American International Group Inc. said yesterday that itsacquisition of 21st Century Insurance Group will result in thelayoff of 600 people through the elimination of duplicatepositions.

The insurer said the cuts would affect about 11 percent of thecombined work force, which amounts to 5,500 people. AIG said themerged organization will be named aigdirect.com.SM, and will bebased in Wilmington, Del., and Woodland Hills, Calif.

Bruce Marlow, chief executive officer of 21st Century, willserve as president, and Tony DeSantis, president of AIG Marketing,will serve as chief operating officer, AIG said.

Robert M. Sandler, AIG executive vice president, domesticpersonal lines, said, "The combination of AIG's direct personalauto business with that of 21st Century will create the scale andsophistication to permit us to respond more effectively to themarketplace."

The company said it plans an "aggressive IT integration process"to be completed in three years.

AIG said the duplicate positions to be eliminated are located inboth the home office/corporate functions and in the fieldorganization.

Positions to be eliminated, as well as the locations scheduledfor closing over the next two years have been identified, thecompany said.

"We regret the necessity of eliminating positions as a result ofthe merger. Combining two separate insurance companies naturallyresults in some duplication, necessitating these difficultintegration decisions, which we are implementing as quickly aspossible," said Mr. Sandler in a statement.

According to the company, employees affected by the merger havebeen briefed concerning the job actions and timing, severancearrangements, and the availability of positions within theorganization. AIG has operations in more than 130 countries andjurisdictions.

AIG said that, wherever possible, employees slated to lose theirjobs have been encouraged to apply for open positions in otherparts of the organization.

The merger involved a subsidiary of AIG with 21st Century. AIGacquired the 39.3 percent of the 21st Century shares it did notpreviously own.