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S&P Credit Research1542 word report
published May 19, 2009
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S&P Credit Research
| Abstract: | America's deteriorating commercial real estate picture has a special resonance for U.S. life insurers because of the approximately $310 billion, industry wide, that they've invested in commercial and multifamily mortgages. Life insurers gravitate to these assets because they are fixed-income in nature and long-term in maturation, making them especially well-matched with insurers' liabilities: the annuities and life insurance policies they sell. (Insurers often underwrite mortgages with different durations—for instance, of five, seven, or 10 years—to hedge their risks and ensure consistent income.) But when the real estate markets begin to sour, the possibility exists that commercial mortgages will default and perhaps take a toll on ratings. So far, Standard&Poor's Ratings Services believes that this has not happened. Currently,
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| Brief Excerpt: | RESEARCH Ratings Definitions For U.S. Life Insurers, The Pain From Real Estate Could Lie Ahead Publication date: 19-May-2009 Primary Credit Analyst: Kevin Ahern, New York (1) 212-438-7160; kevin_ahern@standardandpoors.com Secondary...
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| Report Type: | Commentary
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| Sector: | Global Issuers, Public Finance, Structured Finance
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| Free Sample: |
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S&P Credit Research provides analysis on issuers and debt obligations of corporations, states and municipalities, financial institutions, insurance companies and sovereign governments. S&P also offers insight into the credit risk of structured finance deals, providing an independent view of credit risk associated with a growing array of debt-securitized instruments.
