New York Personal Injury Blog | Lever & Stolzenberg, LLP Legal Blog

After Rescue, New Weakness Seen at A.I.G.

If AIG is truly in trouble, this will be very problematic for persons with personal injury cases.  As has been well documented, AIG insures a large number of the insurance policies in place in New York.  Thus, if one gest into an accident and brings a lawsuit, the chances are that the person being sued, if he or she has insurnace, will most likely be insured by AIG.  Now, however, if AIG is indeed in trouble, it might mean that AIG will have to go into bankruptcy.  When this happens, all of the lawsuits brought against parties insured by AIG will be stayed -- or stopped -- until the bankruptcy proceedings are resolved.  This can take years.  Thus, these underlying lawsuits may be paused for years, keeping parties from ever timely settling or resolving their cases.  More troubling, however, is the more omnimous option of waiting years for the bankruptcy proceeding to resolve and then finding out that AIG has no money left to settle the case.  This would be a truly nightmare situation.  Indeed, considering how large AIG is, this could have a major impact on most cases in New York.