American International Assurance

Background

First established in Singapore in 1931 as International Assurance Co. Ltd. (INTASCO), AIA Singapore is now a leading life insurance company in the Asia-Pacific region.

Background
The American Asiatic Underwriters was founded by Cornelius Vander Starr in Shanghai, China, in 1919. It was renamed INTASCO in 1931. In that same year, it began operations in Shanghai and established branch offices in Hong Kong, Malaya, Thailand and Singapore. In 1939, Starr relocated his head office from Shanghai to New York where INTASCO became a subsidiary of the American International Group.¹ In 1948, the company changed its name to American International Assurance (AIA). That year, AIA reopened its regional office in Singapore.²

Postwar
In 1958, Robert Heatlie Scott, Commissioner-General for the United Kingdom office in Southeast Asia, officially opened the 12-storey American International Building located in the heart of Singapore’s business district at the corner of Robinson Road and Telegraph Street. At the time, it was the largest building that AIA had constructed in Southeast Asia.³

In the 1950s, health insurance was still in its infancy in Singapore, and AIA realised the potential of health insurance in Singapore and the region. This venture turned out to be a new growth area for AIA. As a life insurance company, it provided a comprehensive range of insurance schemes such as group term life insurance, personal accident and hospital/surgical benefits.⁴

By the 1960s, the number of AIA’s competitors had grown. They included New Zealand Insurance (NZI), AFIA Worldwide Insurance and the British European Association. AIA, NZI and AFIA commanded a large share of the health insurance sector. By the mid-1960s, AIA had built up a large portfolio of clients and continued to broaden its base in Singapore and Malaysia. Within a few years, AIA had firmly secured contracts with the “Big Four” petroleum companies: Shell, Esso, Mobil and Caltex. These deals had taken place against the backdrop of rapid industrialisation in the 1960s when many multinational companies built and established their plants and factories in the country with the help of Singapore’s Economic Development Board.⁵

Later developments
By the early 1970s, health insurance had established a firm footing in Singapore, as brokers and agents marketed health insurance as part of insurance packages. Lower-level employees, who were covered by health insurance schemes, could enjoy better ward facilities in government hospitals, while managers and executives could opt for treatment in private hospitals. During this period, AIA began to face competition from insurers such as Red Shield, China Underwriters, Travellers and Insurope, ICS (Life Division), Netherlands Insurance (Blue Cross Scheme), NTUC Income, Great Eastern Life, Overseas Assurance, Royal and Norwich Winterthur.⁶

The 1980s was a period of significant growth and expansion for AIA. The company rented space for its administrative and agency offices in various locations such as Far East Finance Building, Parkway Parade, Shing Kwan House, Boon Siew Building, Concorde Hotel and Sea View Hotel.⁷

In the 1990s, AIA’s headquarters were located temporarily at Gateway East, while the new AIA Tower was being built at Robinson Road on the site of the old AIA building, which had been demolished.⁸ At the ground-breaking ceremony of AIA Tower on 19 November 1991, a time capsule – containing items such as a 1962 rate book and other AIA mementoes – was buried. Two years later, the 25-storey AIA Tower was officially opened. The agency also established permanent offices with the opening of AIA Tanjong Pagar on 24 February 1992, and AIA Changi and
Alexandra on 19 July 1994.⁹

In 2008, AIA’s US-based parent company, American International Group, came close to bankruptcy, causing worried customers to form queues outside AIA Tower to surrender their policies.¹⁰ AIA ran a full-page advertisement reassuring policyholders that it had enough funds to meet its policy obligations.¹¹ In 2009, AIA underwent a rebranding exercise to distance itself from its parent agency.¹² In 2010, AIA was successfully listed on the Hong Kong stock exchange, becoming an independent company focused and based in Asia.¹³

In 1998, AIA became the first Asia-based life insurance company to be rated as “AAA” – the highest credit rating by Standard and Poor’s – and the first life insurance company in Asia to receive the ISO 9002 certification.¹⁴ The company also received awards from the Productivity and Standards Board, such as the Singapore Quality Class in 1994 and People Developer Award – the first insurer to do so – in 2001.¹⁵



Author
Kartini Saparudin



References
1. “AIG Marks End of Era with $7.86B AIA Stake Sale,” Today, 19 December 2012, 39. (From NewspaperSG)
2. P. Tan and M. Koh, “AIA Celebrates 70 Years in Singapore”, AIA News, June 2001. (Call no. RSING 368.0065 AIAC)
3. Tan and Koh, “AIA Celebrates 70 Years in Singapore.”
4. Anthony Tan, “Page 16 Advertisements Column 1: History of a Growing Business,” Straits Times, 29 May 1988, 16. (From NewspaperSG)
5. Tan, “History of a Growing Business.”
6. Tan, “History of a Growing Business.”
7. Tan and Koh, “AIA Celebrates 70 Years.”
8. Soh Tiang Keng, “AIG to Launch US$500M Asia Infrastructure Fund,” Business Times, 20 November 1993, 2. (From NewspaperSG)
9. Tan and Koh, “AIA Celebrates 70 Years.”
10. Lorna Tan, “Before You Surrender Your AIA Policy…,” Straits Times, 21 September 2008, 22; Arul John, “Hundreds Queue to Terminate AIA Policies,” New Paper, 17 September 2008, 7. (From NewspaperSG)
11. “Page 57 Advertisements Column 1,” Today, 18 September 2008, 57. (From NewspaperSG)
12. Esther Fung, “AIA Rebrands Itself in Asia,” Today, 29 May 2009, 72. (From NewspaperSG)
13. “AIA Raises $23.2B in Hong Kong IPO,” Today, 22 October 2010, 3. (From NewspaperSG)
14. “S&P Awards Top Credit Rating to AIA,” Straits Times, 23 January 1998, 71. (From NewspaperSG)
15. Tan and Koh, “AIA Celebrates 70 Years.”



The information in this article is valid as at August 2021 and correct as far as we are able to ascertain from our sources. It is not intended to be an exhaustive or complete history of the subject. Please contact the Library for further reading materials on the topic.