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Mired in sub-prime losses and an 80% slide in stock, bond insurer MBIA Inc. approved the lowest executive bonuses in its history. Payouts averaged 40 percent of the company’s targets, compared with an average 75 percent to 90 percent, MBIA said in a regulatory filing today. Some executives’ bonuses were reduced by more than half.… Continue reading MBIA Approves Low Bonuses for Execs

Bond insurer Ambac Financial Group Inc. in taking initial steps towards bolstering its credit ratings, will cut its dividend and stop writing policies for complex debt securities for the next six months. Similar to measures recently announced by rival MBIA Inc., Ambac’s strategy is to preserve its top-notch triple-A rating, which it needs to compete… Continue reading Ambac Takes First Steps for Turnaround, Cuts Dividend and More

Speaking on CNBC this morning, billionaire investor Warren Buffett said that the U.S. economy is in recession , however, in his view over the long-run the U.S. economy will do fine and that each generation will live better than the one before it.     He also said he is no longer offering to guarantee… Continue reading CNBC: Billionaire Buffett Says US in Recession, Long-Haul Will be Fine

Members of the National Association for Business Economists (NABE) said on Monday that the combined punch of sub-prime mortgage defaults and heavy debt remains the biggest risk to the health of the U.S. economy. The conclusion was based on a survey of 259 members conducted between February 1-15 and updates a poll conducted in August.… Continue reading Economists Say Sub-Prime Crisis and Heavy Debt Still Biggest U.S. Risk

A.M. Best Co. is maintaining a stable outlook in 2008 for the global reinsurance sector for the second consecutive year. The affirmation of the sector’s outlook reflects generally strong balance sheets, continued improvements in enterprise risk management, and general earnings momentum through 2007. This current outlook implies that the majority of 2008 reinsurer rating actions… Continue reading A.M. Best: Reinsurance Market Stable for 2008

Michigan will become the newest U.S. captive domicile under a bill now awaiting Gov. Jennifer Granholm’s signature. The bill swiftly passed the House of Representatives and the Senate. House legislators made changes favored by Office of Financial and Insurance Services Commissioner Ken Ross that included an increase in renewal fees in order to pay for… Continue reading Captives Find New Home in Michigan

Buffett’s Berkshire Hathaway Inc. may report lower fourth-quarter profit later today because of falling insurance rates. The company has been scaling back coverage of coastal property as prices drop from their highs following Hurricane Katrina in 2005.     Earnings probably declined 10 percent to $1,667 a share, excluding one-time gains such as the sale… Continue reading Lower Insurance Rates May Result in a Fourth-Quarter Drop for Berkshsire Hathaway

Swiss Reinsurance Co Friday reported an 87% drop in fourth-quarter net profit, due to losses linked to the meltdown of the U.S. sub-prime mortgage market. The world’s largest reinsurer by premium volume, which warned of more sub-prime-linked write-downs for current quarter and said the market will remain tough this year, said net profit for quarter… Continue reading Swiss Re Posts Significant Drop in Fourth-Quarter Profit Due to Write-downs

According to CNBC, the bailout of troubled bond insurer Ambac has hit a significant snag, after rating agencies demanded more capital from the consortium of banks involved in the bailout effort.    People close to the deal are confident that it will still happen, because the banks and the rating agencies are aware that, if… Continue reading CNBC: Ambac Bailout Stumbles, Talks Continue

On Friday American International Group investors were told by Chief Executive Martin Sullivan that the insurer is working to address “material weakness” concerns raised by its auditor earlier this month, after troubles valuing a credit swap portfolio. “We have already begun the process to remediate the material weakness identified by [PricewaterhouseCoopers],” said Sullivan, on a… Continue reading AIG CEO Sullivan Says Company Working on Audit Concerns