American International Group Inc., under pressure to limit executive compensation after a government bailout, froze pay and scrapped bonuses for seven top leaders and said chief executive officer Edward Liddy will get a $1 salary.

The insurer's next 50 highest-ranked executives will forgo pay raises through 2009, New York-based AIG said Tuesday in a statement. New York Attorney General Andrew Cuomo, who demanded last week that AIG disclose compensation plans, said the insurer took a "positive step" and called on other companies to follow.

Subscribe Now

Access to authoritative analysis and perspective and our data-driven report series.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.