Lenders mortgage insurance provider Genworth Australia has announced it will not increase LMI premium rates over the rest of this year.
Genworth has increased premium rates four times in six years but supply and service contracts with three major banks – which account for 66% of its gross written premium in 2013 – and competitive market forces was limiting it from doing so again, it said in an ASX listing.
Its ratio of gross written premium to net insurance written was 1.73% in 2013, more than double the level in 2005, and a rise of 40 basis points over four years.
The company insured around $300 billion in loans for lenders at December 2013.
The LMI industry has come under fire recently for its lack of competition – Genworth holds an effective duopoly with QBE – and burdening consumers.