The report indicates that AIG's problems were heavily influenced by its credit default swap portfolio, which was assembled by a non-insurance AIG subsidiary that was not subject to insurance regulation.
Harrington calls AIG an "anomaly" in an insurance sector that "was largely on the periphery of the financial crisis." The financial crisis and the government's rescue of AIG "do not strengthen arguments for either optional or mandatory federal regulation of insurance," Harrington writes. He also says these events do not justify creation of a systemic risk regulator with authority over insurers and non-bank institutions that are designated as "systemically significant."