Since American International Group Inc.'s financial meltdown last year there has been a lot of speculation about how much business would leave the insurer.

That is still being determined.

But a June 3, bulletin from the California Workers' Compensation Institute reveals AIG is losing ground in the country's largest workers compensation market. AIG's share fell by 21.7% in 2008.

Overall, DWP decreased $1.35 billion in the Golden State to $7.65 billion during 2008. So several insurers experienced premium decreases. But only the State Compensation Insurance Fund lost more premium than AIG. SCIF saw a 27.7% decrease.

SCIF's market share decline is expected. That has been occurring since market conditions improved and policyholders who turned to SCIF during a hard market eventually gained more options.

In contrast, a few insurers like Liberty Mutual Group and Travelers Group gained in California work comp premium last year.

The CWCI bulletin doesn't say why AIG numbers have declined and Comp Time has no idea whether AIG's plunge in California work comp market share has continued into 2009 or the real cause behind the 2008 drop.

Can someone at AIG -which now operates its property/casualty operations as AIU Holdings Inc.- fill us in on what the California numbers mean?