AIG's collapse had nothing to do with life insurance. It was driven by a division called AIG Financial Products which wrote the infamous credit default swaps together with equity based lending. Arguably it reinforces the learning that integrated financial giants shouldn't be allowed
I know it had nothing to do with life insurance and I also think that the article is wrong when focusing on that part of the business, but it is correct when saying that a company like Prudential should have remained on that too-big-to-fail list. When you’re handling ~USD 1.4 trillion you are at the center of the financial system.
https://www.investopedia.com/articles/economics/09/american-...