|AIG GLOBAL SURETY AND BERKSHIRE HATHAWAY TO PROVIDE SURETY FACILITY FOR LARGE CREDITWORTHY CONTRACTORS|
NEW YORK, April 23, 2003--AIG Global Surety, a division of the property and casualty insurance subsidiaries of American International Group, Inc., and National Indemnity Company (NICO), a member of the Berkshire Hathaway group of insurance companies, have joined together to provide a surety facility that offers up to $600 million in aggregate bonding to large creditworthy contractors.
The surety facility will provide up to $200 million per bond, not to exceed $600 million in bonded aggregate liability, to qualified contractors with a net worth of at least $25 million. AIG Global Surety will provide accounting, claims, credit, engineering, legal, management and underwriting expertise, while NICO will participate in the facility as a 50 percent quota share reinsurer.
AIG Global Surety President Louis Iglesias said, "This new surety facility is provided by highly rated insurance companies, and comes at precisely the right time for a market needing financial security. The combination of the industry's poor underwriting and pricing at rates far below those applied to similar credit transactions has caused the evaporation of quality surety. This facility offers solid surety capacity at rates and under terms that realistically reflect the business and credit risks. We are pleased to work with National Indemnity to institute this much needed facility."
American International Group, Inc. (AIG) is the world's leading international insurance and financial services organization, with operations in approximately 130 countries and jurisdictions. AIG member companies serve commercial, institutional and individual customers through the most extensive worldwide property-casualty and life insurance networks of any insurer. In the United States, AIG companies are the largest underwriters of commercial and industrial insurance, and AIG American General is a top-ranked life insurer. AIG's global businesses also include financial services, retirement savings and asset management. AIG's financial services businesses include aircraft leasing, financial products, trading and market making. AIG's growing global consumer finance business is led in the United States by American General Finance. AIG also has one of the largest U.S. retirement savings businesses through AIG SunAmerica and AIG VALIC, and is a leader in asset management for the individual and institutional markets, with specialized investment management capabilities in equities, fixed income, alternative investments and real estate. AIG's common stock is listed on the New York Stock Exchange, as well as the stock exchanges in London, Paris, Switzerland and Tokyo.
In business since 1940, National Indemnity Company has grown to become the largest member of the Berkshire Hathaway group of insurance companies, the second largest capitalized property/casualty group in the United States. National Indemnity Company has a current rating of A++ (Superior), Class XV, according to A.M. Best and has a AAA claims paying rating from Standard & Poor's.
CONTACT: AIG, New York Public Relations: Joe Norton, 212/770-3144 SOURCE: AIG