Fitch Ratings today said that subprime pressures will increase further for U.S. life insurers in 2008.
Fitch, Chicago, says it still believes that the U.S. life insurance industry’s investment exposure to problematic subprime and Alt-A residential mortgage collateral is manageable. The agency adds, however, that significant deterioration in subprime mortgage performance in the second half of 2007 led to a substantial decline in market valuations, particularly in the fourth quarter, and increased downgrade activity.