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The front offices and customer centers of American International Assurance (Bermuda) Ltd (AIA), a subsidiary of the US insurance giant American International Group Inc (AIG), were crowded with people anxious to cancel, transfer or inquire about their policies last week. According to market sources, AIA received 1,570 applications for policy cancelation in the past few days, of which half were investment-linked insurance, and the SAR government said it was in contact with the company's management daily for the latest development of its business.
Many customers of AIA (Hong Kong) went to the company's headquarters or customer centers in Central, Causeway Bay and Fortress Hill to apply for policy cancelation. Some others who do not want to sacrifice a good part of premiums and pay a hefty processing fee for surrendering their insurance policies before they are due chose to withdraw cash from the mature ones instead.
A woman who had been paying for a life insurance policy for nearly 10 years withdrew several hundred thousand dollars of mature cash instead of surrendering the policy for good because she knew cancelation means a great loss.
Government sources said last week that AIA (Hong Kong) received 1,400 applications for policy cancelation, when news that the US government would inject billions of dollars to rescue its parent company AIG here.
Since the company has 1.95 million policies before “black Monday” (US time), sources added, the number of cancelations in Hong Kong so far is minuscule. And relevant authorities have stated that transfer of AIA assets and funds, including related business deals of its subsidiaries, must be approved by the Insurance Authority to safeguard policy holders' interest.
The SAR government said last Wednesday that AIA's Mandatory Provident Fund operations are independent from other businesses and the parent company AIG. The government said it would keep in touch with the US insurance authorities, but admitted it is difficult to monitor AIA fully because its mother company AIG also runs businesses other than insurance. ■春生 資深翻譯員
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