Global regulators are seeking views on how to ensure that the market for mortgage insurance is robust and able to withstand crises.
“The events of the last few years, particularly those in the global financial crisis that began in 2007, indicate that mortgage insurance is subject to significant stress in the worst tail events,” the regulators said today in an e-mailed statement, referring to potential knock-on effects for the mortgage insurers during a financial crisis.
The report includes draft recommendations aimed “at reducing the likelihood of mortgage insurance stress and failure,” according to the group, known as the Joint Forum.
The Joint Forum brings together banking, insurance and markets regulators from industrialized and emerging economies.
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