American International Group (AIG) sent out a presentation to the Senate Banking Committee on Feb. 26 to persuade legislators that problems with the company presented systemic risk -- and presented a cleaned-up version on March 6 for public consumption that paints a dire picture of the world without AIG.

AIG was given an $85 billion bailout in September, and has had that assistance package modified three times since then as the company’s troubles continue to spiral. Now, the U.S. is on the hook for $186 billion in assistance it’s given to the company.

This presentation was first released before AIG had gotten its most-recent boost in aid, totaling about $30 billion. The company minces no words in saying it can’t be allowed to fail, and the U.S. government -- and thus taxpayers -- must do whatever possible to prevent the company from failing.

“AIG’s business model -- a sprawl of $1 trillion of insurance and financial services businesses, whose AAA credit rating was used to backstop a $2 trillion dollar financial products trading business -- has many inherent risks that are correlated with one another,” AIG said in the presentation.

It said the problems have been deepened by the weakness in the global economy, and that “what happens to AIG has to potential to trigger a cascading set of further failures which cannot be stopped except by extraordinary means.”

AIG said it has instituted a wind-down of its financial-products business, as well as a “massive divestiture process to sell businesses.”

But the insurer said that if it were unable to “immediately secure additional assistance from the Federal Reserve and the Department of the Treasury,” it would threaten “not only AIG’s sales process, but also consumer and business confidence around the world.”

The presentation said the systemic risk was principally centered in the life-insurance business “because it is the sector that has the greatest variety of investments and obligations that are subject to loss of value of the underlying assets,” and said the failure of AIG would likely “have a cascading impact on a number of U.S. life insurers.”

AIG noted that it has 116,000 employees, and “a large portion” of them would likely find themselves unemployed – it also noted that it has 74 million customers worldwide, 30 million of which are in the U.S., and they would also be affected.

The insurer said that its failure “would likely result in the immediate seizure of certain insurance businesses of AIG by domestic and foreign regulators, noting that if foreign government seized any businesses they would likely “be out of the reach of the U.S.”

AIG concluded by saying that “there is a legitimate public policy rationale for regulatory reform of the industry, and the federal government’s continuing role in AIG’s destiny would be consistent with such a policy direction.”