AIG History: Founding, Growth & Key Milestones

The birth of AIG is one of the most exotic and daring entrepreneurial adventures in international capitalism. In December 1919, a 27-year-old American entrepreneur named Cornelius Vander Starr arrived in the bustling international port city of Shanghai, China. Recognizing that European colonial insurers ignored Chinese domestic businesses, Starr founded American Asiatic Underwriters (AAU) on the Bund in Shanghai with two clerks. Starr pioneered the revolutionary concept of hiring and training Chinese insurance adjusters and selling policies directly to the local Chinese population. In 1926, Starr expanded to New York, establishing American International Underwriters (AIU) to manage risks across Asia, Latin America, and Europe. Following the communist revolution in China in 1949, Starr relocated enterprise headquarters to Manhattan. In 1967, Starr appointed Maurice R. 'Hank' Greenberg as his successor. Over four decades as CEO, Greenberg built AIG into an invincible global financial supermarket—pioneering Directors and Officers (D&O) liability, pollution insurance, and acquiring Lexington Insurance. In 2008, massive credit default swap losses at AIG Financial Products triggered an unprecedented $182 billion federal bailout, which AIG fully repaid by 2012 with a $22.7 billion profit for US taxpayers. Modern leadership under Peter Zaffino and Eric Andersen completed the corporate resurrection, divesting non-core units and establishing AIG as a pure-play commercial underwriting champion.