarding intentional (Hurricane Isabel) claim underpayments, go to http://www.femainfo.us
FEMA-NFIP-major insurers are facing a (June 2005) 2 BILLON dollar insurance claim settlement-fraud based lawsuit by citizens-clients.
What may come out in discovery is that insurance agents use RECONSTRUCTION data to estimate-factor (underwrite) the value of homeowners insurance coverage-payments, and insurance claim adjusters use NEW CONSTRUCTION data to estimated replacement cost values.
The difference between Reconstruction costs and NEW Construction costs can throw off a homeowners (hurricane, hail, fire, wind, flood, earthquake, etc.) claim by a minimum of 35-50% alone.
http://financialservices.house.gov/media/pdf/041405sk.pdf
Also, leaving out primary-general contractor overhead and profit margins-values, and sub-contractors’s, in a insurer’s claim estimate, can undervalue claim values another 20-49%.
Ask an Allstate, State Farm, Farmers, Hartford, USAA, Travelers, Etc. insurance agent-broker to verify those premium value-claim value facts mentioned above as you shop for / pay for insurance coverage.
Have them prove, in plain language and in writing, that a potential claim will be paid equal to the structure REPLACEMENT (Reconstruction) loss values they anticipated in your premium values, in an insurer’s-adjuster’s claim loss RESERVE dollar estimate.
See Google search keywords–the claim file exhibit a in bad faith litigation–
http://www.manierherod.com/articles/2003FLAPoteetDowningPaper.PDF
http://library.findlaw.com/1999/Apr/1/127547.html
Roger Poe
Reconstruction Specialist
(863)420-6569
therdp5@yahoo.com