Australian Housing Dynamics and Affordability
LENDERS MORTGAGE INSURANCE
SEPTEMBER FULL YEAR 2019 RESULTS
Gross Written Premium ($m)
Net Claims Paid ($m)
Loss Rate (of Exposure - annualised)
ANZLMI MAINTAINED STABLE LOSS RATIOS¹
%
150
100
$80.7m
$31.4m
12.0bps
LMI & REINSURANCE STRUCTURE
Australian Home Loan portfolio LMI and Reinsurance Structure at 30 Sep 19
(% New Business FUM Oct-18 to Sep-19)
LVR<80% Not
LMI Insured
86%
|
9% 7%
LVR 80% to 90% LMI Insured
LVR 90% LMI Insured
Aggregate Stop Loss²
Arrangement on
Net Risk Retained
Quota Share³
Arrangement
50
0
-50
FY06 FY07 FY08 FY09 FY10 FY11 FY12 FY13 FY14 FY15 FY16 FY17 FY18
Industry - ANZ LMI - Insurer 1
Insurer 2 - Insurer 3
(LVR > 80%)
(LVR > 90%)
2019 Reinsurance Arrangement
ANZLMI uses a diversified panel of reinsurers (10+) comprising a mix of APRA
authorised reinsurers and reinsurers with highly rated security
Reinsurance is comprised of a Quota Share arrangement3 with reinsurers for
mortgages 90% LVR and above and in addition an Aggregate Stop Loss
arrangement2 for policies over 80% LVR
1. Negative Loss ratios are the result of reductions in outstanding claims provisions. Source: APRA general insurance statistics (loss ratio net of reinsurance) 2. Aggregate Stop Loss arrangement -
reinsurer indemnifies ANZLMI for an aggregate (or cumulative) amount of losses in excess of a specified aggregate amount. When the sum of the losses exceeds the pre-agreed amount, the
reinsurer will be liable to pay the excess up to a pre-agreed upper limit 3. Quota Share arrangement - reinsurer assumes an agreed reinsured % whereby reinsurer shares all premiums and losses ANZ
accordingly with ANZLMI
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