2021 will be a pivotal year for AIG. Aside from the constant hype about how much progress AIG has supposedly made, the stock is still down 40% since BD took over while the overall stock market is at all time highs. A loss ratio of 107% doesn't cut it anymore.
BD and PZ can blame catastrophes and covid for their lack of performance, but pressure is mounting to show a return on investment for hiring this self proclaimed top talent executive team. Once L & R officially spins off, there will be a laser focus on GI and the fact that GI just doesn't make money consistently.
The only thing keeping GI in the game is the lack of options for customers in a hard market. The insurance market in general is taking a beating due to a changing global environment which is why it is not realistic to exclude CAT losses from your ratio. PZ himself has admitted that reinsurance is getting harder and more expensive to acquire. AIG needs to underwrite better to lower reinsurance costs, but they are losing talent at the producer level at a record pace.
Competition is snatching up talent and out flanking AIG on almost all levels. Because AIG is such a dinosaur, if AIG200 were to ever succeed which is doubtful, it would only put AIG where most other companies have been for several years now.
But, PZ and his top executives will push on by investing hundreds of millions in Accenture and in executive salaries. They will continue to cut costs at the bottom drastically to shore up the bottom line which will mean a great deal of layoffs, outsourcing and resignations as people get even more tired of the hypocrisy. It will lead to the sale or run off of under performing companies and, in my opinion, it will lead to PZ exiting the company in 3 to 4 years without accomplishing a whole lot, but being paid handsomely. He learned this method from BD.
All of these pieces have started to come together and in 2021 there will be a culminations of the need to deliver results and the need to cut more costs across the board in order to buy more time. As we all know, cuts don't happen at the top so hold on if you plan on staying for another year. This is going to get bumpy. Also, look around because if you survive another year you will be doing the work of many colleagues who will leave in 2021 and not be replaced.
Good luck AIG employees, you'll need it!