Brian Duperreault, the new CEO of American International Group (AIG), has tapped Peter Zaffino, a former colleague at insurance broker Marsh, to be executive vice president, global chief operating officer at AIG.
In his role at AIG, Zaffino will lead the day-to-day business of all country operations, including U.S. commercial field operations and AIG’s multinational organization, as well as global business services, administration and communications. He will develop AIG’s long-term strategy and operating plan, and be responsible for executing the commercial lines and consumer strategies. His appointment is effective Aug. 1
Zaffino, age 50, joins AIG after serving as CEO of Marsh, the global insurance brokerage and risk management subsidiary of Marsh & McLennan Companies Inc. (MMC) since 2011 – and as chairman of the Risk and Insurance Services segment of MMC since 2015. He has also been a member of MMC’s Executive Committee since 2008. He and Duperreault worked together at Marsh when Duperreault took over the brokerage firm in 2008 and engineered a successful turnaround at the company that was losing business after allegations of bid-rigging by then-New York Attorney General Eliot Spitzer.
Duperreault called Zaffino “one of the most talented executives operating in the insurance industry.” He said AIG’s field operations will benefit from Zaffino’s experience across all aspects of the business.
According to a report by Reuters citing a memo by Duperreault on the move, Zaffino will replace AIG’s present COO, Jeff Hurd, and there will be “some changes” to the insurer’s “operating structure and reporting lines.”
According to an AIG filing with the Securities and Exchange Commission (SEC), Zaffino will receive a one-time, sign-on bonus worth $15 million, part of which will be in the form of stock options. His initial compensation will include an annual base salary of $1.25 million, a short-term annual incentive target of $3 million and an annual long-term incentive award of $4.25 million. For 2017, consistent with AIG’s compensation program for other executive officers, Zaffino’s long-term incentive award is 70 percent in the form of performance share units earned based on achievement of performance criteria for the three-year performance period covering January 2017 through December 2019, and 30 percent in the form of restricted stock units earned based on continued employment through such three-year period.
Zaffino has more than 25 years of experience in the insurance and reinsurance industry. Prior to being named Marsh CEO in 2011, he was president and CEO of Guy Carpenter, the reinsurance specialist subsidiary of MMC, having previously held a number of senior roles at the firm. Prior to joining Guy Carpenter in 2001, he held several senior positions, including serving in an executive role with a GE Capital portfolio company.
Duperreault, age 70, the founder and CEO of Hamilton Insurance Group Ltd. in Bermuda, was chosen in May to replace CEO Peter Hancock, who announced plans to depart in March after the insurer’s fourth-quarter loss. Duperreault’s appointment meant internal candidates for the CEO job were passed over. Among them was Rob Schimek, age 52, CEO of AIG’s commercial insurance unit.
According to the Duperreault memo cited by Reuters, Zaffino will “work closely” with Schimek, CEO of the commercial unit, and Kevin Hogan, CEO of consumer business that includes U.S. life and retirement businesses.
Duperreault’s memo said the move will put “equal focus and leadership” on field operations, led by Zaffino, with “critical areas” of underwriting and risk strategies led by Hogan and Schimek.
Marsh & McLennan Companies Inc. on Wednesday named Marsh President John Doyle, who joined Marsh after being cut by AIG in a management shake-up in 2016, to replace Zaffino as its brokerage unit’s chief executive. MMC said the role of chairman of risk and insurance services will not be filled. Doyle will report to Marsh & McLennan President and CEO Dan Glaser and continue to serve on the company’s Executive Committee.
MMC further announced that effective immediately, Peter Hearn, president and CEO of Guy Carpenter, will report directly to Glaser and join the company’s Executive Committee.
- AIG Picks Hamilton’s Duperreault as CEO
- AIG’s High Cost of Hiring Duperreault
- Doyle Named to Succeed Departing Zaffino as CEO of Marsh
- New AIG CEO Duperreault Wants to Pursue Acquisitions, Slow Buybacks
- Marsh CEO Zaffino Joins AIG as Global Chief Operating Officer
- AIG Commercial Lines CEO Schimek Eyes Acquisitions for Value-Added, Not Scale
- MMC’s Zaffino Adds Chairman Title; Willis Re’s Hearn to Join Guy Carpenter as CEO
- Former AIG Executive Doyle to Join Marsh as President
- AIG Frees Up Capital with Reinsurance Pact with Swiss Re
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