Wisconsin insurance commissioner Sean Dilweg Friday announced a rehabilitation plan for the riskiest assets — mostly mortgage-backed securities — insured by Ambac Assurance Corp. The plan aims to fairly compensate holders of the risky assets without depleting the insurer of its ability to pay other future claims, including insured municipal bonds.

Ambac Assurance is a Wisconsin-domiciled bond insurer that has not written new policies since June 2008. It was once a triple-A rated insurer before its portfolio imploded from guaranteeing “toxic” mortgage-related assets. It now has below-investment-grade ratings.

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