NU Online News Service, May 14, 1:55 p.m. ? New York
Maurice Greenberg, chairman of American International Group Inc., New York, says U.S. insurers contemplating expansion abroad need to focus on execution.
“Distribution is critical,” Greenberg said here at a recent insurance conference organized by PricewaterhouseCoopers L.L.P., New York. “I think about it all the time.”
But execution is just as important, Greenberg emphasized, adding that employees must understand what is acceptable, and that management has to make sure employees are doing what is acceptable.
If management fails to keep tabs on the employees, then management is to blame for any problems, Greenberg said.
Greenberg, whose company has helped knock down financial-services trade barriers in China and other countries, said being the first foreign carrier to open a market and paying the right price for any acquisitions can help lead to success.
But Greenberg said success in new markets also depends on people — and patience.
“You can’t send in second-tier management,” Greenberg said. “And it takes time to build relationships.”
Finally, Greenberg rejected the idea that a well-run insurer can achieve good results in any country.
A good new market must be a “country of laws,” Greenberg argued.
AIG itself entered the Russian market too early, Greenberg noted. But Greenberg said he is more confident in Russia now that the country has a better legal framework for foreign companies.