Genworth US Mortgage Insurance (USMI) has agreed to settle the review of industry captive reinsurance arrangements with the Consumer Financial Protection Bureau (CFPB)
Based on the terms of the agreement, Genworth will reimburse $4.5m along with other mortgage insurance firms and will abstain from certain reinsurance arrangements for a period of 10 years.
Set to be recorded during the first quarter of the current fiscal, it is expected that the settlement will not have a considerable impact on Genworth USMI financial results.
The CFPB has agreed not to make any findings or determinations that Genworth or any other company breached any law.
USMI president and CEO Rohit Gupta said that the company has agreed to settle this review so that it can concentrate its resources on working with customers to assist borrowers responsibly achieve and maintain homeownership.
Further, it will resolve the uncertainties inherent in such a review and any possible resulting litigation, Gupta claimed.
In order to thwart losses from defaulted mortgage loans and provide liquidity and capital to support the housing industry during and after the financial crisis, private mortgage insurers paid over $40bn, especially from lender-affiliated reinsurance companies, the insurer said.
With 6,300 employees, Genworth trades through three divisions including US Life Insurance, Global Mortgage Insurance, and the Corporate and Other division.
Headquartered in Richmond, Virginia, the company is a provider of life insurance, long-term care insurance, financial protection coverages, independent advisor-based wealth management and mortgage insurance.