MUMBAI (Thomson Financial) - Moody's Investors Service said given the well-diversified and high-quality investment portfolios and very strong financial profile of North American insurance sectors in terms of profitability, capital adequacy and financial flexibility, it expects near-term rating actions due to investment losses to be limited.

Many North American life and property and casualty insurers reported meaningful increases in both realized and unrealized losses in their fixed income investments in the first quarter of 2008 due to significant widening of credit spreads across most asset classes, Moody's said.

Most insurance companies have a very strong liquidity and stable liability profile, as well as the ability and intent to hold asset securities with depressed market valuations until prices recover or investments mature, Moody's added.

However, rating actions are possible for insurers with outsized losses relative to their earnings or capital, especially those companies who were weakly positioned within their rating level, Moody's said.

Moody's also said that over time, it expects a portion of the depressed prices for certain asset classes to reverse as markets

stabilize.

tfn.newsdesk@thomson.com

ndi/ans

COPYRIGHT

Copyright Thomson Financial News Limited 2008. All rights reserved.

The copying, republication or redistribution of Thomson Financial News Content, including by framing or similar means, is expressly prohibited without the prior written consent of Thomson Financial News.