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Further LMI premium hike on the cards

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Australian Broker | 02 May 2013, 07:00 AM Agree 0
Industry stakeholders fear QBE may hike LMI premiums by as much as 12%
  • Allan Faint | 02 May 2013, 09:44 AM Agree 0
    Money for Jam. further reason LMI premiums should be transferable, when refinances occur.
    seems we need more competion.
  • John Broker | 02 May 2013, 09:45 AM Agree 0
    When Genworth did it, QBE were sure to follow.
    Genworth are doing it to prop up a bottom line before a public listing. QBE are doing it because they are similarly greedy.
    Until there is real competition in this arena nothing will change, or certainly not to the benefit of the borrowing public.
  • Broker | 02 May 2013, 09:46 AM Agree 0
    They could crank premiums up 50% if they wished, like our banks GE would fall into line and just do the same
  • NoTimeLikeTheFuture | 02 May 2013, 09:58 AM Agree 0
    In other news QBE and Genworth withdrew a joint statement saying that LMI stands for 'Lining My Inside-pocket' claiming it went against the reality of the state of jobs and property in Australia
  • QEDRisk | 02 May 2013, 10:22 AM Agree 0
    And how much extra business have LMI providers received in the past couple of years because of properties that didn't value up like they should, pushing borrowers into higher LVR territory?

    Who's protecting the consumer on *this* issue? Yes - money for jam.
  • David C | 02 May 2013, 10:49 AM Agree 0
    And we get the wonderful news conveyed to us "As of tomorrow, premiums increase". Thanks, I'll get my client with the pre-approval to find a place this afternoon.
  • Country Broker | 02 May 2013, 11:14 AM Agree 0
    This sector needs competition and quickly .
  • 1martym1 | 02 May 2013, 01:34 PM Agree 0
    Money for stable bread, old rope and jam with flies in it
  • David | 02 May 2013, 03:07 PM Agree 0
    Let's take the 'other side' for just one second- and no I'm not an insurer.

    Who picks up the tab when loans default and the realisation proceeds don't cover the debt?
    Have those realisation costs increased?
    The Mortgage Insurers
    Generally Yes
    Because of across the board property value declines and, longer periods taken to gain possession ( read NCCP Hardship provisions), which adds to the cost of collectionand increases the interest charged.

    Now MLI is no different to any other form of insurance. Essentially it is a bet. The lender is bettingthe borrower will default, and the MLI provider is betting they won't.

    SO like premiums for house hold insurances, when the claims go up, next year - so do the premiiums - but only for new borrowers.
    I can just imagine the furore if MLI was a monthly charge !!

    Perhaps we need to acknowledge (as brokers) that a fair slice of our market would vanish is the MLI Providers vanished. AND if they are not profitable - that's what could happen.

    Now who was talking about self interest?
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