Rating Changes for Insurance Industry?

October 15, 2009 by · Leave a Comment
Filed under: The Ratings System 

This is news!

The insurance industry regulators have determined that MBS ratings do not reflect the economic value of securities. The NAIC is moving to use a metric that demonstrates that “toxic” ratings don’t have to mean “toxic” bond.

Instead of a blanket “toxic” label, the insurance regulators are asking the right question: How toxic?

Let’s count the dollars at risk, instead of using a broad rating value of “toxic.”

This move will more accurately reflect the value of portfolio holdings.

[$$] Insurers Take Step Away From RatersWall Street Journal, October 15, 2009

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