FOR IMMEDIATE RELEASE
WHITE PAPER ADDRESSES REGULATORY FRAMEWORK AND
HOUSING FINANCE SYSTEM
ATLANTA (Aug. 13, 2012) - The National Association of
Insurance Commissioners (NAIC) today released a white paper on the
evolution of the housing finance system and explores insurers' role in
investing in private land ownership.
Written and developed by the NAIC's Center for Insurance Policy and
Research (CIPR), "Financing Home Ownership" evaluates whether the
current insurance regulatory framework provides adequate safeguards with
regard to insurers' investments in residential mortgages and residential mortgage-backed
"Given the important role that insurers have played historically in
residential real estate markets, the insurance sector and insurance
regulators have a keen interest in policy developments in this area,"
said Dr. Therese M. (Terri) Vaughan, NAIC Chief Executive Officer.
"Our hope is that this paper will contribute to an understanding of
historical events shaping the current environment as well as proposals for
improving the RMBS markets."
The white paper details four instances where investments similar in
nature to mortgage-backed securities have triggered economic crises in the
U.S. As a practical matter, the authors concentrated on residential housing
rather than including commercial real estate, although they believe many of
the insights applicable to RMBS will also apply to other securitized
Suggestions for policymakers to improve real estate and investment
- Improvements in risk modeling;
- Observable event reporting; and
- Development of a transaction system to address the information asymmetry
advantage of deal originators.
to view the complete white paper from CIPR.