AIA’s P&C members decline assistance from US$700 billion package

The American Insurance Association (AIA) says its property and casualty insurance members don’t need the money available in the U.S. Treasury’s US$700-billion emergency market stabilization package, passed by Congress.The Treasury’s Capital Purchase Program (CPP) was created to inject capital into the credit markets and to prevent counterparty failure of such a magnitude as to pose a systemic risk to the financial system.”We have surveyed our board of directors and the substantial majority of the insurers represented by AIA do not support the inclusion of property-casualty insurers in Treasury’s Capital Purchase Program,” Evan Greenberg, chairman and CEO of the AIA, said in a statement. “If made available, they will not elect to participate.”Headquartered in Washington, D.C., the AIA represents approximately 350 major insurance companies that provide all lines of property and casualty insurance and write more than US$123 billion annually in premiums. The association is headquartered in Washington, D.C.”Those members believe that, as property-casualty insurance writers, they are well-capitalized and well-positioned to weather the current financial market crisis without the assistance of the CPP announced by Treasury,” Greenberg said. “As a result, the property-casualty insurers who are members of AIA strongly prefer to compete in the private market and the substantial majority will elect not to participate in the CPP.”