Former American International Group Inc. (AIG) chief Maurice R. "Hank" Greenberg will reunite with several former AIG executives in a joint venture that will compete directly with the troubled insurance giant.

C.V. Starr & Co. Inc., run by Greenberg, launched Iron-Starr Excess Agency Ltd., a joint venture with Ironshore Inc., a Bermuda-based insurer that has hired several key AIG executives in recent months.

The joint venture will act as a specialty lines insurance and reinsurance managing general agency to write catastrophic excess casualty insurance products for Fortune 2000 and other clients, with policy limits up to $75 million, a key market for AIG.

"There are significant opportunities in this market, and C.V. Starr together with Ironshore has the team to get the job done," Greenberg said in a press release.

Some of those opportunities come as AIG is hobbled by huge losses in its non-insurance businesses that led to a $60 billion credit line as part of its federal bailout. Under newly installed chairman Edward Liddy, AIG is in the process of selling off many of its businesses to pay off its debt.

The backing from C.V. Starr will put Ironshore in a good position to chase big AIG clients. Both Greenberg and Ironshore declined to comment on the joint venture.

"This partnership enables Ironshore to enter the excess casualty market with additional backing and support to offer larger limits, consistent with the needs of these clients," Kevin Kelley, Ironshore's CEO, said in a press release. Kelley is the former chief executive of AIG's Lexington Insurance commercial insurance unit. AIG's Liddy has had a contentious relationship with Greenberg, AIG's largest individual shareholder, and Greenberg has criticized Liddy's leadership in letters filed with the SEC. Liddy has said that cutthroat competition for AIG's customers and employees is one of the biggest dangers the company faces as it struggles to keep customers while preparing its business units for sale.

"Anyone who wants to start an insurance company or beef up their company will come to our organization and try to pick off our people," AIG's Liddy predicted in a CNBC interview last month. "If that happens, we won't be able to maintain business we want to keep and we won't be able to sell for the values that we need."

-By Lavonne Kuykendall, Dow Jones Newswires; (312) 750 4141; lavonne.kuykendall@dowjones.com

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