Recent media speculation of a potential takeover bid for QBE Insurance Group (QBE), dismissed by the company, suggests foreign investors see value in large-cap insurers. Better opportunities exist in undervalued small- and mid-size insurers in niche fields.
There are tentative signs that small business policy premiums are stabilising after a period of declines. That’s good for insurance brokers. Continued strength in property markets helps mortgage insurers that are vulnerable to a spike in loan delinquencies.
Genworth Mortgage Insurance Australia is an example. With 40% market share, Genworth is the country’s leading provider of Lenders Mortgage Insurance (LMI). Banks use LMI on their highest-risk residential mortgages.