"At the prompting of a major life-insurance trade group, state insurance regulators are considering moves to loosen capital requirements for the battered industry, a development that could buoy companies but also raise concerns about consumer protection. ... 'Let's be honest, were in new territory here,' said Susan Voss, commissioner of insurance in Iowa and secretary-treasurer of the National Association of Insurance Commissioners, in an interview Thursday. 'We want to be as nimble as possible and address these issues.' She added: 'I can tell you, we won't do anything that puts our consumers in a vulnerable position. It's a balancing act.' ... Scott Robinson, a senior credit officer at Moody's Investors Service, estimated that insurers in the U.S. may need 'in excess of $10 billion' in additonal capital if they aim to maintain current risk-based-capital-levels, a key measure of financial stability, though the total depends on market levels and other variables. ... Many items on the ACLI's list of sought-after changes relate to life-insurance accounting, while two focus on variable annuities", my emphasis, Leslie Scism at the WSJ, 14 November 2008.
"U.S. life insurers, weakened by losses on their immense investment portfolios, are maneuvering to get a slice of government bailout funds by buying up tiny banks. On Monday, two insurers, Genworth Financial Inc. and Lincoln National Corp., agreed to but small savings-and-loan institutions in Maple Grove, Minn., and Goodland, Ind. And on Friday, Hartford Financial Services Group Inc. said it had struck a deal to purchase Federal Trust Corp., in Sanford, Fla. ... It isn't yet clear whether insurers have received approval of government financing. But regulators have an interest in shoring up the insurance industry, which is one of the biggest providers of capital to U.S. businesses through its purchases of bonds and other assets. The insurance industry's interest in getting TARP money complicates an already heated competition for limited bailout funds. ... As turmoil from the stock and bond markets has seeped into the insurance industry, insurers have been hoarding cash to calm shareholders. ... They also took tens of billions of dollars of unrealized losses as the prices of corporate bonds dropped while investors dumped them in order to buy safer U.S. Treasurys. At the same time, their variable-annuity bussinesses are suffering as the stock market drops", my emphasis, Leslie Scism, Michael Crittenden, Matthew Karnitsching & Mattias Rieker at the WSJ, 18 November 2008.
This industry is worth watching.