HSB Group to Leverage AIG's Clout.

ATLANTA -- HSB Group Inc., the specialty insurance writer and engineering services firm that grew from Hartford Steam Boiler Inspection & Insurance Co., is looking to expand as a new subsidiary of American International Group Inc., but it is determined to remain dominant in its traditional markets as an insurer of boiler equipment and power-generating businesses.

Normand Mercier, HSB's executive vice president, said of HSB's three business segments--commercial insurance, global specialty risks and engineering services--commercial insurance will remain essentially the same under AIG, except for geographic scope. "We will continue to grow that business in the United States and Canada," Mercier said. "What will be added is that we will replicate that business model overseas."

HSB is looking at potential markets in Latin America, China, Japan, the United Kingdom and Australia, he said. If HSB can replicate its commercial insurance business in new markets, the growth could be impressive. In North America, the company's equipment breakdown insurance business has developed into a market that accounts for 80% of the company's revenue.