American International Group Being Sued

Insurance broker Linda Harris, President of the Independent Financial Planning Group, filed a lawsuit against the auto insurance company American International last week. They are accusing the auto insurance company of engaging in unfair business practices and want to see them stopped.

Harris says that the auto insurance company has been using funds form their California auto insurance companies to support their financial services business. They told policy holders and brokers that their auto insurance business was insulated from their losses and this was not the case.

Harris’ case says that the danger of them getting involved in this sort of practice means that with things other than auto insurance – life insurance, etc. – if they are not kept separate than there is a chance of policyholders losing their savings that they have through the company.

AIG has been receiving support from the government since September as they have been in major financial trouble – and their latest moves do not put confidence in Harris. She thinks that what they are doing is wrong, and illegal, and therefore AIG could find themselves back in trouble again.

Experts say that it is important, especially in this economy for auto insurance companies, life insurance companies, homeowners insurance, etc. to keep their financial practices separate for fear of losing all of their clients’ money. This is the only way that they can practice clean financial accounting as well. The government is obviously going to have to become involved in this case as they have been their major contributor as of late.






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