American International Group Inc., once the world’s largest insurer, is getting a fresh start as a more focused company as the U.S. exits its stake four years after a bailout, Chief Executive Officer Robert Benmosche said.

“We are not at the finish line,” Benmosche, 68, wrote today in a memo to employees of the New York-based firm after the U.S. said it would record a $22.7 billion profit on the $182.3 billion rescue. “We have to exceed the expectations of our clients, our investors, our regulators, and our other stakeholders around the world.”

Benmosche, who took over in 2009, is cutting costs and seeking to restore the reputation of a firm tarnished by its near collapse. After selling non-U.S. life insurance operations, the company is increasingly reliant on property-casualty coverage at the unit previously known as Chartis, a business that has reported an underwriting loss for four straight years.

AIG is “investing a lot of its energy in trying to execute a turnaround in Chartis,” said Josh Stirling, an analyst at Sanford C. Bernstein & Co. “When this starts to work, earnings are going to start to recover.”

AIG is seeking an underwriting profit of 5 to 10 cents on every dollar of premiums it collects for property-casualty coverage by the end of 2015, according to goals it laid out in a regulatory filing last year. Stirling said the company can get there by cutting expenses, raising prices for coverage, and doing a better job of evaluating risk and handling claims.

The insurer is focusing more on writing profitable business than on building premium revenue, Peter Hancock, CEO of the property-casualty unit, said in May. He’s been increasing the focus on emerging markets and reducing business in segments that require the company to hold more capital.

‘Dramatically Different’

“It is a dramatically different company” from the insurer hobbled in 2008 by derivative bets on subprime mortgages, Timothy Massad, the Treasury’s assistant secretary for financial stability, said in an interview today on Bloomberg Television with Erik Schatzker and Stephanie Ruhle. “It’s much smaller. It’s more focused on its core insurance operations. It’s far less risky.”

Benmosche, who is fighting cancer, said in October he’d like to extend his tenure at AIG to 2014. He said in early 2011 he’d remain CEO until this year.

“We kept our promise to rebuild this great company and deliver a profit to those who put their trust in us,” Benmosche said in the memo. “Today warrants a celebration like no other in AIG’s history and places well in the past a crisis none of us will ever forget.”

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