IOSCO Consultative Report: Mortgage Insurance - Market Structure, Underwriting Cycle and Policy Implications (with Lofchie Comment)

The Joint Forum released a consultative report on mortgage insurance which analyzes the interaction of mortgage insurers with mortgage originators and underwriters. The report makes recommendations directed at policymakers and supervisors, and aims to reduce the likelihood of mortgage insurance stress and failure in the worst tail events. Thomas Schmitz-Lippert, Chairman of the Joint Forum, urged the adoption of these recommendations, stating they will help strengthen and reinforce the oversight of mortgage insurers and thereby increase their resilience over the long term.

Lofchie Comment: Even if you don't work in a job at all related to mortgage insurance (I don't), this was an interesting piece for its explanation of mortgage insurance as a product, and because it provides a discussion of the use of the product outside the United States, which gives one perspective in light of the financial crisis.

Click here to view report in full (links externally to IOSCO website).