Canada’s federal mortgage insurer plans to keep 50 per cent of market
The federal Canada Mortgage and Housing Corporation now insures only around 50 per cent of new residential mortgages which is a record low, having been around 90 per cent in 2008. However it is not intending on handing any more of the market to the private sector. The federal government has been keen to reduce the risk to the agency from a potential downturn in the housing market and there have been changes to its policies as a result, but chief executive Evan Siddall says that CMHC intends to maintain a strong presence in the mortgage insurance market and is happy with a share of around 50 per cent.
Indian insurance sector set to boom, AXA takes early advantage
The Indian government has approved the country’s Insurance Laws (Amendments) Bill opening up a potential boom for the insurance sector. Among the amendments, and the most anticipated, is the raising of the limit on foreign direct investment in India’s insurance sector from 26 per cent to 49 per cent. Analysts expect a surge in investment bringing growth to the sector. Global insurer AXA has been quick to take advantage of the new rules, the first foreign firm to do so, and gaining approval to increase its stake in two joint ventures with the Bharti Group to the maximum limit.
San Francisco insurer continues expansion with Arizona office
San Francisco-based insurer Metromile has announced the next step on its quest to spread across America, a new office in Tempe, Arizona. The company has been in operation since 2011 and recently expanded from its California base to Boston. It has also reached a deal with Uber to offer its drivers pay-per-mile insurance. The new office marks the next step in the company’s growth which is expected to escalate during this year.
RBC insurance division fall in second quarter results
The insurance business of the Royal Bank of Canada saw a 20 per cent drop in revenue in the bank’s second quarter compared to a year earlier. Financial results released Thursday show that the bank’s insurance net income of $123 million was down $31 million, mainly due to a change in Canadian tax legislation impacting certain foreign affiliates which became effective November 1, 2014. Compared to last quarter, net income decreased $62 million or 34% mainly due to a lower impact this quarter from a new U.K. annuity contract as compared to two contracts last quarter and higher net claims costs in RBC’s life retrocession business.