Once left for dead, shares of bailed-out American International Group Inc. have defied critics and rallied to become one of the market's top performers in 2010.

On Tuesday, AIG's publicly traded shares closed 45 cents lower at $58.93, capping a nearly 97% gain in the year to date and over 42% in December alone. The insurer is the fourth-best performer in the S&P 500 index this year.

AIG's...