The National Association of Insurance Commissioners plans to conduct a mid-year update on the credit quality of insurers’ residential mortgage-backed securities holdings.

The Valuation of Securities Task Force at the NAIC, Kansas City, Mo., decided to ask for the RMBS update.

The NAIC has shifted to a new system of using an RMBS evaluation service rather than relying on the credit rating agencies.

Insurers had argued that the rating agency approach penalized them when an issuer had shown an sign of defaulting, even when it seems likely that an issuer eventually will make good on most or all of its obligations.

The NAIC has not yet decided when the mid-year RMBS review will be completed, a representative says.