Peter Hancock bounds up the front steps of the Merrion Hotel in Dublin and offers a warm handshake. The global chief executive of American International Group has just come from a meeting across the road with Minister for Finance Michael Noonan where he was able to tell him about AIG's plans to add 20 jobs at a new Europe, Middle East and Africa (EMEA) treasury operations centre in the IFSC.

Noonan was a good sport, agreeing to pose with a Dublin jersey, even though he is from Limerick.

“He said, ‘I’m not sure this was a wise investment’,” Hancock says.

AIG has just closed out the first season of an €800,000-a-year sponsorship with the Dubs, the most lucrative such deal in the GAA. It raised a few eyebrows here because although AIG is the world's biggest insurer, it is a small player in Ireland.

This is something Hancock wants to change. He sees Ireland as a “sophisticated insurance market” where AIG can “pioneer innovations” that it might then launch in bigger markets such as China and Japan.

“Ireland is a great innovation hub for us,” he says. “That’s what helped make the case for the [Dublin] sponsorship and we’re delighted with the response so far. In less than a year, the awareness of the company has increased pretty dramatically.”

These innovations include telematics, the use of in-car devices that record driving behaviour. “We are happy to pioneer that in Ireland as a cost-effective way to promote safe driving,” Hancock says. “The idea is to attract good drivers . . . and give them a healthy discount to continue to drive safely.”

This discount can be up to 30 per cent. It was launched a year ago but AIG is vague about how many drivers are availing of scheme, saying it is “thousands of drivers, especially young drivers”.

Isn’t it a bit Big Brother?

“Certain segments of the population will decide not to have these devices but, increasingly, people will be comfortable with it,” Hancock says. He’s particularly keen to take the product to China, where road safety is shocking.

“It’s the largest cause of deaths for 20- to 30-year-olds,” he says. “So we have an education programme in China at the moment to teach road safety that we take for granted in the west.”

The idea is that prevention is better than cure. “The vision is to become risk experts in the fields that matter most and to share that with our customers to help them manage their risks more effectively.”

AIG has been here more than 40 years and is quietly looking to expand its footprint. It has a 7 per cent market share, with 5 per cent in the motor sector. It is just about to relaunch its home insurance product, by cross-selling it directly to about 100,000 motor customers.

In the past year, it has opened an Irish call centre with about 20 staff who can deal with customer queries. It employs about 400 staff in the State.

The motor side of the business is growing at a double-digit pace and is “profitable”, according to Hancock.

It also has a large number of corporate clients and Hancock reckons AIG is the biggest insurer of cyber-risk here, as it is in many other markets. Discretion prevents him from naming his clients in this growing area of business.

“Being selective is the issue,” Hancock says. “Trying to advance on every front to gain market share is absolutely not AIG’s strategy. We want to focus on where the value is greatest to our customers. We’re not going to be in every line of business and every geography. We are value versus volume. There are some spaces in insurance that are very crowded and we don’t necessarily want to focus on them.”

Realistically, Ireland is just a small dot on AIG’s global map. It has 90 million customers worldwide and pays out $100 million (€80 million) every day “to people who have had something bad happen to them”.

It got whacked by the global financial crash in 2008, receiving a monster $182.3 billion bailout from US taxpayers. This was fully repaid at the end of 2012 with a tidy profit to the US taxpayer of almost $23 billion.

The company had been a major seller of credit default swaps, which insured the assets that supported corporate debt and mortgages. Its swaps against sub-prime mortgages pushed the otherwise profitable company to the brink of collapse.

Bailed out

Deemed too big to fail, it was bailed out by the US government in controversial circumstances. The then chief executive, Maurice (Hank) Greenberg, is still embroiled in legal action against the government. Greenberg, who remains a shareholder in the business, and who says he is suing the government on behalf of fellow shareholders, is seeking more than $40 billion in compensation.

Hancock joined AIG in 2010, as executive vice-president, finance, risk, and investments, when it was at a low ebb. What convinced him to take the job?

"Meeting Bob Benmosche [his predecessor as chief executive] in November 2009 really convinced me that this was a company that was worth preserving and could succeed," he says. "It's a unique company. It has an amazing breadth and scope of operations that meets a fundamental need of society around the world.

“It had strayed from its core competence but he had a very clear plan to focus the company on what it does best, divest the rest and do it in a measured way that didn’t destroy value. That’s what he did.

“It was a very compelling strategy. The more I studied the financials, I realised it was feasible. But it was the calibre of individuals that I met that convinced me that this was a company that would come out swinging. It didn’t take that much convincing.”

Ironically, Hancock’s previous 20-year career with JP Morgan involved the creation of a successful derivatives group that developed the instruments that tripped up AIG. “I was certainly very involved in leading the growth of the derivatives business there. The derivatives that I was responsible for touched on many different risks: foreign currencies, equities, commodities, interest rates as well as insurance. These are all risks that are faced by economies, and derivatives are a fact of the financial landscape that will not go away. They meet a very important need.

“How these tools get used is the issue. It certainly never occurred to me that they would be used in the way they were in the 2000s. I was out of that business for more than a decade before they were applied to the US mortgage market, which is a market that has certain characteristics that don’t lend themselves to these tools. Many risks could have been managed better in the financial crisis.”

Hancock took over as global chief executive at the beginning of September, a role with an annual remuneration package of more than $11 million. His plan for AIG is to continue to focus on its core competence and to improve its profit margin. He wants the business as lean as possible and is pushing the use of technology and data analytics to help meet this goal.

AIG spends billions of dollars each year on technology and research, and Hancock has hired scientists to help the company better analyse its risks. Again, it’s the adage of prevention is better than cure. “As the largest insurer in the world, if we don’t do the R&D, then nobody will. This is an industry that could benefit from a pretty broad approach to integrating different science disciplines.

“The idea is to tap into the best thinkers around the world on various issues – like flood mapping and what are the changes to risk of flooding as a result of urban development and climate change. The scientists can bring rigour to the process of us allocating our capital where it’s needed most. We’re quite pleased with the results and will continue to invest in it.”

AIG has also hired hundreds of engineers in the past two years to “advise companies on how better to construct industrial facilities to reduce their chance of blowing up, being destroyed by quake or flood, and to provide technical expertise that mitigates risk at the industrial level . . . the way workplaces are organised to reduce workplace injuries.

“Better designed hospital procedures for our medical malpractice so people have fewer accidents in hospitals”.

Hancock is something of a global citizen. Born in London, he grew up in Hong Kong and went to university in Oxford. He has made his career in the US and is now an American citizen.

He also has some Irish blood – a maternal grandfather from Cork named Boyle. Hancock has never traced his roots and his only previous trip to Ireland was a holiday to Cork with some friends 35 years ago.

Irish recovery

He’s mightily impressed by the Irish recovery following the collapse of the economy in 2009. “It’s been nothing short of remarkable,” he says. “The resilience of the general population and the courage and leadership of the policymakers, in particular in the finance function . . . it’s a very good story.

“There were clearly policy mistakes made all around the world in the lead-up to the crisis but the willingness to confront them early and take rapid action has obviously paid off in terms of the relative speed of the recovery. The commitment to global engagement is an example to other countries who have gone the other way.”

After almost five years of fire-fighting and working towards repaying its bailout, AIG is once again planning for the future free from the shackles of US state involvement. “We made a modest acquisition recently, a small life insurance company based in the UK that has the potential to be applied around the EU, and we continue to invest in science and in growing our presence in many lines around the world,” Hancock says.

“From the beginning of 2013 we’ve been a company owned by a diverse shareholder base. We never lost our strong credit rating, which is essential for our policyholders. We have a strong single A rating. It puts us very much in the pack of the strongest insurance companies and is reassuring to the customers that buy policies.”

He says its financial performance is “not where we’d like it to be”. “We have improved it considerably and we’re on a journey of improved efficiency by investing in technology to get effective use of shared services around the world.”

Hancock says there is a “rich palette of opportunity” for AIG just by sticking to its “core” business of insurance.

“We think there’s plenty of scope for growth but it’s disciplined growth where we think we can make a difference. We need to keep a close eye on value versus volume. Perhaps, in the past, the company pursued growth at a time when the opportunity to pursue that growth was limited.

“The ability to ebb and flow in terms of growth rate with the strength and weakness of the [economic] cycle is another thing that will be important to the sustained success of the group. One size fits all is not going to work.”

Its plan for Ireland? "It continues to be a very important market for us, and we should continue to expand here, add employment, add capabilities and hopefully add customers." CV Name: Peter Hancock Job: Global chief executive of AIG

Age: 56

Family status: Married with two children

Lives: New York

Hobbies: Tennis and sailing

Something we might expect: “I’m an optimist, which you have to be to lead an organisation like this.”

Something that might surprise: “I like to do tango dancing with my wife. We go every Sunday.”