Pacific Investment Management Co., which regulators hired to monitor insurers' mortgage bond portfolios, will analyze the effect of home price declines of as much as 61%.

The Newport Beach, Calif., company's own "standard base case" view of a drop of 38% will be given the most weight in its valuations of residential mortgage-backed securities owned by insurers, the National Association of Insurance Commissioners said in a memo released Wednesday. The analysis will assume a minimum peak-to-trough decline of 33%.

Subscribe Now

Access to authoritative analysis and perspective and our data-driven report series.

14-Day Free Trial

No credit card required. Complete access to articles, breaking news and industry data.