(Bloomberg) -- American International Group Inc.’s Peter Hancock will get a compensation package of $11.8 million a year as the insurer’s new chief executive officer.
The short-term incentive will be $3.2 million of cash and the long-term will be $7 million in performance share units for meeting targets, plus he will get an annual salary of $1.6 million, the New York-based company said today in a regulatory filing. That package compares with a total target of $9 million last year when Hancock was CEO of the property/casualty operation, the company’s largest business.
Hancock, 56, takes over Sept. 1 from Robert Benmosche, who had a $13 million target for last year after repaying a U.S. bailout in 2012. The incoming CEO has been preparing the company for increased supervision from the Federal Reserve after AIG was named a systemically important financial institution.
“Hancock will have the critical role of managing the company while it is newly regulated by the Fed,” Jay Gelb, an analyst at Barclays Plc, said June 10, when the transition was announced.
AIG has focused on the profitability of its insurance coverage, rather than the total level of sales, under Hancock’s leadership. He’s sought expansion in emerging markets and targeted consumers while limiting sales in capital-intensive business-insurance segments.
Hancock was promoted to the property-casualty post in 2011 after joining a year earlier to manage finance and risk. The initial job included oversight of the credit-default swaps unit whose money-losing contracts forced AIG to take a 2008 bailout. He previously spent 20 years at a predecessor to JPMorgan Chase & Co. where he established the derivatives group and served as chief financial officer.
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