Reinsurance (Tables)

9 Months Ended

Sep. 30, 2021

Effects of Reinsurance on Statement of Operations

Effect of Reinsurance on Condensed Consolidated Statements of Operations


	Third Quarter				Nine Months
	2021		2020		2021		2020
	(in millions)
Premiums Written:
Direct	$	97	$	122	$	256	$	334
Assumed	9		(1)		21		—
Ceded (1)	—		1		—		3
Net	$	106	$	122	$	277	$	337
Premiums Earned:
Direct	$	97	$	100	$	287	$	307
Assumed	6		8		22		28
Ceded	(1)		(1)		(2)		(4)
Net	$	102	$	107	$	307	$	331
Loss and LAE:
Direct	$	(70)	$	72	$	(37)	$	118
Assumed	4		4		2		15
Ceded	(2)		(3)		(19)		(3)
Net	$	(68)	$	73	$	(54)	$	130

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(1) Positive ceded premiums written were due to commutations and changes in expected debt service schedules.

Exposure by Reinsurer

Ceded Reinsurance (1)


	As of September 30, 2021		As of December 31, 2020
	(in millions)
Ceded premium payable, net of commissions	$	4	$	4
Ceded expected loss to be recovered (paid)	(12)		(23)
Financial guaranty ceded par outstanding (2)	378		418
Specialty ceded exposure (see Note 3)	539		556

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(1) The total collateral posted by all non-affiliated reinsurers required to post, or that had agreed to post, collateral as of both September 30, 2021 and December 31, 2020 was approximately $18 million. Such collateral is posted (i) in the case of certain reinsurers not authorized or “accredited” in the U.S., in order for the Company to receive credit for the liabilities ceded to such reinsurers in statutory financial statements, and (ii) in the case of certain reinsurers authorized in the U.S., on terms negotiated with the Company.

(2) Of the total par ceded to BIG rated reinsurers, $66 million and $74 million was rated BIG as of September 30, 2021 and December 31, 2020, respectively.