Mortgage Guaranty Insurance Corporation (MGIC) was set to become Canada’s fifth mortgage default insurer (after CMHC, Genworth, AIG, and PMI). Earlier today, however, they announced that they were withdrawing their application.
CEO, Chuck Wilson, sent an email to industry members saying, “Given the ongoing challenges in the US housing market, MGIC did not feel this was the right time to extend into Canada and provide the level of support Regulators, Lenders and our staff deserved.”
In a chat with Wilson earlier, his concern was foremost with his staff, who he says have been deeply committed to the company since it’s Canadian office opened.
He feels there’s always a chance MGIC will revisit entering the Canadian market in “coming years.” As for now, he says, “The timing was just not perfect.”
MGIC’s announcement follows that of Triad, another U.S. insurer that cancelled plans to enter Canada earlier this year.
When US parents struggle, foreign subsidiaries often shutter their windows. This was case in point. It’s disappointing for Canadian borrowers, who would have undoubtedly benefited from MGIC’s entrance.
Last modified: April 25, 2014
FYI, PMI just announced today that they too are pulling out of the Canadian market and closing their Canadian offices. The few insurance policies that they have already underwritten will be ‘sold’ to another insurer.