American International Group, Inc. announced Friday that its AIG Companies terminated the agency relationship with Starr Technical Risks Agency, Inc. and its subsidiaries (Starr Tech), insurance agencies owned by C.V. Starr & Co., Inc.
C.V. Starr is run by AIG’s own former chairman and CEO, Maurice “Hank” Greenberg. The parties have been in a court dispute over Starr’s attempts to move its AIG business to other carriers.
According to AIG’s announcement, all current and future underwriting, claims, loss control and administrative functions relating to accounts formerly underwritten by Starr Tech on behalf of the AIG Companies will be managed by New York-based AIG Global Energy, which already provides insurance and risk management programs to energy and energy-related companies worldwide.
AIG Global Energy has expanded its scope of operations by creating a new division, AIG Global Energy-North America, to serve the worldwide property insurance needs of insurance customers in North America. AIG Global Energy-North America will initially have offices in New York, Hartford, Conn., and Houston, Tex., as well as Toronto and London.
Starr Technical is a managing general agency that specializes in oil and chemical industry insurance.
Last week, a New York judge granted American International Group a restraining order against Greenberg and Starr Technical Risk Agency, that bars Starr from placing its AIG business with other insurers.
The order barred Greenberg’s agency from pursuing contracts with National Indemnity, a Berkshire Hathaway unit, for business currently with AIG.
New York State Supreme Court Justice Herman Cahn said his restraining order would remain in effect until the parties settle their differences in arbitration.
AIG has claimed that Starr Technical has been using “unauthorized” reinsurance agreements with National Indemnity to take business now placed with AIG and give it to other insurers. AIG maintains that Starr Technical and AIG have had an exclusive contract since 1992, which includes allowing Starr Technical to sell policies in AIG’s name.
C.V. Starr has countersued charging that AIG is trying to keep its agency from competing. Starr claims that its agency is free to write accounts with other carriers when AIG is not competitive. Its lawyers have accused AIG of trying to close down Starr agencies and urging clients not to do business with Greenberg’s companies.
Was this article valuable?
Here are more articles you may enjoy.