NEW YORK (Bloomberg) ? Chubb Corp., the second-largest seller of liability insurance for US directors and executives, received a subpoena from federal prosecutors seeking information on a type of reinsurance that may be used to smooth earnings.

US Attorney David Kelley in Manhattan sent the request on Monday, Chubb said yesterday in a regulatory filing. New York Attorney General Eliot Spitzer and the US Securities and Exchange Commission have made similar requests of Chubb and at least a dozen other insurers since last year.

Chubb?s subpoena is among the first known requests from federal prosecutors about a type of insurance that may amount to a loan and be used to mask losses. The Federal Bureau of Investigation said earlier this month it was probing the industry as Spitzer and the SEC examine the non-traditional reinsurance. The probes led American International Group Inc. to admit it overstated its net worth by about $2.7 billion.

?If you?re seeing subpoenas, there is a belief at some level that there may be violations of federal criminal law,? said Jacob Frenkel, a former federal prosecutor who now practices law in Rockville, Maryland. ?The US attorney?s office usually sits back long enough to see how the facts are playing out and whether it?s worth getting involved.?

Shares of Chubb fell 27 cents to $82.38 in New York Stock Exchange composite trading yesterday. The stock has risen 23 percent in the past year, compared with a 7.4 percent gain in the KBW Insurance Index.

?Chubb believes this investigation involves a number of industry participants and that Chubb has not been singled out in being asked to provide such information,? the Warren, New Jersey- based company said in the filing. The company intends to cooperate with the investigation.

Chubb spokesman Mark Greenberg and Megan Gaffney, a spokeswoman for Kelley, declined to comment.

Gordon Grender, a fund manager at GAM Holding AG in London, said Chubb?s earnings haven?t been as smooth as AIG?s, signalling that if Chubb has used non-traditional, or finite, reinsurance, it?s probably been proper.

?One of the things that people always wondered about AIG is how you could have smooth earnings over many years in a cyclical industry,? said Grender, whose firm owned 413,000 Chubb shares as of December. ?If you look at Chubb?s earnings over a period they have been cyclical, as you would expect from a property and casualty insurer.?

Shares of AIG, the world?s largest insurer, have fallen 27 percent, wiping out about $52 billion of market value, since it disclosed reinsurance subpoenas from Spitzer and the SEC on February 14. Regulatory probes of AIG, also the largest seller of directors liability insurance, forced Maurice ?Hank? Greenberg, 80, to step down as chief executive in March.

US attorneys across the country report to the Department of Justice in Washington, which has been investigating a four-year-old transaction between AIG and Warren Buffett?s Berkshire Hathaway Inc. that AIG has admitted was improper.