STRUCTURED PORTFOLIO PRODUCTS
Structured portfolio products are typically used to obtain capital relief, provide credit enhancement for mortgage-backed securities, or correct a perceived portfolio risk imbalance. There are two main forms:
Traditional Pool Insurance
QBE LMI Asia insures a pool of loans up to a fixed percentage of the original aggregate loan amount (the stop loss). Individual loans in the pool are insured 100% against loss, which means QBE LMI Asia will pay all losses net of property sales proceeds, until the pool stop loss level is reached.
Modified Pool Insurance
QBE LMI Asia insures a pool of loans up to a predetermined stop loss level. Individual loans in the pool are insured with either proportional or fixed exposure coverage. On defaulted loans, QBE LMI Asia will pay the lesser of the coverage percentage and actual losses net of property sales proceeds, until the stop loss level for the pool is reached.
Individual loan coverage and pool stop loss limit will be adapted to each lender's specific needs.