(Mark One) | ||||||||
QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | ||||||||
For the quarterly period ended |
TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 | |||||
For the transition period from ______ to ______ |
(Exact name of registrant as specified in its charter) |
(State or other jurisdiction of incorporation or organization) | (I.R.S. Employer Identification No.) | |||||||||||||||||||
, | ||||||||||||||||||||
(Address of principal executive offices) | (Zip Code) |
Title of each class | Trading Symbol(s) | Name of each exchange on which registered | ||||||
☒ | Accelerated filer | ☐ | ||||||||||||
Non-accelerated filer | ☐ | Smaller reporting company | ||||||||||||
Emerging growth company |
Item 1. | ||||||||
Item 2. | ||||||||
Item 3. | ||||||||
Item 4. | ||||||||
Item 1. | ||||||||
Item 1A. | ||||||||
Item 2. | ||||||||
Item 6. | ||||||||
Condensed Consolidated Balance Sheets as of June 30, 2023 (Unaudited) and December 31, 2022 | |||||
Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) for the three and six months ended June 30, 2023 and 2022 (Unaudited) | |||||
Condensed Consolidated Statements of Changes in Shareholders' Equity for the three months ended June 30, 2023 and 2022 (Unaudited) | |||||
Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2023 and 2022 (Unaudited) | |||||
Notes to Condensed Consolidated Financial Statements (Unaudited) |
June 30, 2023 | December 31, 2022 | ||||||||||
Assets | (In Thousands, except for share data) | ||||||||||
Fixed maturities, available-for-sale, at fair value (amortized cost of $ | $ | $ | |||||||||
Cash and cash equivalents (including restricted cash of $ | |||||||||||
Premiums receivable | |||||||||||
Accrued investment income | |||||||||||
Deferred policy acquisition costs, net | |||||||||||
Software and equipment, net | |||||||||||
Intangible assets and goodwill | |||||||||||
Reinsurance recoverable | |||||||||||
Prepaid federal income taxes | |||||||||||
Other assets | |||||||||||
Total assets | $ | $ | |||||||||
Liabilities | |||||||||||
Debt | $ | $ | |||||||||
Unearned premiums | |||||||||||
Accounts payable and accrued expenses | |||||||||||
Reserve for insurance claims and claim expenses | |||||||||||
Reinsurance funds withheld | |||||||||||
Deferred tax liability, net | |||||||||||
Other liabilities | |||||||||||
Total liabilities | |||||||||||
Commitments and contingencies | |||||||||||
Shareholders' equity | |||||||||||
Common stock - class A shares, $ | |||||||||||
Additional paid-in capital | |||||||||||
Treasury Stock, at cost: | ( | ( | |||||||||
Accumulated other comprehensive loss, net of tax | ( | ( | |||||||||
Retained earnings | |||||||||||
Total shareholders' equity | |||||||||||
Total liabilities and shareholders' equity | $ | $ |
For the three months ended June 30, | For the six months ended June 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
(In Thousands, except for per share data) | |||||||||||||||||||||||
Revenues | |||||||||||||||||||||||
Net premiums earned | $ | $ | $ | $ | |||||||||||||||||||
Net investment income | |||||||||||||||||||||||
Net realized investment gains (losses) | ( | ||||||||||||||||||||||
Other revenues | |||||||||||||||||||||||
Total revenues | |||||||||||||||||||||||
Expenses | |||||||||||||||||||||||
Insurance claims and claim expenses (benefits) | ( | ( | |||||||||||||||||||||
Underwriting and operating expenses | |||||||||||||||||||||||
Service expenses | |||||||||||||||||||||||
Interest expense | |||||||||||||||||||||||
Gain from change in fair value of warrant liability | ( | ( | |||||||||||||||||||||
Total expenses | |||||||||||||||||||||||
Income before income taxes | |||||||||||||||||||||||
Income tax expense | |||||||||||||||||||||||
Net income | $ | $ | $ | $ | |||||||||||||||||||
Earnings per share | |||||||||||||||||||||||
Basic | $ | $ | $ | $ | |||||||||||||||||||
Diluted | $ | $ | $ | $ | |||||||||||||||||||
Weighted average common shares outstanding | |||||||||||||||||||||||
Basic | |||||||||||||||||||||||
Diluted | |||||||||||||||||||||||
Net income | $ | $ | $ | $ | |||||||||||||||||||
Other comprehensive (loss) income, net of tax: | |||||||||||||||||||||||
Unrealized (losses) gains in accumulated other comprehensive (loss) income, net of tax (benefit) expense of $( | ( | ( | ( | ||||||||||||||||||||
Reclassification adjustment for realized (gains) losses included in net income, net of tax expense (benefit) of $ | ( | ( | |||||||||||||||||||||
Other comprehensive (loss) income, net of tax | ( | ( | ( | ||||||||||||||||||||
Comprehensive income (loss) | $ | $ | $ | $ | ( |
Common Stock - Class A | Additional Paid-in Capital | Treasury Stock, At Cost | Accumulated Other Comprehensive Loss | Retained Earnings | Total | ||||||||||||||||||
Shares | Amount | ||||||||||||||||||||||
(In Thousands) | |||||||||||||||||||||||
Balances, December 31, 2022 | $ | $ | $ | ( | $ | ( | $ | $ | |||||||||||||||
Common stock: class A shares issued under stock plans, net of shares withheld for employee taxes | ( | — | — | — | ( | ||||||||||||||||||
Repurchase of common stock | ( | — | — | ( | — | — | ( | ||||||||||||||||
Share-based compensation expense | — | — | — | — | — | ||||||||||||||||||
Change in unrealized investment gains/losses, net of tax expense of $ | — | — | — | — | |||||||||||||||||||
Net income | — | — | — | — | — | ||||||||||||||||||
Balances, March 31, 2023 | $ | $ | $ | ( | $ | ( | $ | $ | |||||||||||||||
Common stock: class A shares issued under stock plans, net of shares withheld for employee taxes | — | — | — | ||||||||||||||||||||
Repurchase of common stock | ( | — | — | ( | — | — | ( | ||||||||||||||||
Share-based compensation expense | — | — | — | — | — | ||||||||||||||||||
Change in unrealized investment gains/losses, net of tax benefit of $ | — | — | — | — | ( | — | ( | ||||||||||||||||
Net income | — | — | — | — | — | ||||||||||||||||||
Balances, June 30, 2023 | $ | $ | $ | ( | $ | ( | $ | $ | |||||||||||||||
Common Stock - Class A | Additional Paid-in Capital | Treasury Stock, At Cost | Accumulated Other Comprehensive Income (Loss) | Retained Earnings | Total | ||||||||||||||||||
Shares | Amount | ||||||||||||||||||||||
(In Thousands) | |||||||||||||||||||||||
Balances, December 31, 2021 | $ | $ | $ | $ | $ | $ | |||||||||||||||||
Common stock: class A shares issued related to warrant exercises | — | — | — | ||||||||||||||||||||
Common stock: class A shares issued under stock plans, net of shares withheld for employee taxes | — | — | — | ||||||||||||||||||||
Repurchase of common stock | ( | — | — | ( | ( | ||||||||||||||||||
Share-based compensation expense | — | — | — | — | — | ||||||||||||||||||
Change in unrealized investment gains/losses, net of tax benefit of $ | — | — | — | — | ( | — | ( | ||||||||||||||||
Net income | — | — | — | — | — | ||||||||||||||||||
Balances, March 31, 2022 | $ | $ | $ | ( | $ | ( | $ | $ | |||||||||||||||
Common stock: class A shares issued related to warrant exercises | * | — | — | — | |||||||||||||||||||
Common stock: class A shares issued under stock plans, net of shares withheld for employee taxes | ( | — | — | — | ( | ||||||||||||||||||
Repurchase of common stock | ( | — | — | ( | — | — | ( | ||||||||||||||||
Share-based compensation expense | — | — | — | — | — | ||||||||||||||||||
Change in unrealized investment gains/losses, net of tax benefit of $ | — | — | — | — | ( | — | ( | ||||||||||||||||
Net income | — | — | — | — | — | ||||||||||||||||||
Balances, June 30, 2022 | $ | $ | $ | ( | $ | ( | $ | $ | |||||||||||||||
For the six months ended June 30, | |||||||||||
2023 | 2022 | ||||||||||
Cash flows from operating activities | (In Thousands) | ||||||||||
Net income | $ | $ | |||||||||
Adjustments to reconcile net income to net cash provided by operating activities: | |||||||||||
Net realized investment loss (gains) | ( | ||||||||||
Gain from change in fair value of warrant liability | ( | ||||||||||
Depreciation and amortization | |||||||||||
Net amortization of premium on investment securities | |||||||||||
Amortization of debt discount and debt issuance costs | |||||||||||
Deferred income taxes | |||||||||||
Share-based compensation expense | |||||||||||
Changes in operating assets and liabilities: | |||||||||||
Premiums receivable | ( | ( | |||||||||
Accrued investment income | ( | ( | |||||||||
Deferred policy acquisition costs, net | ( | ( | |||||||||
Reinsurance recoverable | ( | ||||||||||
Other assets (1) | ( | ||||||||||
Unearned premiums | ( | ( | |||||||||
Reserve for insurance claims and claim expenses | ( | ||||||||||
Reinsurance balances, net | ( | ( | |||||||||
Accounts payable and accrued expenses | ( | ( | |||||||||
Net cash provided by operating activities | |||||||||||
Cash flows from investing activities | |||||||||||
Purchase of short-term investments | ( | ( | |||||||||
Purchase of fixed-maturity investments, available-for-sale | ( | ( | |||||||||
Proceeds from maturity of short-term investments | |||||||||||
Proceeds from redemptions, maturities and sale of fixed-maturity investments, available-for-sale | |||||||||||
Software and equipment | ( | ( | |||||||||
Net cash used in investing activities | ( | ( | |||||||||
Cash flows from financing activities | |||||||||||
Proceeds from issuance of common stock related to employee equity plans | |||||||||||
Proceeds from issuance of common stock related to warrant exercises | |||||||||||
Taxes paid related to net share settlement of equity awards | ( | ( | |||||||||
Repurchases of common stock | ( | ( | |||||||||
Net cash used in financing activities | ( | ( | |||||||||
Net increase (decrease) in cash, cash equivalents and restricted cash | ( | ||||||||||
Cash, cash equivalents and restricted cash, beginning of period | |||||||||||
Cash, cash equivalents and restricted cash, end of period | $ | $ | |||||||||
Supplemental disclosures of cash flow information | |||||||||||
Interest paid | $ | $ | |||||||||
Income taxes paid |
Amortized Cost | Gross Unrealized | Fair Value | |||||||||||||||||||||
Gains | Losses | ||||||||||||||||||||||
As of June 30, 2023 | (In Thousands) | ||||||||||||||||||||||
U.S. Treasury securities and obligations of U.S. government agencies | $ | $ | $ | ( | $ | ||||||||||||||||||
Municipal debt securities | ( | ||||||||||||||||||||||
Corporate debt securities | ( | ||||||||||||||||||||||
Asset-backed securities | ( | ||||||||||||||||||||||
Total bonds | ( | ||||||||||||||||||||||
Short-term investments | ( | ||||||||||||||||||||||
Total investments | $ | $ | $ | ( | $ |
Amortized Cost | Gross Unrealized | Fair Value | |||||||||||||||||||||
Gains | Losses | ||||||||||||||||||||||
As of December 31, 2022 | (In Thousands) | ||||||||||||||||||||||
U.S. Treasury securities and obligations of U.S. government agencies | $ | $ | $ | ( | $ | ||||||||||||||||||
Municipal debt securities | ( | ||||||||||||||||||||||
Corporate debt securities | ( | ||||||||||||||||||||||
Asset-backed securities | ( | ||||||||||||||||||||||
Total bonds | ( | ||||||||||||||||||||||
Short-term investments | ( | ||||||||||||||||||||||
Total investments | $ | $ | $ | ( | $ |
June 30, 2023 | December 31, 2022 | ||||||||||
Financial | % | % | |||||||||
Consumer | |||||||||||
Communications | |||||||||||
Utilities | |||||||||||
Technology | |||||||||||
Industrial | |||||||||||
Total | % | % |
As of June 30, 2023 | Amortized Cost | Fair Value | |||||||||
(In Thousands) | |||||||||||
Due in one year or less | $ | $ | |||||||||
Due after one through five years | |||||||||||
Due after five through ten years | |||||||||||
Due after ten years | |||||||||||
Asset-backed securities | |||||||||||
Total investments | $ | $ |
As of December 31, 2022 | Amortized Cost | Fair Value | |||||||||
(In Thousands) | |||||||||||
Due in one year or less | $ | $ | |||||||||
Due after one through five years | |||||||||||
Due after five through ten years | |||||||||||
Due after ten years | |||||||||||
Asset-backed securities | |||||||||||
Total investments | $ | $ |
Less Than Twelve Months | Twelve Months or Greater | Total | |||||||||||||||||||||||||||||||||
# of Securities | Fair Value | Unrealized Losses | # of Securities | Fair Value | Unrealized Losses | # of Securities | Fair Value | Unrealized Losses | |||||||||||||||||||||||||||
As of June 30, 2023 | ($ In Thousands) | ||||||||||||||||||||||||||||||||||
U.S. Treasury securities and obligations of U.S. government agencies | $ | $ | ( | $ | $ | ( | $ | $ | ( | ||||||||||||||||||||||||||
Municipal debt securities | ( | ( | ( | ||||||||||||||||||||||||||||||||
Corporate debt securities | ( | ( | ( | ||||||||||||||||||||||||||||||||
Asset-backed securities | ( | ( | |||||||||||||||||||||||||||||||||
Short-term investments | ( | ( | |||||||||||||||||||||||||||||||||
Total | $ | $ | ( | $ | $ | ( | $ | $ | ( |
Less Than Twelve Months | Twelve Months or Greater | Total | |||||||||||||||||||||||||||||||||
# of Securities | Fair Value | Unrealized Losses | # of Securities | Fair Value | Unrealized Losses | # of Securities | Fair Value | Unrealized Losses | |||||||||||||||||||||||||||
As of December 31, 2022 | ($ In Thousands) | ||||||||||||||||||||||||||||||||||
U.S. Treasury securities and obligations of U.S. government agencies | $ | $ | ( | $ | $ | ( | $ | $ | ( | ||||||||||||||||||||||||||
Municipal debt securities | ( | ( | ( | ||||||||||||||||||||||||||||||||
Corporate debt securities | ( | ( | ( | ||||||||||||||||||||||||||||||||
Asset-backed securities | ( | ( | ( | ||||||||||||||||||||||||||||||||
Short-term investments | ( | ( | |||||||||||||||||||||||||||||||||
Total | $ | $ | ( | $ | $ | ( | $ | $ | ( |
For the three months ended June 30, | For the six months ended June 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
(In Thousands) | |||||||||||||||||||||||
Investment income | $ | $ | $ | $ | |||||||||||||||||||
Investment expenses | ( | ( | ( | ( | |||||||||||||||||||
Net investment income | $ | $ | $ | $ |
For the three months ended June 30, | For the six months ended June 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
(In Thousands) | |||||||||||||||||||||||
Gross realized investment gains | $ | $ | $ | $ | |||||||||||||||||||
Gross realized investment losses | ( | ( | ( | ||||||||||||||||||||
Net realized investment gains (losses) | $ | $ | $ | ( | $ |
Fair Value Measurements Using | |||||||||||||||||||||||
Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Fair Value | ||||||||||||||||||||
As of June 30, 2023 | (In Thousands) | ||||||||||||||||||||||
U.S. Treasury securities and obligations of U.S. government agencies | $ | $ | $ | $ | |||||||||||||||||||
Municipal debt securities | |||||||||||||||||||||||
Corporate debt securities | |||||||||||||||||||||||
Asset-backed securities | |||||||||||||||||||||||
Cash, cash equivalents and short-term investments | |||||||||||||||||||||||
Total assets | $ | $ | $ | $ | |||||||||||||||||||
Fair Value Measurements Using | |||||||||||||||||||||||
Quoted Prices in Active Markets for Identical Assets (Level 1) | Significant Other Observable Inputs (Level 2) | Significant Unobservable Inputs (Level 3) | Fair Value | ||||||||||||||||||||
As of December 31, 2022 | (In Thousands) | ||||||||||||||||||||||
U.S. Treasury securities and obligations of U.S. government agencies | $ | $ | $ | $ | |||||||||||||||||||
Municipal debt securities | |||||||||||||||||||||||
Corporate debt securities | |||||||||||||||||||||||
Asset-backed securities | |||||||||||||||||||||||
Cash, cash equivalents and short-term investments | |||||||||||||||||||||||
Total assets | $ | $ | $ | $ | |||||||||||||||||||
For the three months ended June 30, | For the six months ended June 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
(In Thousands) | |||||||||||||||||||||||
Net premiums written | |||||||||||||||||||||||
Direct | $ | $ | $ | $ | |||||||||||||||||||
Ceded (1) | ( | ( | ( | ( | |||||||||||||||||||
Net premiums written | $ | $ | $ | $ | |||||||||||||||||||
Net premiums earned | |||||||||||||||||||||||
Direct | $ | $ | $ | $ | |||||||||||||||||||
Ceded (1) | ( | ( | ( | ( | |||||||||||||||||||
Net premiums earned | $ | $ | $ | $ |
($ values in thousands) | Inception Date | Covered Production | Initial Reinsurance Coverage | Current Reinsurance Coverage | Initial First Layer Retained Loss | Current First Layer Retained Loss (1) | ||||||||||||||||||||||||||
2018 ILN Transaction | July 25, 2018 | 1/1/2017 – 5/31/2018 | $ | $ | $ | $ | ||||||||||||||||||||||||||
2019 ILN Transaction | July 30, 2019 | 6/1/2018 – 6/30/2019 | ||||||||||||||||||||||||||||||
2020-2 ILN Transaction | October 29, 2020 | 4/1/2020 – 9/30/2020 (2) | ||||||||||||||||||||||||||||||
2021-1 ILN Transaction | April 27, 2021 | 10/1/2020 – 3/31/2021 (3) | ||||||||||||||||||||||||||||||
2021-2 ILN Transaction | October 26, 2021 | 4/1/2021 – 9/30/2021 (4) |
($ values in thousands) | Inception Date | Covered Production | Initial Reinsurance Coverage | Current Reinsurance Coverage | Initial First Layer Retained Loss | Current First Layer Retained Loss (1) | ||||||||||||||||||||||||||
2022-1 XOL Transaction | April 1, 2022 | 10/1/2021 – 3/31/2022 (2) | $ | $ | $ | $ | ||||||||||||||||||||||||||
2022-2 XOL Transaction | July 1, 2022 | 4/1/2022 – 6/30/2022 (3) | ||||||||||||||||||||||||||||||
2022-3 XOL Transaction | October 1, 2022 | 7/1/2022 – 9/30/2022 | ||||||||||||||||||||||||||||||
2023-1 XOL Transaction (4) | January 1, 2023 | 10/1/2022 – 6/30/2023 |
As of and for the three months ended | As of and for the six months ended | ||||||||||||||||||||||
June 30, 2023 | June 30, 2022 | June 30, 2023 | June 30, 2022 | ||||||||||||||||||||
(In Thousands) | |||||||||||||||||||||||
Ceded risk-in-force | $ | $ | $ | $ | |||||||||||||||||||
Ceded premiums earned | ( | ( | ( | ( | |||||||||||||||||||
Ceded claims and claim expenses (benefits) | ( | ( | |||||||||||||||||||||
Ceding commission earned | |||||||||||||||||||||||
Profit commission |
For the six months ended June 30, | |||||||||||
2023 | 2022 | ||||||||||
(In Thousands) | |||||||||||
Beginning balance | $ | $ | |||||||||
Less reinsurance recoverables (1) | ( | ( | |||||||||
Beginning balance, net of reinsurance recoverables | |||||||||||
Add claims incurred: | |||||||||||
Claims and claim expenses (benefits) incurred: | |||||||||||
Current year (2) | |||||||||||
Prior years (3) | ( | ( | |||||||||
Total claims and claim expenses (benefits) incurred | ( | ||||||||||
Less claims paid: | |||||||||||
Claims and claim expenses paid: | |||||||||||
Current year (2) | |||||||||||
Prior years (3) | |||||||||||
Total claims and claim expenses paid | |||||||||||
Reserve at end of period, net of reinsurance recoverables | |||||||||||
Add reinsurance recoverables (1) | |||||||||||
Ending balance | $ | $ |
For the three months ended June 30, | For the six months ended June 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
(In Thousands, except for per share data) | |||||||||||||||||||||||
Net income | $ | $ | $ | $ | |||||||||||||||||||
Basic weighted average shares outstanding | |||||||||||||||||||||||
Basic earnings per share | $ | $ | $ | $ | |||||||||||||||||||
Net income | $ | $ | $ | $ | |||||||||||||||||||
Gain from change in fair value of warrant liability | ( | ( | |||||||||||||||||||||
Diluted net income | $ | $ | $ | $ | |||||||||||||||||||
Basic weighted average shares outstanding | |||||||||||||||||||||||
Dilutive effect of issuable shares | |||||||||||||||||||||||
Diluted weighted average shares outstanding | |||||||||||||||||||||||
Diluted earnings per share | $ | $ | $ | $ | |||||||||||||||||||
Anti-dilutive shares |
June 30, 2023 | December 31, 2022 | ||||||||||
(In Thousands) | |||||||||||
Statutory surplus | $ | $ | |||||||||
Contingency reserve | |||||||||||
Statutory capital (1) | $ | $ | |||||||||
Risk-to-capital |
($ values in thousands) | Inception Date | Covered Production | Initial Reinsurance Coverage | Current Reinsurance Coverage | Initial First Layer Retained Loss | Current First Layer Retained Loss (1) | ||||||||||||||||||||||||||
2018 ILN Transaction | July 25, 2018 | 1/1/2017 – 5/31/2018 | $ | 264,545 | $ | 142,638 | $ | 125,312 | $ | 121,966 | ||||||||||||||||||||||
2019 ILN Transaction | July 30, 2019 | 6/1/2018 – 6/30/2019 | 326,905 | 176,647 | 123,424 | 122,085 | ||||||||||||||||||||||||||
2020-2 ILN Transaction | October 29, 2020 | 4/1/2020 – 9/30/2020 (2) | 242,351 | 74,728 | 121,777 | 121,177 | ||||||||||||||||||||||||||
2021-1 ILN Transaction | April 27, 2021 | 10/1/2020 – 3/31/2021 (3) | 367,238 | 257,809 | 163,708 | 163,520 | ||||||||||||||||||||||||||
2021-2 ILN Transaction | October 26, 2021 | 4/1/2021 – 9/30/2021 (4) | 363,596 | 351,215 | 146,229 | 146,112 |
($ values in thousands) | Inception Date | Covered Production | Initial Reinsurance Coverage | Current Reinsurance Coverage | Initial First Layer Retained Loss | Current First Layer Retained Loss (1) | |||||||||||||||||||||||||||||
2022-1 XOL Transaction | April 1, 2022 | 10/1/2021 – 3/31/2022 (2) | $289,741 | $279,416 | $133,366 | $133,366 | |||||||||||||||||||||||||||||
2022-2 XOL Transaction | July 1, 2022 | 4/1/2022 – 6/30/2022 (3) | 154,306 | 152,347 | 78,906 | 78,906 | |||||||||||||||||||||||||||||
2022-3 XOL Transaction | October 1, 2022 | 7/1/2022 – 9/30/2022 | 96,779 | 96,197 | 106,265 | 106,265 | |||||||||||||||||||||||||||||
2023-1 XOL Transaction (4) | January 1, 2023 | 10/1/2022 – 6/30/2023 | 89,864 | 89,864 | 146,513 | 146,513 |
Primary and pool IIF and NIW | As of and for the three months ended | For the six months ended | |||||||||||||||||||||||||||||||||
June 30, 2023 | June 30, 2022 | June 30, 2023 | June 30, 2022 | ||||||||||||||||||||||||||||||||
IIF | NIW | IIF | NIW | NIW | |||||||||||||||||||||||||||||||
(In Millions) | |||||||||||||||||||||||||||||||||||
Monthly | $ | 171,685 | $ | 11,266 | $ | 148,488 | $ | 15,695 | $ | 19,816 | $ | 28,789 | |||||||||||||||||||||||
Single | 19,621 | 212 | 20,151 | 916 | 396 | 1,987 | |||||||||||||||||||||||||||||
Primary | 191,306 | 11,478 | 168,639 | 16,611 | 20,212 | 30,776 | |||||||||||||||||||||||||||||
Pool | 1,000 | — | 1,114 | — | — | — | |||||||||||||||||||||||||||||
Total | $ | 192,306 | $ | 11,478 | $ | 169,753 | $ | 16,611 | $ | 20,212 | $ | 30,776 |
Primary and pool premiums written and earned | For the three months ended June 30, | For the six months ended June 30, | |||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
(In Thousands) | |||||||||||||||||||||||
Net premiums written | $ | 117,144 | $ | 118,457 | $ | 230,120 | $ | 234,491 | |||||||||||||||
Net premiums earned | 125,985 | 120,870 | 247,739 | 237,365 |
Primary portfolio trends | As of and for the three months ended | ||||||||||||||||||||||||||||
June 30, 2023 | March 31, 2023 | December 31, 2022 | September 30, 2022 | June 30, 2022 | |||||||||||||||||||||||||
($ Values In Millions, except as noted below) | |||||||||||||||||||||||||||||
New insurance written | $ | 11,478 | $ | 8,734 | $ | 10,719 | $ | 17,239 | $ | 16,611 | |||||||||||||||||||
Percentage of monthly premium | 98 | % | 98 | % | 98 | % | 97 | % | 94 | % | |||||||||||||||||||
Percentage of single premium | 2 | % | 2 | % | 2 | % | 3 | % | 6 | % | |||||||||||||||||||
New risk written | $ | 3,022 | $ | 2,258 | $ | 2,797 | $ | 4,616 | $ | 4,386 | |||||||||||||||||||
Insurance-in-force (1) | $ | 191,306 | $ | 186,724 | $ | 183,968 | $ | 179,173 | $ | 168,639 | |||||||||||||||||||
Percentage of monthly premium | 90 | % | 89 | % | 89 | % | 89 | % | 88 | % | |||||||||||||||||||
Percentage of single premium | 10 | % | 11 | % | 11 | % | 11 | % | 12 | % | |||||||||||||||||||
Risk-in-force (1) | $ | 49,875 | $ | 48,494 | $ | 47,648 | $ | 46,259 | $ | 43,260 | |||||||||||||||||||
Policies in force (count) (1) | 611,441 | 600,294 | 594,142 | 580,525 | 551,543 | ||||||||||||||||||||||||
Average loan size ($ value in thousands) (1) | $ | 313 | $ | 311 | $ | 310 | $ | 309 | $ | 306 | |||||||||||||||||||
Coverage percentage (2) | 26.1 | % | 26.0 | % | 25.9 | % | 25.8 | % | 25.7 | % | |||||||||||||||||||
Loans in default (count) (1) | 4,349 | 4,475 | 4,449 | 4,096 | 4,271 | ||||||||||||||||||||||||
Default rate (1) | 0.71 | % | 0.75 | % | 0.75 | % | 0.71 | % | 0.77 | % | |||||||||||||||||||
Risk-in-force on defaulted loans (1) | $ | 335 | $ | 337 | $ | 323 | $ | 284 | $ | 295 | |||||||||||||||||||
Net premium yield (3) | 0.27 | % | 0.26 | % | 0.26 | % | 0.27 | % | 0.30 | % | |||||||||||||||||||
Earnings from cancellations | $ | 1.1 | $ | 1.4 | $ | 1.5 | $ | 1.8 | $ | 2.2 | |||||||||||||||||||
Annual persistency (4) | 86.0 | % | 85.1 | % | 83.5 | % | 80.1 | % | 76.0 | % | |||||||||||||||||||
Quarterly run-off (5) | 3.7 | % | 3.2 | % | 3.3 | % | 4.0 | % | 4.3 | % |
Primary IIF | As of and for the three months ended | As of and for the six months ended | |||||||||||||||||||||
June 30, 2023 | June 30, 2022 | June 30, 2023 | June 30, 2022 | ||||||||||||||||||||
(In Millions) | |||||||||||||||||||||||
IIF, beginning of period | $ | 186,724 | $ | 158,877 | $ | 183,968 | $ | 152,343 | |||||||||||||||
NIW | 11,478 | 16,611 | 20,212 | 30,776 | |||||||||||||||||||
Cancellations, principal repayments and other reductions | (6,896) | (6,849) | (12,874) | (14,480) | |||||||||||||||||||
IIF, end of period | $ | 191,306 | $ | 168,639 | $ | 191,306 | $ | 168,639 |
Primary IIF and RIF | As of June 30, 2023 | As of June 30, 2022 | |||||||||||||||||||||
IIF | RIF | IIF | RIF | ||||||||||||||||||||
(In Millions) | |||||||||||||||||||||||
June 30, 2023 | $ | 19,811 | $ | 5,176 | $ | — | $ | — | |||||||||||||||
2022 | 54,739 | 14,496 | 30,249 | 7,972 | |||||||||||||||||||
2021 | 68,016 | 17,553 | 76,657 | 19,522 | |||||||||||||||||||
2020 | 30,799 | 7,978 | 39,154 | 9,928 | |||||||||||||||||||
2019 | 8,385 | 2,220 | 10,248 | 2,688 | |||||||||||||||||||
2018 and before | 9,556 | 2,452 | 12,331 | 3,150 | |||||||||||||||||||
Total | $ | 191,306 | $ | 49,875 | $ | 168,639 | $ | 43,260 |
Primary NIW by FICO | For the three months ended June 30, | For the six months ended June 30, | |||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
(In Millions) | |||||||||||||||||||||||
>= 760 | $ | 6,919 | $ | 7,990 | $ | 12,170 | $ | 14,362 | |||||||||||||||
740-759 | 1,836 | 2,900 | 3,350 | 5,288 | |||||||||||||||||||
720-739 | 1,541 | 2,056 | 2,648 | 3,993 | |||||||||||||||||||
700-719 | 668 | 1,650 | 1,124 | 3,289 | |||||||||||||||||||
680-699 | 413 | 1,277 | 755 | 2,521 | |||||||||||||||||||
<=679 | 101 | 738 | 165 | 1,323 | |||||||||||||||||||
Total | $ | 11,478 | $ | 16,611 | $ | 20,212 | $ | 30,776 | |||||||||||||||
Weighted average FICO | 763 | 751 | 762 | 750 |
Primary NIW by LTV | For the three months ended June 30, | For the six months ended June 30, | |||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
(In Millions) | |||||||||||||||||||||||
95.01% and above | $ | 1,003 | $ | 1,577 | $ | 1,361 | $ | 2,943 | |||||||||||||||
90.01% to 95.00% | 5,323 | 8,253 | 9,408 | 15,308 | |||||||||||||||||||
85.01% to 90.00% | 3,891 | 4,772 | 7,125 | 8,640 | |||||||||||||||||||
85.00% and below | 1,261 | 2,009 | 2,318 | 3,885 | |||||||||||||||||||
Total | $ | 11,478 | $ | 16,611 | $ | 20,212 | $ | 30,776 | |||||||||||||||
Weighted average LTV | 92.0 | % | 92.2 | % | 91.9 | % | 92.1 | % |
Primary NIW by purchase/refinance mix | For the three months ended June 30, | For the six months ended June 30, | |||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
(In Millions) | |||||||||||||||||||||||
Purchase | $ | 11,233 | $ | 16,203 | $ | 19,727 | $ | 29,601 | |||||||||||||||
Refinance | 245 | 408 | 485 | 1,175 | |||||||||||||||||||
Total | $ | 11,478 | $ | 16,611 | $ | 20,212 | $ | 30,776 |
Primary IIF by FICO | As of June 30, | ||||||||||||||||||||||
2023 | 2022 | ||||||||||||||||||||||
($ Values In Millions) | |||||||||||||||||||||||
>= 760 | $ | 94,931 | 50 | % | $ | 83,769 | 50 | % | |||||||||||||||
740-759 | 33,841 | 18 | 29,195 | 17 | |||||||||||||||||||
720-739 | 26,862 | 14 | 23,240 | 14 | |||||||||||||||||||
700-719 | 18,261 | 9 | 16,221 | 10 | |||||||||||||||||||
680-699 | 12,506 | 6 | 11,160 | 6 | |||||||||||||||||||
<=679 | 4,905 | 3 | 5,054 | 3 | |||||||||||||||||||
Total | $ | 191,306 | 100 | % | $ | 168,639 | 100 | % | |||||||||||||||
Primary RIF by FICO | As of June 30, | ||||||||||||||||||||||
2023 | 2022 | ||||||||||||||||||||||
($ Values In Millions) | |||||||||||||||||||||||
>= 760 | $ | 24,472 | 49 | % | $ | 21,159 | 49 | % | |||||||||||||||
740-759 | 8,888 | 18 | 7,564 | 17 | |||||||||||||||||||
720-739 | 7,090 | 14 | 6,044 | 14 | |||||||||||||||||||
700-719 | 4,865 | 10 | 4,289 | 10 | |||||||||||||||||||
680-699 | 3,315 | 7 | 2,936 | 7 | |||||||||||||||||||
<=679 | 1,245 | 2 | 1,268 | 3 | |||||||||||||||||||
Total | $ | 49,875 | 100 | % | $ | 43,260 | 100 | % | |||||||||||||||
Primary IIF by LTV | As of June 30, | ||||||||||||||||||||||
2023 | 2022 | ||||||||||||||||||||||
($ Values In Millions) | |||||||||||||||||||||||
95.01% and above | $ | 18,141 | 10 | % | $ | 16,068 | 10 | % | |||||||||||||||
90.01% to 95.00% | 91,719 | 48 | 77,804 | 46 | |||||||||||||||||||
85.01% to 90.00% | 58,210 | 30 | 51,029 | 30 | |||||||||||||||||||
85.00% and below | 23,236 | 12 | 23,738 | 14 | |||||||||||||||||||
Total | $ | 191,306 | 100 | % | $ | 168,639 | 100 | % | |||||||||||||||
Primary RIF by LTV | As of June 30, | ||||||||||||||||||||||
2023 | 2022 | ||||||||||||||||||||||
($ Values In Millions) | |||||||||||||||||||||||
95.01% and above | $ | 5,600 | 11 | % | $ | 4,914 | 11 | % | |||||||||||||||
90.01% to 95.00% | 27,097 | 54 | 22,974 | 53 | |||||||||||||||||||
85.01% to 90.00% | 14,400 | 29 | 12,553 | 29 | |||||||||||||||||||
85.00% and below | 2,778 | 6 | 2,819 | 7 | |||||||||||||||||||
Total | $ | 49,875 | 100 | % | $ | 43,260 | 100 | % | |||||||||||||||
Primary RIF by Loan Type | As of June 30, | ||||||||||
2023 | 2022 | ||||||||||
Fixed | 98 | % | 99 | % | |||||||
Adjustable rate mortgages: | |||||||||||
Less than five years | — | — | |||||||||
Five years and longer | 2 | 1 | |||||||||
Total | 100 | % | 100 | % |
As of June 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Book Year | Original Insurance Written | Remaining Insurance in Force | % Remaining of Original Insurance | Policies Ever in Force | Number of Policies in Force | Number of Loans in Default | # of Claims Paid | Incurred Loss Ratio (Inception to Date) (1) | Cumulative Default Rate (2) | Current Default Rate (3) | |||||||||||||||||||||||||||||||||||||||||||||||||
($ Values In Millions) | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
2014 and prior | $ | 3,613 | $ | 188 | 5 | % | 15,441 | 1,191 | 14 | 56 | 3.7 | % | 0.5 | % | 1.2 | % | |||||||||||||||||||||||||||||||||||||||||||
2015 | 12,422 | 1,098 | 9 | % | 52,548 | 6,170 | 104 | 131 | 2.5 | % | 0.4 | % | 1.7 | % | |||||||||||||||||||||||||||||||||||||||||||||
2016 | 21,187 | 2,263 | 11 | % | 83,626 | 11,926 | 220 | 157 | 1.8 | % | 0.5 | % | 1.8 | % | |||||||||||||||||||||||||||||||||||||||||||||
2017 | 21,582 | 2,782 | 13 | % | 85,897 | 14,989 | 403 | 129 | 2.4 | % | 0.6 | % | 2.7 | % | |||||||||||||||||||||||||||||||||||||||||||||
2018 | 27,295 | 3,225 | 12 | % | 104,043 | 16,736 | 480 | 121 | 3.6 | % | 0.6 | % | 2.9 | % | |||||||||||||||||||||||||||||||||||||||||||||
2019 | 45,141 | 8,385 | 19 | % | 148,423 | 35,522 | 546 | 44 | 3.3 | % | 0.4 | % | 1.5 | % | |||||||||||||||||||||||||||||||||||||||||||||
2020 | 62,702 | 30,799 | 49 | % | 186,174 | 101,899 | 538 | 10 | 2.1 | % | 0.3 | % | 0.5 | % | |||||||||||||||||||||||||||||||||||||||||||||
2021 | 85,574 | 68,016 | 79 | % | 257,972 | 214,464 | 1,283 | 7 | 5.3 | % | 0.5 | % | 0.6 | % | |||||||||||||||||||||||||||||||||||||||||||||
2022 | 58,734 | 54,739 | 93 | % | 163,281 | 154,826 | 753 | — | 21.8 | % | 0.5 | % | 0.5 | % | |||||||||||||||||||||||||||||||||||||||||||||
2023 | 20,212 | 19,811 | 98 | % | 54,625 | 53,718 | 8 | — | 0.2 | % | — | % | — | % | |||||||||||||||||||||||||||||||||||||||||||||
Total | $ | 358,462 | $ | 191,306 | 1,152,030 | 611,441 | 4,349 | 655 |
Top 10 primary RIF by state | As of June 30, | ||||||||||
2023 | 2022 | ||||||||||
California | 10.4 | % | 10.8 | % | |||||||
Texas | 8.7 | 9.0 | |||||||||
Florida | 7.9 | 8.3 | |||||||||
Georgia | 4.1 | 4.0 | |||||||||
Virginia | 4.0 | 4.3 | |||||||||
Washington | 4.0 | 3.9 | |||||||||
Illinois | 3.9 | 3.9 | |||||||||
Pennsylvania | 3.4 | 3.3 | |||||||||
Colorado | 3.4 | 3.7 | |||||||||
Maryland | 3.3 | 3.5 | |||||||||
Total | 53.1 | % | 54.7 | % |
For the three months ended June 30, | For the six months ended June 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
(In Thousands) | |||||||||||||||||||||||
Beginning balance | $ | 108,157 | $ | 102,372 | $ | 99,836 | $ | 103,551 | |||||||||||||||
Less reinsurance recoverables (1) | (23,479) | (20,080) | (21,587) | (20,320) | |||||||||||||||||||
Beginning balance, net of reinsurance recoverables | 84,678 | 82,292 | 78,249 | 83,231 | |||||||||||||||||||
Add claims incurred: | |||||||||||||||||||||||
Claims and claim expenses (benefits) incurred: | |||||||||||||||||||||||
Current year (2) | 17,262 | 8,707 | 44,870 | 18,787 | |||||||||||||||||||
Prior years (3) | (14,389) | (11,743) | (35,296) | (22,442) | |||||||||||||||||||
Total claims and claim expenses (benefits) incurred | 2,873 | (3,036) | 9,574 | (3,655) | |||||||||||||||||||
Less claims paid: | |||||||||||||||||||||||
Claims and claim expenses paid: | |||||||||||||||||||||||
Current year (2) | 54 | 26 | 54 | 26 | |||||||||||||||||||
Prior years (3) | 1,072 | 356 | 1,344 | 676 | |||||||||||||||||||
Total claims and claim expenses paid | 1,126 | 382 | 1,398 | 702 | |||||||||||||||||||
Reserve at end of period, net of reinsurance recoverables | 86,425 | 78,874 | 86,425 | 78,874 | |||||||||||||||||||
Add reinsurance recoverables (1) | 24,023 | 19,588 | 24,023 | 19,588 | |||||||||||||||||||
Ending balance | $ | 110,448 | $ | 98,462 | $ | 110,448 | $ | 98,462 |
For the three months ended June 30, | For the six months ended June 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Beginning default inventory | 4,475 | 5,238 | 4,449 | 6,227 | |||||||||||||||||||
Plus: new defaults | 1,417 | 1,069 | 2,975 | 2,232 | |||||||||||||||||||
Less: cures | (1,493) | (2,011) | (3,000) | (4,143) | |||||||||||||||||||
Less: claims paid | (46) | (24) | (67) | (43) | |||||||||||||||||||
Less: rescission and claims denied | (4) | (1) | (8) | (2) | |||||||||||||||||||
Ending default inventory | 4,349 | 4,271 | 4,349 | 4,271 |
For the three months ended June 30, | For the six months ended June 30, | ||||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
($ Values In Thousands) | |||||||||||||||||||||||
Number of claims paid (1) | 46 | 24 | 67 | 43 | |||||||||||||||||||
Total amount paid for claims | $ | 1,386 | $ | 471 | $ | 1,730 | $ | 873 | |||||||||||||||
Average amount paid per claim | $ | 30 | $ | 20 | $ | 26 | $ | 20 | |||||||||||||||
Severity (2) | 62 | % | 46 | % | 56 | % | 43 | % |
Average reserve per default: | As of June 30, | ||||||||||
2023 | 2022 | ||||||||||
(In Thousands) | |||||||||||
Case (1) | $ | 23.5 | $ | 21.3 | |||||||
IBNR (1)(2) | 1.9 | 1.8 | |||||||||
Total | $ | 25.4 | $ | 23.1 |
As of June 30, | |||||||||||
2023 | 2022 | ||||||||||
(In Thousands) | |||||||||||
Available assets | $ | 2,491,280 | $ | 2,169,388 | |||||||
Risk-based required assets | 1,317,961 | 1,240,143 |
Consolidated statements of operations | For the three months ended June 30, | For the six months ended June 30, | |||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
Revenues | ($ In Thousands, except for per share data) | ||||||||||||||||||||||
Net premiums earned | $ | 125,985 | $ | 120,870 | $ | 247,739 | $ | 237,365 | |||||||||||||||
Net investment income | 16,518 | 10,921 | 31,412 | 21,120 | |||||||||||||||||||
Net realized investment gains (losses) | — | 53 | (33) | 461 | |||||||||||||||||||
Other revenues | 182 | 376 | 346 | 715 | |||||||||||||||||||
Total revenues | 142,685 | 132,220 | 279,464 | 259,661 | |||||||||||||||||||
Expenses | |||||||||||||||||||||||
Insurance claims and claim expenses (benefits) | 2,873 | (3,036) | 9,574 | (3,655) | |||||||||||||||||||
Underwriting and operating expenses | 27,448 | 30,700 | 53,234 | 63,635 | |||||||||||||||||||
Service expenses | 267 | 336 | 347 | 766 | |||||||||||||||||||
Interest expense | 8,048 | 8,051 | 16,087 | 16,092 | |||||||||||||||||||
Gain from change in fair value of warrant liability | — | (1,020) | — | (1,113) | |||||||||||||||||||
Total expenses | 38,636 | 35,031 | 79,242 | 75,725 | |||||||||||||||||||
Income before income taxes | 104,049 | 97,189 | 200,222 | 183,936 | |||||||||||||||||||
Income tax expense | 23,765 | 21,745 | 45,480 | 40,812 | |||||||||||||||||||
Net income | $ | 80,284 | $ | 75,444 | $ | 154,742 | $ | 143,124 | |||||||||||||||
Earnings per share - Basic | $ | 0.97 | $ | 0.88 | $ | 1.86 | $ | 1.67 | |||||||||||||||
Earnings per share - Diluted | $ | 0.95 | $ | 0.86 | $ | 1.83 | $ | 1.63 | |||||||||||||||
Loss ratio(1) | 2.3 | % | (2.5) | % | 3.9 | % | (1.5) | % | |||||||||||||||
Expense ratio(2) | 21.8 | % | 25.4 | % | 21.5 | % | 26.8 | % | |||||||||||||||
Combined ratio (3) | 24.1 | % | 22.9 | % | 25.4 | % | 25.3 | % |
For the three months ended June 30, | For the six months ended June 30, | ||||||||||||||||||||||
Non-GAAP financial measures (4) | 2023 | 2022 | 2023 | 2022 | |||||||||||||||||||
($ In Thousands, except for per share data) | |||||||||||||||||||||||
Adjusted income before tax | $ | 104,049 | $ | 96,061 | $ | 200,255 | $ | 182,567 | |||||||||||||||
Adjusted net income | 80,284 | 74,339 | 154,768 | 141,809 | |||||||||||||||||||
Adjusted diluted EPS | 0.95 | 0.86 | 1.83 | 1.63 | |||||||||||||||||||
Non-GAAP Financial Measure Reconciliations | For the three months ended June 30, | For the six months ended June 30, | |||||||||||||||||||||
2023 | 2022 | 2023 | 2022 | ||||||||||||||||||||
As reported | ($ In Thousands, except for per share data) | ||||||||||||||||||||||
Income before income taxes | $ | 104,049 | $ | 97,189 | $ | 200,222 | $ | 183,936 | |||||||||||||||
Income tax expense | 23,765 | 21,745 | 45,480 | 40,812 | |||||||||||||||||||
Net income | $ | 80,284 | $ | 75,444 | $ | 154,742 | $ | 143,124 | |||||||||||||||
Adjustments | |||||||||||||||||||||||
Net realized investment (gains) losses | — | (53) | 33 | (461) | |||||||||||||||||||
Gain from change in fair value warrant liability | — | (1,020) | — | (1,113) | |||||||||||||||||||
Capital market transaction costs | — | (55) | — | 205 | |||||||||||||||||||
Adjusted income before tax | 104,049 | 96,061 | 200,255 | 182,567 | |||||||||||||||||||
Income tax (benefit) expense on adjustments (1) | — | (23) | 7 | (54) | |||||||||||||||||||
Adjusted net income | $ | 80,284 | $ | 74,339 | $ | 154,768 | $ | 141,809 | |||||||||||||||
Weighted average diluted shares outstanding | 84,190 | 86,577 | 84,504 | 86,943 | |||||||||||||||||||
Adjusted diluted EPS | $ | 0.95 | $ | 0.86 | $ | 1.83 | $ | 1.63 |
Consolidated balance sheets | June 30, 2023 | December 31, 2022 | |||||||||
(In Thousands) | |||||||||||
Total investment portfolio | $ | 2,233,656 | $ | 2,099,389 | |||||||
Cash and cash equivalents | 73,319 | 44,426 | |||||||||
Premiums receivable | 72,367 | 69,680 | |||||||||
Deferred policy acquisition costs, net | 61,162 | 58,564 | |||||||||
Software and equipment, net | 32,262 | 31,930 | |||||||||
Reinsurance recoverable | 24,023 | 21,587 | |||||||||
Prepaid federal income tax | 154,409 | 154,409 | |||||||||
Other assets | 38,652 | 36,045 | |||||||||
Total assets | $ | 2,689,850 | $ | 2,516,030 | |||||||
Debt | $ | 396,808 | $ | 396,051 | |||||||
Unearned premiums | 105,067 | 123,035 | |||||||||
Accounts payable and accrued expenses | 72,506 | 74,576 | |||||||||
Reserve for insurance claims and claim expenses | 110,448 | 99,836 | |||||||||
Reinsurance funds withheld | 1,696 | 2,674 | |||||||||
Deferred tax liability, net | 242,144 | 193,859 | |||||||||
Other liabilities | 12,226 | 12,272 | |||||||||
Total liabilities | 940,895 | 902,303 | |||||||||
Total shareholders' equity | 1,748,955 | 1,613,727 | |||||||||
Total liabilities and shareholders' equity | $ | 2,689,850 | $ | 2,516,030 |
Consolidated cash flows | For the six months ended June 30, | ||||||||||
2023 | 2022 | ||||||||||
Net cash provided by (used in): | (In Thousands) | ||||||||||
Operating activities | $ | 191,740 | $ | 173,834 | |||||||
Investing activities | (119,470) | (147,756) | |||||||||
Financing activities | (43,377) | (30,326) | |||||||||
Net increase in cash and cash equivalents | $ | 28,893 | $ | (4,248) |
Percentage of portfolio's fair value | June 30, 2023 | December 31, 2022 | |||||||||
Corporate debt securities | 58 | % | 60 | % | |||||||
Municipal debt securities | 26 | 23 | |||||||||
Cash, cash equivalents, and short-term investments | 9 | 10 | |||||||||
U.S. Treasury securities and obligations of U.S. government agencies | 4 | 4 | |||||||||
Asset-backed securities | 3 | 3 | |||||||||
Total | 100 | % | 100 | % |
Investment portfolio ratings at fair value (1) | June 30, 2023 | December 31, 2022 | |||||||||
AAA | 14 | % | 19 | % | |||||||
AA(2) | 29 | 25 | |||||||||
A(2) | 43 | 41 | |||||||||
BBB(2) | 14 | 15 | |||||||||
BB (3) | — | — | |||||||||
Total | 100 | % | 100 | % |
($ In Thousands, except for per share data) | Total Number of Shares Purchased | Average Price Paid per Share | Total Number of Shares Purchased as Part of Publicly Announced Plans or Programs (1) | Approximate Dollar Value of Shares That May Yet Be Purchased Under the Plans or Program (1) | ||||||||||||||||||||||
Period: | ||||||||||||||||||||||||||
4/1/2023 to 4/30/2023 | — | $ | — | — | $ | 53,697 | ||||||||||||||||||||
5/1/2023 to 5/31/2023 | 564,735 | 24.20 | 564,735 | 40,028 | ||||||||||||||||||||||
6/1/2023 to 6/30/2023 | 481,249 | 25.56 | 481,249 | 27,725 | ||||||||||||||||||||||
Total | 1,045,984 | $ | — | 1,045,984 |
Exhibit Number | Description | |||||||
3.1 | Second Amended and Restated Certificate of Incorporation (incorporated herein by reference to Exhibit 3.1 to our Form S-1 Registration Statement (Registration No. 333-191635), filed on October 9, 2013) | |||||||
3.2 | Fourth Amended and Restated By-Laws (incorporated herein by reference to Exhibit 3.2 to our Form 8-K, filed on November 10, 2022) | |||||||
4.1 | Indenture, dated as of June 19, 2020, among NMI Holdings, Inc., NMI Services, Inc. as the Initial Guarantor, and the Bank of New York Mellon Trust Company, N.A. as Trustee and Notes Collateral Agent (incorporated herein by reference to Exhibit 4.1 to our Form 8-K, filed on June 19, 2020) | |||||||
4.2 | Description of Securities (incorporated by reference to Exhibit 4.8 to our Form 10-8, filed on February 16, 2022) | |||||||
10.1 ~ | NMI Holdings, Inc. 2012 Stock Incentive Plan (incorporated herein by reference to Exhibit 10.1 to our Form S-1 Registration Statement (Registration No. 333-191635), filed on October 9, 2013) | |||||||
10.2 ~ | Form of NMI Holdings, Inc. 2012 Stock Incentive Plan Restricted Stock Unit Award Agreement (For Management) (Other than CEO and CFO) (incorporated herein by reference to Exhibit 10.3 to our Form S-1 Registration Statement (Registration No. 333-191635), filed on October 9, 2013) | |||||||
10.3 ~ | Form of NMI Holdings, Inc. 2012 Stock Incentive Plan Nonqualified Stock Option Award Agreement (For CEO and CFO) (incorporated herein by reference to Exhibit 10.5 to our Form S-1 Registration Statement (Registration No. 333-191635), filed on October 9, 2013) | |||||||
10.4 ~ | Form of NMI Holdings, Inc. 2012 Stock Incentive Plan Nonqualified Stock Option Award Agreement (For Management) (incorporated herein by reference to Exhibit 10.6 to our Form S-1 Registration Statement (Registration No. 333-191635), filed on October 9, 2013) | |||||||
10.5 ~ | Form of NMI Holdings, Inc. 2012 Stock Incentive Plan Nonqualified Stock Option Award Agreement (For Non-Employee Directors) (incorporated herein by reference to Exhibit 10.7 to our Form S-1 Registration Statement (Registration No. 333-191635), filed on October 9, 2013) | |||||||
10.6 ~ | Form of NMI Holdings, Inc. 2012 Stock Incentive Plan Nonqualified Stock Option Award Agreement (For CEO/CFO) (incorporated herein by reference to Exhibit 10.8 to our Form 10-K, filed on February 17, 2017) | |||||||
10.7 ~ | Form of NMI Holdings, Inc. 2012 Stock Incentive Plan Nonqualified Stock Option Award Agreement (For Employees) (incorporated herein by reference to Exhibit 10.9 to our Form 10-K, filed on February 17, 2017) | |||||||
10.8 ~ | Form of NMI Holdings, Inc. 2012 Stock Incentive Plan Restricted Stock Unit Award Agreement (For Independent Directors) (incorporated herein by reference to Exhibit 10.30 to our Form 10-Q, filed on May 2, 2019) | |||||||
10.9 ~ | Form of NMI Holdings, Inc. 2012 Stock Incentive Plan Restricted Stock Unit Award Agreement (For Employees) (incorporated herein by reference to Exhibit 10.31 to our Form 10-Q, filed on May 2, 2019) | |||||||
10.10 ~ | Form of NMI Holdings, Inc. 2012 Stock Incentive Plan Nonqualified Stock Option Agreement (For Employees) (incorporated herein by reference to Exhibit 10.32 to our Form 10-Q, filed on May 2, 2019) | |||||||
10.11 ~ | NMI Holdings, Inc. Amended and Restated 2014 Omnibus Incentive Plan (incorporated herein by reference to Appendix A to our 2022 Annual Proxy Statement, filed on March 29, 2022) | |||||||
10.12 ~ | Form of NMI Holdings, Inc. Amended and Restated 2014 Omnibus Incentive Plan Restricted Stock Unit Award Agreement (For CEO) (incorporated herein by reference to Exhibit 10.19 to our Form 10-Q filed on August 1, 2017) | |||||||
10.13 ~ | Form of NMI Holdings, Inc. Amended and Restated 2014 Omnibus Incentive Plan Restricted Stock Unit Award Agreement (For Executive Officers) (incorporated herein by reference to Exhibit 10.20 to our Form 10-Q filed on August 1, 2017) | |||||||
10.14 ~ | Form of NMI Holdings, Inc. Amended and Restated 2014 Omnibus Incentive Plan Restricted Stock Unit Award Agreement (For Employees) (incorporated herein by reference to Exhibit 10.21 to our Form 10-Q filed on August 1, 2017) | |||||||
10.15 ~ | Form of NMI Holdings, Inc. Amended and Restated 2014 Omnibus Incentive Plan Restricted Stock Unit Award Agreement (For Independent Directors) (incorporated herein by reference to Exhibit 10.22 to our Form 10-Q filed on August 1, 2017) | |||||||
10.16 ~ | Form of NMI Holdings, Inc. Amended and Restated 2014 Omnibus Incentive Plan Nonqualified Stock Option Award Agreement (For CEO) (incorporated herein by reference to Exhibit 10.23 to our Form 10-Q filed on August 1, 2017) |
10.17 ~ | Form of NMI Holdings, Inc. Amended and Restated 2014 Omnibus Incentive Plan Nonqualified Stock Option Award Agreement (For Executive Officers and Employees) (incorporated herein by reference to Exhibit 10.24 to our Form 10-Q filed on August 1, 2017) | |||||||
10.18 ~ | Form of NMI Holdings, Inc. Amended and Restated 2014 Omnibus Incentive Plan Restricted Stock Unit Award Agreement (Performance Based) (incorporated herein by reference to Exhibit 10.38 to our Form 10-Q, filed on May 7, 2020) | |||||||
10.19 ~ | Form of NMI Holdings, Inc. Amended and Restated 2014 Omnibus Incentive Plan Restricted Stock Unit Award Agreement (For Independent Directors) (incorporated herein by reference to Exhibit 10.33 to our Form 10-Q, filed on May 2, 2019) | |||||||
10.20 ~ | Form of NMI Holdings, Inc. Amended and Restated 2014 Omnibus Incentive Plan Restricted Stock Unit Award Agreement (For Employees) (incorporated herein by reference to Exhibit 10.34 to our Form 10-Q, filed on May 2, 2019) | |||||||
10.21 ~ | Form of NMI Holdings, Inc. Amended and Restated 2014 Omnibus Incentive Plan Nonqualified Stock Option Agreement (For Employees) (incorporated herein by reference to Exhibit 10.35 to our Form 10-Q, filed on May 2, 2019) | |||||||
10.22 ~ | Form of Indemnification Agreement between NMI Holdings, Inc. and its directors and certain executive officers (incorporated herein by reference to Exhibit 10.1 to our Form 8-K, filed on November 25, 2014) | |||||||
10.23 ~ | NMI Holdings, Inc. Severance Benefit Plan (incorporated herein by reference to Exhibit 10.1 to our Form 8-K, filed on February 17, 2016) | |||||||
10.24 ~ | NMI Holdings, Inc. Amended and Restated Change in Control Severance Benefit Plan (incorporated herein by reference to Exhibit 10.30 to our Form 10-Q, filed on October 30, 2018) | |||||||
10.25 ~ | NMI Holdings, Inc. Clawback Policy (incorporated herein by reference to Exhibit 10.2 to our Form 8-K, filed on February 23, 2017) | |||||||
10.26 ~ | Offer Letter by and between NMI Holdings, Inc. and William Leatherberry, dated July 11, 2014 (incorporated herein by reference to Exhibit 10.10 to our Form 10-Q, filed on April 28, 2016) | |||||||
10.27 ~ | Employment Letter by and between NMI Holdings, Inc. and Bradley M. Shuster, effective as of January 1, 2019 (incorporated herein by reference to Exhibit 10.1 to our Form 8-K, filed on December 28, 2018) | |||||||
10.28 ~ | Offer Letter by and between NMI Holdings, Inc. and Adam Pollitzer, dated September 9, 2021 (incorporated herein by reference to Exhibit 10.1 to our Form 8-K, filed on September 9, 2021) | |||||||
10.29 ~ | Offer letter by and between NMI Holdings, Inc. and Ravi Mallela, dated December 20, 2021 (incorporated herein by reference to Exhibit 10.1 to our Form 8-K, filed on December 21, 2021) | |||||||
10.30 + | Commitment Letter dated July 12, 2013 for Bulk Fannie Mae-Paid Loss-on-Sale Mortgage Insurance on the Portfolio of approximately $5.46 billion Purchased by Fannie Mae and Identified by Fannie Mae as Deal No. 2013 MIRT 01 and by the Company as Policy No. P-0001-01 (incorporated herein by reference to Exhibit 10.14 to our Form S-1 Registration Statement (Registration No. 333-191635), filed on October 9, 2013) | |||||||
10.31 | Amended and Restated Credit Agreement, dated as of November 29, 2021, by and among the Company, the lender parties thereto and JPMorgan Chase Bank, N.A., as administrative agent (incorporated herein by reference to Exhibit 10.1 to our Form 8-K filed on November 30, 2021) | |||||||
21.1 | Subsidiaries of NMI Holdings, Inc. (incorporated herein by reference to Exhibit 21.1 to our Form 10-Q, filed on October 30, 2015) | |||||||
22.1 | Guaranteed Securities by Subsidiary Guarantor (incorporated herein by reference to Exhibit 22.1 to our Form 10-K, filed on February 16, 2022) | |||||||
31.1 | ||||||||
31.2 | ||||||||
32.1 # | ||||||||
101 | The following financial information from NMI Holdings, Inc.'s Quarterly Report on Form 10-Q for the quarter ended June 30, 2023 (Unaudited) formatted in XBRL (eXtensible Business Reporting Language): | |||||||
(i) Condensed Consolidated Balance Sheets as of June 30, 2023 (Unaudited) and December 31, 2022; | ||||||||
(ii) Condensed Consolidated Statements of Operations and Comprehensive Income (Loss) for the three and six months ended June 30, 2023 and 2022 (Unaudited); | ||||||||
(iii) Condensed Consolidated Statements of Changes in Shareholders' Equity for the three months ended June 30, 2023 and 2022 (Unaudited); |
(iv) Condensed Consolidated Statements of Cash Flows for the six months ended June 30, 2023 and 2022 (Unaudited); and | ||||||||
(v) Notes to Condensed Consolidated Financial Statements (Unaudited). The instance document does not appear in the Interactive Data File because XBRL tags are embedded within the Inline XBRL document. | ||||||||
104 | The cover page from NMI Holdings, Inc.'s Quarterly Report on Form 10-Q for the quarter ended June 30, 2023 (formatted as Inline XBRL and contained in Exhibit 101). |
~ | Indicates a management contract or compensatory plan or contract. | ||||
+ | Confidential treatment granted as to certain portions, which portions have been filed separately with the SEC. | ||||
# | In accordance with Item 601(b)(32)(ii) of Regulation S-K and SEC Release No. 34-47986, the certifications furnished in Exhibit 32.1 hereto are deemed to accompany this Form 10-Q and will not be deemed "filed" for purposes of Section 18 of the Exchange Act or deemed to be incorporated by reference into any filing under the Exchange Act or the Securities Act except to the extent that the registrant specifically incorporates it by reference. |
NMI HOLDINGS, INC. | |||||
Date: August 1, 2023 | |||||
By: /s/ Ravi Mallela | |||||
Name: Ravi Mallela | |||||
Title: Chief Financial Officer and Duly Authorized Signatory |
Description of Securities | ||
7.375% senior secured notes due June 19, 2025. | ||
Variable interest senior secured revolving credit facility due earlier of (x) November 29, 2025 or (y) if any existing senior secured notes remaining outstanding on such date, February 28, 2025. |
August 1, 2023 | /s/ Adam S. Pollitzer | ||||
Adam S. Pollitzer | |||||
Chief Executive Officer | |||||
(Principal Executive Officer) |
August 1, 2023 | /s/ Ravi Mallela | ||||
Ravi Mallela | |||||
Chief Financial Officer | |||||
(Principal Financial Officer) | |||||
August 1, 2023 | |||||
/s/ Adam S. Pollitzer | |||||
Adam S. Pollitzer | |||||
Chief Executive Officer | |||||
(Principal Executive Officer) |
August 1, 2023 | |||||
/s/ Ravi Mallela | |||||
Ravi Mallela | |||||
Chief Financial Officer | |||||
(Principal Financial Officer) |
CONDENSED CONSOLIDATED BALANCE SHEETS (UNAUDITED) (Parenthetical) - USD ($) $ in Thousands |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Statement of Financial Position [Abstract] | ||
Debt securities, amortized cost | $ 2,465,556 | $ 2,352,747 |
Restricted cash | $ 2,222 | $ 2,176 |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Common stock, issued (in shares) | 86,925,030 | 86,472,742 |
Common stock, outstanding (in shares) | 82,289,763 | 83,549,879 |
Common stock, authorized (in shares) | 250,000,000 | 250,000,000 |
Treasury stock, common shares (in shares) | 4,635,267 | 2,922,863 |
CONDENSED CONSOLIDATED STATEMENTS OF OPERATIONS AND COMPREHENSIVE INCOME (LOSS) (UNAUDITED) (Parenthetical) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Income Statement [Abstract] | ||||
Unrealized (losses) gains in accumulated other comprehensive (loss) income (loss), tax (benefit) expense | $ (4,120) | $ (17,004) | $ 4,513 | $ (43,180) |
Reclassification adjustment for realized gains (losses) included in net income, tax (benefit) expense | $ 0 | $ 11 | $ (7) | $ 97 |
CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN SHAREHOLDERS' EQUITY (UNAUDITED) (Parenthetical) - USD ($) $ in Thousands |
3 Months Ended | |||
---|---|---|---|---|
Jun. 30, 2023 |
Mar. 31, 2023 |
Jun. 30, 2022 |
Mar. 31, 2022 |
|
Statement of Stockholders' Equity [Abstract] | ||||
Change in unrealized investment gains/losses, tax expense (benefit) | $ (4,120) | $ 8,640 | $ (17,015) | $ (26,262) |
Common stock, par value (in dollars per share) | $ 0.01 | $ 0.01 |
Organization, Basis of Presentation and Summary of Accounting Principles |
6 Months Ended |
---|---|
Jun. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Organization, Basis of Presentation and Summary of Accounting Principles | Organization, Basis of Presentation and Summary of Accounting Principles NMI Holdings, Inc. (NMIH) is a Delaware corporation, incorporated in May 2011 to provide private mortgage guaranty insurance (which we refer to as mortgage insurance or MI) through its wholly-owned insurance subsidiaries, National Mortgage Insurance Corporation (NMIC) and National Mortgage Reinsurance Inc One (Re One). Our common stock is listed on the Nasdaq exchange under the ticker symbol "NMIH." NMIC, our primary insurance subsidiary, issued its first mortgage insurance policy in April 2013. NMIC is licensed to write mortgage insurance in all 50 states and the District of Columbia (D.C.). Re One historically provided reinsurance coverage to NMIC in accordance with certain statutory risk retention requirements. Such requirements have been repealed and the reinsurance coverage provided by Re One to NMIC has been commuted. Re One remains a wholly-owned, licensed insurance subsidiary; however, it does not currently have active insurance exposures. In August 2015, NMIH capitalized a wholly-owned subsidiary, NMI Services, Inc. (NMIS), through which we offer outsourced loan review services to mortgage loan originators. Basis of Presentation The accompanying unaudited condensed consolidated financial statements, which include the results of NMIH and its wholly-owned subsidiaries, have been prepared in accordance with the instructions to Form 10-Q as prescribed by the SEC for interim reporting and include other information and disclosures required by accounting principles generally accepted in the U.S. (GAAP). Our accounts are maintained in U.S. dollars. These statements should be read in conjunction with our consolidated financial statements and notes thereto for the year ended December 31, 2022, included in our 2022 10-K. All intercompany transactions have been eliminated. Certain reclassifications to previously reported financial information have been made to conform to our current period presentation. The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that affect reported amounts of assets and liabilities, as well as disclosure of contingent assets and liabilities as of the balance sheet date. Estimates also affect the reported amounts of income and expenses for the reporting period. Actual results could differ from those estimates. The results of operations for the interim period may not be indicative of the results that may be expected for the full year ending December 31, 2023. Significant Accounting Principles There have been no changes to our significant accounting principles as described in Item 8, "Financial Statements and Supplementary Data - Notes to Consolidated Financial Statements - Note 2 - Summary of Accounting Principles" of our 2022 10-K, except as noted in "Recent Accounting Pronouncements - Adopted" below. Recent Accounting Pronouncements - Adopted In August 2018, the Financial Accounting Standards Board (the FASB) issued ASU 2018-12, Targeted Improvements to the Accounting for Long-Duration Contracts (Topic 944). The update provides guidance to the existing recognition, measurement, presentation and disclosure requirements for long-duration contracts issued by an insurance entity. The FASB subsequently issued ASU 2019-09 in November 2019 and ASU 2020-11 in November 2020, which amended the effective date for this standard and provided transition relief to facilitate early application for long duration contracts. The standard will now take effect for public business entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2022. We adopted this ASU on January 1, 2023 and determined it did not have a material impact on our consolidated financial statements. Recent Accounting Pronouncements - Not Yet Adopted In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848). The update provides optional guidance to ease the potential burden in accounting for reference rate reform on financial reporting. Reference rate reform refers to the global transition away from referencing the London Interbank Offered Rate (LIBOR) in financial contracts, which is expected to be discontinued during a transition period from 2021 through 2023. The ASU includes optional expedients and exceptions for applying GAAP to contracts, hedging relationships and other transactions affected by reference rate reform if certain criteria are met. This standard may be elected and applied prospectively over time from March 12, 2020 through December 31, 2022 as reference rate reform activities occur. In December 2022, the FASB issued ASU 2022-06, which extended the sunset date of Topic 848 from December 31, 2022 to December 31, 2024. We continue to monitor the impact the discontinuance of LIBOR will have on our contracts and other transactions; however, the adoption of, and future elections under ASU 2020-04 and ASU 2022-06 are not expected to have a material impact on our consolidated financial statements as the ASUs will ease, if warranted, the requirements for accounting for the future effects of the rate reform.
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Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Investments | Investments We hold all investments on an available-for-sale basis at fair value on our condensed consolidated balance sheets and evaluate each position quarterly for impairment. We recognize an impairment on a security through the statement of operations if (i) we intend to sell the impaired security; or (ii) it is more likely than not that we will be required to sell the impaired security prior to recovery of its amortized cost basis. If a sale is intended or likely to be required, we recognize an impairment loss equivalent to the difference of the amortized cost basis of the security and its fair value through the condensed consolidated statement of operations and comprehensive income as a "Net Realized Investment Loss." In the event of an impairment of a security that we intend to and have the ability to hold to maturity, we evaluate the drivers of the impairment to determine the portion that is credit related and the portion that is non-credit related. The portion of impairment loss that is attributed to credit related factors is recognized through the statement of operations as a provision for credit loss and the portion that is attributed to non-credit related factors is recognized in other comprehensive income, net of taxes. Fair Values and Gross Unrealized Gains and Losses on Investments
We did not own any mortgage-backed securities in our asset-backed securities portfolio at June 30, 2023 or December 31, 2022. The following table presents a breakdown of the fair value of our corporate debt securities by issuer industry group as of June 30, 2023 and December 31, 2022:
As of June 30, 2023 and December 31, 2022, approximately $5.3 million and $5.4 million, respectively, of our cash and investments were held in the form of U.S. Treasury securities on deposit with various state insurance departments to satisfy regulatory requirements. Scheduled Maturities The amortized cost and fair value of available-for-sale securities as of June 30, 2023 and December 31, 2022, by contractual maturity, are shown below. Expected maturities will differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties. Because most asset-backed securities provide for periodic payments throughout their lives, they are listed below in a separate category.
Aging of Unrealized Losses As of June 30, 2023, the investment portfolio had gross unrealized losses of $234.6 million, of which $224.9 million were associated with securities that had been in an unrealized loss position for a period of twelve months or longer. As of December 31, 2022, the investment portfolio had gross unrealized losses of $254.7 million, of which $218.5 million were associated with securities that had been in an unrealized loss position for a period of twelve months or longer. For those securities in an unrealized loss position, the length of time the securities were in such a position is as follows:
Allowance for credit losses As of June 30, 2023 and December 31, 2022, we did not recognize an allowance for credit loss for any security in the investment portfolio and we did not record any provision for credit loss for investment securities during the three or six month periods ended June 30, 2023 or June 30, 2022. We evaluated the securities in an unrealized loss position as of June 30, 2023, assessing their credit ratings as well as any adverse conditions specifically related to the security. Based upon our estimate of the amount and timing of cash flows to be collected over the remaining life of each instrument, we believe the unrealized losses as of June 30, 2023 are not indicative of the ultimate collectability of the current amortized cost of the securities. Rather, the unrealized losses on securities held as of June 30, 2023 were primarily driven by fluctuations in interest rates, and to a lesser extent, movements in credit spreads following the purchase of those securities. Net Investment Income The following table presents the components of net investment income:
The following table presents the components of net realized investment gains (losses):
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Fair Value of Financial Instruments |
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Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value of Financial Instruments | Fair Value of Financial Instruments The following describes the valuation techniques used by us to determine the fair value of our financial instruments: We established a fair value hierarchy by prioritizing the inputs to valuation techniques used to measure fair value. The hierarchy gives the highest priority to unadjusted quoted prices in active markets for identical assets or liabilities (Level 1 measurements) and the lowest priority to unobservable inputs (Level 3 measurements). The three levels of the fair value hierarchy under this standard are described below: Level 1 - Fair value measurements based on quoted prices in active markets that we have the ability to access for identical assets or liabilities. Market price data generally is obtained from exchange or dealer markets. We do not adjust the quoted price for such instruments. Level 2 - Fair value measurements based on inputs other than quoted prices included in Level 1 that are observable for the asset or liability, either directly or indirectly. Level 2 inputs include quoted prices for similar assets and liabilities in active markets, quoted prices for identical or similar assets or liabilities in markets that are not active, and inputs other than quoted prices that are observable for the asset or liability, such as interest rates and yield curves that are observable at commonly quoted intervals. Level 3 - Fair value measurements based on valuation techniques that use significant inputs that are unobservable. Both observable and unobservable inputs may be used to determine the fair values of positions classified in Level 3. The circumstances for using these measurements include those in which there is little, if any, market activity for the asset or liability. Therefore, we must make certain assumptions, which require significant management judgment or estimation about the inputs a hypothetical market participant would use to value that asset or liability. In certain cases, the inputs used to measure fair value may fall into different levels of the fair value hierarchy. In such cases, the level in the fair value hierarchy is determined based on the lowest level input that is significant to the fair value measurement in its entirety. Assets classified as Level 1 and Level 2 To determine the fair value of securities available-for-sale in Level 1 and Level 2 of the fair value hierarchy, independent pricing sources have been utilized. One price is provided per security based on observable market data. To ensure securities are appropriately classified in the fair value hierarchy, we review the pricing techniques and methodologies of the independent pricing sources and believe that their policies adequately consider market activity, either based on specific transactions for the issue valued or based on modeling of securities with similar credit quality, duration, yield and structure that were recently traded. A variety of inputs are utilized by the independent pricing sources including benchmark yields, reported trades, non-binding broker/dealer quotes, issuer spreads, two sided markets, benchmark securities, bids, offers and reference data including data published in market research publications. Inputs may be weighted differently for any security, and not all inputs are used for each security evaluation. Market indicators, industry and economic events are also considered. This information is evaluated using a multidimensional pricing model. Quality controls are performed by the independent pricing sources throughout this process, which include reviewing tolerance reports, trading information and data changes, and directional moves compared to market moves. This model combines all inputs to arrive at a value assigned to each security. We have not made any adjustments to the prices obtained from the independent pricing sources. The following tables present the level within the fair value hierarchy at which our financial instruments were measured:
There were no transfers between Level 2 and Level 3 of the fair value hierarchy during the six months ended June 30, 2023, or the year ended December 31, 2022. Financial Instruments not Measured at Fair Value On June 19, 2020, we issued $400 million aggregate principal amount of senior secured notes that mature on June 1, 2025 (the Notes) and used a portion of the proceeds from the Notes offering to repay the outstanding amount due under our $150 million term loan (2018 Term Loan). At June 30, 2023, the Notes were carried at a cost of $396.8 million, net of unamortized debt issuance costs of $3.2 million, and had a fair value of $405.6 million as assessed under our Level 2 hierarchy. At December 31, 2022, the Notes were carried at a cost of $396.1 million, net of unamortized debt issuance costs of $3.9 million, and had a fair value of $405.9 million.
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Jun. 30, 2023 | |
Debt Disclosure [Abstract] | |
Debt | Debt Senior Secured Notes At June 30, 2023, we had $400 million aggregate principal amount of senior secured notes outstanding. The Notes were issued pursuant to an indenture dated June 19, 2020 (the Indenture) and bear interest at a rate of 7.375%, payable semi-annually on June 1 and December 1. The Notes mature on June 1, 2025. At any time, or from time to time, prior to March 1, 2025, we may elect to redeem the Notes in whole or in part at a price based on 100% of the aggregate principal amount of any Notes redeemed plus the "Applicable Premium," plus accrued and unpaid interest thereon. Applicable Premium is defined as the greater of (1) 1.0% of the principal amount of the Notes, or (2) the excess of the present value of the principal value of the Notes plus all future interest payments over the principal amount. At any time on or after March 1, 2025, we may elect to redeem the Notes in whole or in part at a price equal to 100% of the aggregate principal amount of the Notes to be redeemed plus accrued and unpaid interest thereon. Interest expense for the Notes includes interest and the amortization of capitalized debt issuance costs. In connection with the Notes offering, we recorded capitalized debt issuance costs of $7.4 million. Such amounts will be amortized over the contractual life of the Notes using the effective interest method. The effective interest rate on the Notes is 7.825%. At June 30, 2023 and December 31, 2022, approximately $3.2 million and $3.9 million, respectively, of unamortized debt issuance costs remained. At June 30, 2023 and December 31, 2022, $2.5 million of accrued and unpaid interest on the Notes was included in "Accounts Payable and Accrued Expenses" on the condensed consolidated balance sheets. 2021 Revolving Credit Facility On November 29, 2021, we amended our $110 million senior secured revolving credit facility (the 2020 Revolving Credit Facility and as amended, the 2021 Revolving Credit Facility), expanding the lender group, increasing the revolving capacity to $250 million, and extending the maturity from February 22, 2023 to the earlier of (x) November 29, 2025, or (y) if any existing senior secured notes remain outstanding on such date, February 28, 2025. Borrowings under the 2021 Revolving Credit Facility may be used for general corporate purposes, including to support the growth of our new business production and operations, and accrue interest at a variable rate equal to, at our discretion, (i) a Base Rate (as defined in the 2021 Revolving Credit Facility) subject to a floor of 1.00% per annum) plus a margin of 0.375% to 1.875% per annum, or (ii) the Adjusted Term SOFR (as defined in the 2021 Revolving Credit Facility) plus a margin of 1.375% to 2.875% per annum, with the margin in each of (i) or (ii) based on our applicable corporate credit rating at the time. As of June 30, 2023 and December 31, 2022, no amounts were drawn under the 2021 Revolving Credit Facility. Under the 2021 Revolving Credit Facility, we are required to pay a quarterly commitment fee on the average daily undrawn amount of 0.175% to 0.525%, based on the applicable corporate credit rating at the time. As of June 30, 2023, the applicable commitment fee was 0.30%. For the three and six months ended June 30, 2023, we recorded $0.2 million and $0.4 million of commitment fees in interest expense, respectively. We incurred debt issuance costs of $1.1 million in connection with the 2021 Revolving Credit Facility and had $0.6 million of unamortized debt issuance costs associated with the 2020 Revolving Credit Facility remaining at the time of its amendment and replacement. Combined unamortized debt issuance costs are amortized through interest expense on a straight-line basis over the contractual life of the 2021 Revolving Credit Facility. At June 30, 2023 and December 31, 2022, remaining unamortized deferred debt issuance costs were $1.0 million and $1.2 million, respectively. We are subject to certain covenants under the 2021 Revolving Credit Facility, including, but not limited to, the following: a maximum debt-to-total capitalization ratio of 35%, compliance with the private mortgage insurer eligibility requirements (PMIERs) financial requirements (subject to any GSE approved waivers), and minimum consolidated net worth and statutory capital requirements (respectively, as defined therein). We were in compliance with all covenants at June 30, 2023.
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Reinsurance Disclosures [Abstract] | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reinsurance | ReinsuranceWe enter into third-party reinsurance transactions to actively manage our risk, ensure compliance with PMIERs, state regulatory and other applicable capital requirements, (respectively, as defined therein), and support the growth of our business. The Wisconsin Office of the Commissioner of Insurance (Wisconsin OCI) has approved and the GSEs have indicated their non-objection to all such transactions (subject to certain conditions and ongoing review, including levels of approved capital credit). The effect of our reinsurance agreements on premiums written and earned is as follows:
(1) Net of profit commission. Excess-of-loss reinsurance Insurance-linked notes NMIC is a party to reinsurance agreements with Oaktown Re II Ltd., Oaktown Re III Ltd., Oaktown Re V Ltd., Oaktown Re VI Ltd., and Oaktown Re VII Ltd. (special purpose reinsurance entities collectively referred to as the Oaktown Re Vehicles) effective July 25, 2018, July 30, 2019, October 29, 2020, April 27, 2021, and October 26, 2021, respectively. Each agreement provides NMIC with aggregate excess-of-loss reinsurance coverage on a defined portfolio of mortgage insurance policies. Under each agreement, NMIC retains a first layer of aggregate loss exposure on covered policies and the respective Oaktown Re Vehicle then provides second layer loss protection up to a defined reinsurance coverage amount. NMIC then retains losses in excess of the respective reinsurance coverage amounts. NMIC makes risk premium payments to the Oaktown Re Vehicles for the applicable outstanding reinsurance coverage amount and pays an additional amount for anticipated operating expenses (capped at $250 thousand per year). NMIC ceded aggregate premiums to the Oaktown Re Vehicles of $8.8 million and $17.9 million during the three and six months ended June 30, 2023, respectively, and $10.1 million and $21.1 million during the three and six months ended June 30, 2022, respectively. NMIC applies claims paid on covered policies against its first layer aggregate retained loss exposure under each excess-of-loss agreement. NMIC did not cede any incurred losses on covered policies to the Oaktown Re Vehicles during the three and six months ended June 30, 2023 and 2022, as the aggregate first layer risk retention for each applicable agreement was not exhausted during such periods. Under the terms of each excess-of-loss reinsurance agreement, the Oaktown Re Vehicles are required to fully collateralize their outstanding reinsurance coverage amount to NMIC with funds deposited into segregated reinsurance trusts. Such trust funds are required to be invested in short-term U.S. Treasury money market funds at all times. Each Oaktown Re Vehicle financed its respective collateral requirement through the issuance of mortgage insurance-linked notes to unaffiliated investors. Such insurance-linked notes mature ten years from the inception date of each reinsurance agreement (except the notes issued by Oaktown Re VI Ltd. and Oaktown Re VII Ltd., which have a 12.5-year maturity). We refer to NMIC's reinsurance agreements with and the insurance-linked note issuances by Oaktown Re Vehicles individually as the 2018 ILN Transaction, 2019 ILN Transaction, 2020-2 ILN Transaction, 2021-1 ILN Transaction, and 2021-2 ILN Transaction, and collectively as the ILN Transactions. The respective reinsurance coverage amounts provided by the Oaktown Re Vehicles decrease over a ten-year period as the underlying insured mortgages are amortized or repaid, and/or the mortgage insurance coverage is canceled (except the coverage provided by Oaktown Re VI Ltd. and Oaktown Re VII Ltd., which decreases over a 12.5-year period). As the reinsurance coverage decreases, a prescribed amount of collateral held in trust by the Oaktown Re Vehicles is distributed to ILN Transaction noteholders as amortization of the outstanding insurance-linked note principal balances. The outstanding reinsurance coverage amounts stop amortizing, and the distribution of collateral assets to ILN Transaction noteholders and amortization of insurance-linked note principal is suspended if certain credit enhancement or delinquency thresholds, as defined in each agreement, are triggered (each, a Lock-Out Event). NMIC holds optional termination rights under each ILN Transaction, including, among others, an optional call feature which provides NMIC the discretion to terminate the transaction on or after a prescribed date, and a clean-up call if the outstanding reinsurance coverage amount amortizes to 10% or less of the reinsurance coverage amount at inception or if NMIC reasonably determines that changes to GSE or rating agency asset requirements would cause a material and adverse effect on the capital treatment afforded to NMIC under a given agreement. In addition, there are certain events that trigger mandatory termination of an agreement, including NMIC's failure to pay premiums or consent to reductions in a trust account to make principal payments to noteholders, among others. The following table presents the inception date, covered production period, initial and current reinsurance coverage amount, and initial and current first layer retained aggregate loss under each outstanding ILN Transaction. Current amounts are presented as of June 30, 2023.
(1) NMIC applies claims paid on covered policies against its first layer aggregate retained loss exposure and cedes reserves for incurred claims and claim expenses to each applicable ILN Transaction and recognizes a reinsurance recoverable if such incurred claims and claim expenses exceed its current first layer retained loss. (2) Approximately 1% of the production covered by the 2020-2 ILN Transaction has coverage reporting dates between July 1, 2019 and March 31, 2020. (3) Approximately 1% of the production covered by the 2021-1 ILN Transaction has coverage reporting dates between July 1, 2019 and September 30, 2020. (4) Approximately 2% of the production covered by the 2021-2 ILN Transaction has coverage reporting dates between July 1, 2019 and March 31, 2021. Under the terms of our ILN Transactions, we are required to maintain a certain level of restricted funds in premium deposit accounts with Bank of New York Mellon until the respective notes have been redeemed in full. "Cash and cash equivalents" on our condensed consolidated balance sheets includes restricted amounts of $2.2 million as of June 30, 2023 and December 31, 2022. The restricted balances required under these transactions will decline over time as the outstanding principal balance of the respective insurance-linked notes are amortized. Traditional reinsurance NMIC is a party to four excess-of-loss reinsurance agreements with broad panels of third-party reinsurers – the 2022-1 XOL Transaction, effective April 1, 2022, the 2022-2 XOL Transaction, effective July 1, 2022, the 2022-3 XOL Transaction, effective October 1, 2022, and the 2023-1 XOL Transaction, effective January 1, 2023 – which we refer to collectively as the XOL Transactions. Each XOL Transaction provides NMIC with aggregate excess-of-loss reinsurance coverage on a defined portfolio of mortgage insurance policies. Under each agreement, NMIC retains a first layer of aggregate loss exposure on covered policies and the reinsurers then provide second layer loss protection up to a defined reinsurance coverage amount. The reinsurance coverage amount of each XOL Transaction is set to approximate the PMIERs minimum required assets of its reference pool and decreases from the inception of each respective agreement (except 2023-1 XOL, which decreases from the end of the covered production period) over a ten-year period in the event the PMIERs minimum required assets of the pool declines. NMIC retains losses in excess of the outstanding reinsurance coverage amount. Under the terms of the XOL Transactions, NMIC makes risk premium payments to its third-party reinsurance providers for the outstanding reinsurance coverage amount and ceded aggregate premiums of $7.7 million and $14.9 million during the three and six months ended June 30, 2023, respectively, and $2.9 million during both the three and six months ended June 30, 2022. NMIC applies claims paid on covered policies against its first layer aggregate retained loss exposure under each agreement. NMIC did not cede any incurred losses on covered policies under the XOL Transactions during the three and six months ended June 30, 2023, as the aggregate first layer risk retention for each agreement was not exhausted during the period. NMIC holds optional termination rights which provide it the discretion to terminate each XOL Transaction on or after a specified date. NMIC may also elect to terminate the XOL Transactions at any point if the outstanding reinsurance coverage amount amortizes to 10% or less of the reinsurance coverage amount provided at inception, or if it determines that it will no longer be able to take full PMIERs asset credit for the coverage. Additionally, under the terms of the treaties, NMIC may selectively terminate its engagement with individual reinsurers under certain circumstances. Such selective termination rights arise when, among other reasons, a reinsurer experiences a deterioration in its capital position below a prescribed threshold, and/or a reinsurer breaches (and fails to cure) its collateral posting obligation. Each of the third-party reinsurance providers that is party to the XOL Transactions has an insurer financial strength rating of A- or better by Standard & Poor’s Rating Service (S&P), A.M. Best Company Inc. (A.M. Best) or both. The following table presents the inception date, covered production period, initial and current reinsurance coverage amount, and initial and current first layer retained aggregate loss under each outstanding XOL Transaction. Current amounts are presented as of June 30, 2023.
(1) NMIC applies claims paid on covered policies against its first layer aggregate retained loss exposure and cedes reserves for incurred claims and claim expenses to each applicable XOL Transaction and recognizes a reinsurance recoverable if such incurred claims and claim expenses exceed its current first layer retained loss. (2) Approximately 1% of the production covered by the 2022-1 XOL Transaction has coverage reporting dates between October 21, 2019 and September 30, 2021. (3) Approximately 1% of the production covered by the 2022-2 XOL Transaction has coverage reporting dates between January 4, 2021 and March 31, 2022. (4) The 2023-1 XOL Transaction provides coverage for production generated between October 1, 2022 and June 30, 2023. The current reinsurance coverage and current first layer retained loss will decrease in future periods to the extent the PMIERs minimum required assets of the covered pool declines. Quota share reinsurance NMIC is a party to seven quota share reinsurance treaties – the 2016 QSR Transaction, effective September 1, 2016, the 2018 QSR Transaction, effective January 1, 2018, the 2020 QSR Transaction, effective April 1, 2020, the 2021 QSR Transaction, effective January 1, 2021, the 2022 QSR Transaction, effective October 1, 2021, the 2022 Seasoned QSR Transaction, effective July 1, 2022 and the 2023 QSR Transaction, effective January 1, 2023 – which we refer to collectively as the QSR Transactions. Under each of the QSR Transactions, NMIC cedes a proportional share of its risk on eligible policies to panels of third-party reinsurance providers. Each of the third-party reinsurance providers that is party to the QSR Transactions has an insurer financial strength rating of A- or better by S&P, A.M. Best or both. Under the terms of the 2016 QSR Transaction, NMIC cedes premiums written related to 25% of the risk on eligible primary policies written for all periods through December 31, 2017 and 100% of the risk under our pool agreement with Fannie Mae. The 2016 QSR Transaction is scheduled to terminate on December 31, 2027, except with respect to the ceded pool risk, which is scheduled to terminate on August 31, 2023. NMIC has the option, based on certain conditions and subject to a termination fee, to terminate the agreement as of December 31, 2020, or at the end of any calendar quarter thereafter, which would result in NMIC recapturing the related risk. Under the terms of the 2018 QSR Transaction, NMIC cedes premiums earned related to 25% of the risk on eligible policies written in 2018 and 20% of the risk on eligible policies written in 2019. The 2018 QSR Transaction is scheduled to terminate on December 31, 2029. NMIC has the option, based on certain conditions and subject to a termination fee, to terminate the agreement as of December 31, 2022, or at the end of any calendar quarter thereafter, which would result in NMIC recapturing the related risk. Under the terms of the 2020 QSR Transaction, NMIC cedes premiums earned related to 21% of the risk on eligible policies written from April 1, 2020 to December 31, 2020. The 2020 QSR Transaction is scheduled to terminate on December 31, 2030. NMIC has the option, based on certain conditions and subject to a termination fee, to terminate the agreement as of December 31, 2023, or at the end of any calendar quarter thereafter, which would result in NMIC recapturing the related risk. Under the terms of the 2021 QSR Transaction, NMIC cedes premiums earned related to 22.5% of the risk on eligible policies written from January 1, 2021 to October 30, 2021. The 2021 QSR Transaction is scheduled to terminate on December 31, 2031. NMIC has the option, based on certain conditions and subject to a termination fee, to terminate the agreement as of December 31, 2024, or at the end of any calendar quarter thereafter, which would result in NMIC recapturing the related risk. Under the terms of the 2022 QSR Transaction, NMIC cedes premiums earned related to 20% of the risk on eligible policies written primarily between October 30, 2021 and December 31, 2022. The 2022 QSR Transaction is scheduled to terminate on December 31, 2032. NMIC has the option, based on certain conditions and subject to a termination fee, to terminate the agreement as of December 31, 2024 or semi-annually thereafter, which would result in NMIC recapturing the related risk. In connection with the 2022 QSR Transaction, NMIC entered into the 2023 QSR Transaction as a springing back-to-back quota share agreement. Under the terms of the 2023 QSR Transaction, NMIC cedes premiums earned related to 20% of the risk on eligible policies written from January 1, 2023 to December 31, 2023. The 2023 QSR Transaction is scheduled to terminate on December 31, 2033. NMIC has the option, based on certain conditions and subject to a termination fee, to terminate the agreement as of December 31, 2025 or semi-annually thereafter, which would result in NMIC recapturing the related risk. Under the terms of the 2022 Seasoned QSR Transaction, NMIC cedes premiums earned related to 95% of the net risk on eligible policies primarily for a seasoned pool of mortgage insurance policies that had previously been covered under the retired Oaktown Re Ltd. and Oaktown Re IV Ltd. reinsurance transactions, after the consideration of coverage provided by other QSR Transactions. The 2022 Seasoned QSR Transaction is scheduled to terminate on June 30, 2032. NMIC has the option, based on certain conditions, to terminate the agreement as of June 30, 2025 or quarterly thereafter through December 31, 2027 with the payment of a termination fee, and as of March 31, 2028 or quarterly thereafter without the payment of a termination fee. Such termination would result in NMIC recapturing the related risk. NMIC may terminate any or all of the QSR Transactions without penalty if, due to a change in PMIERs requirements, it is no longer able to take full PMIERs asset credit for the risk-in-force (RIF) ceded under the respective agreements. Additionally, under the terms of the QSR Transactions, NMIC may elect to selectively terminate its engagement with individual reinsurers on a run-off basis (i.e., reinsurers continue providing coverage on all risk ceded prior to the termination date, with no new cessions going forward) or cut-off basis (i.e., the reinsurance arrangement is completely terminated with NMIC recapturing all previously ceded risk) under certain circumstances. Such selective termination rights arise when, among other reasons, a reinsurer experiences a deterioration in its capital position below a prescribed threshold and/or a reinsurer breaches (and fails to cure) its collateral posting obligations under the relevant agreement. Effective April 1, 2019, NMIC elected to terminate its engagement with one reinsurer under the 2016 QSR Transaction on a cut-off basis. In connection with the termination, NMIC recaptured approximately $500 million of previously ceded primary RIF and stopped ceding new premiums earned or written with respect to the recaptured risk. With the termination, ceded premiums written under the 2016 QSR Transaction decreased from 25% to 20.5% on eligible policies. The termination has no effect on the cession of pool risk under the 2016 QSR Transaction. The following table shows amounts related to the QSR Transactions:
Ceded premiums written under the 2016 QSR Transaction are recorded on the balance sheet as prepaid reinsurance premiums and amortized to ceded premiums earned in a manner consistent with the recognition of revenue on direct premiums. Under all other QSR Transactions, premiums are ceded on an earned basis as defined in the agreement. NMIC receives a 20% ceding commission for premiums ceded under the QSR Transactions, except with respect to the 2022 Seasoned QSR Transaction under which it receives a 35% ceding commission. NMIC also receives a profit commission under each of the QSR Transactions, provided that the loss ratios on loans covered under the 2016, 2018, 2020, 2021, 2022, 2023 QSR and 2022 Seasoned QSR Transactions, generally remain below 60%, 61%, 50%, 57.5%, 62%, 62%, and 55% respectively, as measured annually. Ceded claims and claim expenses under each of the QSR Transactions reduce the respective profit commission received by NMIC on a dollar-for-dollar basis. In accordance with the terms of the 2016 QSR Transaction, rather than making a cash payment or transferring investments for ceded premiums written, NMIC established a funds withheld liability, which also includes amounts due to NMIC for ceding and profit commissions. Any loss recoveries and any potential profit commission to NMIC will be realized from this account until exhausted. NMIC's reinsurance recoverable balance is further supported by trust accounts established and maintained by each reinsurer in accordance with the PMIERs funding requirements for risk ceded to non-affiliates. The reinsurance recoverable on loss reserves related to the 2016 QSR Transaction was $1.9 million and $2.6 million as of June 30, 2023 and December 31, 2022, respectively. In accordance with the terms of the 2018, 2020, 2021, 2022 and 2023 QSR and 2022 Seasoned QSR Transactions, cash payments for ceded premiums earned are settled on a quarterly basis, offset by amounts due to NMIC for ceding and profit commissions. Any loss recoveries and any potential profit commission to NMIC are also recognized quarterly. NMIC's reinsurance recoverable balance is supported by trust accounts established and maintained by each reinsurer in accordance with the PMIERs funding requirements for risk ceded to non-affiliates. The aggregate reinsurance recoverable on loss reserves related to the 2018, 2020, 2021, 2022, 2023 QSR and 2022 Seasoned QSR Transactions was $22.1 million and $19.0 million as of June 30, 2023 and December 31, 2022, respectively. We remain directly liable for all claim payments if we are unable to collect reinsurance recoverable due from our reinsurers and, as such, we actively monitor and manage our counterparty credit exposure to our reinsurance providers. We establish an allowance for expected credit loss against our reinsurance recoverable if we do not expect to recover amounts due from one or more of our reinsurance counterparties, and report our reinsurance recoverable net of such allowance, if any. We actively monitor the counterparty credit profiles of our reinsurers and each is required to partially collateralize its obligations under the terms of our QSR Transactions. The allowance for credit loss established on our reinsurance recoverable was deemed immaterial at June 30, 2023 and December 31, 2022.
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Reserves for Insurance Claims and Claim Expenses |
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Reserves for Insurance Claims and Claim Expenses | Reserves for Insurance Claims and Claim ExpensesWe hold gross reserves in an amount equal to the estimated liability for insurance claims and claim expenses related to defaults on insured mortgage loans. A loan is considered to be in "default" as of the payment date at which a borrower has missed the preceding two or more consecutive monthly payments. We establish reserves for loans that have been reported to us in default by servicers, referred to as case reserves, and additional loans that we estimate (based on actuarial review and other factors) to be in default that have not yet been reported to us by servicers, referred to as incurred but not reported (IBNR) reserves. We also establish reserves for claim expenses, which represent the estimated cost of the claim administration process, including legal and other fees, as well as other general expenses of administering the claim settlement process. As of June 30, 2023, we had 4,349 primary loans in default and held gross reserves for insurance claims and claim expenses of $110.4 million. During the six months ended June 30, 2023, we paid 67 claims totaling $1.7 million, including 65 claims covered under the QSR Transactions representing $0.3 million of ceded claims and claim expenses. In 2013, we entered into a pool insurance transaction with Fannie Mae. The pool transaction includes a deductible, which represents the amount of claims to be absorbed by Fannie Mae before we are obligated to pay any claims. We only establish reserves for pool risk if we expect claims to exceed this deductible. At June 30, 2023, 37 loans in the pool were in default. These 37 loans represented approximately $2.8 million of RIF. Due to the size of the remaining deductible, our expectation that a limited number of loans in default will progress to a claim and the expected severity on such claim submissions (all loans in the pool had loan-to-value (LTV) ratios under 80% at origination), we did not establish any case or IBNR reserves for pool risk at June 30, 2023. In connection with the settlement of pool claims, we applied $1.0 million to the pool deductible through June 30, 2023. At June 30, 2023, the remaining pool deductible was $9.4 million. We have not paid any pool claims to date. 100% of our pool RIF is reinsured under the 2016 QSR Transaction. We had 4,349 loans in default in our primary insured portfolio as of June 30, 2023, which represented a 0.71% default rate against 611,441 total policies in-force and 4,449 loans in default in our primary portfolio as of December 31, 2022, which represented a 0.75% default rate against 594,142 total policies in-force. The size of the reserve we establish for each defaulted loan (and by extension our aggregate reserve for claims and claim expenses) reflects our best estimate of the future claim payment to be made for each individual loan in default. Our future claims exposure is a function of the number of defaulted loans that progress to claim payment (which we refer to as frequency) and the amount to be paid to settle such claims (which we refer to as severity). Our estimates of claims frequency and severity are not formulaic, rather they are broadly synthesized based on historical observed experience for similarly situated loans and assumptions about future macroeconomic factors. The following table provides a reconciliation of the beginning and ending gross reserve balances for primary insurance claims and claim expenses (benefits):
(1) Related to ceded losses recoverable under the QSR Transactions. See Note 5, "Reinsurance" for additional information. (2) Related to insured loans with their most recent defaults occurring in the current year. For example, if a loan defaulted in a prior year and subsequently cured and later re-defaulted in the current year, the default would be included in the current year. Amounts are presented net of reinsurance and included $39.1 million attributed to net case reserves and $5.0 million attributed to net IBNR reserves for the six months ended June 30, 2023 and $14.0 million attributed to net case reserves and $4.5 million attributed to net IBNR reserves for the six months ended June 30, 2022. (3) Related to insured loans with defaults occurring in prior years, which have been continuously in default before the start of the current year. Amounts are presented net of reinsurance and included $30.3 million attributed to net case reserves and $4.5 million attributed to net IBNR reserves for the six months ended June 30, 2023 and $17.0 million attributed to net case reserves and $4.7 million attributed to net IBNR reserves for the six months ended June 30, 2022. The "claims incurred" section of the table above shows claims and claim expenses (benefits) incurred on defaults occurring in current and prior years, including IBNR reserves, and is presented net of reinsurance. The amount of claims incurred relating to current year defaults increased during six months ended June 30, 2023, compared to the same period in the prior year, primarily driven by the establishment of initial reserves on newly defaulted loans and the increase in the average case reserve held against previously defaulted loans that have aged in their delinquency status. Our provision for claims and claim expenses during both six months ended June 30, 2023 and 2022 benefited from favorable development on prior year defaults. We recognized $35.3 million and $22.4 million of favorable prior year development during the six months ended June 30, 2023 and 2022, respectively, primarily due to cure activity and ongoing analysis of recent loss development trends. We may increase or decrease our claim estimates and reserves as we learn additional information about individual defaulted loans, and continue to observe and analyze loss development trends in our portfolio. Gross reserves of $53.1 million related to prior year defaults remained as of June 30, 2023.
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Earnings per Share (EPS) |
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Earnings per Share (EPS) | Earnings per Share (EPS) Basic EPS is based on the weighted average number of shares of common stock outstanding. Diluted EPS is based on the weighted average number of shares of common stock outstanding and common stock equivalents that would be issuable upon the vesting of service-based and performance and service-based restricted stock units (RSUs), and the exercise of vested and unvested stock options and outstanding warrants. The number of shares issuable for RSUs subject to performance and service-based vesting requirements are only included in diluted shares if the relevant performance measurement period has commenced and results during such period meet the necessary performance criteria. The following table reconciles the net income and the weighted average shares of common stock outstanding used in the computations of basic and diluted EPS of common stock:
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Income Taxes |
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Jun. 30, 2023 | |
Income Tax Disclosure [Abstract] | |
Income Taxes | Income TaxesWe are a U.S. taxpayer and are subject to a statutory U.S. federal corporate income tax rate of 21%. Taxable income is reported on our consolidated U.S. federal and various state income tax returns, filed by NMIH on behalf of itself and its subsidiaries. Our effective tax rate on our pre-tax income was 22.8% and 22.7% for the three and six months ended June 30, 2023, respectively, compared to 22.4% and 22.2% for the three and six months ended June 30, 2022, respectively. Our provision for income taxes for interim reporting periods is established based on our estimated annual effective tax rate for a given year. Our effective tax rate may fluctuate between interim periods due to the impact of discrete items not included in our estimated annual effective tax rate, including the tax effects associated with the vesting of RSUs and exercise of options. Such items are treated on a discrete basis in the reporting period in which they occur.As a mortgage guaranty insurance company, we are eligible to claim a tax deduction for our statutory contingency reserve balance, subject to certain limitations outlined under IRC Section 832(e), and only to the extent we acquire tax and loss bonds in an amount equal to the tax benefit derived from the claimed deduction, which is our intent. As a result, our interim provision for income taxes for the three and six months ended June 30, 2023 primarily represents a change in our net deferred tax liability. As of June 30, 2023 and December 31, 2022, we held $154.4 million of tax and loss bonds in "Prepaid federal income taxes" on our condensed consolidated balance sheets. |
Stockholders' Equity |
6 Months Ended |
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Jun. 30, 2023 | |
Equity [Abstract] | |
Stockholders' Equity | Stockholders' EquityOn February 10, 2022, our Board of Directors approved a $125 million share repurchase program (excluding associated costs and applicable taxes) effective through December 31, 2023. The authorization provides us the flexibility, based on market and business conditions, stock price and other factors, to repurchase stock from time to time through open market purchases, privately negotiated transactions, or other means, including pursuant to Rule 10b5-1 trading plans. During the six months ended June 30, 2023, we repurchased 1.7 million shares at an average price of $23.80 per share (excluding associated costs and applicable taxes). During the year ended December 31, 2022, we repurchased 2.9 million shares at an average price of $19.34 per share (excluding associated costs). As of June 30, 2023, $27.7 million of repurchase authority remained under the program. |
Litigation |
6 Months Ended |
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Jun. 30, 2023 | |
Commitments and Contingencies Disclosure [Abstract] | |
Litigation | Litigation We record a litigation liability when we determine that it is probable a litigation loss will be incurred and the amount of such anticipated loss can be reasonably estimated. In the event we determine that a litigation loss is reasonably possible (though not probable), we disclose an estimate of the possible loss if such estimate can be reasonably established, or disclose the matter with no estimate if such estimate cannot be reasonably made. We evaluate litigation and other legal developments that could affect our accrual for probable losses or our estimated disclosure of possible losses, and make ongoing adjustments to our accruals and disclosures as appropriate. Significant judgment is required to determine both the likelihood and the estimated amount of potential losses related to such matters. We are currently monitoring litigation regarding the refund of certain mortgage insurance premiums as it pertains to provisions of the Homeowners Protection Act and have been named as a defendant in one such case. We are unable to assess the outcome of such litigation at this time or its potential impact on us.
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Premiums Receivable |
6 Months Ended |
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Jun. 30, 2023 | |
Insurance [Abstract] | |
Premiums Receivable | Premiums Receivable Premiums receivable consists of premiums due on our mortgage insurance policies. If a mortgage insurance premium is unpaid for more than 120 days, the associated receivable is written off against earned premium and the related insurance policy is canceled. We recognize an allowance for credit losses for premiums receivable based on credit losses expected to arise over the life of the receivable. Due to the nature of our insurance policies (a necessary precondition for access to mortgage credit for covered borrowers) and the short duration of the related receivables, we do not typically experience credit losses against our premium receivables and the allowance for credit loss established on premium receivable was deemed immaterial at June 30, 2023 and December 31, 2022. Premiums receivable may be written off prior to 120 days in the ordinary course of business for non-credit events including, but not limited to, the modification or refinancing of an underlying insured loan. We established a $2.7 million and $2.3 million reserve for premium write-offs at June 30, 2023 and December 31, 2022, respectively.
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Regulatory Information |
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Insurance [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Regulatory Information | Regulatory Information Statutory Requirements Our insurance subsidiaries, NMIC and Re One, file financial statements in conformity with statutory accounting principles (SAP) prescribed or permitted by the Wisconsin OCI, NMIC's principal regulator. Prescribed SAP includes state laws, regulations and general administrative rules, as well as a variety of publications of the National Association of Insurance Commissioners (NAIC). The Wisconsin OCI recognizes only statutory accounting practices prescribed or permitted by the state of Wisconsin for determining and reporting the financial condition and results of operations of an insurance company and for determining its solvency under Wisconsin insurance laws. NMIC and Re One generated combined statutory net income of $28.1 million and $49.9 million for the three and six months ended June 30, 2023, respectively, compared to $25.6 million and $44.2 million for the three and six months ended June 30, 2022, respectively. The Wisconsin OCI has imposed a prescribed accounting practice for the treatment of statutory contingency reserves that differs from the treatment promulgated by the NAIC. Under Wisconsin OCI's prescribed practice mortgage guaranty insurers are required to reflect changes in their contingency reserves through statutory income. Such approach contrasts with the NAIC's treatment, which records changes to contingency reserves directly to unassigned funds. As a Wisconsin-domiciled insurer, NMIC's statutory net income reflects an expense associated with the change in its contingency reserve. While such treatment impacts NMIC's statutory net income, it does not have an effect on NMIC's statutory capital position. The following table presents NMIC's statutory surplus, contingency reserve, statutory capital and risk-to-capital (RTC) ratio as of June 30, 2023 and December 31, 2022.
(1) Represents the total of the statutory surplus and contingency reserve. Re One had $5.6 million of statutory capital at June 30, 2023 and December 31, 2022. NMIH is not subject to any limitations on its ability to pay dividends except those generally applicable to corporations that are incorporated in Delaware. Delaware law provides that dividends are only payable out of a corporation's capital surplus or, subject to certain limitations, recent net profits. NMIC and Re One are subject to certain rules and regulations prescribed by jurisdictions in which they are authorized to operate and the GSEs that may restrict their ability to pay dividends to NMIH. NMIC has the capacity to pay $98.0 million of aggregate ordinary dividends to NMIH during the twelve-month period ending December 31, 2023, and on May 12, 2023, NMIC paid a $98.0 million ordinary course dividend to NMIH.
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Subsequent Events |
6 Months Ended |
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Jun. 30, 2023 | |
Subsequent Events [Abstract] | |
Subsequent Events | Subsequent Events 2018 ILN Transaction termination Effective July 25, 2023, NMIC exercised its optional call to terminate the 2018 ILN Transaction. In connection with the termination of the transaction, NMIC’s excess of loss reinsurance agreement with Oaktown Re II Ltd. was commuted and the insurance-linked notes issued by Oaktown Re II Ltd. were redeemed in full with a distribution of remaining collateral assets. Excess-of-loss reinsurance agreement Effective July 1, 2023, NMIC entered into a reinsurance agreement with a broad panel of highly rated reinsurers that provides for up to $95.8 million of aggregate excess-of-loss reinsurance coverage for delinquencies that emerge on mortgage insurance policies written between July 1, 2023 and December 31, 2023 (2023-2 XOL Transaction). For the reinsurance coverage period, NMIC will retain a first layer of aggregate losses on covered policies and the reinsurers then provide second layer loss protection up to $95.8 million. NMIC retains losses in excess of the outstanding reinsurance coverage amount. Share repurchase program approval and extension of existing program On July 31, 2023, our Board of Directors authorized a new $200 million share repurchase program (excluding associated costs and applicable taxes) effective through December 31, 2025. The authorization provides us the flexibility, based on market and business conditions, stock price and other factors, to repurchase stock from time to time through open market repurchases, privately negotiated transactions, or other means, including pursuant to Rule 10b5-1 trading plans. Concurrent with the new authorization, our Board of Directors also approved an extension of our existing $125 million share repurchase program through December 31, 2025 to align its remaining tenor with that of the $200 million program.
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Organization, Basis of Presentation and Summary of Accounting Principles (Policies) |
6 Months Ended |
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Jun. 30, 2023 | |
Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Basis of Presentation | Basis of Presentation The accompanying unaudited condensed consolidated financial statements, which include the results of NMIH and its wholly-owned subsidiaries, have been prepared in accordance with the instructions to Form 10-Q as prescribed by the SEC for interim reporting and include other information and disclosures required by accounting principles generally accepted in the U.S. (GAAP). Our accounts are maintained in U.S. dollars. These statements should be read in conjunction with our consolidated financial statements and notes thereto for the year ended December 31, 2022, included in our 2022 10-K. All intercompany transactions have been eliminated. Certain reclassifications to previously reported financial information have been made to conform to our current period presentation. The preparation of financial statements in accordance with GAAP requires management to make estimates and assumptions that affect reported amounts of assets and liabilities, as well as disclosure of contingent assets and liabilities as of the balance sheet date. Estimates also affect the reported amounts of income and expenses for the reporting period. Actual results could differ from those estimates. The results of operations for the interim period may not be indicative of the results that may be expected for the full year ending December 31, 2023.
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Recent Accounting Pronouncements - Adopted and Not Yet Adopted | Recent Accounting Pronouncements - Adopted In August 2018, the Financial Accounting Standards Board (the FASB) issued ASU 2018-12, Targeted Improvements to the Accounting for Long-Duration Contracts (Topic 944). The update provides guidance to the existing recognition, measurement, presentation and disclosure requirements for long-duration contracts issued by an insurance entity. The FASB subsequently issued ASU 2019-09 in November 2019 and ASU 2020-11 in November 2020, which amended the effective date for this standard and provided transition relief to facilitate early application for long duration contracts. The standard will now take effect for public business entities for fiscal years, and interim periods within those fiscal years, beginning after December 15, 2022. We adopted this ASU on January 1, 2023 and determined it did not have a material impact on our consolidated financial statements. Recent Accounting Pronouncements - Not Yet Adopted In March 2020, the FASB issued ASU 2020-04, Reference Rate Reform (Topic 848). The update provides optional guidance to ease the potential burden in accounting for reference rate reform on financial reporting. Reference rate reform refers to the global transition away from referencing the London Interbank Offered Rate (LIBOR) in financial contracts, which is expected to be discontinued during a transition period from 2021 through 2023. The ASU includes optional expedients and exceptions for applying GAAP to contracts, hedging relationships and other transactions affected by reference rate reform if certain criteria are met. This standard may be elected and applied prospectively over time from March 12, 2020 through December 31, 2022 as reference rate reform activities occur. In December 2022, the FASB issued ASU 2022-06, which extended the sunset date of Topic 848 from December 31, 2022 to December 31, 2024. We continue to monitor the impact the discontinuance of LIBOR will have on our contracts and other transactions; however, the adoption of, and future elections under ASU 2020-04 and ASU 2022-06 are not expected to have a material impact on our consolidated financial statements as the ASUs will ease, if warranted, the requirements for accounting for the future effects of the rate reform.
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Earnings Per Share | Basic EPS is based on the weighted average number of shares of common stock outstanding. Diluted EPS is based on the weighted average number of shares of common stock outstanding and common stock equivalents that would be issuable upon the vesting of service-based and performance and service-based restricted stock units (RSUs), and the exercise of vested and unvested stock options and outstanding warrants. The number of shares issuable for RSUs subject to performance and service-based vesting requirements are only included in diluted shares if the relevant performance measurement period has commenced and results during such period meet the necessary performance criteria. |
Premiums Receivable | Premiums Receivable Premiums receivable consists of premiums due on our mortgage insurance policies. If a mortgage insurance premium is unpaid for more than 120 days, the associated receivable is written off against earned premium and the related insurance policy is canceled. We recognize an allowance for credit losses for premiums receivable based on credit losses expected to arise over the life of the receivable. Due to the nature of our insurance policies (a necessary precondition for access to mortgage credit for covered borrowers) and the short duration of the related receivables, we do not typically experience credit losses against our premium receivables and the allowance for credit loss established on premium receivable was deemed immaterial at June 30, 2023 and December 31, 2022. Premiums receivable may be written off prior to 120 days in the ordinary course of business for non-credit events including, but not limited to, the modification or refinancing of an underlying insured loan. We established a $2.7 million and $2.3 million reserve for premium write-offs at June 30, 2023 and December 31, 2022, respectively.
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Investments (Tables) |
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Investments, Debt and Equity Securities [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Fair Values and Gross Unrealized Gains and Losses | Fair Values and Gross Unrealized Gains and Losses on Investments
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Schedule of Corporate Debt Securities by Industry Group | The following table presents a breakdown of the fair value of our corporate debt securities by issuer industry group as of June 30, 2023 and December 31, 2022:
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Schedule of Investments by Maturity | The amortized cost and fair value of available-for-sale securities as of June 30, 2023 and December 31, 2022, by contractual maturity, are shown below. Expected maturities will differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties. Because most asset-backed securities provide for periodic payments throughout their lives, they are listed below in a separate category.
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Schedule of Aging Unrealized Losses | For those securities in an unrealized loss position, the length of time the securities were in such a position is as follows:
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Schedule of Net Investment Income | The following table presents the components of net investment income:
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Schedule of Net Realized Investment Gains (Losses) | The following table presents the components of net realized investment gains (losses):
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Fair Value of Financial Instruments (Tables) |
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Fair Value Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Fair Value Measurements of Financial Instruments | The following tables present the level within the fair value hierarchy at which our financial instruments were measured:
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Reinsurance (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Reinsurance Disclosures [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Effect of Reinsurance Agreements on Premiums Written and Earned | The effect of our reinsurance agreements on premiums written and earned is as follows:
(1) Net of profit commission. The following table shows amounts related to the QSR Transactions:
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Schedule of ILN Transactions | The following table presents the inception date, covered production period, initial and current reinsurance coverage amount, and initial and current first layer retained aggregate loss under each outstanding ILN Transaction. Current amounts are presented as of June 30, 2023.
(1) NMIC applies claims paid on covered policies against its first layer aggregate retained loss exposure and cedes reserves for incurred claims and claim expenses to each applicable ILN Transaction and recognizes a reinsurance recoverable if such incurred claims and claim expenses exceed its current first layer retained loss. (2) Approximately 1% of the production covered by the 2020-2 ILN Transaction has coverage reporting dates between July 1, 2019 and March 31, 2020. (3) Approximately 1% of the production covered by the 2021-1 ILN Transaction has coverage reporting dates between July 1, 2019 and September 30, 2020. (4) Approximately 2% of the production covered by the 2021-2 ILN Transaction has coverage reporting dates between July 1, 2019 and March 31, 2021.
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Schedule of XOL Transactions | The following table presents the inception date, covered production period, initial and current reinsurance coverage amount, and initial and current first layer retained aggregate loss under each outstanding XOL Transaction. Current amounts are presented as of June 30, 2023.
(1) NMIC applies claims paid on covered policies against its first layer aggregate retained loss exposure and cedes reserves for incurred claims and claim expenses to each applicable XOL Transaction and recognizes a reinsurance recoverable if such incurred claims and claim expenses exceed its current first layer retained loss. (2) Approximately 1% of the production covered by the 2022-1 XOL Transaction has coverage reporting dates between October 21, 2019 and September 30, 2021. (3) Approximately 1% of the production covered by the 2022-2 XOL Transaction has coverage reporting dates between January 4, 2021 and March 31, 2022. (4) The 2023-1 XOL Transaction provides coverage for production generated between October 1, 2022 and June 30, 2023. The current reinsurance coverage and current first layer retained loss will decrease in future periods to the extent the PMIERs minimum required assets of the covered pool declines.
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Reserves for Insurance Claims and Claim Expenses (Tables) |
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Insurance [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Reconciliation of Liability for Insurance Claims and (benefits) Claim Expenses | The following table provides a reconciliation of the beginning and ending gross reserve balances for primary insurance claims and claim expenses (benefits):
(1) Related to ceded losses recoverable under the QSR Transactions. See Note 5, "Reinsurance" for additional information. (2) Related to insured loans with their most recent defaults occurring in the current year. For example, if a loan defaulted in a prior year and subsequently cured and later re-defaulted in the current year, the default would be included in the current year. Amounts are presented net of reinsurance and included $39.1 million attributed to net case reserves and $5.0 million attributed to net IBNR reserves for the six months ended June 30, 2023 and $14.0 million attributed to net case reserves and $4.5 million attributed to net IBNR reserves for the six months ended June 30, 2022. (3) Related to insured loans with defaults occurring in prior years, which have been continuously in default before the start of the current year. Amounts are presented net of reinsurance and included $30.3 million attributed to net case reserves and $4.5 million attributed to net IBNR reserves for the six months ended June 30, 2023 and $17.0 million attributed to net case reserves and $4.7 million attributed to net IBNR reserves for the six months ended June 30, 2022.
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Earnings per Share (EPS) (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Earnings Per Share [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Earnings Per Share, Basic and Diluted | The following table reconciles the net income and the weighted average shares of common stock outstanding used in the computations of basic and diluted EPS of common stock:
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Regulatory Information (Tables) |
6 Months Ended | ||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
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Jun. 30, 2023 | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Insurance [Abstract] | |||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||||
Schedule of Statutory Net Income (loss), Surplus, Contingency Reserve and Risk-to-Capital Ratio | The following table presents NMIC's statutory surplus, contingency reserve, statutory capital and risk-to-capital (RTC) ratio as of June 30, 2023 and December 31, 2022.
(1) Represents the total of the statutory surplus and contingency reserve.
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Organization, Basis of Presentation and Summary of Accounting Principles - Narrative (Details) |
Jun. 30, 2023
state
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Organization, Consolidation and Presentation of Financial Statements [Abstract] | |
Number of states in which the entity operates | 50 |
Investments - Schedule of Fair Values and Gross Unrealized Gains and Losses (Details) - USD ($) $ in Thousands |
Jun. 30, 2023 |
Dec. 31, 2022 |
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Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | $ 2,465,556 | $ 2,352,747 |
Gross unrealized gains | 2,662 | 1,334 |
Gross unrealized losses | (234,562) | (254,692) |
Fair Value | 2,233,656 | 2,099,389 |
U.S. Treasury securities and obligations of U.S. government agencies | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 82,381 | 82,301 |
Gross unrealized gains | 0 | 0 |
Gross unrealized losses | (2,388) | (2,369) |
Fair Value | 79,993 | 79,932 |
Municipal debt securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 674,701 | 563,972 |
Gross unrealized gains | 6 | 0 |
Gross unrealized losses | (71,631) | (80,796) |
Fair Value | 603,076 | 483,176 |
Corporate debt securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 1,502,338 | 1,457,589 |
Gross unrealized gains | 1,102 | 1,149 |
Gross unrealized losses | (155,139) | (165,096) |
Fair Value | 1,348,301 | 1,293,642 |
Asset-backed securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 68,466 | 74,762 |
Gross unrealized gains | 0 | 0 |
Gross unrealized losses | (5,383) | (6,204) |
Fair Value | 63,083 | 68,558 |
Total bonds | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 2,327,886 | 2,178,624 |
Gross unrealized gains | 1,108 | 1,149 |
Gross unrealized losses | (234,541) | (254,465) |
Fair Value | 2,094,453 | 1,925,308 |
Short-term investments | ||
Debt Securities, Available-for-sale [Line Items] | ||
Amortized Cost | 137,670 | 174,123 |
Gross unrealized gains | 1,554 | 185 |
Gross unrealized losses | (21) | (227) |
Fair Value | $ 139,203 | $ 174,081 |
Investments - Schedule of Corporate Debt Securities by Industry Group (Details) |
Jun. 30, 2023 |
Dec. 31, 2022 |
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Debt Securities By Industry [Line Items] | ||
Corporate debt securities as component of total (percent) | 100.00% | 100.00% |
Financial | ||
Debt Securities By Industry [Line Items] | ||
Corporate debt securities as component of total (percent) | 38.00% | 38.00% |
Consumer | ||
Debt Securities By Industry [Line Items] | ||
Corporate debt securities as component of total (percent) | 24.00% | 24.00% |
Communications | ||
Debt Securities By Industry [Line Items] | ||
Corporate debt securities as component of total (percent) | 11.00% | 11.00% |
Utilities | ||
Debt Securities By Industry [Line Items] | ||
Corporate debt securities as component of total (percent) | 11.00% | 11.00% |
Technology | ||
Debt Securities By Industry [Line Items] | ||
Corporate debt securities as component of total (percent) | 8.00% | 8.00% |
Industrial | ||
Debt Securities By Industry [Line Items] | ||
Corporate debt securities as component of total (percent) | 8.00% | 8.00% |
Investments - Schedule of Investments by Maturity (Details) - USD ($) $ in Thousands |
Jun. 30, 2023 |
Dec. 31, 2022 |
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Amortized Cost | ||
Due in one year or less | $ 307,520 | $ 271,613 |
Due after one through five years | 1,047,539 | 935,615 |
Due after five through ten years | 1,028,749 | 1,047,461 |
Due after ten years | 13,282 | 23,296 |
Asset-backed securities | 68,466 | 74,762 |
Amortized Cost | 2,465,556 | 2,352,747 |
Fair Value | ||
Due in one year or less | 306,258 | 270,428 |
Due after one through five years | 961,503 | 862,747 |
Due after five through ten years | 889,801 | 875,947 |
Due after ten years | 13,011 | 21,709 |
Asset-backed securities | 63,083 | 68,558 |
Fair Value | $ 2,233,656 | $ 2,099,389 |
Investments - Narrative (Details) - USD ($) $ in Thousands |
Jun. 30, 2023 |
Dec. 31, 2022 |
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Debt Securities, Available-for-sale [Line Items] | ||
Unrealized loss position, accumulated loss | $ 234,562 | $ 254,692 |
Unrealized loss position, 12 months or greater | 224,945 | 218,467 |
U.S. Treasury securities and obligations of U.S. government agencies | ||
Debt Securities, Available-for-sale [Line Items] | ||
Cash and investments held with various state insurance departments | 5,300 | 5,400 |
Unrealized loss position, accumulated loss | 2,388 | 2,369 |
Unrealized loss position, 12 months or greater | $ 1,132 | $ 109 |
Investments - Schedule of Aging of Unrealized Losses (Details) $ in Thousands |
Jun. 30, 2023
USD ($)
security
|
Dec. 31, 2022
USD ($)
security
|
---|---|---|
Debt Securities, Available-for-sale [Line Items] | ||
Number of securities, less than 12 months | security | 95 | 241 |
Fair value, less than 12 months | $ 423,094 | $ 772,198 |
Unrealized losses, less than 12 months | $ (9,617) | $ (36,225) |
Number of securities,12 months or greater | security | 500 | 367 |
Fair value, 12 months or greater | $ 1,588,337 | $ 1,188,415 |
Unrealized losses, 12 months or greater | $ (224,945) | $ (218,467) |
Number of securities, total | security | 595 | 608 |
Fair Value | $ 2,011,431 | $ 1,960,613 |
Unrealized Losses | $ (234,562) | $ (254,692) |
U.S. Treasury securities and obligations of U.S. government agencies | ||
Debt Securities, Available-for-sale [Line Items] | ||
Number of securities, less than 12 months | security | 11 | 19 |
Fair value, less than 12 months | $ 54,004 | $ 77,164 |
Unrealized losses, less than 12 months | $ (1,256) | $ (2,260) |
Number of securities,12 months or greater | security | 14 | 4 |
Fair value, 12 months or greater | $ 25,989 | $ 2,768 |
Unrealized losses, 12 months or greater | $ (1,132) | $ (109) |
Number of securities, total | security | 25 | 23 |
Fair Value | $ 79,993 | $ 79,932 |
Unrealized Losses | $ (2,388) | $ (2,369) |
Municipal debt securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Number of securities, less than 12 months | security | 25 | 57 |
Fair value, less than 12 months | $ 128,176 | $ 143,097 |
Unrealized losses, less than 12 months | $ (2,683) | $ (12,942) |
Number of securities,12 months or greater | security | 223 | 181 |
Fair value, 12 months or greater | $ 467,902 | $ 340,079 |
Unrealized losses, 12 months or greater | $ (68,948) | $ (67,854) |
Number of securities, total | security | 248 | 238 |
Fair Value | $ 596,078 | $ 483,176 |
Unrealized Losses | $ (71,631) | $ (80,796) |
Corporate debt securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Number of securities, less than 12 months | security | 57 | 141 |
Fair value, less than 12 months | $ 225,972 | $ 434,174 |
Unrealized losses, less than 12 months | $ (5,657) | $ (19,699) |
Number of securities,12 months or greater | security | 238 | 168 |
Fair value, 12 months or greater | $ 1,031,363 | $ 790,537 |
Unrealized losses, 12 months or greater | $ (149,482) | $ (145,397) |
Number of securities, total | security | 295 | 309 |
Fair Value | $ 1,257,335 | $ 1,224,711 |
Unrealized Losses | $ (155,139) | $ (165,096) |
Asset-backed securities | ||
Debt Securities, Available-for-sale [Line Items] | ||
Number of securities, less than 12 months | security | 0 | 12 |
Fair value, less than 12 months | $ 0 | $ 13,527 |
Unrealized losses, less than 12 months | $ 0 | $ (1,097) |
Number of securities,12 months or greater | security | 25 | 14 |
Fair value, 12 months or greater | $ 63,083 | $ 55,031 |
Unrealized losses, 12 months or greater | $ (5,383) | $ (5,107) |
Number of securities, total | security | 25 | 26 |
Fair Value | $ 63,083 | $ 68,558 |
Unrealized Losses | $ (5,383) | $ (6,204) |
Short-term investments | ||
Debt Securities, Available-for-sale [Line Items] | ||
Number of securities, less than 12 months | security | 2 | 12 |
Fair value, less than 12 months | $ 14,942 | $ 104,236 |
Unrealized losses, less than 12 months | $ (21) | $ (227) |
Number of securities,12 months or greater | security | 0 | 0 |
Fair value, 12 months or greater | $ 0 | $ 0 |
Unrealized losses, 12 months or greater | $ 0 | $ 0 |
Number of securities, total | security | 2 | 12 |
Fair Value | $ 14,942 | $ 104,236 |
Unrealized Losses | $ (21) | $ (227) |
Investments - Schedule of Net Investment Income (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Investment Income, Net [Abstract] | ||||
Investment income | $ 16,591 | $ 11,238 | $ 31,765 | $ 21,770 |
Investment expenses | (73) | (317) | (353) | (650) |
Net investment income | $ 16,518 | $ 10,921 | $ 31,412 | $ 21,120 |
Investments - Schedule of Net Realized Investment Gains (Losses) (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Investments, Debt and Equity Securities [Abstract] | ||||
Gross realized investment gains | $ 0 | $ 57 | $ 0 | $ 466 |
Gross realized investment losses | 0 | (4) | (33) | (5) |
Net realized investment gains (losses) | $ 0 | $ 53 | $ (33) | $ 461 |
Fair Value of Financial Instruments - Narrative (Details) - Secured Debt - USD ($) |
Jun. 30, 2023 |
Dec. 31, 2022 |
Jun. 19, 2020 |
---|---|---|---|
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Debt instrument face amount | $ 400,000,000 | ||
Carried cost | $ 396,800,000 | $ 396,100,000 | |
Debt issuance costs | 3,200,000 | 3,900,000 | 7,400,000 |
Significant Other Observable Inputs (Level 2) | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Fair value of long term debt | $ 405,600,000 | $ 405,900,000 | |
2018 Term loan | |||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | |||
Debt instrument face amount | $ 150,000,000 |
Fair Value of Financial Instruments -Schedule of Fair Value Measurements of Financial Instruments (Details) - USD ($) $ in Thousands |
Jun. 30, 2023 |
Dec. 31, 2022 |
---|---|---|
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of securities | $ 2,233,656 | $ 2,099,389 |
U.S. Treasury securities and obligations of U.S. government agencies | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of securities | 79,993 | 79,932 |
Municipal debt securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of securities | 603,076 | 483,176 |
Corporate debt securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of securities | 1,348,301 | 1,293,642 |
Asset-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of securities | 63,083 | 68,558 |
Recurring | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash, cash equivalents and short-term investments | 212,522 | 218,507 |
Total assets | 2,306,975 | 2,143,815 |
Recurring | U.S. Treasury securities and obligations of U.S. government agencies | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of securities | 79,993 | 79,932 |
Recurring | Municipal debt securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of securities | 603,076 | 483,176 |
Recurring | Corporate debt securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of securities | 1,348,301 | 1,293,642 |
Recurring | Asset-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of securities | 63,083 | 68,558 |
Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash, cash equivalents and short-term investments | 212,522 | 218,507 |
Total assets | 292,515 | 298,439 |
Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | U.S. Treasury securities and obligations of U.S. government agencies | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of securities | 79,993 | 79,932 |
Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | Municipal debt securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of securities | 0 | 0 |
Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | Corporate debt securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of securities | 0 | 0 |
Recurring | Quoted Prices in Active Markets for Identical Assets (Level 1) | Asset-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of securities | 0 | 0 |
Recurring | Significant Other Observable Inputs (Level 2) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash, cash equivalents and short-term investments | 0 | 0 |
Total assets | 2,014,460 | 1,845,376 |
Recurring | Significant Other Observable Inputs (Level 2) | U.S. Treasury securities and obligations of U.S. government agencies | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of securities | 0 | 0 |
Recurring | Significant Other Observable Inputs (Level 2) | Municipal debt securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of securities | 603,076 | 483,176 |
Recurring | Significant Other Observable Inputs (Level 2) | Corporate debt securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of securities | 1,348,301 | 1,293,642 |
Recurring | Significant Other Observable Inputs (Level 2) | Asset-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of securities | 63,083 | 68,558 |
Recurring | Significant Unobservable Inputs (Level 3) | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Cash, cash equivalents and short-term investments | 0 | 0 |
Total assets | 0 | 0 |
Recurring | Significant Unobservable Inputs (Level 3) | U.S. Treasury securities and obligations of U.S. government agencies | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of securities | 0 | 0 |
Recurring | Significant Unobservable Inputs (Level 3) | Municipal debt securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of securities | 0 | 0 |
Recurring | Significant Unobservable Inputs (Level 3) | Corporate debt securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of securities | 0 | 0 |
Recurring | Significant Unobservable Inputs (Level 3) | Asset-backed securities | ||
Fair Value, Assets and Liabilities Measured on Recurring and Nonrecurring Basis [Line Items] | ||
Fair value of securities | $ 0 | $ 0 |
Debt - Narrative (Details) - USD ($) |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Nov. 29, 2021 |
Jun. 19, 2020 |
Jun. 30, 2023 |
Jun. 30, 2023 |
Dec. 31, 2022 |
|
Revolving credit facility | |||||
Debt Instrument [Line Items] | |||||
Commitment fees in interest expense | $ 200,000 | $ 400,000 | |||
2018 Term loan | |||||
Debt Instrument [Line Items] | |||||
Interest payable | 2,500,000 | 2,500,000 | $ 2,500,000 | ||
2020 Revolving credit facility | |||||
Debt Instrument [Line Items] | |||||
Debt issuance costs | $ 600,000 | ||||
2020 Revolving credit facility | Revolving credit facility | |||||
Debt Instrument [Line Items] | |||||
Credit facility borrowing capacity | 110,000,000 | ||||
Remaining deferred issuance costs, net of accumulated amortization | 1,000,000 | 1,000,000 | 1,200,000 | ||
2021 Revolving credit facility | |||||
Debt Instrument [Line Items] | |||||
Debt Issuance costs | 1,100,000 | ||||
2021 Revolving credit facility | Revolving credit facility | |||||
Debt Instrument [Line Items] | |||||
Credit facility borrowing capacity | $ 250,000,000 | ||||
Borrowings outstanding | $ 0 | $ 0 | 0 | ||
Debt instrument covenant, maximum debt-to-total capitalization ratio | 35.00% | ||||
2021 Revolving credit facility | Revolving credit facility | Minimum | |||||
Debt Instrument [Line Items] | |||||
Commitment fee (in percent) | 0.175% | 0.30% | |||
2021 Revolving credit facility | Revolving credit facility | Maximum | |||||
Debt Instrument [Line Items] | |||||
Commitment fee (in percent) | 0.525% | ||||
2021 Revolving credit facility | Revolving credit facility | Base rate | |||||
Debt Instrument [Line Items] | |||||
Variable rate floor (in percent) | 1.00% | ||||
2021 Revolving credit facility | Revolving credit facility | Base rate | Minimum | |||||
Debt Instrument [Line Items] | |||||
Basis spread on variable rate (in percent) | 0.375% | ||||
2021 Revolving credit facility | Revolving credit facility | Base rate | Maximum | |||||
Debt Instrument [Line Items] | |||||
Basis spread on variable rate (in percent) | 1.875% | ||||
2021 Revolving credit facility | Revolving credit facility | Secured overnight financing rate | Minimum | |||||
Debt Instrument [Line Items] | |||||
Basis spread on variable rate (in percent) | 1.375% | ||||
2021 Revolving credit facility | Revolving credit facility | Secured overnight financing rate | Maximum | |||||
Debt Instrument [Line Items] | |||||
Basis spread on variable rate (in percent) | 2.875% | ||||
Senior debt | |||||
Debt Instrument [Line Items] | |||||
Effective interest rate (in percent) | 7.825% | 7.825% | |||
Secured Debt | |||||
Debt Instrument [Line Items] | |||||
Senior secured notes | $ 400,000,000 | $ 400,000,000 | |||
Stated interest rate (in percent) | 7.375% | 7.375% | |||
Applicable premium | 1.00% | ||||
Debt issuance costs | $ 7,400,000 | $ 3,200,000 | $ 3,200,000 | $ 3,900,000 | |
Secured Debt | Prior to March 1, 2025 | |||||
Debt Instrument [Line Items] | |||||
Redemption price (in percent) | 100.00% | ||||
Secured Debt | After March 1, 2025 | |||||
Debt Instrument [Line Items] | |||||
Redemption price (in percent) | 100.00% |
Reinsurance - Schedule of Effect of Reinsurance Agreements on Premiums Written and Earned (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Net premiums written | ||||
Direct | $ 151,992 | $ 143,651 | $ 300,924 | $ 282,523 |
Ceded | (34,848) | (25,194) | (70,804) | (48,032) |
Net premiums written | 117,144 | 118,457 | 230,120 | 234,491 |
Net premiums earned | ||||
Direct | 160,988 | 146,362 | 318,892 | 286,078 |
Ceded | (35,003) | (25,492) | (71,153) | (48,713) |
Net premiums earned | $ 125,985 | $ 120,870 | $ 247,739 | $ 237,365 |
Reinsurance - Narrative (Details) $ in Thousands |
3 Months Ended | 6 Months Ended | ||||||
---|---|---|---|---|---|---|---|---|
Apr. 01, 2019
USD ($)
reinsurance_engagement
|
Mar. 31, 2019 |
Jun. 30, 2023
USD ($)
reinsuranceAgreement
quota_share_agreement
|
Jun. 30, 2022
USD ($)
|
Jun. 30, 2023
USD ($)
reinsuranceAgreement
quota_share_agreement
|
Jun. 30, 2022
USD ($)
|
Dec. 31, 2022
USD ($)
|
Dec. 31, 2021
USD ($)
|
|
Ceded Credit Risk [Line Items] | ||||||||
Reinsurance coverage amount amortized (as a percent) | 10.00% | 10.00% | ||||||
Restricted cash | $ 2,222 | $ 2,222 | $ 2,176 | |||||
Number of excess-of-loss reinsurance agreements | reinsuranceAgreement | 4 | 4 | ||||||
Reinsurance coverage amount | $ 7,700 | $ 2,900 | $ 14,900 | $ 2,900 | ||||
Number of quota share reinsurance treaties | quota_share_agreement | 7 | 7 | ||||||
Reinsurance recoverable on unpaid claims | $ 24,023 | 19,588 | $ 24,023 | 19,588 | 21,587 | $ 20,320 | ||
Reinsurance Policy, Type [Axis]: Aggregate 2018 QSR Transactions | ||||||||
Ceded Credit Risk [Line Items] | ||||||||
Reinsurance recoverable on unpaid claims | 22,100 | 22,100 | 19,000 | |||||
Reinsurance Policy, Type [Axis]: Aggregate 2020 QSR Transactions | ||||||||
Ceded Credit Risk [Line Items] | ||||||||
Reinsurance recoverable on unpaid claims | 22,100 | 22,100 | 19,000 | |||||
Reinsurance Policy, Type [Axis]: Aggregate 2021 QSR Transactions | ||||||||
Ceded Credit Risk [Line Items] | ||||||||
Reinsurance recoverable on unpaid claims | 22,100 | 22,100 | 19,000 | |||||
Reinsurance Policy, Type [Axis]: Aggregate 2022 QSR Transactions | ||||||||
Ceded Credit Risk [Line Items] | ||||||||
Reinsurance recoverable on unpaid claims | 22,100 | 22,100 | 19,000 | |||||
Reinsurance Policy, Type [Axis]: Aggregate 2022 Seasoned QSR Transactions | ||||||||
Ceded Credit Risk [Line Items] | ||||||||
Reinsurance recoverable on unpaid claims | 22,100 | 22,100 | 19,000 | |||||
Reinsurance Policy, Type [Axis]: Aggregate 2023 QSR Transactions | ||||||||
Ceded Credit Risk [Line Items] | ||||||||
Reinsurance recoverable on unpaid claims | 22,100 | $ 22,100 | 19,000 | |||||
Reinsurance Policy, Type [Axis]: Oaktown Re Vehicles | ||||||||
Ceded Credit Risk [Line Items] | ||||||||
Reinsurance coverage, term of underlying mortgage amortization (in years) | 10 years | |||||||
Third-party Reinsurers | Reinsurance Policy, Type [Axis]: QSR Transactions | ||||||||
Ceded Credit Risk [Line Items] | ||||||||
Percentage of ceding commission received | 20.00% | |||||||
Third-party Reinsurers | Reinsurance Policy, Type [Axis]: 2016 QSR Transaction | ||||||||
Ceded Credit Risk [Line Items] | ||||||||
Number of reinsurance engagements terminated | reinsurance_engagement | 1 | |||||||
Previously ceded primary risk-in-force recaptured | $ 500,000 | |||||||
Threshold for loss ratio on loans to qualify for profit commission | 60.00% | |||||||
Reinsurance recoverable on unpaid claims | 1,900 | $ 1,900 | $ 2,600 | |||||
Third-party Reinsurers | Reinsurance Policy, Type [Axis]: 2016 QSR Transaction, Eligible Primary Policies | ||||||||
Ceded Credit Risk [Line Items] | ||||||||
Percent of premiums earned under 2018 QSR Transaction | 25.00% | |||||||
Third-party Reinsurers | Reinsurance Policy, Type [Axis]: 2016 QSR Transaction, Pool Agreement with Fannie Mae | ||||||||
Ceded Credit Risk [Line Items] | ||||||||
Percent of premiums earned under 2018 QSR Transaction | 100.00% | |||||||
Third-party Reinsurers | Reinsurance Policy, Type [Axis]: 2018 QSR Transaction | ||||||||
Ceded Credit Risk [Line Items] | ||||||||
Percent of premiums earned under 2018 QSR Transaction | 25.00% | |||||||
Threshold for loss ratio on loans to qualify for profit commission | 61.00% | |||||||
Third-party Reinsurers | Reinsurance Policy, Type [Axis]: 2019 QSR Transaction | ||||||||
Ceded Credit Risk [Line Items] | ||||||||
Percent of premiums earned under 2018 QSR Transaction | 20.00% | |||||||
Third-party Reinsurers | Reinsurance Policy, Type [Axis]: 2020 QSR Transaction | ||||||||
Ceded Credit Risk [Line Items] | ||||||||
Percent of premiums earned under 2018 QSR Transaction | 21.00% | |||||||
Threshold for loss ratio on loans to qualify for profit commission | 50.00% | |||||||
Third-party Reinsurers | Reinsurance Policy, Type [Axis]: 2021 QSR Transaction | ||||||||
Ceded Credit Risk [Line Items] | ||||||||
Percent of premiums earned under 2018 QSR Transaction | 22.50% | |||||||
Threshold for loss ratio on loans to qualify for profit commission | 57.50% | |||||||
Third-party Reinsurers | Reinsurance Policy, Type [Axis]: 2022 QSR Transaction | ||||||||
Ceded Credit Risk [Line Items] | ||||||||
Percent of premiums earned under 2018 QSR Transaction | 20.00% | |||||||
Threshold for loss ratio on loans to qualify for profit commission | 62.00% | |||||||
Third-party Reinsurers | Reinsurance Policy, Type [Axis]: 2022 Seasoned QSR Transaction | ||||||||
Ceded Credit Risk [Line Items] | ||||||||
Percent of premiums earned under 2018 QSR Transaction | 95.00% | |||||||
Percentage of ceding commission received | 35.00% | |||||||
Threshold for loss ratio on loans to qualify for profit commission | 55.00% | |||||||
Third-party Reinsurers | Reinsurance Policy, Type [Axis]: 2023 QSR Transaction | ||||||||
Ceded Credit Risk [Line Items] | ||||||||
Percent of premiums earned under 2018 QSR Transaction | 20.00% | |||||||
Threshold for loss ratio on loans to qualify for profit commission | 62.00% | |||||||
Third-party Reinsurers | Reinsurance Policy, Type [Axis]: Oaktown Re Vehicles | ||||||||
Ceded Credit Risk [Line Items] | ||||||||
Risk premiums paid | $ 8,800 | $ 10,100 | $ 17,900 | $ 21,100 | ||||
Maximum | ||||||||
Ceded Credit Risk [Line Items] | ||||||||
Reinsurance coverage, term of underlying mortgage amortization (in years) | 12 years 6 months | |||||||
Maximum | Third-party Reinsurers | Reinsurance Policy, Type [Axis]: 2016 QSR Transaction | ||||||||
Ceded Credit Risk [Line Items] | ||||||||
Percent of premiums ceded under QSR Transaction | 25.00% | |||||||
Maximum | Third-party Reinsurers | Reinsurance Policy, Type [Axis]: Oaktown Re Vehicles | ||||||||
Ceded Credit Risk [Line Items] | ||||||||
Anticipated payment related to annual operating expenses | $ 250 | |||||||
Minimum | ||||||||
Ceded Credit Risk [Line Items] | ||||||||
Reinsurance coverage, term of underlying mortgage amortization (in years) | 10 years | |||||||
Minimum | Third-party Reinsurers | Reinsurance Policy, Type [Axis]: 2016 QSR Transaction | ||||||||
Ceded Credit Risk [Line Items] | ||||||||
Percent of premiums ceded under QSR Transaction | 20.50% |
Reinsurance - Schedule of ILN Transactions and XOL Transactions (Details) - USD ($) $ in Thousands |
Jun. 30, 2023 |
Oct. 26, 2021 |
Apr. 27, 2021 |
Oct. 29, 2020 |
Jul. 30, 2019 |
Jul. 25, 2018 |
---|---|---|---|---|---|---|
Reinsurance Policy, Type [Axis]: 2018 ILN Transaction | ||||||
Deferred Compensation Arrangement with Individual, Excluding Share-based Payments and Postretirement Benefits [Line Items] | ||||||
Initial Reinsurance Coverage | $ 264,545 | |||||
Current Reinsurance Coverage | $ 142,638 | |||||
Initial First Layer Retained Loss | $ 125,312 | |||||
Current first layer retained loss | 121,966 | |||||
Reinsurance Policy, Type [Axis]: 2019 ILN Transaction | ||||||
Deferred Compensation Arrangement with Individual, Excluding Share-based Payments and Postretirement Benefits [Line Items] | ||||||
Initial Reinsurance Coverage | $ 326,905 | |||||
Current Reinsurance Coverage | 176,647 | |||||
Initial First Layer Retained Loss | $ 123,424 | |||||
Current first layer retained loss | $ 122,085 | |||||
Reinsurance Policy, Type [Axis]: 2020-2 ILN | ||||||
Deferred Compensation Arrangement with Individual, Excluding Share-based Payments and Postretirement Benefits [Line Items] | ||||||
Percentage of population with production prior to period start date | 1.00% | |||||
Reinsurance Policy, Type [Axis]: 2020-2 ILN transaction | ||||||
Deferred Compensation Arrangement with Individual, Excluding Share-based Payments and Postretirement Benefits [Line Items] | ||||||
Initial Reinsurance Coverage | $ 242,351 | |||||
Current Reinsurance Coverage | $ 74,728 | |||||
Initial First Layer Retained Loss | $ 121,777 | |||||
Current first layer retained loss | $ 121,177 | |||||
Reinsurance Policy, Type [Axis]: 2021-1 ILN | ||||||
Deferred Compensation Arrangement with Individual, Excluding Share-based Payments and Postretirement Benefits [Line Items] | ||||||
Percentage of population with production prior to period start date | 1.00% | |||||
Reinsurance Policy, Type [Axis]: 2021-1 ILN Transaction | ||||||
Deferred Compensation Arrangement with Individual, Excluding Share-based Payments and Postretirement Benefits [Line Items] | ||||||
Initial Reinsurance Coverage | $ 367,238 | |||||
Current Reinsurance Coverage | $ 257,809 | |||||
Initial First Layer Retained Loss | $ 163,708 | |||||
Current first layer retained loss | $ 163,520 | |||||
Reinsurance Policy, Type [Axis]: 2021-2 ILN | ||||||
Deferred Compensation Arrangement with Individual, Excluding Share-based Payments and Postretirement Benefits [Line Items] | ||||||
Percentage of population with production prior to period start date | 2.00% | |||||
Reinsurance Policy, Type [Axis]: 2021-2 ILN transaction | ||||||
Deferred Compensation Arrangement with Individual, Excluding Share-based Payments and Postretirement Benefits [Line Items] | ||||||
Initial Reinsurance Coverage | $ 363,596 | |||||
Current Reinsurance Coverage | $ 351,215 | |||||
Initial First Layer Retained Loss | $ 146,229 | |||||
Current first layer retained loss | 146,112 | |||||
Reinsurance Policy, Type [Axis]: 2022-1 XOL Transaction | ||||||
Deferred Compensation Arrangement with Individual, Excluding Share-based Payments and Postretirement Benefits [Line Items] | ||||||
Initial Reinsurance Coverage | 289,741 | |||||
Current Reinsurance Coverage | 279,416 | |||||
Initial First Layer Retained Loss | 133,366 | |||||
Current first layer retained loss | $ 133,366 | |||||
Percentage of population with production prior to period start date | 1.00% | |||||
Reinsurance Policy, Type [Axis]: 2022-2 XOL Transaction | ||||||
Deferred Compensation Arrangement with Individual, Excluding Share-based Payments and Postretirement Benefits [Line Items] | ||||||
Initial Reinsurance Coverage | $ 154,306 | |||||
Current Reinsurance Coverage | 152,347 | |||||
Initial First Layer Retained Loss | 78,906 | |||||
Current first layer retained loss | $ 78,906 | |||||
Percentage of population with production prior to period start date | 1.00% | |||||
Reinsurance Policy, Type [Axis]: 2022-3 XOL Transaction | ||||||
Deferred Compensation Arrangement with Individual, Excluding Share-based Payments and Postretirement Benefits [Line Items] | ||||||
Initial Reinsurance Coverage | $ 96,779 | |||||
Current Reinsurance Coverage | 96,197 | |||||
Initial First Layer Retained Loss | 106,265 | |||||
Current first layer retained loss | 106,265 | |||||
Reinsurance Policy, Type [Axis]: 2023-1 XOL Transaction | ||||||
Deferred Compensation Arrangement with Individual, Excluding Share-based Payments and Postretirement Benefits [Line Items] | ||||||
Initial Reinsurance Coverage | 89,864 | |||||
Current Reinsurance Coverage | 89,864 | |||||
Initial First Layer Retained Loss | 146,513 | |||||
Current first layer retained loss | $ 146,513 |
Reinsurance - Schedule of Amounts Related to QSR Transactions (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||
---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Ceded Credit Risk [Line Items] | ||||
Ceded premiums earned | $ (35,003) | $ (25,492) | $ (71,153) | $ (48,713) |
Third-party Reinsurers | ||||
Ceded Credit Risk [Line Items] | ||||
Ceded risk-in-force | 12,761,294 | 9,040,944 | 12,761,294 | 9,040,944 |
Ceded premiums earned | (42,002) | (30,231) | (84,098) | (59,236) |
Ceded claims and claim expenses (benefits) | 803 | (403) | 2,768 | (562) |
Ceding commission earned | 9,877 | 6,146 | 19,842 | 12,032 |
Profit commission | $ 23,486 | $ 17,778 | $ 45,765 | $ 34,501 |
Reserves for Insurance Claims and Claim Expenses - Narrative (Details) $ in Thousands |
6 Months Ended | |||
---|---|---|---|---|
Jun. 30, 2023
USD ($)
loan
claim
policy
|
Jun. 30, 2022
USD ($)
|
Dec. 31, 2022
USD ($)
policy
loan
|
Dec. 31, 2021
USD ($)
|
|
Liability for Claims and Claims Adjustment Expense [Line Items] | ||||
Primary loans in default | loan | 4,349 | 4,449 | ||
Total gross liability for unpaid claims and claim adjustment expenses | $ 110,448 | $ 98,462 | $ 99,836 | $ 103,551 |
Number of claims paid | claim | 67 | |||
Claims paid, including amounts covered by insurance | $ 1,700 | |||
Primary insured portfolio, loan default rate | 0.71% | 0.75% | ||
Total number of policies in-force | policy | 611,441 | 594,142 | ||
Favorable development on prior year defaults | $ 35,300 | $ 22,400 | ||
Reserve for prior year insurance claims and claim expenses | $ 53,100 | |||
Fannie Mae | ||||
Liability for Claims and Claims Adjustment Expense [Line Items] | ||||
Number of loans in pool past due 60 days or more | loan | 37 | |||
Risk-in-Force of loans in pool past due 60 days or more | $ 2,800 | |||
Loan-to-value ratio (less than) | 0.80 | |||
Claims applied to pool deductible | $ 1,000 | |||
Deductible on policy | $ 9,400 | |||
Reinsurance Policy, Type [Axis]: 2016 QSR Transaction | Fannie Mae | ||||
Liability for Claims and Claims Adjustment Expense [Line Items] | ||||
Percent of pool RIF reinsured | 100.00% | |||
Reinsurance Policy, Type [Axis]: QSR Transactions | ||||
Liability for Claims and Claims Adjustment Expense [Line Items] | ||||
Number of covered claims included in number of claims paid | claim | claim | 65 | |||
Component of claims paid covered under QSR Transaction | $ 300 |
Reserves for Insurance Claims and Claim Expenses - Reconciliation of Reserve Balances for Insurance Claims and Claim Expense (Details) - USD ($) $ in Thousands |
6 Months Ended | |
---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Liability for Unpaid Claims and Claims Adjustment Expense [Roll Forward] | ||
Beginning Balance | $ 99,836 | $ 103,551 |
Less reinsurance recoverables | (21,587) | (20,320) |
Beginning balance, net of reinsurance recoverables | 78,249 | 83,231 |
Claims and claim expenses (benefits) incurred: | ||
Current year | 44,870 | 18,787 |
Prior years | (35,296) | (22,442) |
Total claims and claim expenses (benefits) incurred | 9,574 | (3,655) |
Claims and claim expenses paid: | ||
Current year | 54 | 26 |
Prior years | 1,344 | 676 |
Total claims and claim expenses paid | 1,398 | 702 |
Reserve at end of period, net of reinsurance recoverables | 86,425 | 78,874 |
Add reinsurance recoverables | 24,023 | 19,588 |
Ending balance | 110,448 | 98,462 |
Current year case reserves | 39,100 | 14,000 |
Current year IBNR | 5,000 | 4,500 |
Prior year case reserves | 30,300 | 17,000 |
Prior year, IBNR | $ 4,500 | $ 4,700 |
Earnings per Share (EPS) - Schedule of Earnings Per Share, Basic and Diluted (Details) - USD ($) $ / shares in Units, shares in Thousands, $ in Thousands |
3 Months Ended | 6 Months Ended | ||||
---|---|---|---|---|---|---|
Jun. 30, 2023 |
Mar. 31, 2023 |
Jun. 30, 2022 |
Mar. 31, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
|
Basic EPS | ||||||
Net income | $ 80,284 | $ 74,458 | $ 75,444 | $ 67,680 | $ 154,742 | $ 143,124 |
Basic weighted average shares outstanding (in shares) | 82,958 | 85,734 | 83,277 | 85,842 | ||
Basic earnings per share (in dollars per share) | $ 0.97 | $ 0.88 | $ 1.86 | $ 1.67 | ||
Diluted EPS | ||||||
Net income | $ 80,284 | $ 74,458 | $ 75,444 | $ 67,680 | $ 154,742 | $ 143,124 |
Gain from change in fair value of warrant liability | 0 | (1,020) | 0 | (1,113) | ||
Diluted net income | $ 80,284 | $ 74,424 | $ 154,742 | $ 142,011 | ||
Basic weighted average shares outstanding (in shares) | 82,958 | 85,734 | 83,277 | 85,842 | ||
Dilutive effect of issuable shares (in shares) | 1,232 | 843 | 1,227 | 1,101 | ||
Dilutive weighted average shares outstanding (in shares) | 84,190 | 86,577 | 84,504 | 86,943 | ||
Diluted earnings per share (in dollars per share) | $ 0.95 | $ 0.86 | $ 1.83 | $ 1.63 | ||
Anti-dilutive shares (in shares) | 4 | 141 | 1 | 52 |
Income Taxes - Narrative (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | |||
---|---|---|---|---|---|
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
Dec. 31, 2022 |
|
Income Tax Disclosure [Abstract] | |||||
Effective income tax rate on pre-tax income or loss | 22.80% | 22.40% | 22.70% | 22.20% | |
Prepaid federal income taxes | $ 154,409 | $ 154,409 | $ 154,409 |
Stockholders' Equity - Narrative (Details) - USD ($) $ / shares in Units, shares in Millions |
6 Months Ended | 12 Months Ended | |
---|---|---|---|
Jun. 30, 2023 |
Dec. 31, 2022 |
Feb. 10, 2022 |
|
Equity [Abstract] | |||
Repurchase authorization | $ 125,000,000 | ||
Repurchased shares (in shares) | 1.7 | 2.9 | |
Shares repurchased, average price per share (in dollars per share) | $ 23.80 | $ 19.34 | |
Remaining authorized repurchase amount | $ 27,700,000 |
Premiums Receivable - Narrative (Details) $ in Millions |
6 Months Ended | 12 Months Ended |
---|---|---|
Jun. 30, 2023
USD ($)
d
|
Dec. 31, 2022
USD ($)
|
|
Insurance [Abstract] | ||
Number of days to be written off | d | 120 | |
Premium receivable, write-off period | 120 days | |
Premium receivable, allowance for credit loss, uncollected | $ | $ 2.7 | $ 2.3 |
Regulatory Information - Narrative (Details) - USD ($) $ in Thousands |
3 Months Ended | 6 Months Ended | ||||
---|---|---|---|---|---|---|
May 12, 2023 |
Jun. 30, 2023 |
Jun. 30, 2022 |
Jun. 30, 2023 |
Jun. 30, 2022 |
Dec. 31, 2022 |
|
NMIC and Re One combined | ||||||
Statutory Accounting Practices [Line Items] | ||||||
Net income amount | $ 28,100 | $ 25,600 | $ 49,900 | $ 44,200 | ||
Statutory capital | 2,340,609 | 2,340,609 | $ 2,246,263 | |||
Aggregate dividend capacity | 98,000 | 98,000 | ||||
Payment of ordinary dividends | $ 98,000 | |||||
Re One | ||||||
Statutory Accounting Practices [Line Items] | ||||||
Statutory capital | $ 5,600 | $ 5,600 | $ 5,600 |
Regulatory Information - Schedule of Statutory Net Income (loss), Surplus, Contingency Reserve and Risk-to-Capital Ratio (Details) - NMIC and Re One combined $ in Thousands |
Jun. 30, 2023
USD ($)
|
Dec. 31, 2022
USD ($)
|
---|---|---|
Statutory Accounting Practices [Line Items] | ||
Statutory surplus | $ 924,081 | $ 980,225 |
Contingency reserve | 1,416,528 | 1,266,038 |
Statutory capital | $ 2,340,609 | $ 2,246,263 |
Risk-to-capital | 11.3 | 11.1 |
Subsequent Events (Details) - USD ($) |
Jul. 28, 2023 |
Jul. 31, 2023 |
Feb. 10, 2022 |
---|---|---|---|
Subsequent Event [Line Items] | |||
Repurchase authorization | $ 125,000,000 | ||
Subsequent Event | |||
Subsequent Event [Line Items] | |||
Amount reinsured | $ 95,800,000 | ||
Second layer amount reinsured | $ 95,800,000 | ||
Subsequent Event | July 2023 Share Repurchase Program | |||
Subsequent Event [Line Items] | |||
Repurchase authorization | $ 200,000,000 | ||
Subsequent Event | 2022 Extended Share Repurchase Program | |||
Subsequent Event [Line Items] | |||
Repurchase authorization | $ 125,000,000 |
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