Genworth-Sagen's default-insurance market share swells amid CMHC changes

The insurer also saw its net income grow by 12% annually during the third quarter

Genworth-Sagen's default-insurance market share swells amid CMHC changes

Genworth MI Canada, also operating as Sagen MI Canada, said that it has seen its default-insurance market share reach the “high 30s” following the Canada Mortgage and Housing Corporation’s adjustments of its underwriting policies earlier this year.

In a recent conference call on the insurer’s Q3 results, Sagen President and CEO Stuart Levings said that the company saw its net income reach $124 million for the quarter, representing a 12% annual increase.

“We were pleased with our third-quarter results, including positive top line momentum, a 13% loss ratio and 13% operating return on equity,” Levings said.

Sagen’s outstanding principal balance of deferred insured mortgages dropped to $12.2 billion, accounting for 6% of its outstanding insured mortgage balance as of Sept. 30.

Sagen continues to limit its exposure to high debt-service-ratio loans and credit scores below 720, Levings said. He added that this level of vigilance is something that the insurer will maintain over the next few months.

“While the economic environment continues to evolve in line with our expectations, there remains a high degree of uncertainty, especially as we enter the second wave of COVID-19,” Levings said. “That said, the pace of economic recovery to date, strength of the housing market and downward trend in the balance of mortgage payment deferrals should help us manage through this period even when the deferral programs and government wage subsidy programs wind down.”