Helia Group Boosts Premiums Amid Market Shifts, Reaffirms LMI Commitment
Helia Group’s 3Q25 APRA data reveals rising gross written premiums despite government scheme pressures, while a Board review confirms strategic focus on the Australian LMI market with significant cost cuts.
- Gross written premium up 30% year-on-year
- Insurance revenue declines due to government scheme impact
- Claims remain exceptionally low with negative incurred claims
- Board completes review, commits to Australian LMI market
- Cost base reduced by $15 million to adapt to market changes
3Q25 Regulatory Filing Highlights Growth and Challenges
Helia Group Limited has submitted its 3Q25 data to the Australian Prudential Regulation Authority (APRA), showing a notable 30% increase in gross written premiums (GWP) compared to the previous year. This growth reflects Helia’s expanding market share and higher lending volumes in the Australian mortgage insurance sector. However, insurance revenue has declined, influenced by the expanded Australian Government 5% Deposit Scheme, which continues to suppress premium income across the industry.
Despite these revenue pressures, claims activity remains remarkably subdued. Helia reported negative total incurred claims for the quarter and year to date, a rare occurrence driven by low paid claims and reserve reductions. This benign claims environment has persisted, supporting the company’s guidance that claims will remain negative through FY25.
Strategic Review Affirms Market Commitment Amid Industry Shifts
Following a comprehensive business review announced earlier this year, Helia’s Board has reaffirmed its dedication to the Australian Lenders Mortgage Insurance (LMI) market. Chair Leona Murphy emphasized the company’s intent to evolve alongside market changes while leveraging its 60-year heritage. With a commanding 51% share of the LMI industry’s in-force liabilities, Helia is well positioned to capitalize on its scale and expertise.
The Board’s review also acknowledged the challenges posed by the government’s expanded deposit scheme, which is expected to reduce overall market premiums. In response, Helia has proactively cut its recurring cost base by $15 million in FY25 and plans further efficiency gains through automation and process improvements.
Financial Strength and Capital Management
Helia maintains a robust balance sheet with a prescribed capital amount (PCA) coverage ratio of 1.85 times, comfortably above regulatory requirements. The company continues to explore flexible capital management strategies, including reinsurance and subordinated debt issuance, to optimize shareholder returns. The Board’s target PCA range remains steady at 1.40 to 1.60 times APRA’s requirements, signaling confidence in the company’s financial resilience despite market headwinds.
Net investment revenue held steady year-on-year but softened in the third quarter due to unrealized losses in the bond portfolio, reflecting broader market volatility. Overall, Helia’s financial results and strategic initiatives position it to navigate the evolving LMI landscape with agility.
Bottom Line?
Helia’s disciplined cost management and market leadership set the stage for navigating ongoing industry shifts and government policy impacts.
Questions in the middle?
- How will further expansions of the government deposit scheme affect Helia’s premium growth?
- What specific automation initiatives will Helia pursue to drive future cost efficiencies?
- Could Helia consider strategic partnerships or acquisitions to offset market contraction?
