AIG Hawaii is being sold as part of a $1.9 billion deal between American International Group Inc. and Zurich Financial Services AG.

Zurich's Los Angeles-based subsidiary, Farmers Group, will be taking over AIG's automobile insurance business in the transaction that's expected to close later this year. The sale is the biggest by AIG, a troubled insurer that is looking to repay parts of the $182.5 billion in government bailout money.

"We are delighted that this is happening," said Robin Campaniano, president and chief executive officer.

"We're hopeful and very optimistic that the strength of Zurich and Farmers will greatly add to the presence we have in Hawai'i."