AA&B: What will be the management structure of the new entity?

Doyle: AIU Holdings will include about 44,000 employees worldwide, in 130 countries, with $40 billion in revenues and $43 billion in shareholder equity. It will be a stand-alone entity the size of a Fortune 54 company--not the size of AIG, but large nevertheless.

Kris Moor, who has been with AIG for close to 30 years, was named president; Nick Walsh, another AIG long-timer, will run AIU's international operations, and I will oversee its domestic business. We will make some new appointments within the operation with the long-term view of attracting third-party investors, but otherwise AIU Holdings will be made up of the same people who have been instrumental in the success of AIG's worldwide property-casualty business.

AA&B: Given the fact that most of AIG's more than $60 billion in fourth-quarter losses resulted from writedowns from its commercial mortgage-backed securities, this seems like a smart move. What are the main benefits of the formation of AIU Holdings--and are there any inherent risks involved?

Doyle: The global holding company will own AIG's property-casualty companies is the first step in operating more independently from AIG. We will also look to attract third-party investment in AIU Holdings for a minority stake.

Our main objective is to highlight the distinctions between our well-performing business and the challenges confronting AIG. When the media are reporting on AIG, it's focused only on these challenges, so it's important in our marketplace from a branding and reputation point of view to make sure our various constituencies--brokers, customers and staff--are well aware of the independent strength of our companies.

The plan is to improve and enhance the value of our business globally, and we think this is an important step forward. Based on the reception we've gotten so far, I think it will achieve that.

AA&B: Although brokers like AON have publicly supported AIG's request for more TARP money, other groups are concerned that continual government intervention will give AIG an unfair competitive edge. How are you addressing these concerns?

Doyle: Our businesses are well capitalized, liquid, and haven't required any TARP money to fund the capitalization of our property-casualty businesses. The formation of AIU Holdings will better convey that message to our marketplace.

AA&B: Will AIU Holdings make a point of distancing itself from the AIG operations?

Doyle: We like the name AIU because it connects us to a great history of underwriting around the world. We will develop subbrands, but remain connected to a great history. At the same time, the establishment of AIU Holdings creates an opportunity for us to distinguish ourselves from AIG.

New products are who we are; innovation is a hallmark of our commercial insurance operations. Over the last 6 months, even when the problems of our parent company were most acute, we continued to introduce more than 20 new products and services.

AA&B: A hardening market seems inevitable, given current insurer performances and the overall poor economy, how will AIU Holdings address this and still attempt to stay competitive?

Doyle: We have a very broad product offering, and not all are equal in terms of the current margins. We have some products that need rate improvements and others that are operating on satisfactory margins. We have seen pricing improvement in our portfolio over the last 6 months, and we expect that to continue. The pricing pressure of the last 4 to 5 years also puts pressure on operating margins; we will address this on a product-by-product and account-by-account basis to improve our pricing position during 2009.