AIG Financial Products

AIG Financial Products was a division of American International Group (AIG) that specialized in creating financial contracts called derivatives. These derivatives were designed to help companies manage risk, such as fluctuations in interest rates, currency values, or credit events. However, during the 2008 financial crisis, some of these products, particularly credit default swaps, led to massive losses when the underlying risks materialized unexpectedly. This contributed significantly to AIG’s financial troubles, ultimately requiring government intervention to prevent broader systemic failure. In essence, AIG FP was involved in complex financial tools that amplified risk exposure, especially during turbulent market conditions.