The following article was originally published on TheStreet.com on March 2
American International Group's (AIG) competitors have found it more complicated than imagined to take advantage of the troubled insurance giant while its down.
The competition smelled blood in the water amid massive losses, a government bailout and a major restructuring plan. But AIG rivals are grumbling the company is using its leading position and government support as tools to drastically undercut prices. AIG declined to comment on those charges, but sources inside and outside the firm say the accusations are merely a tactic to kick the insurance giant while it's down.
Despite its struggles, AIG is still a leader in the insurance world. It holds the top position for life insurance, commercial lines and workers' compensation insurance and the No. 2 spot for property & casualty insurance, according to the Insurance Information Institute. It remains within the top 10 for passenger and commercial auto insurance.Overall, AIG was the No. 2 insurer in 2007, underwriting a total of $37.7 billion in premiums and investments, topped only by State Farm, which underwrote $49.4 billion, according Highline Data. Its leading position engendered bitterness among sales reps from other insurers, who were frustrated by AIG's constant one-upsmanship, and harbored ill will toward boastful AIG sales reps, according to Joseph Paduda, a former marketing director at AIG. When AIG's struggles first came to light last fall, he says, those with sour grapes felt the company was getting what it deserved. "The attitude was, 'They're a greedy bunch of people and we're glad to see them fall apart,'" says Paduda, now a principal of managed-care consulting firm Health Strategy Associates. "They were arrogant, cocky and very self-confident and a lot of their competitors spent a lot of time complaining about it, and now they're happy they're getting their comeuppance."
Select the service that is right for you!COMPARE ALL SERVICES
Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.
- $2.5+ million portfolio
- Large-cap and dividend focus
- Intraday trade alerts from Cramer
- Weekly roundups
Access the tool that DOMINATES the Russell 2000 and the S&P 500.
- Buy, hold, or sell recommendations for over 4,300 stocks
- Unlimited research reports on your favorite stocks
- A custom stock screener
- Upgrade/downgrade alerts
Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.
- Diversified model portfolio of dividend stocks
- Alerts when market news affect the portfolio
- Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.
- Real Money + Doug Kass + 15 more Wall Street Pros
- Intraday commentary & news
- Ultra-actionable trading ideas
Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.
- 100+ monthly options trading ideas
- Actionable options commentary & news
- Real-time trading community
- Options TV