Genworth's Loss Widens

The U.S. Mortgage Insurance operations at Genworth Financial Inc., Richmond, Va., had a fourth quarter 2008 net operating loss of $114 million; one-year prior, it had an operating loss of just $3 million. The company said higher captive reinsurance coverage benefits and loss mitigation actions were more than offset by higher incurred losses. For the period, Genworth received $206 million in pre-tax income from lender captive reinsurance coverage. Paid claims were $173 million, an increase of $41 million over the third quarter 2008 and $108 million over the fourth quarter 2007. Average paid claim increased from $39,200 in the fourth quarter 2007 to $52,300 for the most recent period. The amount of new flow insurance written during the quarter was down 48% from the third quarter 2008, to $3.2 billion. For the year, the U.S. MI business lost $330 million, compared with net operating income of $167 million in 2007. Genworth's MI business in Canada had net operating income of $67 million, down from $88 million one-year prior. Net operating income at the Australian MI unit was flat, at $40 million. However higher delinquencies in Spain were responsible for the "other international" segment of Genworth's MI business, recording an $8 million loss for the fourth quarter 2008.