American International Group Inc. promoted Peter Hancock to chief executive officer as the company focuses on growth after his predecessor stabilized the insurer and paid back a 2008 government bailout.
Hancock, 55, oversees property-casualty insurance and will be CEO and president as of Sept. 1, the New York-based firm said yesterday. He previously spent 20 years at a predecessor to JPMorgan Chase & Co., where he established the derivatives group. He replaces Robert Benmosche, 70, who stayed on longer than previously planned.
“AIG is no longer burning down, and the challenge for AIG and for Peter as CEO is to continue to drive the transformation,” Josh Stirling, an analyst at Sanford C. Bernstein & Co., said in a phone interview. “People are very much looking for real signs of progress.”
Hancock takes over a company that has shrunk by half since 2008 as Benmosche sold assets and cut jobs to simplify the business and repay a rescue that swelled to $182.3 billion. The firm is now focused on global property-casualty coverage and U.S. life insurance and retirement products. Jay Wintrob heads the life unit and intends to stay with AIG, though he is disappointed he wasn’t selected as the company’s CEO, Chairman Steve Miller told reporters.
AIG slipped 0.3 percent to $54.85 at 6:04 p.m. in extended trading in New York yesterday after the announcement. That compares with about $11.39 on Aug. 3, 2009, the day AIG announced Benmosche’s hiring.
Hancock joined AIG in 2010 to oversee finance and risk. In 2011, he was promoted to run the property-casualty business, an operation that became increasingly important to AIG as the company sold non-U.S. life insurers and a plane-leasing unit.
“Property and casualty is not only our largest business, but it’s our most complex business and it’s the one that can most effect the future success of AIG,” Miller said. “He’s the one who has dealt with the thorniest issues.”
Hancock sought to expand in less capital-intensive lines of insurance after AIG was burned by higher-than-expected costs in commercial segments including workers’ compensation, where claims emerge years after policies are sold. He targeted emerging markets and sales to consumers.
Hancock said in an interview that he plans to focus on customer segments and products where AIG is “properly rewarded” for taking risks. “And to do that we are investing in research and development to really understand emerging risks better.”