Six insurance companies have been contacted by US regulators in an ongoing investigation into finite reinsurance. XL Capital, RenaissanceRe Holdings, Assurant Inc, PartnerRe Ltd, Platinum Underwriters and Bristol West have all received requests for information in connection to the probe.

Florida-based auto insurer Bristol West and Bermuda reinsurer Platinum said they have received a grand jury subpoenas, and four other companies have been sent similar requests, according to a report by the AFX news agency.

At least two of the subpoenas came from a grand jury, indicating a possibility that criminal as well as civil indictments are being considered as part of the investigation, the agency said.

US regulatory authorities, including the US Department of Justice, the SEC and New York Attorney General, Eliot Spitzer, are examining a number of companies in order to evaluate whether non-traditional reinsurance products, namely finite reinsurance, have been used inappropriately.

Finite reinsurance is a combination of traditional reinsurance and financing, in which the risk assumed by the reinsurer can be limited. The investigation has been looking into whether finite reinsurance has been used to allow ‘reinsured’ companies to hide poor financial health.

Over the past few months MEtlife, Everest Re, GE, Axa, Munich Re, Converium and Hanover Re have all received legal requests for information regarding the possible use of finite or nontraditional reinsurance to distort financial results. AIG has also had lawsuits filed against it over alleged wrongful practices regarding finite reinsurance.