XML 33 R45.htm IDEA: XBRL DOCUMENT v2.4.0.6
Loss Reserves (Details) (USD $)
3 Months Ended 6 Months Ended 9 Months Ended 12 Months Ended
Sep. 30, 2012
Sep. 30, 2011
Jun. 30, 2009
Sep. 30, 2012
Sep. 30, 2011
Dec. 31, 2011
Dec. 31, 2010
Dec. 31, 2009
Loss Reserve [Roll Forward]                
Reserve at beginning of period       $ 4,557,512,000 $ 5,884,171,000 $ 5,884,171,000    
Less reinsurance recoverable       154,607,000 275,290,000 275,290,000    
Net reserve at beginning of year       4,402,905,000 [1] 5,608,881,000 [1] 5,608,881,000 [1]    
Loss Reserve Reduction From Rescission 500,000,000 800,000,000   500,000,000 800,000,000 700,000,000 1,300,000,000  
Losses and LAE incurred in respect of default notices received to [Abstract]                
Current year       1,091,326,000 1,328,906,000      
Prior years       287,291,000 [2] (96,269,000) [2]      
Subtotal       1,378,617,000 [3] 1,232,637,000 [3]      
Losses and LAE paid in respect of default notices received to [Abstract]                
Current year       54,813,000 37,111,000      
Prior years       1,840,992,000 2,218,490,000      
Reinsurance terminations       (425,000) [4] (38,769,000) [4]      
Subtotal       1,895,380,000 [5] 2,216,832,000 [5]      
Net reserve at end of period 3,886,142,000 [6] 4,624,686,000 [6]   3,886,142,000 [6] 4,624,686,000 [6] 4,402,905,000 [1] 5,608,881,000 [1]  
Plus reinsurance recoverables 117,859,000 166,874,000   117,859,000 166,874,000 154,607,000 275,290,000  
Reserve at end of period 4,004,001,000 4,791,560,000   4,004,001,000 4,791,560,000 4,557,512,000 5,884,171,000  
Paid Losses Mitigated By Rescission Amount       200,000,000 500,000,000      
Loss Reserve Reduction From Rescission 500,000,000 800,000,000   500,000,000 800,000,000 700,000,000 1,300,000,000  
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items]                
Historical average period for uncured default to develop into paid claim       12 months        
Premium refund liability, expected claim payments 118,000,000     118,000,000   114,000,000    
Aging of the Primary Default Inventory [Abstract]                
3 months or less 25,593 33,167   25,593 33,167 31,456    
3 months or less (in hundredths) 17.00% 18.00%   17.00% 18.00% 18.00%    
4 - 11 months 35,029 45,110   35,029 45,110 46,352    
4 - 11 months (in hundredths) 24.00% 25.00%   24.00% 25.00% 26.00%    
12 months or more 88,263 102,617   88,263 102,617 97,831    
12 months or more (in hundredths) 59.00% 57.00%   59.00% 57.00% 56.00%    
Total primary default inventory 148,885 180,894   148,885 180,894 175,639 214,724  
Total primary default inventory (in hundredths) 100.00% 100.00%   100.00% 100.00% 100.00%    
Primary claims received inventory included in ending default inventory 12,508 [7] 13,799 [7]   12,508 [7] 13,799 [7] 12,610 [7]    
Primary claims received inventory included in ending default inventory (in hundredths) 8.00% [7] 8.00% [7]   8.00% [7] 8.00% [7] 7.00% [7]    
Number of rescindable loans affected by Company's decision to suspend rescissions 1,700     1,700        
Total potential claim payments of rescindable loans affected by Company's decision to suspend rescissions 125,000,000     125,000,000        
Number of rescindable loans affected by Company's decision to suspend rescissions for customers other than Countrywide 350     350        
Total potential claim payments of rescindable loans affected by Company's decision to suspend rescissions for customers other than Countrywide 23,000,000     23,000,000        
Number of payments delinquent [Abstract]                
3 payments or less 35,130 43,312   35,130 43,312 42,804    
3 payments or less (in hundredths) 24.00% 24.00%   24.00% 24.00% 24.00%    
4 - 11 payments 36,359 47,929   36,359 47,929 47,864    
4 - 11 payments (in hundredths) 24.00% 26.00%   24.00% 26.00% 27.00%    
12 payments or more 77,396 89,653   77,396 89,653 84,971    
12 payments or more (in hundredths) 52.00% 50.00%   52.00% 50.00% 49.00%    
Total primary default inventory 148,885 180,894   148,885 180,894 175,639 214,724  
Total primary default inventory (in hundredths) 100.00% 100.00%   100.00% 100.00% 100.00%    
Claims resolved by rescissions [Abstract]                
Mitigation of paid losses by rescission of policies       200,000,000   600,000,000 1,200,000,000 1,200,000,000
Percentage of claims received in a quarter resolved by rescission, lower range limit (in hundredths)       8.00%       8.00%
Percentage of claims received in a quarter resolved by rescission, upper range limit (in hundredths)     28.00% 13.00%       13.00%
Number of rescindable loans affected by Company's decision to suspend rescissions 1,700     1,700        
Total potential claim payments of rescindable loans affected by Company's decision to suspend rescissions 125,000,000     125,000,000        
Number of rescindable loans affected by Company's decision to suspend rescissions for customers other than Countrywide 350     350        
Total potential claim payments of rescindable loans affected by Company's decision to suspend rescissions for customers other than Countrywide 23,000,000     23,000,000        
Estimated Rescission Reduction - Loss Reserve [Roll Forward]                
Estimated rescission reduction - beginning reserve 600,000,000 900,000,000   700,000,000 1,300,000,000 1,300,000,000    
Estimated rescission reduction - losses incurred 0 0   0 0      
Rescission reduction - paid claims 100,000,000 100,000,000   200,000,000 500,000,000      
Amounts that may have been applied to a deductible 0 0   0 0      
Net rescission reduction - paid claims 100,000,000 100,000,000   200,000,000 500,000,000      
Estimated rescission reduction - ending reserve 500,000,000 [8] 800,000,000 [8]   500,000,000 [8] 800,000,000 [8] 700,000,000 1,300,000,000  
Premium refund liability, expected future rescissions 49,000,000     49,000,000   58,000,000    
Statute of limitations to bring legal proceedings disputing right to rescind coverage 3 years     3 years        
Number of settlement agreements approved by GSEs 1     1        
Primary Default Inventory [Roll Forward]                
Default inventory at beginning of period 153,990 184,452   175,639 214,724 214,724    
Plus: New Notices 34,432 44,342   101,454 127,509      
Less: Cures (27,384) (34,335)   (90,896) (115,806)      
Less: Paids (including those charged to a deductible or captive) (11,344) (12,033)   (34,991) (39,052)      
Less: Rescissions and denials (809) (1,532)   (2,321) (6,481)      
Default inventory at end of period 148,885 180,894   148,885 180,894 175,639 214,724  
Pool insurance notice inventory [Abstract]                
Pool insurance notice inventory (in number of loans) 9,337 33,792   9,337 33,792 32,971    
Number of notices removed from pool notice inventory 15,600              
Increase (Decrease) in Severity, Primary Defaults [Member]
               
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items]                
Change in loss reserves         105,000,000      
Percentage of prior year default inventory resolved (in hundredths)         49.00%      
Decrease in Estimated Loss Adjustment Expenses [Member]
               
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items]                
Change in loss reserves         121,000,000      
Increase (Decrease) in Expected Claim Rate [Member]
               
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items]                
Change in loss reserves       300,000,000 180,000,000      
Increase (Decrease) in Severity, Pool Defaults [Member]
               
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items]                
Change in loss reserves         50,000,000      
Increase (Decrease) Related to Pool Reserves, LAE Reserves and Reinsurance [Member]
               
Causes of Increase (Decrease) in Liability for Unpaid Claims and Claims Adjustment Expense [Line Items]                
Change in loss reserves       $ 13,000,000        
[1] At December 31, 2011 and 2010, the estimated reduction in loss reserves related to rescissions approximated $0.7 billion and $1.3 billion, respectively.
[2] A negative number for prior year losses incurred indicates a redundancy of prior year loss reserves, and a positive number for prior year losses incurred indicates a deficiency of prior year loss reserves.
[3] Rescissions did not have a significant impact on incurred losses in the nine months ended September 30, 2012 or 2011.
[4] In a termination, the reinsurance agreement is cancelled, with no future premium ceded and funds for any incurred but unpaid losses transferred to us. The transferred funds result in an increase in our investment portfolio (including cash and cash equivalents) and a decrease in net losses paid (reduction to losses incurred). In addition, there is an offsetting decrease in the reinsurance recoverable (increase in losses incurred), and thus there is no net impact to losses incurred.
[5] Rescissions mitigated our paid losses by an estimated $0.2 billion in the nine months ended September 30, 2012 and by an estimated $0.5 billion in the nine months ended September 30, 2011, which excludes amounts that may have been applied to a deductible.
[6] At September 30, 2012 and 2011, the estimated reduction in loss reserves related to rescissions approximated $0.5 billion and $0.8 billion, respectively.
[7] As discussed in Note 5 – "Litigation and Contingencies" we are in mediation in an effort to resolve our dispute with Countrywide. In connection with that mediation, we have voluntarily suspended rescissions of coverage related to loans that we believe could be included in a potential resolution. As of September 30, 2012, coverage on approximately 1,700 loans, representing total potential claim payments of approximately $125 million, that we had determined was rescindable was affected by our decision to suspend such rescissions. Substantially all of these potential rescissions relate to claims received beginning in the first quarter of 2011 or later and, had we not suspended rescissions, most of these rescissions would have been processed in the first nine months of 2012. In addition, as of September 30, 2012, approximately 350 rescissions, representing total potential claim payments of approximately $23 million, were affected by our decision to suspend rescissions for customers other than Countrywide.
[8] As noted in Note 5 – "Litigation and Contingencies" we are in mediation in an effort to resolve our dispute with Countrywide. In connection with that mediation, we have voluntarily suspended rescissions of coverage related to loans that we believe could be included in a potential resolution. As of September 30, 2012, coverage on approximately 1,700 loans, representing total potential claim payments of approximately $125 million, that we had determined was rescindable was affected by our decision to suspend such rescissions. Substantially all of these potential rescissions relate to claims received beginning in the first quarter of 2011 or later and, had we not suspended rescissions, most of these rescissions would have been processed in the first nine months of 2012. In addition, as of September 30, 2012, approximately 350 rescissions, representing total potential claim payments of approximately $23 million, were affected by our decision to suspend rescissions for customers other than Countrywide. Although the loans with suspended rescissions are included in our delinquency inventory, for purposes of determining our reserve amounts, it is assumed that coverage on these loans will be rescinded, and thus are included in the estimated $0.5 million estimated rescission reduction to ending reserves at September 30, 2012. The decision to suspend these potential rescissions does not represent the only reason for the recent decline in the percentage of claims that have been resolved through rescissions and we continue to expect that our rescissions will continue to decline.