Insurers are the least likely financial institutions to bear the brunt of the US subprime mortgage crisis, says a ratings agency official.

Moody’s Senior Vice President Jeffrey Berg told a US Casualty Actuarial Society seminar insurers’ strong financial profiles mean they will be able to handle investment losses, and few rating downgrades are expected.

But Mr Berg says there will still be effects on the industry including a negative impact on professional lines and discretionary insurance products, rising claim costs for business lines such as workers’ compensation, and a weaker US dollar.

He says while the market’s view of insurers has deteriorated, thereby squeezing their financial flexibility, the effect has not been as bad as with other financial services.