Enact Mortgage Insurance Completes XOL Reinsurance Transaction as Part of its Diversified Credit Risk Transfer Program
Enact Holdings, a leading provider of private mortgage insurance through its insurance subsidiaries, today announced that its flagship legal entity, Enact Mortgage Insurance Corporation, has secured approximately $325 million of additional excess of loss (“XOL”) reinsurance coverage. This credit risk transfer (CRT) transaction covers a portfolio of existing mortgage insurance policies written from July 1, 2021 through December 31, 2021, and is effective March 1, 2022. Reinsurance coverage is provided by a panel of reinsurers each currently rated “A-” or better by Standard & Poor’s or A.M. Best Company, Inc.
“Today’s announcement reflects the continued execution of our growth and risk management strategy and demonstrates our ability to source cost effective PMIERs capital and loss protection in a period of capital markets volatility and widening spreads,” said Enact’s President & CEO Rohit Gupta. “Enact’s CRT program allows us to participate effectively across reinsurance markets with highly rated counterparties and in the capital markets via mortgage insurance linked notes. We select the type and structure of our CRT transactions based on several factors, including market conditions, capacity, and cost, with a focus on further strengthening our capital position and improving capital efficiency while driving shareholder value.”
This latest CRT transaction follows the forward XOL reinsurance transaction executed in January of 2022, covering a portion of mortgage insurance policies written from January 1, 2022 to December 31, 2022, that is expected to provide approximately $300 million of reinsurance coverage from a panel of reinsurers.
Since 2015, Enact has executed approximately $4.4 billion of CRT transactions, including approximately $2.6 billion of reinsurance coverage with highly rated reinsurers and approximately $1.8 billion through our Triangle Re mortgage insurance linked note platform.
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