Earl Codling, general manager, American Home Assurance Company Limited. - Contributed

American Home Assurance, including the Jamaican subsidiary of the New York-based insurer, is expected to have a new name by yearend - a move aimed at sprucing up the brand that did not escape some of the tarnish from its ultimate parent, AIG group, in America's financial sector meltdown.

Earl Codling, the general manager of Home Assurance in Jamaica, told Wednesday Business that the general reorganisation of the parent would inevitably reach Jamaica, but said he did not yet know what the rejigged operation would be called.

"The local company may even have a different name within six months," Codlin said. "(But I am) not sure what the name will be."

Mortgage crisis

AIG (American Insurance Group), a global iusurance giant, was among the early companies to falter in America's sub-prime mortgage crisis. It had traded heavily in credit default swaps (CDS), the murky instruments that ostensibly insure mortgages that borrowers could no longer repay. When AIG itself could not meet its CDS obligations, it had to be shored up by the United States Government by an injection of more than US$100 billion.

The company's image took a further battering when it emerged that in the face of the crisis the group was still fêting employees and paying agreed bonuses to employees in divisions that lost heavily in the meltdown.

Codling's operation, one of 30 Home Assurance firms in Latin America and the Caribbean, has weathered the crisis relatively unscathed. Last year, in a tight market, the Jamaica business posted gross premium income of J$1.9 billion, and even in more difficult circumstances earnings for the first six months of 2009 reached J$564 million.

In the Caribbean as a whole, gross premium income for this year is projected to reach US$443 million, or 34 per cent of the US$1.3 billion expected from the entire Latin America and the Caribbean.

But Codling explained that as part of the global reorganisation, a new holding company, AIU Holdings, has been formed as the umbrella for AIG's insurance entities.

"A number of these companies will have their names changed in what could be termed rebranding," he said.

No fundamental change

It was not immediately clear, however, how these moves will affect American Home's subsidiaries in Jamaica, Puerto Rico, Trinidad and Tobago and Aruba or its agencies elsewhere in the Caribbean

Codling, however, did not anticipate any fundamental change in the classes of business sold, and insisted that, if anything, the aim would be to enhance the quality of service.

"We will perhaps get one out of Bermuda, but I am not sure," he said. "It will be of the same highly rated and quality reinsurance."

sabrina.gordon@gleanerjm.com