As a naysayer, I’ll make this observation. AIG has a long history of manipulating earnings. And one of the “classic” earnings manipulation techniques is to recognize excessive losses in periods where you have to take losses, to “pad” your reserves so those losses from prior periods can be taken back into earnings in the future. It’s so common it even has a name, the “bathwater effect.” I’m not sure of your motivation (are you an employee, shareholder, etc.), but I’d be careful of pointing to this one quarter of results from a company with a history of lying, and use that as “proof” that everyone else is wrong about the company.
Show me a carrier who hasn’t lied about one thing or the other. AIG made its problems, no doubt about it, but whats the point of putting the industry in a whirlwind because of it. The supporters of AIG’s fall want it to fall because their gonna make a dollar or two if it does. The reality of it is that we are in a soft market and a giant like AIG will bounce back in a matter of no time. Its alrteady happening in the first quarter. In addition, if it came to that dont you think the states and local and Federal goverment are gonna do whats necessary to maintain stability, for the peoples sake. Im glad that AIG got caught, not for its demise though, but to stop the bleeding befor thousands of insureds and shareholders get burned. I am curious to know why people stating comments despising AIG are happy, I am assuming they have THEIR OWN BEST INTEREST in mind. Thanks for listening.
I’ll reply for me, since I don’t suggest to speak for others.
I am not an AIG shareholder, employee, agent, employed by a competitor, policyholder, etc. I will not benefit financially by the changes happening at AIG, whether good or bad. I will benefit in the sense that as more of the unethical players in the industry are uprooted and destroyed, consumers and the industry will benefit.
My comments expressing satisfaction at the demise of Hank Greenberg and my low opinion of the culture at that company stem from a genuine love of the industry and a passion for morality and ethics in business. Everyone keeps making the argument that “everyone is doing it” so we shouldn’t fault AIG. This is discouraging for me to read. We should strive for high ethics and morality in business, not a race to the bottom in the quest for profits. Have other insurance companies made missteps? Yes. Have they been punished? Hopefully, most have.
In working in insurance companies, I was frequently pressured to compromise my position on underwriting, pricing and accounting issues. When I pushed back, the most common argument I heard was that “all of the competition is doing it, so we have to as well to compete.” I didn’t buy that hten, and I don’t buy that now. Maybe I’m the last boy scout in this industry, but somehow I don’t think so. All of us who strive for high standards of ethics and morality, and have paid a price for our unwillingness to compromise our morals and ethics, are delighted to see the crooked fall.
ya. right.
where are all the naysayers now? 20% growth on scrubbed financials.
face it, they’re a juggernaut. learn to hate the game, not the player.
the player makes the game.
Hi Hahaha –
As a naysayer, I’ll make this observation. AIG has a long history of manipulating earnings. And one of the “classic” earnings manipulation techniques is to recognize excessive losses in periods where you have to take losses, to “pad” your reserves so those losses from prior periods can be taken back into earnings in the future. It’s so common it even has a name, the “bathwater effect.” I’m not sure of your motivation (are you an employee, shareholder, etc.), but I’d be careful of pointing to this one quarter of results from a company with a history of lying, and use that as “proof” that everyone else is wrong about the company.
But that’s just my opinion, I could be wrong.
Mike
Show me a carrier who hasn’t lied about one thing or the other. AIG made its problems, no doubt about it, but whats the point of putting the industry in a whirlwind because of it. The supporters of AIG’s fall want it to fall because their gonna make a dollar or two if it does. The reality of it is that we are in a soft market and a giant like AIG will bounce back in a matter of no time. Its alrteady happening in the first quarter. In addition, if it came to that dont you think the states and local and Federal goverment are gonna do whats necessary to maintain stability, for the peoples sake. Im glad that AIG got caught, not for its demise though, but to stop the bleeding befor thousands of insureds and shareholders get burned. I am curious to know why people stating comments despising AIG are happy, I am assuming they have THEIR OWN BEST INTEREST in mind. Thanks for listening.
I’ll reply for me, since I don’t suggest to speak for others.
I am not an AIG shareholder, employee, agent, employed by a competitor, policyholder, etc. I will not benefit financially by the changes happening at AIG, whether good or bad. I will benefit in the sense that as more of the unethical players in the industry are uprooted and destroyed, consumers and the industry will benefit.
My comments expressing satisfaction at the demise of Hank Greenberg and my low opinion of the culture at that company stem from a genuine love of the industry and a passion for morality and ethics in business. Everyone keeps making the argument that “everyone is doing it” so we shouldn’t fault AIG. This is discouraging for me to read. We should strive for high ethics and morality in business, not a race to the bottom in the quest for profits. Have other insurance companies made missteps? Yes. Have they been punished? Hopefully, most have.
In working in insurance companies, I was frequently pressured to compromise my position on underwriting, pricing and accounting issues. When I pushed back, the most common argument I heard was that “all of the competition is doing it, so we have to as well to compete.” I didn’t buy that hten, and I don’t buy that now. Maybe I’m the last boy scout in this industry, but somehow I don’t think so. All of us who strive for high standards of ethics and morality, and have paid a price for our unwillingness to compromise our morals and ethics, are delighted to see the crooked fall.
Mike