Breaking the Bank? Insurance Executive Salaries Flat
In its 2010 Executive Compensation Review, Charlottesville, Va.-based SNL Financial, a provider of financial data and analysis on the banking, financial services and insurance markets, examines pay packages across a number of lines of business for the 2009 fiscal year. While CEO base salary ebbed slightly (down .86%) for all insurance companies, there were some large variances across all lines, notes the report.
For example, while multiline and property/casualty CEOs saw base salary increases of 5.81% and 4.26% respectively, life/health and managed care CEOs saw a decline of 16.21% and 12.21%. Given the long-term nature of executive compensation packages, the fact these retrenchments occurred as health insurers came under increased scrutiny during the health care reform debate is likely coincidental.
The most intensely scrutinized of all insurance companies, New York-based American International Group, also reported some interesting numbers. While AIG President and CEO Robert Benmosche tallied the largest base salary at $3,077,622, his aggregate pay package of $4,639,188 placed him 96th on the list of total compensation. That list was headed by ACE Limited Chairman, President and CEO Evan Greenberg, who netted $21,297, 698 in total pay. Jay Fishman, chairman and CEO of the Travelers Companies Inc., placed second with $20,102,833.
Indeed, the SNL report underscored the fact that base salary is only a small component of total compensation, averaging just 20.53% in 2009. In the case of AIG, four of Benmosche’s underlings earned more than he did. AIG EVP, Property/Casualty Group Kristian Phillip Moor pulled down $10,409,171, AIG EVP Life Insurance Rodney Owen Martin took home $9,990,550, AIG EVP Foreign General Insurance Nicholas C. Walsh was paid $8,962,420 and AIG EVP and CFO David Lawrence Herzog earned $6,068,346.
Another not unexpected finding is that compensation directly mirrors institution asset size. For example, in the case of CIOs, the median compensation was $971,225. The top earner for organizations in the highest percentile was $6,127,475, while the top earner in the lower 20th percentile netted $604,169.