Insurer's chairman, Bob Willumstad, takes over from Martin Sullivan.
AIG chief executive Martin Sullivan has been ousted following successive quarters of record losses and sustained objections from shareholders, equating to almost a sixth of the insurer’s investor base.
The move follows an emergency board meeting of the sub-prime ravaged insurer last week.
Sullivan will be replaced by AIG chairman Bob Willumstad, who said a review of the company’s operations was underway.
Pressure on Sullivan grew after AIG, the world’s largest insurer, posted record losses of $5bn and $7.81bn over the last two quarters. Its share price has lost more than half its value this year.
Despite the board's insistence that it would back Sullivan, discontent from a number of shareholders – including billionaire Eli Broad – who wrote to the AIG board in recent weeks expressing their concerns, are understood to have forced the issue.
Sullivan’s position was further eroded by outspoken criticism from former chief executive and mentor Hank Greenberg, who repeatedly called for Sullivan to take responsibility for the company’s investment exposure to the sub-prime mortgage crisis, which resulted in writedowns of $20bn and an investigation from the US regulator over the valuation of its sub-prime linked assets. Four officials at the insurer, including Sullivan, also face a sub-prime related lawsuit from a Florida pension fund.
Sullivan will receive a redundancy package worth $35m.
Hosted by comedian and actor Tom Allen, 34 Gold, 23 Silver and 22 Bronze awards were handed out across an amazing 34 categories recognising brilliance and innovation right across the breadth of UK general insurance.
