Helia Is Generating Strong Returns and Is Well-Capitalized, but Higher Claims Are Likely

Helia, formerly known as Genworth, has a long history of providing mortgage insurance to lenders in Australia but has only been listed on the ASX since May 2014. Global US-based insurer Genworth Financial listed it and completely sold out in 2021. We think it is likely Helia will find it challenging to grow its lender's mortgage insurance business in the face of increased competition. We believe the entrance of Arch Capital Group, and increasing tendency of lenders to self-insure, will see Helia cede further share over time.