EMPLOYEE BENEFITS (Tables)

12 Months Ended

Dec. 31, 2011

DEFINED BENEFIT PLAN DISCLOSURE

Schedule of funded status of the plans, reconciled to the amount reported in the balance sheet

			Pension												Postretirement(a)
			Non-U.S. Plans(b)						U.S. Plans(c)						Non-U.S. Plans						U.S. Plans
As of or for the Years Ended December 31, (in millions)
			2011			2010			2011			2010			2011			2010			2011			2010
Change in projected benefit obligation:
	Benefit obligation, beginning of year		$	1,981		$	2,313		$	3,878		$	3,687		$	66		$	106		$	279		$	274
	Service cost			66			137			150			150			4			8			8			8
	Interest cost			37			59			207			216			2			4			13			15
	Actuarial (gain) loss			(7	)		(6	)		653			305			7			(10	)		6			3
	Benefits paid:
		AIG assets		(26	)		(52	)		(8	)		(10	)		(1	)		(1	)		(7	)		(13	)
		Plan assets		(48	)		(57	)		(118	)		(115	)		-			-			-			-
	Plan amendment			(11	)		-			(324	)		-			-			(1	)		(63	)		-
	Curtailments			-			-			-			(73	)		-			-			-			(3	)
	Settlements			(56	)		(28	)		-			(282	)		-			-			-			(5	)
	Foreign exchange effect			80			37			-			-			1			5			-			-
	Dispositions			(888	)		(736	)		-			-			(30	)		(45	)		-			-
	Acquisitions			-			329			-			-			-			-			-			-
	Other			9			(15	)		-			-			3			-			-			-
Projected benefit obligation, end of year			$	1,137		$	1,981		$	4,438		$	3,878		$	52		$	66		$	236		$	279
Change in plan assets:
	Fair value of plan assets, beginning of year		$	954		$	750		$	3,425		$	3,362		$	-		$	-		$	-		$	-
	Actual return on plan assets, net of expenses			3			(3	)		125			456			-			-			-			-
	AIG contributions			100			161			8			11			1			1			7			13
	Benefits paid:
		AIG assets		(26	)		(52	)		(8	)		(10	)		(1	)		(1	)		(7	)		(13	)
		Plan assets		(48	)		(57	)		(118	)		(115	)		-			-			-			-
	Settlements			(56	)		(27	)		-			(279	)		-			-			-			-
	Foreign exchange effect			45			39			-			-			-			-			-			-
	Dispositions			(295	)		(159	)		-			-			-			-			-			-
	Acquisitions			-			303			-			-			-			-			-			-
	Other			6			(1	)		-			-			-			-			-			-
Fair value of plan assets, end of year			$	683		$	954		$	3,432		$	3,425		$	-		$	-		$	-		$	-
Funded status, end of year			$	(454	)	$	(1,027	)	$	(1,006	)	$	(453	)	$	(52	)	$	(66	)	$	(236	)	$	(279	)
Amounts recognized in the consolidated balance sheet:
	Assets		$	80		$	43		$	-		$	-		$	-		$	-		$	-		$	-
	Liabilities			(534	)		(1,070	)		(1,006	)		(453	)		(52	)		(66	)		(236	)		(279	)
	Total amounts recognized		$	(454	)	$	(1,027	)	$	(1,006	)	$	(453	)	$	(52	)	$	(66	)	$	(236	)	$	(279	)
Pre tax amounts recognized in Accumulated other comprehensive income (loss):
	Net gain (loss)		$	(272	)	$	(539	)	$	(1,550	)	$	(838	)	$	(2	)	$	3		$	(18	)	$	(11	)
	Prior service (cost) credit			30			36			303			(13	)		1			1			48			(15	)
	Total amounts recognized		$	(242	)	$	(503	)	$	(1,247	)	$	(851	)	$	(1	)	$	4		$	30		$	(26	)

(a)

AIG does not currently fund postretirement benefits.

(b)

Includes unfunded plans for which the aggregate pension benefit obligation was $267 million and $627 million at December 2011 and 2010, respectively. For 2011 and 2010, approximately 32 percent and 72 percent pertain to Japanese plans, which are not required by local regulation to be funded. The projected benefit obligation for these plans total $86 million and $454 million, respectively. The decrease is primarily attributed to the AIG Star and AIG Edison divestiture.

(c)

Includes non-qualified unfunded plans, for which the aggregate projected benefit obligation was $210 million and $219 million at December 2011 and 2010, respectively.

Schedule of components of net periodic benefit cost recognized in income and other amounts recognized in Accumulated other comprehensive income (loss)

		Pension																		Postretirement
		Non-U.S. Plans									U.S. Plans									Non-U.S. Plans								U.S. Plans
(in millions)		2011			2010			2009			2011			2010			2009			2011			2010		2009			2011			2010			2009
Components of net periodic benefit cost:
	Service cost	$	66		$	137		$	121		$	150		$	150		$	155		$	4		$	8	$	11		$	8		$	8		$	8
	Interest cost		37			59			60			207			216			219			2			4		4			13			15			16
	Expected return on assets		(25	)		(31	)		(31	)		(250	)		(259	)		(226	)		-			-		-			-			-			-
	Amortization of prior service (credit) cost		(4	)		(9	)		(13	)		(7	)		1			-			-			-		-			(2	)		-			-
	Amortization of net (gain) loss		15			45			41			65			57			88			-			-		1			-			(1	)		1
	Net curtailment (gain) loss		-			(1	)		(2	)		-			1			(4	)		-			-		-			-			(2	)		1
	Net settlement (gain) loss		8			3			11			-			58			14			-			-		-			-			(6	)		(8	)
	Other		-			2			1			-			-			-			-			-		-			-			-			-
Net periodic benefit cost		$	97		$	205		$	188		$	165		$	224		$	246		$	6		$	12	$	16		$	19		$	14		$	18
Total recognized in Accumulated other comprehensive income (loss)		$	261		$	167		$	(134	)	$	(396	)	$	85		$	492		$	(6	)	$	16	$	11		$	56		$	(3	)	$	10
Total recognized in net periodic benefit cost and other comprehensive income (loss)		$	164		$	(38	)	$	(322	)	$	(561	)	$	(139	)	$	246		$	(12	)	$	4	$	(5	)	$	37		$	(17	)	$	(8	)

Schedule of weighted average assumptions used to determine the benefit obligations

	Pension				Postretirement
	Non-U.S. Plans(a)		U.S. Plans(b)		Non-U.S. Plans(a)		U.S. Plans(b)
December 31, 2011
Discount rate		3.02%		4.62%		4.19%		4.51%
Rate of compensation increase		2.94%		4.00%		3.61%		N/A%
December 31, 2010
Discount rate		2.25%		5.50%		4.00%		5.25%
Rate of compensation increase		3.00%		4.00%		3.00%		N/A%

(a)

The non-U.S. plans reflect those assumptions that were most appropriate for the local economic environments of each of the subsidiaries providing such benefits.

(b)

Due to plan amendments effective in 2012, the AIG Retirement, Excess and Postretirement Plans were remeasured at September 30, 2011 using the following discount rates 4.5, 4.25 and 4.5 percents, respectively,

Schedule of weighted average assumptions used to determine the net periodic benefit costs

		Pension
							Postretirement
				U.S. Plans
At December 31,		Non-U.S. Plans(a)					Non-U.S. Plans(a)		U.S. Plans
2011
	Discount rate		2.25%		5.50	(b)%		4.00%		5.25(c)%
	Rate of compensation increase		3.00%		4.00	%		3.00%		N/A
	Expected return on assets		3.14%		7.50	%		N/A		N/A
2010
	Discount rate		2.75%		6.00	%		3.75%		5.75%
	Rate of compensation increase		3.50%		4.00	%		3.75%		N/A
	Expected return on assets		3.75%		7.75	%		N/A		N/A
2009
	Discount rate		3.00%		6.00	%		3.50%		6.00%
	Rate of compensation increase		3.50%		4.25	%		3.25%		N/A
	Expected return on assets		4.75%		7.75	%		N/A		N/A

(a)

The non-U.S. plans reflect those assumptions that were most appropriate for the local economic environments of the subsidiaries providing such benefits.

(b)

As a result of plan amendments effective April 1, 2012, the AIG Retirement and AIG Excess Plans were remeasured utilizing a discount rate of 4.5 and 4.25 percent, respectively at September 30, 2011.

(c)

As a result of a plan amendment effective April 1, 2012, the AIG Postretirement Plan was remeasured utilizing a discount rate of 4.5 percent at September 30, 2011.

Schedule of plan assets based on the level within the fair value hierarchy in which the fair value measurement falls

			Non-U.S. Plans								U.S. Plans
(in millions)			Level 1		Level 2		Level 3		Total		Level 1		Level 2		Level 3		Total
At December 31, 2011
Assets:
	Cash & cash equivalents		$	114	$	-	$	-	$	114	$	9	$	-	$	-	$	9
	Equity securities:
		U.S.(a)		19		-		-		19		1,449		13		-		1,462
		International(b)		242		1		-		243		305		16		-		321
	Fixed maturity securities:
		U.S. investment grade(c)		-		-		-		-		-		794		1		795
		International investment grade(c)		-		139		-		139		-		-		-		-
		U.S. and international high yield(d)		-		88		-		88		-		104		-		104
		Mortgage and other asset-backed securities(e)		-		-		-		-		-		80		36		116
		Other fixed maturity securities		-		40		1		41		-		-		-		-
	Other investment types:
		Hedge funds(f)		-		-		-		-		-		345		-		345
		Commodities		-		-		-		-		-		26		-		26
		Private equity(g)		-		-		-		-		-		-		223		223
		Insurance contracts		-		-		39		39		-		31		-		31
Total			$	375	$	268	$	40	$	683	$	1,763	$	1,409	$	260	$	3,432
At December 31, 2010
Assets:
	Cash & cash equivalents		$	41	$	3	$	-	$	44	$	37	$	-	$	-	$	37
	Equity securities:
		U.S.(a)		24		-		-		24		1,731		13		-		1,744
		International(b)		407		112		-		519		278		18		-		296
	Fixed maturity securities:
		U.S. investment grade(c)		-		10		-		10		-		478		1		479
		International investment grade(c)		8		219		-		227		-		-		-		-
		U.S. and international high yield(d)		-		32		-		32		-		153		-		153
		Mortgage and other asset-backed securities(e)		-		-		-		-		-		44		80		124
	Other investment types:
		Hedge funds(f)		-		-		-		-		-		332		-		332
		Commodities		-		-		-		-		-		19		-		19
		Private equity(g)		-		-		-		-		-		-		209		209
		Insurance contracts		-		64		34		98		-		32		-		32
Total			$	480	$	440	$	34	$	954	$	2,046	$	1,089	$	290	$	3,425

(a)

Includes index funds that primarily track several indices including S&P 500 and S&P 600 in addition to other actively managed accounts, comprised of investments in large cap companies.

(b)

Includes investments in companies in emerging and developed markets.

(c)

Represents investments in U.S. and non-U.S. government issued bonds, U.S. government agency or sponsored agency bonds, and investment grade corporate bonds.

(d)

Consists primarily of investments in securities or debt obligations that have a rating below investment grade.

(e)

Comprised primarily of investments that are guaranteed by a U.S. government agency.

(f)

Includes funds comprised of macro, event driven, long/short equity, and controlled risk hedge fund strategies and a separately managed controlled risk strategy.

(g)

Includes funds that are diverse by geography, investment strategy, and sector.

Schedule of changes in Level 3 plan assets measured at fair value

At December 31, 2011 (in millions)			Balance Beginning of year		Net Realized and Unrealized Gains (Losses)		Purchases		Sales			Issuances		Settlements			Transfers In		Transfers Out			Balance at End of year		Changes in Unrealized Gains (Losses) on Instruments Held at End of year
Non-U.S. Plan Assets:
	Other fixed income securities		$	-	$	-	$	1	$	-		$	-	$	-		$	-	$	-		$	1	$	-
	Insurance contracts			34		3		2		-			-		-			-		-			39		-
Total			$	34	$	3	$	3	$	-		$	-	$	-		$	-	$	-		$	40	$	-
U.S. Plan Assets:
	Fixed maturity
		U.S. investment grade	$	1	$	-	$	-	$	-		$	-	$	-		$	-	$	-		$	1	$	-
		U.S. and international high yield		-		-		-		-			-		(1	)		1		-			-		1
		Mortgage and other asset-backed securities		80		1		34		(79	)		-		(1	)		4		(3	)		36		13
	Private equity			209		5		30		(20	)		-		(1	)		-		-			223		(23	)
Total			$	290	$	6	$	64	$	(99	)	$	-	$	(3	)	$	5	$	(3	)	$	260	$	(9	)

(in millions)			Balance Beginning of year		Net Realized and Unrealized Gains (Losses)		Purchases, Sales, Issuances and Settlements-Net		Transfers In (Out)			Balance at End of year		Changes in Unrealized Losses on Instruments Held at End of year
At December 31, 2010
Non-U.S. Plan Assets:
	Real estate		$	19	$	-	$	-	$	(19	)	$	-	$	-
	Private equity			21		-		-		(21	)		-		-
	Insurance contracts			29		3		2		-			34		-
Total			$	69	$	3	$	2	$	(40	)	$	34	$	-
U.S. Plan Assets:
	Fixed maturity
		U.S. investment grade	$	1	$	-	$	-	$	-		$	1	$	-
		U.S. and international high yield		1		-		-		(1	)		-		(1	)
		Mortgage and other asset-backed securities		52		7		24		(3	)		80		(14	)
	Private equity			175		17		17		-			209		-
Total			$	229	$	24	$	41	$	(4	)	$	290	$	(15	)

Schedule of expected future benefit payments, net of participants' contributions

	Pension				Postretirement
(in millions)	Non-U.S. Plans		U.S. Plans		Non-U.S. Plans		U.S. Plans
2012	$	45	$	276	$	1	$	16
2013		43		292		1		16
2014		44		298		1		17
2015		42		304		1		17
2016		45		311		1		18
2017 - 2021		266		1,654		8		104

Pensions

DEFINED BENEFIT PLAN DISCLOSURE

Schedule of accumulated benefit obligations

At December 31, (in millions)	2011		2010
Non-U.S. pension benefit plans	$	895	$	1,720
U.S. pension benefit plans	$	4,291	$	3,388

Schedule of projected benefit obligation in excess of the plan assets and the accumulated benefit obligation in excess of the plan assets

	PBO Exceeds Fair Value of Plan Assets								ABO Exceeds Fair Value of Plan Assets
	Non-U.S. Plans				U.S. Plans				Non-U.S. Plans				U.S. Plans
At December 31, (in millions)
	2011		2010		2011		2010		2011		2010		2011		2010
Projected benefit obligation	$	956	$	1,716	$	4,438	$	3,878	$	916	$	1,594	$	4,438	$	219
Accumulated benefit obligation		895		1,720		4,291		3,388		864		1,496		4,291		167
Fair value of plan assets		422		646		3,432		3,425		388		612		3,432		-

Non U.S. Pension Plans

DEFINED BENEFIT PLAN DISCLOSURE

Schedule of asset allocation percentage by major asset class and target allocation

At December 31,		Target 2012			Actual 2011			Actual 2010
Asset class:
	Equity securities		36	%		38	%		57	%
	Fixed maturity securities		41	%		39	%		28	%
	Other investments		12	%		6	%		10	%
	Cash and cash equivalents		11	%		17	%		5	%
Total			100	%		100	%		100	%

U.S. Pension Plans

DEFINED BENEFIT PLAN DISCLOSURE

Schedule of asset allocation percentage by major asset class and target allocation

At December 31,		Target 2012			Actual 2011			Actual 2010
Asset class:
	Equity securities		45	%		52	%		60	%
	Fixed maturity securities		30	%		30	%		22	%
	Other investments		25	%		18	%		18	%
Total			100	%		100	%		100	%

Postretirement Plans

DEFINED BENEFIT PLAN DISCLOSURE

Schedule of A one percent point change in the assumed healthcare cost trend rate

	One Percent Increase				One Percent Decrease
At December 31, (in millions)
	2011		2010		2011			2010
Non-U.S. plans	$	11	$	8	$	(8	)	$	(6	)
U.S. plans	$	3	$	4	$	(3	)	$	(3	)

U.S. Postretirement Plans

DEFINED BENEFIT PLAN DISCLOSURE

Schedule of assumed health care cost trend rates

At December 31,		2011			2010
Following year:
	Medical (before age 65)		7.59%			7.75%
	Medical (age 65 and older)		6.88%			7.00%
Ultimate rate to which cost increase is assumed to decline			4.50%			4.50%
Year in which the ultimate trend rate is reached:
	Medical (before age 65)		2027	*		2027
	Medical (age 65 and older)		2027	*		2027

*

Increase in ultimate trend rate is based on the current expectation of future increases in medical and prescription drug costs.