AI-extracted from the 10-Q filed 2026-08-07 — Q2 2026 (six months ended June 30, 2026). Every figure is machine-verified against the filing text on SEC EDGAR.
Net income of $361.5M driven by $536.9M net premiums earned and $120.9M net investment income, with mortgage insurance segment generating $402.7M pre-tax income as portfolio matures.
Biggest Revenue Drivers
Net premiums earned$536.9M+8.5% YoY
Increase driven by property and casualty reinsurance assumed beginning January 1, 2026, partially offset by lower mortgage insurance average net premium rates.
Net investment income$120.9M+2.9% YoY
Increase due to higher pre-tax investment income yield (3.89% vs. 3.81%) and stable average portfolio balance of $6.4B.
Biggest Revenue Drivers
Total revenue: $698.8M+9.8% YoY
Net premiums earned$536.9M+8.5% YoY
Increase driven by property and casualty reinsurance assumed beginning January 1, 2026, partially offset by lower mortgage insurance average net premium rates.
Net investment income$120.9M+2.9% YoY
Increase due to higher pre-tax investment income yield (3.89% vs. 3.81%) and stable average portfolio balance of $6.4B.
Other income$11.7M-9.7% YoY
Decline in underwriting consulting services revenues to third-party reinsurers, partially offset by title settlement services and contract underwriting.
Largest Expense Items
Other underwriting and operating expenses$148.2M+10.7% YoY
Increase driven by higher acquisition costs and professional fees related to property and casualty reinsurance, partially offset by lower Mortgage Insurance segment headcount.
Interest expense$16.3M0% YoY
No change; $500M senior notes at 6.25% weighted average rate.
Margins: Combined ratio for Mortgage Insurance improved to 31.6% from 27.5% YoY due to aging portfolio entering peak claim years, offset by favorable prior-year development of $54.2M. Reinsurance segment's combined ratio widened to 74.6% from 18.1% due to property and casualty business assumed at higher loss ratios.
Watch Items from the Filing
Mortgage insurance portfolio aging: 47% of IIF is at least three years old as of June 30, 2026, entering peak claims period; provision for losses increased 101% YoY, and average reserve per default rose to $23.4K from $20.0K.
Property and casualty reinsurance concentration: Effective January 1, 2026, Essent Re began reinsuring P&C risks; non-mortgage premiums represented 83% of Reinsurance segment NIW in Q2 2026 with 39.3% loss ratio vs. 0.3% for mortgage business.
Bermuda tax exposure: Company qualifies for LIP exemption from 15% corporate income tax for five years ending December 2028; future strategic decisions could impact qualification, and exemption interpretation remains subject to regulatory risk.
AI-extracted and verified against SEC EDGAR filing text. Not investment advice.
