They say necessity is the mother of invention, so when GMAC Insurance Group was downgraded to "A-minus" from "A" by A.M. Best Company back in May 2005, the timing was perfect to introduce a new segregated trust to reassure buyers their accounts were secure.

However, GMAC Re's chief operating officer, Karen Schmitt, made it clear in a recent interview with National Underwriter that her company's trust product was not created in response to the downgrade, but "was actually in the pipeline well before then. We felt it would be a good marketing tool in any case."

"There was a lot of fear out there when we spoke to clients," she said, referring to primary insurers and captive owners looking for rock-solid reinsurance. "The trust initiative wasn't just a rating issue. Your rating could be good today, but you could be gone in two or five years."

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