Commercial property-linked investments could be a problem
Michael Moriarty, the New York Insurance Department's deputy superintendent of property and capital markets has warned that commercial property-backed investments will be the next trouble spot for insurers, Dow Jones reports.
"There will be more losses in these securities going forward. With unemployment at 10%-plus, there is less need for commercial real estate, and some of that has not gone through the system yet," he said
The National Association of Insurance Commissioners (NAIC) will re-examine requirements for the amount of risk-based capital insurers need to hold against residential mortgage-backed securities at the end of 2009.
NAIC said it will continue the process in 2010, and Moriarty said that commercial mortgage-backed securities will get the same type of examination.
