AIG Singapore head resigns amid turmoil

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(Agencies)
Updated: 2008-09-19 15:02

SINGAPORE -- The head of the Singapore unit of troubled insurance giant American International Group Inc. has resigned effective immediately, the country's central bank said Friday.

The logo of American International Group (AIG) is seen at their offices in New York September 18, 2008. A public pension fund has sued the chief executive and board of American International Group Inc (AIG), accusing them of mismanagement and "grossly imprudent risk taking" that led to the insurer's $85 billion government rescue this week. [Agencies]

Mark O'Dell, general manager of AIA Singapore, has taken a leave of absence and Executive Vice President Kenneth Juneau will take over, said the bank, known as the Monetary Authority of Singapore.

AIA Singapore headquarters has been flooded this week with thousands of nervous policyholders seeking to find out the status of their policies or cash them out, even after the US Federal Reserve pledged an US$85 billion loan to prop up AIG.

The company said in a statement Friday that any policyholder who terminated their policy this week would be allowed to reinstate it during the next two weeks without penalty.

"We have received feedback that many of our customers are now more reassured of AIA Singapore's financial position," said Mark Wilson, regional president of AIG Life Companies in Asia Pacific. "So we have offered this policy conservation program to those policyholders who reacted to the uncertainty of recent developments at AIG."

Less than 0.1 percent, or about 2,000, of the company's 2 million in force policies in Singapore, a nation of 4.6 million people, have been terminated this week, the company said.

Both AIA Singapore and the central bank reiterated that the company's policies are safe.

"AIA maintains separate insurance funds for all policies," the company said. "AIA Singapore has more than sufficient capital and reserves above the regulatory minimum requirements to meet our obligations."

AIG customers throughout Asia have canceled policies this week amid fears AIG would follow investment bank Lehman Brothers Holdings Inc. into bankruptcy.

AIG provides services in 130 countries and areas, including the Chinese mainland, Japan, South Korea and China's Taiwan Provoince.