American International Group Inc. (AIG), the insurer deemed too important to fail, will get as much as $30 billion in new government capital in a revised bailout after posting the worst loss by a U.S. corporation.

The fourth-quarter loss widened to $61.7 billion from $5.29 billion in the year-earlier period, the New York-based insurer said today in a statement. The government relaxed terms of its bailout package to reduce pressure on AIG and stabilize the financial system.

The insurer, first saved from collapse in September with a package that grew to $150 billion last year, had to ask for help again after failing to sell enough subsidiaries to repay the government. Banks relied on AIG to back more than $300 billion of assets through derivative contracts as of Sept. 30, making the company a “systemically significant failing institution” that has to be propped up, according to the Treasury.

AIG will pay down the federal loan, valued at about $38.9 billion on Dec. 31, partly by turning over its two largest international life insurance units, which will be put in trusts. The company will also give the government rights to the cash flow from tens of thousands of life insurance policies.

AIG, once the world’s largest insurer, operates in more than 100 countries, providing protection to individuals and businesses. It insures against some of the biggest risks, covering planes and commercial shipping and providing protection against terrorist attacks.

The biggest insurers in North America posted more than $150 billion in writedowns and unrealized losses linked to the collapse of the mortgage market from the start of 2007, with AIG representing more than a third of that total. The company has units that insure, originate and invest in home loans.

The U.S. Senate’s banking committee has scheduled a hearing for March 5 to discuss AIG’s bailout and the government involvement.

(Source: Bloomberg.com)