The U.S. House Financial Services Committee’s Housing and Insurance Subcommittee is holding a hearing on reinsurance and credit risk transfer (CRT), with Subcommittee Chairman Mike Flood outlining how both tools redistribute risk that might otherwise be concentrated in a single firm or institution. In opening remarks, Flood described reinsurance as “insurance for insurers,” using an example of a small mutual home insurer facing correlated catastrophe claims, and presented CRT as a mechanism used by Fannie Mae and Freddie Mac to move mortgage credit risk off the Enterprises’ books. He framed CRT as a way to place private capital ahead of taxpayers in the event of mortgage defaults and reduce taxpayer exposure to mortgage-market downturns, while noting downstream effects on consumers through insurers’ ability to pay claims and the functioning of the conforming mortgage market. Flood also requested that a letter from the National Association of Realtors be entered into the hearing record.
2026-04-22U.S. Financial Services Committee
U.S. House Financial Services Committee holds Housing and Insurance Subcommittee hearing on reinsurance and credit risk transfer
The U.S. House Financial Services Committee’s Housing and Insurance Subcommittee held a hearing on reinsurance and credit risk transfer, with Chairman Mike Flood highlighting their role in redistributing risk that might otherwise be concentrated in a single firm. Flood described reinsurance as “insurance for insurers” and credit risk transfer as a tool used by Fannie Mae and Freddie Mac to move mortgage credit risk to private capital ahead of taxpayers, affecting insurers’ claims-paying capacity and the conforming mortgage market.