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From Great Depression to Great Credit Crisis: Similarities, Differences and Lessons

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In the United States, insurance regulators require bonds and preferred stocks to be reported in statutory financial statements in one of six National Association of Insurance Commissioners (NAIC) designations categories that denote credit quality. If an accepted rating organisation (ARO) has rated the security, the security is not required to be filed with the NAIC’s Securities Valuation Office (SVO). Rather, the ARO rating is used to map the security to one of the six NAIC designation categories. 18 The NAIC designations are primarily designed to assist regulators (as opposed to investors) to monitor the financial condition of their insurers. Finally,...
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From Great Depression to Great Credit Crisis: Similarities, Differences and Lessons

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