AIG and PICC explore China joint venture AIG is in talks with China's PICC Group over a potential joint venture to sell life and other insurance products across the country as the US company looks to increase its exposure to growth markets. The US group's main business, Chartis, is a property and casualty insurer that is concentrated on US and European markets where growth opportunities are limited. AIG, which is also investing $500m in the Hong Kong listing of PICC, said it had signed a non-binding proposal to establish a joint venture, with discussions to last for up to six months. If no agreement is reached by May 31, AIG is free to sell its cornerstone stake in PICC. If a deal is struck, which would include agreements on reinsurance and other co-operation, AIG would not sell more than 25 per cent of its PICC holding without the Chinese company's consent for five years. AIG renamed its general insurance business Chartis in an attempt to restore its reputation after the group's spectacular near-collapse at the height of the financial crisis in 2008, which led to it receiving a world-record $180bn bailout from the US government. Chartis gets 50 per cent of its business from the US and a further 17 per cent from Europe, according to its 2011 annual report, meaning more than two-thirds of its operations are in mature, low-growth markets. General insurance as a business is highly correlated with wider economic conditions because when activity at companies declines they buy less insurance, so static or declining gross domestic product has a direct impact on a group such as Chartis. AIG owns 9.9 per cent of PICC Property and Casualty, the Hong Kong-listed general insurance subsidiary of PICC Group. It also still holds 14 per cent of AIA, the pan-Asia life insurer that it used to own outright until the company listed on the Hong Kong stock exchange in 2010. PICC Group, which is China's biggest general insurer and fifth biggest life insurer by premiums, has 17 cornerstone investors in total taking $1.85bn worth of stock in its planned $3.6bn listing. AIG is the largest investor followed by State Grid, the Chinese electricity network, which has pledged to buy $300m. Most of the other cornerstones are Chinese companies, including export and credit insurer Sinosure and rival life company China Life, each of which is investing $100m. Other insurance companies investing in the deal include China Reinsurance, French reinsurer Scor, Tokio Marine of Japan and Russian Insurance.