Did insurance leader has lost its iron grip

According to the latest results of the SECOND QUARTER 2008
American International Group, Inc. (AIG) today reported a net loss for the second quarter of 2008 of $5.36 billion or $2.06 per diluted share compared to 2007 second quarter net income of $4.28 billion or $1.64 per diluted share.

Report states that due to the weaker U.S. housing market and disruption in the credit markets, as well as high volatility of global equity market, had a substantial adverse effect on AIG's results in the second quarter.

The company, which sells insurance to 74 million customers from operations in more than 130 countries and territories, has been badly hit over the past three quarters by more than $25 billion in write-downs on credit default swaps (CDS) it wrote to guarantee mortgage-linked securities against default.

But it doesn't mean all is going wrong way there were a few bright spots for AIG on Thursday.Investors may have breathed a small relief that its exposure to Fannie Mae and Freddie Mac preferred shares is limited to between $550 million and $600 million, according to a source familiar with the investment.

read the full report here
http://ir.aigcorporate.com/phoenix.zhtml?c=76115&p=irol-newsArticle&ID=1184560&highlight=

http://www.insurancejournal.com/news/national/2008/09/11/93616.htm