Helia Group – formerly known as Genworth Mortgage Insurance Australia – says its gross written premium (GWP) was $106.45 million in the first quarter while net profit was $17.61 million.

GWP was substantially lower than in January-March a year earlier, Australia’s top provider of lenders mortgage insurance (LMI) says, reflecting soft industry new loan commitments.

Helia had flagged last year that GWP would decline on fewer new home loans – particularly for first home buyers and other higher loan-to-value-ratio (LVR) lending which is more likely to trigger required LMI. 

After “extraordinarily high” volume in 2021, Helia’s 2022 GWP fell 42% as new housing loans dropped by more than a quarter in the second half.

Helia says it recently renewed exclusive customer contracts with a non-major bank and a large customer-owned bank, and first-quarter net earned premium (NEP) of $108.39 “remains high due to previous book year GWP as well as the level of cancellations, which remains elevated”.

Net incurred claims remained negative on continued low mortgage delinquency levels, though this is expected to increase toward long-term average levels over the full year, Helia says, in response to higher interest rates, falling property values and an expected modest rise in unemployment.

Last year, Helia’s closing delinquencies were down 22% at just 4569 – the lowest level since it listed on the ASX in 2014, reflecting savings accumulated during the covid pandemic, a strong labour market and low interest rates in the first half. 

Helia’s annual shareholder meeting will be held on Thursday.