Note 9 - Losses and LAE (Tables)

6 Months Ended

Jun. 30, 2015

Reserve for Losses and LAE by category [Table Text Block]

The following table shows our reserve for losses and LAE by category at the end of each period indicated:



(In thousands)	June 30, 2015		December 31, 2014
Reserve for losses by category:
Prime	$	562,918	$	700,174
Alt-A	256,854		292,293
A minus and below	148,043		179,103
IBNR and other	125,038		223,114
LAE	48,141		56,164
Reinsurance recoverable (1)	11,677		26,665
Total primary reserve	1,152,671		1,477,513
Pool	47,902		75,785
IBNR and other	891		1,775
LAE	2,353		3,542
Total pool reserve	51,146		81,102
Total First-lien reserve	1,203,817		1,558,615
Second-lien and other (2)	975		1,417
Total reserve for losses	$	1,204,792	$	1,560,032

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(1)	Primarily represents ceded losses on captive transactions and the QSR Transactions.


(2)	Does not include our Second-lien PDR that is included in other liabilities.

Schedule of Liability for Unpaid Claims and Claims Adjustment Expense [Table Text Block]

The following table presents information relating to our reserve for losses, including our IBNR reserve and LAE but excluding Second-lien PDR, for the periods indicated:



	Three Months Ended June 30,						Six Months Ended June 30,
(In thousands)	2015			2014			2015			2014
Balance at beginning of period	$	1,384,714		$	1,893,960		$	1,560,032		$	2,164,353
Less reinsurance recoverables (1)	13,365			25,751			26,665			38,363
Balance at beginning of period, net of reinsurance recoverables	1,371,349			1,868,209			1,533,367			2,125,990
Add losses and LAE incurred in respect of default notices reported and unreported in:
Current year (2) (3)	53,617			75,472			134,054			184,321
Prior years (3)	(19,835		)	(11,207		)	(55,195		)	(70,896		)
Total incurred	33,782			64,265			78,859			113,425
Deduct paid claims and LAE related to:
Current year (2)	576			803			576			803
Prior years	211,440			239,448			418,535			546,389
Total paid	212,016			240,251			419,111			547,192
Balance at end of period, net of reinsurance recoverables	1,193,115			1,692,223			1,193,115			1,692,223
Add reinsurance recoverables (1)	11,677			22,458			11,677			22,458
Balance at end of period	$	1,204,792		$	1,714,681		$	1,204,792		$	1,714,681

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(1)	Related to ceded losses on captive reinsurance transactions and the QSR Transactions. See Note 7 for additional information.


(2)	Related to underlying defaulted loans with a most recent default notice dated in the year indicated. For example, if a loan had defaulted in a prior year, but then subsequently cured and later re-defaulted in the current year, that default would be considered a current year default.

(3)

Amounts previously reported for losses and LAE incurred in respect of default notices reported and unreported in current year and prior years have been reclassified to correct an error. There was no net change to total incurred losses in any period as a result of these reclassifications. For the three and six months ended June 30, 2014, the amounts previously reported for losses and LAE incurred in respect of default notices reported and unreported in current year have been revised downward by approximately $14.4 million and $48.2 million, respectively, with an equal and offsetting adjustment to the amount previously reported for default notices reported and unreported in prior years. For the years ended December 31, 2014, 2013 and 2012, the amounts previously reported related to losses and LAE incurred from current year default notices should have been lower by approximately $71.8 million, $65.0 million and $75.7 million, respectively, with equal and offsetting adjustments to the incurred loss amounts related to prior years’ default notices.

Rescissions And Denials [Table Text Block]

The following table illustrates the amount of First-lien claims submitted to us for payment that were rescinded or denied, for the periods indicated, net of any Reinstatements of previous Rescissions or Claim Denials within each period. Net (Reinstatements), Rescissions or Claim Denials related to the BofA Settlement Agreement represent such activities, prior to the February 1, 2015 Implementation Date, on loans that subsequently became subject to the BofA Settlement Agreement.



	Three Months Ended June 30,						Six Months Ended June 30,
(In millions)	2015			2014			2015			2014
Rescissions, net	$	3.4		$	7.6		$	7.2		$	14.0
Claim Denials, net	3.6			6.4			9.2			25.3
Net (Reinstatements), Rescissions or Claim Denials related to the BofA Settlement Agreement	(47.1		)	(2.5		)	(71.2		)	0.5
Net First-lien claims submitted for payment that were (reinstated), rescinded or denied (1)	$	(40.1	)	$	11.5		$	(54.8	)	$	39.8

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(1)	Includes an amount related to a small number of submitted claims that were subsequently withdrawn by the insured.