In recent months the New York-based AIG has had credit downgrades and billions of dollars of bailout money pumped into it by the federal government.
NJ Transit Executive Director Richard Sarles told a state Assembly committee that the agency would not raise fares to cover the loss, but would instead defer capital projects.
Chief Financial Officer Charles Wedel says that under a hypothetical fare hike, prices would need to rise by at least 10 percent to cover the $150 million loss.