American International Group Inc. (
AIG) is advertising to consumers using the
AIG name for the first time in the U.S. since late 2008, the year it was bailed out.
Selling life insurance through the “
AIG Direct” platform is a shift for the New York-based company, which renamed its global property-casualty unit and other businesses to avoid the stigma of a federal rescue that swelled to $182.3 billion.
Chief Executive Officer Robert Benmosche, 67, is seeking to restore confidence in the insurer as he attracts investors to replace government funds. He told employees in 2009 that the
AIG name may return if the company rebounded and started to repay debt to the government.
AIG Direct is a marketing name for the insurer's Matrix Direct business, an agent for selling life insurance over the phone.
“Even Charlie Sheen got another shot,” said Al Ries, chairman of market-strategy firm Ries & Ries, in a telephone interview. “A known name with flaws is more powerful than an unknown name that nobody's ever heard about.”
AIG rose 55 cents to $25.04 in New York trading yesterday. It has declined 48 percent this year, compared with the 3.9 percent drop in the Standard & Poor's 500 Index.
In a television advertisement running this week, the insurer says it can help consumers get more for their money when purchasing term life insurance through
AIG Direct.
The commercial “is part of a very small pilot that involves the first time since the crisis that
AIG is marketing a product directly to consumers under the
AIG brand” in the U.S., said Mark Herr, a spokesman for the insurer. “We haven't made any broad-reaching decisions about branding.”
Testing AIG Brand
AIG may be using the ads to get feedback about the brand before expanding it to other parts of the business, said Rohit Deshpande, a professor of marketing at Harvard Business School, in a phone interview.
“They're sticking their toe in the water to test out one small part of the business,” he said.
The advertisement fulfills, in part, a prediction Benmosche made to AIG employees in 2009, the year he became CEO. “My sense is, one day, if AIG does well, starts to pay back the debt, AIG's name may come back. Does that mean we want to go back to the name on the building and all the other stuff? That will be up to you to decide,” he said.
Benmosche's predecessor, Edward Liddy, had sought to distance subsidiaries from the AIG name as the insurer's bailout was extended at least four times. He told Congress in 2009 that the name was “so thoroughly wounded and disgraced that we're probably going to have to change it.”
Name Changes
AIG's global property-casualty business changed its name to Chartis in 2009 from AIU Holdings LLC after 7,000 brokers, clients and employees were surveyed about whether the unit needed a brand more distinct from its parent. Part of fund manager AIG Global Investment Corp. were renamed PineBridge Investments later that year to ease a sale to Pacific Century Group. AIG Annuity is now called Western National Life.
The insurer previously offered auto coverage under the AIG Direct brand before renaming it 21st Century Insurance. The unit was sold to Zurich Financial Services AG in 2009.
AIG paid back the remaining $21 billion on its
Federal Reserve credit line in January, and the U.S. Treasury Department converted its preferred stake into 92 percent of AIG's common shares. That was cut to 77 percent in a May stock sale.
Sheen was fired from primetime comedy “Two and a Half Men,” by Time Warner Inc.'s Warner Bros. television studio in March after the actor denounced the show's creator. Lions Gate Entertainment Corp. said in July that it hired Sheen for a sitcom called “Anger Management.”
“Charlie Sheen has never needed another ‘shot,'” Larry Solters, Sheen's spokesman, said in an e-mail. “He has always been on top.”
--Bloomberg News--
