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Investments
 12 Months Ended
Dec. 31, 2024
Investments [Abstract]  
Investments

6. Investments

Available for Sale Securities

Our available for sale securities within our investment portfolio consisted of the following as of the dates indicated.

 

Available for sale securities

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2024

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(In thousands)

 

Amortized
Cost

 

 

Gross
Unrealized
Gains

 

 

Gross
Unrealized
Losses

 

 

 

Fair Value

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fixed maturities available for sale

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. government and agency securities

 

$

160,509

 

 

$

—

 

 

$

(32,177

)

 

 

$

128,332

 

State and municipal obligations

 

 

167,114

 

 

 

40

 

 

 

(18,263

)

 

 

 

148,891

 

Corporate bonds and notes

 

 

2,878,705

 

 

 

5,261

 

 

 

(277,535

)

 

 

 

2,606,431

 

RMBS

 

 

1,104,721

 

 

 

6,965

 

 

 

(100,056

)

 

 

 

1,011,630

 

CMBS

 

 

438,139

 

 

 

51

 

 

 

(26,191

)

 

 

 

411,999

 

CLO

 

 

411,328

 

 

 

983

 

 

 

(849

)

 

 

 

411,462

 

Other ABS

 

 

442,620

 

 

 

1,556

 

 

 

(5,305

)

 

 

 

438,871

 

Mortgage insurance-linked notes (1)

 

 

45,447

 

 

 

1,709

 

 

 

—

 

 

 

 

47,156

 

Total securities available for sale, including loaned securities

 

 

5,648,583

 

 

$

16,565

 

 

$

(460,376

)

(2)

 

 

5,204,772

 

Less: loaned securities (3)

 

 

137,082

 

 

 

 

 

 

 

 

 

 

129,852

 

Total fixed maturities available for sale

 

$

5,511,501

 

 

 

 

 

 

 

 

 

$

5,074,920

 

 

 

 

December 31, 2023

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(In thousands)

 

Amortized
Cost

 

 

Gross
Unrealized
Gains

 

 

Gross
Unrealized
Losses

 

 

 

Fair Value

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Fixed maturities available for sale

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. government and agency securities

 

$

171,194

 

 

$

93

 

 

$

(26,891

)

 

 

$

144,396

 

State and municipal obligations

 

 

158,539

 

 

 

283

 

 

 

(16,037

)

 

 

 

142,785

 

Corporate bonds and notes

 

 

2,876,175

 

 

 

12,286

 

 

 

(259,177

)

 

 

 

2,629,284

 

RMBS

 

 

1,089,919

 

 

 

8,250

 

 

 

(84,098

)

 

 

 

1,014,071

 

CMBS

 

 

605,029

 

 

 

51

 

 

 

(46,697

)

 

 

 

558,383

 

CLO

 

 

494,339

 

 

 

63

 

 

 

(6,553

)

 

 

 

487,849

 

Other ABS

 

 

286,988

 

 

 

1,608

 

 

 

(4,037

)

 

 

 

284,559

 

Foreign government and agency securities

 

 

5,128

 

 

 

—

 

 

 

(41

)

 

 

 

5,087

 

Mortgage insurance-linked notes (1)

 

 

47,456

 

 

 

1,540

 

 

 

—

 

 

 

 

48,996

 

Total securities available for sale, including loaned securities

 

 

5,734,767

 

 

$

24,174

 

 

$

(443,531

)

(2)

 

 

5,315,410

 

Less: loaned securities (3)

 

 

135,656

 

 

 

 

 

 

 

 

 

 

127,182

 

Total fixed maturities available for sale

 

$

5,599,111

 

 

 

 

 

 

 

 

 

$

5,188,228

 

 

(1)
Includes mortgage insurance-linked notes purchased by Radian Group in connection with the XOL Program. See Note 8 for more information.
(2)
See “Gross Unrealized Losses and Related Fair Value of Available for Sale Securities” below for additional details.
(3)
Included in other assets on our consolidated balance sheets. See “Loaned Securities” below for a discussion of our securities lending agreements.

Gross Unrealized Losses and Related Fair Value of Available for Sale Securities

For securities deemed “available for sale” that are in an unrealized loss position and for which an allowance for credit loss has not been established, the following tables show the gross unrealized losses and fair value, aggregated by investment category and length of time that individual securities have been in a continuous unrealized loss position, as of the dates indicated. Included in the amounts as of December 31, 2024 and 2023, are loaned securities that are classified as other assets on our consolidated balance sheets, as further described below.

 

Unrealized losses on fixed maturities available for sale by category and length of time

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2024

 

 

 

Less Than 12 Months

 

 

12 Months or Greater

 

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(In thousands)
Description of Securities

 

Fair Value

 

 

Unrealized
Losses

 

 

Fair Value

 

 

Unrealized
Losses

 

 

Fair Value

 

 

Unrealized
Losses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. government and agency securities

 

$

5,807

 

 

$

(574

)

 

$

113,783

 

 

$

(31,603

)

 

$

119,590

 

 

$

(32,177

)

State and municipal obligations

 

 

45,539

 

 

 

(2,399

)

 

 

78,523

 

 

 

(15,864

)

 

 

124,062

 

 

 

(18,263

)

Corporate bonds and notes

 

 

749,427

 

 

 

(18,113

)

 

 

1,552,535

 

 

 

(259,422

)

 

 

2,301,962

 

 

 

(277,535

)

RMBS

 

 

296,899

 

 

 

(6,467

)

 

 

559,525

 

 

 

(93,589

)

 

 

856,424

 

 

 

(100,056

)

CMBS

 

 

15,179

 

 

 

(139

)

 

 

388,282

 

 

 

(26,052

)

 

 

403,461

 

 

 

(26,191

)

CLO

 

 

44,350

 

 

 

(65

)

 

 

43,542

 

 

 

(784

)

 

 

87,892

 

 

 

(849

)

Other ABS

 

 

180,824

 

 

 

(3,081

)

 

 

45,192

 

 

 

(2,224

)

 

 

226,016

 

 

 

(5,305

)

Total

 

$

1,338,025

 

 

$

(30,838

)

 

$

2,781,382

 

 

$

(429,538

)

 

$

4,119,407

 

 

$

(460,376

)

 

 

December 31, 2023

 

 

Less Than 12 Months

 

 

12 Months or Greater

 

 

Total

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

(In thousands)
Description of Securities

 

Fair Value

 

 

Unrealized
Losses

 

 

Fair Value

 

 

Unrealized
Losses

 

 

Fair Value

 

 

Unrealized
Losses

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

U.S. government and agency securities

 

$

15,650

 

 

$

(938

)

 

$

113,678

 

 

$

(25,953

)

 

$

129,328

 

 

$

(26,891

)

State and municipal obligations

 

 

17,154

 

 

 

(551

)

 

 

104,949

 

 

 

(15,486

)

 

 

122,103

 

 

 

(16,037

)

Corporate bonds and notes

 

 

161,924

 

 

 

(1,261

)

 

 

2,055,113

 

 

 

(257,916

)

 

 

2,217,037

 

 

 

(259,177

)

RMBS

 

 

113,506

 

 

 

(1,439

)

 

 

653,955

 

 

 

(82,659

)

 

 

767,461

 

 

 

(84,098

)

CMBS

 

 

8,558

 

 

 

(31

)

 

 

546,104

 

 

 

(46,666

)

 

 

554,662

 

 

 

(46,697

)

CLO

 

 

15,083

 

 

 

(25

)

 

 

438,294

 

 

 

(6,528

)

 

 

453,377

 

 

 

(6,553

)

Other ABS

 

 

49,513

 

 

 

(322

)

 

 

64,078

 

 

 

(3,715

)

 

 

113,591

 

 

 

(4,037

)

Foreign government and agency securities

 

 

—

 

 

 

—

 

 

 

5,087

 

 

 

(41

)

 

 

5,087

 

 

 

(41

)

Total

 

$

381,388

 

 

$

(4,567

)

 

$

3,981,258

 

 

$

(438,964

)

 

$

4,362,646

 

 

$

(443,531

)

 

There were 1,059 and 1,063 securities in an unrealized loss position at December 31, 2024 and 2023, respectively. We determined that these unrealized losses were due to non-credit factors and that, as of December 31, 2024, we did not expect to realize a loss for our investments in an unrealized loss position given our intent and ability to hold these investment securities until recovery of their amortized cost basis. See Note 2 for information regarding our accounting policy for impairments of investments.

Contractual Maturities

The contractual maturities of fixed-maturities available for sale were as follows.

 

Contractual maturities of fixed maturities available for sale

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

December 31, 2024

 

(In thousands)

 

Amortized Cost

 

 

Fair Value

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Due in one year or less

 

$

134,289

 

 

$

133,121

 

Due after one year through five years (1)

 

 

1,104,983

 

 

 

1,067,941

 

Due after five years through 10 years (1)

 

 

1,032,245

 

 

 

954,004

 

Due after 10 years (1)

 

 

934,811

 

 

 

728,588

 

Asset-backed and mortgage-backed securities (2)

 

 

2,442,255

 

 

 

2,321,118

 

Total

 

 

5,648,583

 

 

 

5,204,772

 

Less: loaned securities

 

 

137,082

 

 

 

129,852

 

Total fixed maturities available for sale

 

$

5,511,501

 

 

$

5,074,920

 

 

(1)
Actual maturities may differ as a result of calls before scheduled maturity.
(2)
Includes RMBS, CMBS, CLO, Other ABS and mortgage insurance-linked notes, which are not due at a single maturity date.

Net Investment Income

Net investment income consisted of the following.

 

Net investment income

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Years Ended December 31,

 

 

 

 

 

 

 

 

 

 

 

(In thousands)

 

2024

 

 

2023

 

 

2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Investment income

 

 

 

 

 

 

 

 

 

Fixed maturities

 

$

231,769

 

 

$

226,654

 

 

$

184,189

 

Equity securities

 

 

12,003

 

 

 

13,420

 

 

 

11,210

 

Residential mortgage loans held for sale (1)

 

 

22,569

 

 

 

4,212

 

 

 

39

 

Short-term investments

 

 

31,736

 

 

 

18,840

 

 

 

5,716

 

Other (2)

 

 

6,282

 

 

 

5,286

 

 

 

1,370

 

Gross investment income

 

 

304,359

 

 

 

268,412

 

 

 

202,524

 

Investment expenses (2)

 

 

(11,666

)

 

 

(9,982

)

 

 

(6,866

)

Net investment income

 

$

292,693

 

 

$

258,430

 

 

$

195,658

 

 

(1)
See Note 7 for additional information on our residential mortgage loans held for sale.
(2)
Includes the impact from our securities lending activities. Investment expenses also include other investment management expenses.

Net Gains (Losses) on Investments and Other Financial Instruments

Net gains (losses) on investments and other financial instruments consisted of the following.

 

Net gains (losses) on investments and other financial instruments

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Years Ended December 31,

 

 

 

 

 

 

 

 

 

 

 

(In thousands)

 

2024

 

 

2023

 

 

2022

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

Net realized gains (losses) on investments sold or redeemed (1)

 

 

 

 

 

 

 

 

 

Fixed maturities available for sale

 

 

 

 

 

 

 

 

 

Gross realized gains

 

$

3,428

 

 

$

1,609

 

 

$

2,763

 

Gross realized losses

 

 

(12,465

)

 

 

(15,346

)

 

 

(12,737

)

Fixed maturities available for sale, net

 

 

(9,037

)

 

 

(13,737

)

 

 

(9,974

)

Fixed maturities trading securities

 

 

(704

)

 

 

(402

)

 

 

(135

)

Equity securities

 

 

1,867

 

 

 

3,350

 

 

 

1,655

 

Other investments

 

 

69

 

 

 

56

 

 

 

148

 

Net realized gains (losses) on investments sold or redeemed (1)

 

 

(7,805

)

 

 

(10,733

)

 

 

(8,306

)

Change in unrealized gains (losses) on investments sold or redeemed (1)

 

 

(281

)

 

 

915

 

 

 

(3,458

)

Impairment losses due to intent to sell

 

 

(369

)

 

 

—

 

 

 

—

 

Net unrealized gains (losses) on investments still held (1)

 

 

 

 

 

 

 

 

 

Fixed maturities trading securities

 

 

(3,135

)

 

 

2,308

 

 

 

(27,700

)

Equity securities

 

 

3,054

 

 

 

7,625

 

 

 

(25,255

)

Other investments

 

 

75

 

 

 

25

 

 

 

(387

)

Net unrealized gains (losses) on investments still held (1)

 

 

(6

)

 

 

9,958

 

 

 

(53,342

)

Total net gains (losses) on investments (1)

 

 

(8,461

)

 

 

140

 

 

 

(65,106

)

Net gains (losses) on residential mortgage loans held for sale (Note 7) (2)

 

 

(5,798

)

 

 

814

 

 

 

48

 

Net gains (losses) on other financial instruments (1) (3)

 

 

4,145

 

 

 

9,287

 

 

 

(15,675

)

Net gains (losses) on investments and other financial instruments

 

$

(10,114

)

 

$

10,241

 

 

$

(80,733

)

 

(1)
Excludes activities related to our residential mortgage loans held for sale. See Note 7 for additional information.
(2)
Includes realized and unrealized net gains (losses) on residential mortgage loans held for sale and related activities, including interest rate hedges. See Note 7 for additional details.
(3)
Includes changes in the fair value of embedded derivatives associated with our XOL Program. See Note 8 for additional information.

Loaned Securities

We participate in a securities lending program whereby we loan certain securities in our investment portfolio to third-party borrowers for short periods of time. These securities lending agreements are collateralized financing arrangements whereby we transfer securities to third parties through an intermediary in exchange for cash or other securities. However, pursuant to the terms of these agreements, we maintain effective control over all loaned securities. Although we report such securities at fair value within other assets in our consolidated balance sheets, rather than within investments, the detailed information we provide in this Note 6 includes these securities. See Note 5 for additional detail on the loaned securities.

Under our securities lending agreements, the borrower is required to provide to us collateral, consisting of cash or securities, in amounts generally equal to or exceeding: (i) 102% of the value of the loaned securities (105% in the case of foreign securities) or (ii) another agreed-upon percentage not less than 100% of the market value of the loaned securities. Any cash collateral we receive may be invested in liquid assets. Cash collateral, which is reinvested for our benefit by the intermediary in accordance with the investment guidelines contained in the securities lending and collateral agreements, is reflected in short-term investments, with an offsetting liability recognized in other liabilities for the obligation to return the cash collateral. Securities collateral we receive is held on deposit for the borrower’s benefit and we may not transfer or loan such securities collateral unless the borrower is in default. Therefore, such securities collateral is not reflected in our consolidated financial statements given that the risks and rewards of ownership are not transferred to us from the borrowers.

Fees received and paid in connection with securities lending agreements are recorded in net investment income on the consolidated statements of operations.

All of our securities lending agreements are classified as overnight and revolving. Securities collateral on deposit with us from third-party borrowers totaling $18 million and $61 million as of December 31, 2024 and 2023, respectively, may not be transferred or re-pledged unless the third-party borrower is in default, and is therefore not reflected in our consolidated financial statements.

Other

Our investments include securities totaling $14 million at both December 31, 2024 and 2023, that are on deposit and serving as collateral with various state regulatory authorities. Our fixed-maturities available for sale also include securities serving as collateral for our FHLB advances. See Note 12 for additional information about our FHLB advances.