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QBE LMI chief executive Ian Graham has dismissed claims that the role of LMIs has been marginalised on the back of lower loan-to-value ratios (LVRs).
Speaking to The Australian Financial Review, Mr Graham said the value proposition of LMIs was actually more compelling today thanks to the consequences of the global financial crisis.
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According to Mr Graham, LVRs have actually increased across the industry as a result of the dramatic uptake of the first home buyers grant and he expects LVRs to only fall marginally as the stimulus is retracted.
“Any downward impact on LVRs will be short term,” Mr Graham said.
“Given the competitive environment within major banks, it usually doesn’t take long before one bank decides it will take over from its rivals that are less comfortable with doing business.”
Last August, QBE LMI decided to lift its premiums for customers with LVRs of more than 90 per cent by 20 per cent.
Premiums for LVRs over 80 per cent rose by 4 per cent.
