(Bloomberg) -- American International Group Inc.'s incoming Chief Operating Officer Peter Zaffino is getting a $23.5 million pay package, including a $15 million sign-on award.
Zaffino, who's joining the insurer next month, also will receive $1.25 million in salary, a cash bonus with a $3 million target and $4.25 million in restricted stock units, AIG said Thursday in a regulatory filing. The restricted shares are split so that 70 percent are based on performance and vest in December 2019. Zaffino must remain with the company until then to get the rest.
Chief Executive Officer Brian Duperreault, who took over in May to improve AIG's profitability, is seeking to expand a bench of talent. Hiring executives like Zaffino is critical to succession planning at the New York-based insurer, Credit Suisse Group AG analyst Ryan Tunis said in a note to clients earlier this year. Zaffino, 50, previously worked at insurance brokerage Marsh & McLennan Cos., where Duperreault, 70, had been CEO.
Read also: AIG grants new CEO $12 million in cash, 1.5 million options
Zaffino's $15 million sign-on package includes 1 million stock options, with a third vesting annually over three years and the rest tied to the performance of the insurer's stock. The remainder of that award will be paid in cash in February 2018 and January 2019.
Marsh & McLennan gave him a $9.11 million pay package last year, according to a March filing.
To contact the reporter on this story: Sonali Basak in New York at sbasak7@bloomberg.net.
To contact the editors responsible for this story: Dan Kraut at dkraut2@bloomberg.net, Alicia Ritcey at aritcey@bloomberg.net, Peter Eichenbaum
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