An insurance trade group official says the major U.S. insurers can weather the current financial turmoil, and Senate Majority Leader Harry Reid has backed off from a remark that suggested otherwise.
Senate Majority Leader Harry Reid told reporters Wednesday that a large insurer might fail if a bailout bill did not get through Congress.
“One of the individuals in the caucus today talked about a major insurance company – a major insurance company – one with a name that everyone knows, that’s on the verge of going bankrupt,” Reid said, according to ABC News, Agence France-Press and Bloomberg.
Reid’s office now has issued an official statement indicating that Reid is not “personally aware of any particular company being on the verge of bankruptcy.”
“He has no special knowledge nor has he talked to any insurance company officials,” Reid’s office says in the statement. “Rather, his comments were meant to refer to the conditions in the financial sector generally. He regrets any confusion his comments may have caused.”
MetLife Inc., New York, today put out a statement indicating that Reid’s reference did not apply to MetLife.
“MetLife is financially sound and has high ratings from all of the major insurance ratings agencies,” MetLife says. “MetLife is fully able to meet all its obligations.”
Andrew Kligerman, a securities analyst at UBS Investment Research, New York, says that the concerns about liquidity at MetLife have been overblown and notes that the company can generate up to $1 billion a week in cash if the inflows are not invested and that MetLife faces no ratings-triggered cash or collateral calls.