AIG’s Zaffino to Step Down as CEO as Aon’s Andersen Steps In (2)

American International Group Inc. said Peter Zaffino intends to retire as chief executive officer by midyear, ending a five-year run of improved returns that was marred by recent managerial turmoil. He’ll be replaced by Aon Plc’s Eric Andersen.

The announcement sent AIG shares tumbling by 6.9% at 9:57 a.m. in New York trading Tuesday, the largest decline since April.

Andersen, most recently a member of Aon’s executive committee, will join AIG as president and CEO-elect, effective Feb. 16, AIG said in a statement Tuesday. He’ll take the reins from Zaffino and join the board on June 1, and ...