Robert Benmosche, AIG’s new chief executive, will receive annual pay of $7m in cash and shares and be in line for a bonus of $3.5m a year, the government-controlled insurer announced on Monday.

Mr Benmosche’s package has been approved “in principle” by the Obama administration’s “pay czar” Kenneth Feinberg in a move aimed at avoiding a repeat of the political row that broke out earlier this year over bonuses for AIG’s staff.