TODAYonline

AIA insurance boss quits

Timing said to be unfortunate, not linked to US parent’s troubles

BARRY PORTER and KELVIN CHOW

barry@mediacorp.com.sg

THE timing couldn’t have been more terrible. With United States insurance giant American International Group (AIG) facing its worst ever crisis, the head of its Singapore life insurance arm has resigned, after getting an overseas job offer from a rival insurer.

From today, Mr Mark O’Dell will vacate his hot-seat as AIA Singapore’s executive vice-president and general manager, and go on gardening leave before taking up a new position abroad. The timing is said to be unfortunate but coincidential.

“His decision to leave the company is in no way related to the recent developments at AIG. It is a personal decision that he has been planning for some time,” said a statement last night from Mr Mark Wilson, regional president of AIG Life Companies in Asia-Pacific and AIA president.

Hundreds of worried policyholders have swamped AIA’s Raffles Place customer service centre for the past three days, even after news that AIG had been given a US$85-billion ($119-billion) financial lifeline this week by the United States Federal Reserve to avoid bankruptcy.

This effectively means AIG is as good as guaranteed by the Fed and not at risk of failing at the moment.

Still, worried AIA Singapore customers have surrendered up to 2,000 policies, despite repeated reassurances — which included advertisements taken out by the insurer in the local newspapers — that their money is safe.

AIA has provided no precise figure, but said less than 0.1 per cent of its policies here have been surrendered. Its website said it has 2 million policies in force.

To accommodate policyholders who may find they have acted in haste, AIA Singapore said yesterday that it would allow anyone who had surrendered policies this week to reinstate them at no cost.

The policy conservation programme applies to whole life and endowment policies.

There will be no penalties or need to submit evidence of insurability to have these policies reinstated, the firm said in a statement.

Mr Wilson said: “We have received feedback that many of our customers are now more reassured of AIA Singapore’s financial position and would like to continue to enjoy the insurance protection and accumulated savings that their policies offer.

“So we have offered this policy conversation programme to those policyholders who reacted to the uncertainty of recent developments at AIG.”

Mr Low Kwok Mun, the Monetary Authority of Singapore’s (MAS) executive director of insurance supervision, welcomed AIA’s move to offer policyholders the option for penalty-free reinstatement.

He reiterated that AIA Singapore has sufficient assets in its insurance funds to meet its liabilities to policyholders.

24-hour notice is standard

Mr O’Dell (picture) had been with AIA for 14 years and his hasty departure was a big surprise.

It is AIA’s standard practice for senior staff to vacate their desks within 24 hours of resigning to join a competitor.

Earlier this week, Mr Martin Sullivan, the British-born chief executive of AIG, the world’s largest insurer, resigned and was replaced immediately by the group’s chairman.

Mr O’Dell was not answering his mobile phone yesterday evening when Today tried contacting him.

He was not only AIA Singapore’s principal officer with legal responsibility to the MAS for all of the firm’s operations here, he was also the current president of both the Life Insurance of Singapore and Financial Planning Association of Singapore.

To ensure a smooth transition at AIA Singapore, a senior executive will be transferred from Hong Kong to assume leadership responsibilities here from today, as an interim measure until a permanent successor is appointed.

Mr Kenneth Juneau, the executive vice- president and senior regional life executive of AIA’s regional office, has more than 30 years experience in the insurance industry.

MAS has been monitoring the situation closely and said it expects a “smooth” leadership transition.

Mr Low said: “MAS’ regulatory oversight of AIA and all insurers in Singapore is rigorous. We are satisified with the ability of the company to carry on business as usual and to meet new demands even when there are any changes in management.”

He added: “We urge policymakers not to act hastily to terminate their insurance policies as they may suffer losses from the premature termination and lose the insurance protection they may need.”