AIG contents insurance - AIG in trouble?

BoingBoing_2

I have my household contents insurance with AIG (I'm a tenant so no buildings insurance).

Following the collapse of Lehman, several news agencies have stated that AIG - who have lost significant amounts over the last 3 quarters - could be next to 'collapse'.

My worry is that if AIG go under, what happens to my policy?

Does it just cease to exist?

What steps - if any - should I take now to ensure continuation of cover?

Do I cancel my current policy and take out new cover? Is that even possible?

I know this may sound rather drastic and seem OTT to some, but I'm sure I'm not the only person wondering what happens to policies in situations like this at the moment!

Any help or advice greatfully received

hansi

Yes, I have AIG cover for my buildings and contents insurance. What happens if they go bust? Can I claim a refund from my credit card company?

sjane2008

I saw and read this http://www.insurancetimes.co.uk/story.asp?storycode=374103

So it means they are trying to 'fix' things before they do get messy. I'm unsure what happens in the worse case scinario, but i'm sure someone here will be able to answer soon xx

Mr_Crunch

I had a similar question yesterday, & had some helpful responses. The thread is here http://forums.moneysavingexpert.com/showthread.html?t=1158205

The answer appears to be 'wait & see, should be OK', so all we can do is keep an eye on the news. But if AIG fails and no-one picks it up, I do not know at what point cover might cease, or whether policyholders will be even be contacted. Hopefully someone in the insurance business is watching this thread, and can comment further on the likely procedures.

hansi

According to press reports today, AIG are going to be "bailed out of trouble" by having more cash injected.

greco_2

A recent precedent was the demise of Independent Insurance in 2001. When Independent went into liquidation, brokers received approaches from other insurers such as RS&A, Allianz and Norwich Union offering rollover arrangements. What this meant was that the insurer would take over the entire broker's account with Independent to ensure immediate transition of cover for all affected customers. The agreement included provisos that cover would be offered at the same rates of premium and that the insurer was to be provided with full underwriting information to determine that the insurer was happy with the risk. If not, the insurers would make the broker aware of the situation and allow a reasonable period of time for cover to be replaced.

In the main, the quality of Independents book of business was good and insurers were happy with the majority of the risks which they had taken on. There were some exceptions, notably cold stores and the like where use of composite panels presented particular fire insurance risks, but the transistion was pretty seamless on the whole.

azza30

So with my AIGdirect car insurance i've just taken out and claimed cashback, i shouldnt cancel during my cooling off period as it is secured anyway??

BoingBoing_2

AIG have been bailed out by the Federal Reserve, hopefully the 85 billion dollar loan will mean that, for the moment, AIG will carry on trading and providing cover.