8-KLeadership ChangesRegulation FDExhibits & Filings

AMERICAN INTERNATIONAL GROUP, INC. 8-K Report, Executive Changes (May 15, 2017)

Filed May 15, 2017For Securities:AIG

Summary

American International Group, Inc. (AIG) announced a significant leadership change with the appointment of Brian Duperreault as President, Chief Executive Officer, and a member of the Board of Directors, effective May 14, 2017. This change coincides with the resignation of Peter D. Hancock from these roles. Mr. Duperreault brings extensive experience in the insurance industry, having previously held leadership positions at Hamilton Insurance Group, Marsh & McLennan Companies, and ACE Limited, with prior experience at AIG itself. The appointment is accompanied by several strategic transactions designed to facilitate Mr. Duperreault's transition and leverage cutting-edge technology. These include arrangements with Hamilton Insurance Group, Two Sigma Insurance Quantified, and Attune Holdings. Key elements involve AIG's potential acquisition of Hamilton's U.S. operations, exploration of a technology partnership with Two Sigma for a new insurance platform, and the expansion of the Attune joint venture.

Key Highlights

  • 1Brian Duperreault appointed President, CEO, and Board member, replacing Peter D. Hancock.
  • 2Duperreault's compensation package includes a $1.6 million base salary, a target $3.2 million short-term incentive, and a $11.2 million long-term incentive for 2017.
  • 3Duperreault receives a $12 million make-whole award for forfeited Hamilton equity and up to 1,500,000 stock options with performance-based vesting tied to share price targets.
  • 4AIG will pay Hamilton Insurance Group $40 million ( $20 million upfront, $20 million contingent) to release Duperreault from restrictive covenants.
  • 5AIG is pursuing the acquisition of Hamilton U.S. Holdings, Inc. for an estimated $110 million (book value plus $30 million premium).
  • 6AIG is negotiating a technology development contract with Two Sigma for a new insurance platform, with an initial $37.5 million installment.
  • 7The Attune joint venture, involving AIG, Hamilton, and Two Sigma, will expand its target market for small-to-medium enterprise businesses.

Frequently Asked Questions

Brian Duperreault has been appointed as the new President and CEO of AIG, effective May 14, 2017. He is a seasoned insurance executive with extensive experience, including previous roles as CEO of Hamilton Insurance Group, CEO of Marsh & McLennan Companies, and CEO of ACE Limited. He also has prior experience with AIG's affiliates.

Mr. Duperreault's compensation includes an annual base salary of $1.6 million, a target annual incentive of $3.2 million, and an annual long-term incentive award of $11.2 million. He also receives a $12 million make-whole award for forfeited Hamilton equity and up to 1,500,000 stock options, with some options subject to vesting based on AIG's stock price performance.

Several strategic transactions are underway. AIG is acquiring Hamilton's U.S. operations for an estimated $110 million. AIG is also exploring a technology partnership with Two Sigma to develop a next-generation insurance platform, with an initial payment of $37.5 million. Additionally, the Attune joint venture, in which AIG is a partner, is expanding its market reach.

AIG will pay Hamilton $40 million to release Mr. Duperreault from restrictive covenants. AIG is also acquiring Hamilton's U.S. operations and has offered Hamilton the opportunity to participate in a reinsurance strategic partnership. Hamilton will retain its stake in the Attune joint venture.