New York — American International Group Inc. will remove “AIG” from the name of a U.S. auto unit, as well as cut 6.6% of jobs there to improve chances of finding a buyer for the operation.
AIG will start calling its aigdirect.com business 21st Century Insurance in January, reverting to the brand of a California-based car insurer acquired last year, says Nicholas Ashooh, a spokesman for AIG. The company also will close offices in 12 cities, AIG said in an Oct. 21 letter to workers. The unit had about 5,500 employees as of September 2007.
“They probably weighed the benefits and costs and figured that it has more worth labeled as 21st Century than as AIG Direct,” says Jeremy Bowler, a director at J.D. Power and Associates who studies insurer brands. “Every consumer has so many choices, and AIG’s problems have been so highly publicized—why would someone choose a company with a bad rap?”
AIG is selling businesses including auto insurance, U.S. life coverage and a plane-leasing unit to repay the government loan that saved it from bankruptcy in September.
Rebranding the auto unit “will make our business more attractive to a prospective buyer,” Tony DeSantis, head of AIG’s personal auto group, said in a Nov. 17 letter. Ashooh confirmed the letter’s contents today in an interview.
AIG will launch new television commercials, as well as a revamped logo and Web site on Jan. 5, according to the letter.
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