AIG and Aurec had formed AIG Israel in 1996 as a joint venture and the operation primarily writes personal lines as well as accident & health and life insurance through a direct distribution platform, and it encompasses some commercial lines products via brokers.

AIG said that it currently owns 50.01% of AIG Israel, and upon completion of the transaction, AIG Israel will become wholly-owned by AIG.

Commenting on the agreement, AIG president and CEO for EMEA region, Rob Schimek, said: "Our decision to acquire the remaining interest in AIG Israel represents an excellent opportunity to increase our presence in Israel, as well as to further integrate an important operation as part of our global platform,"

"We are pleased that this transaction will enable us to continue to strengthen our market position in a country that is a core component of AIG’s business in the EMEA region," Schimek added.

AIG also named Shay Feldman as general manager of AIG Israel effective 1 April 2013. Feldman joined AIG in 1998, and held positions within accident & health and marketing and sales in Israel, and later moved to Paris to serve as CEO of AIG Marketing Europe, which led direct marketing of AIG’s life and general insurance products across Western Europe.

Following senior regional roles in Hong Kong, Feldman moved to London in 2011 to take up his most recent position as chief marketing officer for consumer lines in EMEA.

The transaction is subject to approval by the Israel Insurance Commissioner.