Here’s How American International Group Inc (AIG) Became an Insurance Top Dog Again

AIG also managed to dodge a bullet from regulators during the quarter, as the company’s mortgage-insurance unit was one of four insurers that settled with the Consumer Financial Protection Bureau over allegations of paying kickbacks to mortgage-lenders who pushed borrowers to use their insurance policies. AIG and Genworth Financial Inc (NYSE:GNW) will have to pay the largest fines of the four, but at just $4.5 million, the liability is a pittance compared to what lenders themselves may face if the CFPB chooses to pursue them.

In American International Group Inc (NYSE:AIG)’s quarterly report, watch for what the company says about eventually returning capital to shareholders, either in the form of a dividend or with share buybacks. Perhaps the biggest news of the quarter was that AIG bought back warrants from the U.S. Treasury back in March, taking away the last piece of federal ownership in the company and freeing the company to take more independent action. Given AIG’s work to reduce debt and improve its credit rating, investors are hopeful that the time is coming when they’ll earn their reward for sticking with AIG through the hard times.

The article How AIG Became an Insurance Leader Again originally appeared on Fool.com and is written by Dan Caplinger.

Fool contributor Dan Caplinger owns warrants on AIG. You can follow him on Twitter @DanCaplinger. The Motley Fool recommends AIG. The Motley Fool owns shares of AIG and has the following options: Long Jan 2014 $25 Calls on AIG.

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