NEW YORK (Bloomberg) — American International Group Inc., the largest insurer by assets, projects operating profit from non-US life insurance and retirement services to climb about 88 percent by 2012 on growth in countries including China.

Profit from the business may reach $12 billion in 2012 compared with $6.4 billion last year, the New York-based insurer said today in a presentation on its website.

Chief executive Martin Sullivan is expanding sales outside North America to capitalise on the growing number of middle-class savers. He's touting the gains to shareholders frustrated with AIG's $11.1 billion fourth-quarter write-down of derivatives linked in part to sub-prime mortgages. The company got more than a third of its revenue last year from life insurance and retirement services outside the US.

"As you can imagine, I'm extremely pleased that we're getting back to discussing core businesses," Sullivan said yesterday at a conference for investors and analysts. He is unable to comment on first-quarter results, he said.

AIG, founded in Shanghai in 1919, is competing with rivals MetLife Inc. and Prudential Financial Inc. to sell products that replace income or protect wealth for ageing populations in nations including South Korea, Japan and Mexico.

AIG's operating profit from international life insurance climbed 3.4 percent to about $6.4 billion in 2007 as deposits from fixed and variable annuities declined in Japan. In 2006, profit from outside the US rose about 18 percent.

The insurer has fallen about 30 percent in the past year, underperforming the 17 percent decline of the 24-company KBW Insurance Index. AIG in February reported the biggest quarterly loss in its history.

Yesterday's presentation on life insurance was postponed from a December meeting when AIG switched the agenda, at the request of investors, to a discussion about losses related to the US housing slump.