MetLife, the largest life insurer in the US, has become the latest company to receive a subpoena regarding finite reinsurance activities. The information request from the Connecticut Attorney General comes in the wake of other US officials issuing subpoenas to a number of US and European insurance companies.
Responding to the approach from Connecticut Attorney General Richard Blumenthal, MetLife said that it intends to co-operate with the request and that it believes it has appropriately accounted for its transactions of this type.
As has been seen with New York Attorney General Eliot Sptizer and the SEC’s recent actions, Blumenthal has initiated his investigation into MetLife to evaluate whether non-traditional reinsurance products have been used inappropriately to allow the reinsured insurance companies to hide poor financial health.
Over the past couple of months 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. Last week AIG had lawsuits filed against it over alleged wrongful practices.
So far the coming to light of the investigation has not significantly affected MetLife’s share price, which was down by just a penny to $44.70 at the time the subpoena news broke.