The factors rating agencies use to rate financial institutions do not necessarily well serve insurance companies, according to New York's top regulator.

Speaking at a meeting of the Association of Professional Insurance Women (APIW), New York Insurance Superintendent Eric Dinallo said rating agencies have some basic issues and conflicts that they have to manage going forward, particularly involving their business model. But he also said rating agencies in general use some criteria that do not work well for insurance companies.

The rating system, Mr. Dinallo said, is based on factors such as franchise value, expansion and return on equity. These factors, he noted, work better for "widget makers" rather than insurance companies.