Can the Insurance Industry Create Systemic Risk?
- An insurance business having special interconnections to capital markets may be capable of generating systemic risk, however, but financial and mortgage guarantee lines have been stressed because of their coverage of mortgage related securities, and as has been well-documented, large, complex financial institutions with insurance operations, like AIG, have produced systemic risks within the economy. (p15)
-- Statement of Therese M. Vaughan, Ph.D., Chief Executive Officer, National Association of Insurance Commissioners (NAIC)
2009 0305 - GOV - Perspectives on Systemic Risk