An over-reliance on financial models used in securitizing mortgage risks and a failure to question basic assumptions played a role in the subprime crisis, an expert panel advised a recent meeting of actuaries.
The group's comments came at the Casualty Actuarial Society's (CAS) 2008 Annual Meeting last month in Seattle.
According to a report of the panel's remarks by CAS, David Ingram, senior vice president, Willis Re, explained that the models overlooked a number of things and "gave the wrong answers and people acted on those answers."
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