Helia Insurance Pty Ltd.

We select the higher of the dual notch anchor because we consider both Helia's business risk profile and financial risk profile to be at the upper end of the strong category. The stable outlook on Helia reflects our view that it will maintain its strong competitive position as one of the largest providers of LMI in Australia, as well as strong capital adequacy for at least the next two years. Although unlikely, we could lower the ratings on Helia over the next two years if: We view the insurer's competitive position to have deteriorated. A material weakening in its market share could reflect this; or We assess Helia's prospective capital adequacy to have weakened below the strong category under our

...Helia Insurance Pty Ltd. will maintain its position as one of the leading LMI providers in Australia for at least the next three years. The insurer is the oldest and largest provider of LMI in Australia, with a panel of over 50 bank and non-bank lenders. Our strong competitive position assessment recognizes some concentration in Helia's customer base, with its largest customer accounting for about half of its premiums. The insurer also has limited product diversity as a monoline insurer. Helia's strong profitability continues to support its competitive position. The insurer has maintained strong profitability in recent years, with a net profit after tax of A$277 million in fiscal 2023 (ended Dec. 31), and a very strong return on equity of 25%. Helia should report another strong earnings result in fiscal 2024, with low unemployment and modestly rising house prices supporting low claims for mortgage insurers. This is despite interest rates remaining higher for longer, affecting the majority...

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