GENERAL insurer American Home Assurance (AHA), which has a sizeable operation in Singapore, will not be sold off in the fallout from the financial crisis, the embattled parent firm said on Monday.

The parent, American International Group (AIG), which was saved from collapse by the US government last month, said it had no plans to sell its non-life insurance businesses.

Speculation had been mounting that AIG might have been forced to sell such businesses in order to repay up to US$85billion (S$125 billion) borrowed from the US government as part of the rescue deal.

AHA employs 450 staff here. Thousands of consumers have non-life policies such as health, accident and car policies with the insurer.

Last Friday, AIG said it would not be selling a majority stake in its coveted foreign life units, including AIA Singapore, which was initially hit by queues of policyholders seeking to redeem policies.

At a media conference on Monday, AIG's regional president for South-east Asia, Mr Leslie Mouat, said AIG would not consider selling even a minority stake in its non-life business.

'Absolutely not. We run an exceptionally profitable business and we like the financial strength,' he said. 'And our agents have been absolutely phenomenal during the process.'

Read the full story in Tuesday's edition of The Straits Times.