MGIC INVESTMENT CORP

Previous wording

The following is management’s discussion and analysis of the financial condition and results of operations of MGIC Investment Corporation for the second quarter of 2025. As used below, “we” and “our” refer to MGIC Investment Corporation’s consolidated operations. This form 10-Q should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2024. See the“Glossary of terms and acronyms” for definitions and descriptions of terms used throughout this MD&A. Our revenues and losses could be affected by the Risk Factors referred to under “Forward Looking Statements and Risk Factors” below, and they are an integral part of the MD&A.

Current wording

The following is management’s discussion and analysis of the financial condition and results of operations of MGIC Investment Corporation for the third quarter of 2025. As used below, “we” and “our” refer to MGIC Investment Corporation’s consolidated operations. This form 10-Q should be read in conjunction with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” in our Annual Report on Form 10-K for the year ended December 31, 2024. See the“Glossary of terms and acronyms” for definitions and descriptions of terms used throughout this MD&A. Our revenues and losses could be affected by the Risk Factors referred to under “Forward Looking Statements and Risk Factors” below, and they are an integral part of the MD&A.

Previous wording

We recorded second quarter 2025 net income of $192.5 million, or $0.81 per diluted share. Net income decreased by $11.7 million from net income of $204.2 million, or $0.77 per diluted share, in the prior year. The decrease is primarily due to an increase in losses incurred, net in the three months ended June 30, 2025 compared with the same period in the prior year. Diluted income per share increased primarily due to a decrease in the number of diluted weighted shares outstanding offset partially by a decrease in net income.

Current wording

We recorded third quarter 2025 net income of $191.1 million (Q3 2024: $200.0 million), or $0.83 per diluted share (Q3 2024: $0.77). The decrease in net income is primarily due to an increase in losses incurred, net, offset partially by a decrease in the provision for income taxes in the three months ended September 30, 2025 compared with the same period in the prior year. Diluted income per share increased primarily due to a decrease in the number of diluted weighted shares outstanding partially offset by a decrease in net income.

Previous wording

Adjusted net operating income for the second quarter 2025 was $194.0 million (Q2 2024: $204.9 million) and adjusted net operating income per diluted share was $0.82 (Q2 2024: $0.77). The decrease in adjusted net operating income primarily reflects a decrease in net income. The increase in adjusted net operating income per diluted share primarily reflects a decrease in the number of diluted weighted shares outstanding partially offset by a decrease in adjusted net operating income.

Current wording

Adjusted net operating income for the third quarter 2025 was $190.8 million (Q3 2024: $200.7 million) and adjusted net operating income per diluted share was $0.83 (Q3 2024: $0.77). The decrease in adjusted net operating income primarily reflects a decrease in net income. The increase in adjusted net operating income per diluted share primarily reflects a decrease in the number of diluted weighted shares outstanding partially offset by a decrease in adjusted net operating income.

Previous wording

Losses incurred, net for the second quarter of 2025 were $(2.8) million, compared with $(18.3) million for the same period last year. While new delinquency notices added approximately $51.6 million to our loss reserves for the three months ended June 30, 2025, our re-estimation of loss reserves on previously received delinquency notices resulted in favorable development of approximately $54.4 million. For the three months ended June 30, 2024, new delinquency notices added approximately $49.1 million to our loss reserves, offset by our re-estimation of loss reserves on previously received delinquency notices resulting in favorable development of approximately $67.4 million. The favorable development for both periods primarily resulted from a decrease in the expected claim rate on previously received delinquencies. Home price appreciation experienced in recent years has allowed some borrowers to cure their delinquencies through the sale of their property.

Current wording

Losses incurred, net for the third quarter of 2025 were $10.9 million, compared with $(9.8) million for the same period last year. While new delinquency notices added approximately $43.1 million to our loss reserves for the three months ended September 30, 2025, our re-estimation of loss reserves on previously received delinquency notices resulted in favorable development of approximately $32.1 million. For the three months ended September 30, 2024, new delinquency notices added approximately $55.8 million to our loss reserves, offset by our re-estimation of loss reserves on previously received delinquency notices resulting in favorable development of approximately $65.6 million. The favorable development for both periods primarily resulted from a decrease in the expected claim rate on previously received delinquencies. Home price appreciation experienced in recent years has allowed some borrowers to cure their delinquencies through the sale of their property.

Previous wording

We recorded net income of $377.9 million, or $1.56 per diluted share. Net income decreased by $0.4 million from net income of $378.3 million, or $1.40 per diluted share in the prior year. The decrease is primarily due to an increase in losses incurred, net. This was partially offset by a decrease in other underwriting and operating expenses, net as well as the change in net gains and losses on investments and other financial instruments. Diluted income per share increased primarily due to a decrease in the number of diluted weighted shares outstanding partially offset by a decrease in net income.

Current wording

We recorded net income of $569.0 million (2024: $578.3 million), or $2.39 per diluted share (2024: $2.17). The decrease in net income is primarily due to an increase in losses incurred, net, partially offset by a decrease in underwriting and other expenses, net, a decrease in the provision for income taxes, as well as the change in net gains and losses on investments and other financial instruments. Diluted income per share increased primarily due to a decrease in the number of diluted weighted shares outstanding partially offset by a decrease in net income.

Previous wording

Adjusted net operating income for the six months ended June 30, 2025, was $379.2 million (2024: $383.3 million) and adjusted net operating income per diluted share was $1.57 (2024: $1.42). The decrease in adjusted net operating income primarily reflects a decrease in net income. The increase in adjusted net operating income per diluted share primarily reflects a decrease in the number of diluted weighted shares outstanding partially offset by a decrease in adjusted net operating income.

Current wording

Adjusted net operating income for the nine months ended September 30, 2025, was $570.0 million (2024: $584.0 million) and adjusted net operating income per diluted share was $2.39 (2024: $2.19). The decrease in adjusted net operating income primarily reflects a decrease in net income. The increase in adjusted net operating income per diluted share primarily reflects a decrease in the number of diluted weighted shares outstanding partially offset by a decrease in adjusted net operating income.

Previous wording

Losses incurred, net for the six months ended June 30, 2025 were $6.8 million, compared with $(13.7) million for the same period last year. While new delinquency notices added approximately $111.1 million to our loss reserves for the six months ended June 30, 2025, our re-estimation of loss reserves on previously received delinquency notices resulted in favorable development of approximately $104.3 million. For the six months ended June 30, 2024, new delinquency notices added approximately $102.6 million to our loss reserves, offset by our re-estimation of loss reserves on previously received delinquency notices resulting in favorable development of approximately $116.3 million. The favorable development for both periods primarily resulted from a decrease in the expected claim rate on previously received delinquencies. Home price appreciation experienced in recent years has allowed some borrowers to cure their delinquencies through the sale of their property.

Current wording

Losses incurred, net for the nine months ended September 30, 2025 were $17.7 million, compared with $(23.6) million for the same period last year. While new delinquency notices added approximately $154.2 million to our loss reserves for the nine months ended September 30, 2025, our re-estimation of loss reserves on previously received delinquency notices resulted in favorable development of approximately $136.5 million. For the nine months ended September 30, 2024, new delinquency notices added approximately $158.3 million to our loss reserves, offset by our re-estimation of loss reserves on previously received delinquency notices resulting in favorable development of approximately $181.9 million. The favorable development for both periods primarily resulted from a decrease in the expected claim rate on previously received delinquencies. Home price appreciation experienced in recent years has allowed some borrowers to cure their delinquencies through the sale of their property.

Previous wording

Net gains (losses) on investments and other financial instruments were $(0.7) million, compared with $(8.8) million for the same period last year. Changes in the recognition of net realized investment gains (losses) are primarily driven by the timing of individual securities sales and such timing is influenced by such factors as market opportunities, our tax and capital profile, and overall market cycles. See Note 7 - “Investments,” to our consolidated financial statements for additional discussion of net gains (losses) on investments and other financial instruments.

Current wording

Net gains (losses) on investments and other financial instruments were $(0.5) million, compared with $(8.2) million for the same period last year. Changes in the recognition of net realized investment gains (losses) are primarily driven by the timing of individual securities sales and such timing is influenced by such factors as market opportunities, our tax and capital profile, and overall market cycles. See Note 7 - “Investments,” to our consolidated financial statements for additional discussion of net gains (losses) on investments and other financial instruments.

Previous wording

Underwriting and other expenses, net in the six months ended June 30, 2025 were $101.8 million, compared with $111.7 million for the same period last year. The decrease in underwriting and other expenses, net was primarily due to a decrease in employee costs. See Note 15 - “Segment Reporting,” to our consolidated financial statements for additional discussion of significant segment expenses.

Current wording

Underwriting and other expenses, net in the nine months ended September 30, 2025 were $149.5 million, compared with $162.7 million for the same period last year. The decrease in underwriting and other expenses, net was primarily due to a decrease in employee costs. See Note 15 - “Segment Reporting,” to our consolidated financial statements for additional discussion of significant segment expenses.

Previous wording

The financial requirements of the PMIERs require a mortgage insurer’s "Available Assets" (generally only the most liquid assets of an insurer) to equal or exceed its "Minimum Required Assets" (which are generally based on an insurer's book of risk in force and calculated from tables of factors with several risk dimensions, reduced for credit given for risk ceded under reinsurance agreements and subject to a floor amount). Based on our application of the PMIERs as of June 30, 2025, MGIC’s Available Assets totaled $5.7 billion, or $2.4 billion in excess of its Minimum Required Assets. In August 2024, the GSEs issued updates to the calculation of Available Assets. The updates will be implemented through a 24-month phased-in approach, with a fully effective date of September 30, 2026. If these changes were effective as of June 30, 2025, without a graduated implementation period, MGIC's Available Assets of $5.7 billion would decrease by approximately 1% or $60 million, and MGIC's PMIERs excess would be $2.3 billion.

Current wording

The financial requirements of the PMIERs require a mortgage insurer’s "Available Assets" (generally only the most liquid assets of an insurer) to equal or exceed its "Minimum Required Assets" (which are generally based on an insurer's book of risk in force and calculated from tables of factors with several risk dimensions, reduced for credit given for risk ceded under reinsurance agreements and subject to a floor amount). Based on our application of the PMIERs as of September 30, 2025, MGIC’s Available Assets totaled $5.9 billion, or $2.5 billion in excess of its Minimum Required Assets. In August 2024, the GSEs issued updates to the calculation of Available Assets. The updates will be implemented through a 24-month phased-in approach, with a fully effective date of September 30, 2026. If these changes were effective as of September 30, 2025, without a graduated implementation period, MGIC's Available Assets of $5.9 billion would decrease by approximately 0.5% or $30 million, and MGIC's PMIERs excess would be $2.5 billion.

Previous wording

At June 30, 2025, MGIC’s risk-to-capital ratio was 10.0 to 1, below the maximum allowed by the jurisdictions with State Capital Requirements, and its policyholder position was $3.6 billion above the required MPP of $2.2 billion. The calculation of our risk-to-capital ratio and MPP reflect full credit for the risk ceded under our reinsurance transactions. It is possible that under the revised State Capital Requirements discussed below, MGIC will not be allowed full credit for the risk ceded under such transactions. If MGIC is not allowed an agreed level of credit under either the State Capital Requirements or the PMIERs, MGIC may terminate the reinsurance transactions, without penalty.

Current wording

At September 30, 2025, MGIC’s risk-to-capital ratio was 9.7 to 1, below the maximum allowed by the jurisdictions with State Capital Requirements, and its policyholder position was $3.8 billion above the required MPP of $2.2 billion. The calculation of our risk-to-capital ratio and MPP reflect full credit for the risk ceded under our reinsurance transactions. It is possible that under the revised State Capital Requirements discussed below, MGIC will not be allowed full credit for the risk ceded under such transactions. If MGIC is not allowed an agreed level of credit under either the State Capital Requirements or the PMIERs, MGIC may terminate the reinsurance transactions, without penalty.

Previous wording

•Losses ceded under reinsurance transactions which will decrease losses incurred, net when a delinquency or an insured is covered by a reinsurance transaction. See Note 4 - “Reinsurance” to our consolidated financial statements for a discussion of our reinsurance transactions.

Current wording

•Losses ceded under reinsurance transactions will decrease losses incurred, net when a delinquency is covered by a reinsurance transaction. See Note 4 - “Reinsurance” to our consolidated financial statements for a discussion of our reinsurance transactions.

Previous wording

NIW for the second quarter of 2025 was $16.4 billion (Q2 2024: $13.5 billion) and $26.6 billion for the six months ended June 30, 2025 (YTD June 30, 2024: $22.6 billion).The increase reflects a higher expected market position in the current year compared with the same period in the prior year. For the full year, we expect our 2025 NIW to be higher than 2024.

Current wording

NIW for the third quarter of 2025 was $16.5 billion (Q3 2024: $17.2 billion) and $43.1 billion for the nine months ended September 30, 2025 (YTD September 30, 2024: $39.8 billion).The increase for the nine months ended September 30, 2025 reflects a higher expected market position in the current year compared with the same period in the prior year. For the full year, we expect our 2025 NIW to be higher than 2024.

Previous wording

The following tables present characteristics of our primary NIW for the three and six months ended June 30, 2025 and 2024.

Current wording

The following tables present characteristics of our primary NIW for the three and nine months ended September 30, 2025 and 2024.

Previous wording

Our annual persistency was 84.7% at June 30, 2025 compared with 85.4% at June 30, 2024. Since 2018, our annual persistency ranged from a high of 86.3% at September 30, 2023 to a low of 60.7% at March 31, 2021. Our persistency rate is primarily affected by the level of current mortgage interest rates compared to the mortgage coupon rates on our IIF, which affects the vulnerability of the IIF to refinancing; and the current amount of equity that borrowers have in the homes underlying our IIF.

Current wording

Our annual persistency was 85.0% at September 30, 2025 compared with 85.3% at September 30, 2024. Since 2018, our annual persistency ranged from a high of 86.3% at September 30, 2023 to a low of 60.7% at March 31, 2021. Our persistency rate is primarily affected by the level of current mortgage interest rates compared to the mortgage coupon rates on our IIF, which affects the vulnerability of the IIF to refinancing; and the current amount of equity that borrowers have in the homes underlying our IIF.

Previous wording

In connection with the GSEs' CRT programs, an insurance subsidiary of MGIC provides insurance and reinsurance covering portions of the credit risk related to certain reference pools of mortgages acquired by the GSEs. Our RIF, as reported to us, related to these programs was approximately $520 million and $392 million as of June 30, 2025 and December 31, 2024, respectively.

Current wording

In connection with the GSEs' CRT programs, an insurance subsidiary of MGIC provides insurance and reinsurance covering portions of the credit risk related to certain reference pools of mortgages acquired by the GSEs. Our RIF, as reported to us, related to these programs was approximately $493 million and $392 million as of September 30, 2025 and December 31, 2024, respectively.

Previous wording

The following section of the MD&A provides a comparative discussion of MGIC Investment Corporation’s Consolidated Results of Operations for the three and six months ended June 30, 2025 and 2024.

Current wording

The following section of the MD&A provides a comparative discussion of MGIC Investment Corporation’s Consolidated Results of Operations for the three and nine months ended September 30, 2025 and 2024.

Previous wording

Net premium yield is net premiums earned divided by average IIF during the period. The following table presents the key drivers of our net premium yield for each of the three and six months ended June 30, 2025 and June 30, 2024.

Current wording

Net premium yield is net premiums earned divided by average IIF during the period. The following table presents the key drivers of our net premium yield for each of the three and nine months ended September 30, 2025 and September 30, 2024.

Previous wording

(2) Assumed premiums include those from our participation in GSE CRT programs, of which the impact on the net premium yield was 0.5 bps for both thesix months ended June 30, 2025 and June 30, 2024.

Current wording

(2) Assumed premiums include those from our participation in GSE CRT programs, of which the impact on the net premium yield was 0.5 bps for both the nine months ended September 30, 2025 and September 30, 2024.

Previous wording

The following table provides information related to our QSR Transactions for each of the three and six months ended and as of June 30, 2025 and June 30, 2024.

Current wording

The following table provides information related to our QSR Transactions for the presented periods.

Previous wording

The increase in profit commission for the three and six months ended June 30, 2025, was primarily driven by an increase in the percentage of our IIF covered by the QSR Transactions as discussed below. Ceded losses incurred are impacted by the delinquencies covered by our QSR Transactions, our estimates of payments that will be ultimately made on those delinquencies, and claim payments covered by our QSR Transactions.

Current wording

The increase in profit commission for the three and nine months ended September 30, 2025, was primarily driven by an increase in the percentage of our IIF covered by the QSR Transactions as discussed below. Ceded losses incurred are impacted by the delinquencies covered by our QSR Transactions, our estimates of payments that will be ultimately made on those delinquencies, and claim payments covered by our QSR Transactions.

Previous wording

We executed a 40% QSR transaction with a group of unaffiliated reinsurers covering most of our new insurance written in 2026.

Current wording

We executed a 40% QSR transaction with a group of unaffiliated reinsurers covering eligible NIW in 2026. We have agreed to terms on a 40% QSR Transaction with a group of unaffiliated reinsurers covering eligible NIW in 2027. Additionally, we have amended the terms on our 2022 quota share reinsurance transaction with certain participants from the existing reinsurance panel. The quota share cede rate will decrease from 30% to 28%, effective December 31, 2025.

Previous wording

As of June 30, 2025, the weighted average coverage percentage of our QSR transactions was 32% based on RIF.

Current wording

As of September 30, 2025, the weighted average coverage percentage of our QSR transactions was 33% based on RIF.

Previous wording

The Home Re Transactions are executed through the issuance of insurance linked notes (“ILNs”). As of June 30, 2025 our Home Re Transactions provided $689.9 million of loss coverage on a portfolio of policies having an in force date from August 1, 2020 through December 31, 2021, and from June 1, 2022 through August 31, 2023; all dates inclusive. For this reinsurance coverage, we retain the first layer of the respective aggregate losses paid, and a Home Re Entity will then provide second layer coverage up to the outstanding reinsurance amount.

Current wording

The Home Re Transactions are executed through the issuance of insurance linked notes (“ILNs”). As of September 30, 2025 our Home Re Transactions provided $620.8 million of loss coverage on a portfolio of policies having an in force date from August 1, 2020 through December 31, 2021, and from June 1, 2022 through August 31, 2023; all dates inclusive. For this reinsurance coverage, we retain the first layer of the respective aggregate losses paid, and a Home Re Entity will then provide second layer coverage up to the outstanding reinsurance amount.

Previous wording

The current attachment, current detachment, and PMIERs required asset credit for each of our XOL Transactions, excluding the 2025 Traditional XOL which is still in its fill up period, as of June 30, 2025, are as follows.

Current wording

The current attachment, current detachment, and PMIERs required asset credit for each of our XOL Transactions, as of September 30, 2025, are presented in the table below. The table below excludes the 2025 Traditional XOL which is still within its contractual fill-up period covering policies in force from January 1, 2025 through December 31, 2025.

Previous wording

In June of 2025, we executed two XOL Transactions which provide up to $160 million and $184 million of reinsurance coverage on new insurance written in 2025 and 2026, respectively.

Current wording

In June of 2025, we executed two XOL Transactions which provide up to $160 million and $184 million of reinsurance coverage on NIW in 2025 and 2026, respectively. In October 2025, we agreed to terms on an XOL Transaction effective December 1, 2025, which provides $250 million of reinsurance coverage on NIW from 2021.

Previous wording

Ceded premiums on our XOL Transactions were $15.4 million and $30.1 million, respectively, for the three and six months ended June 30, 2025, and $16.6 million and $32.7 million, respectively, for the three and six months ended June 30, 2024.

Current wording

Ceded premiums on our XOL Transactions were $16.2 million and $46.3 million, respectively, for the three and nine months ended September 30, 2025, and $16.9 million and $49.6 million, respectively, for the three and nine months ended September 30, 2024.

Previous wording

Net investment income in the three months ended June 30, 2025 and 2024 was $61.0 million and $61.5 million, respectively. Net investment income for the six months ended June 30, 2025 and 2024 was $122.4 million and $121.2 million, respectively.

Current wording

Net investment income in the three months ended September 30, 2025 and 2024 was $62.2 million and $62.1 million, respectively. Net investment income for the nine months ended September 30, 2025 and 2024 was $184.6 million and $183.3 million, respectively.

Previous wording

Losses incurred, net increased $15.4 million and $20.5 million for the three and six months ended June 30, 2025 compared with the same periods in the prior year. The following table details the financial impact of the significant components of losses incurred for the periods indicated.

Current wording

Losses incurred, net increased $20.8 million and $41.2 million for the three and nine months ended September 30, 2025 compared with the same periods in the prior year. The following table details the financial impact of the significant components of losses incurred for the periods indicated.

Previous wording

A rollforward of our primary delinquency inventory for the three and six months ended June 30, 2025 and 2024 appears in the table below. The information concerning new notices and cures is compiled from monthly reports received from loan servicers. The level of new notice and cure activity reported in a particular month can be influenced by, among other things, the date on which a servicer generates its report, the number of business days in a month and transfers of servicing between loan servicers.

Current wording

A rollforward of our primary delinquency inventory for the three and nine months ended September 30, 2025 and 2024 appears in the table below. The information concerning new notices and cures is compiled from monthly reports received from loan servicers. The level of new notice and cure activity reported in a particular month can be influenced by, among other things, the date on which a servicer generates its report, the number of business days in a month and transfers of servicing between loan servicers.

Previous wording

The majority of loans insured prior to 2014 (which represent 28% of the loans in the delinquency inventory) are covered by master policy terms that, except under certain circumstances, do not limit the number of years that an insured can include interest when filing a claim. Under our current master policy terms, an insured can include accumulated interest when filing a claim only for the first three years the loan is delinquent. In each case, the insured must comply with its obligations under the terms of the applicable master policy.

Current wording

The majority of loans insured prior to 2014 (which represent 26% of the loans in the delinquency inventory) are covered by master policy terms that, except under certain circumstances, do not limit the number of years that an insured can include interest when filing a claim. Under our current master policy terms, an insured can include accumulated interest when filing a claim only for the first three years the loan is delinquent. In each case, the insured must comply with its obligations under the terms of the applicable master policy.

Previous wording

(1)Approximately 24%, 27%, and 31% of the primary delinquency inventory delinquent for 12 consecutive months or more has been delinquent for at least 36 consecutive months as of June 30, 2025, December 31, 2024, and June 30, 2024, respectively.

Current wording

(1)Approximately 23%, 27%, and 29% of the primary delinquency inventory delinquent for 12 consecutive months or more has been delinquent for at least 36 consecutive months as of September 30, 2025, December 31, 2024, and September 30, 2024, respectively.

Previous wording

(1)Approximately 20%, 25%, and 30% of the primary delinquency inventory with 12 payments or more delinquent has at least 36 payments delinquent as of June 30, 2025, December 31, 2024, and June 30, 2024, respectively.

Current wording

(1)Approximately 18%, 25%, and 27% of the primary delinquency inventory with 12 payments or more delinquent has at least 36 payments delinquent as of September 30, 2025, December 31, 2024, and September 30, 2024, respectively.

Previous wording

Net losses and LAE paid in the three and six months ended June 30, 2025 were consistent with the same periods in the prior year. The primary average claim paid can vary materially from period to period based upon a variety of factors, including the local market conditions, average loan amount, average coverage percentage, the amount of time between delinquency and claim filing, and our loss mitigation efforts on loans for which claims are paid.

Current wording

Net losses and LAE paid in the three and nine months ended September 30, 2025 were consistent with the same periods in the prior year. The primary average claim paid can vary materially from period to period based upon a variety of factors, including the local market conditions, average loan amount, average coverage percentage, the amount of time between delinquency and claim filing, and our loss mitigation efforts on loans for which claims are paid.

Previous wording

The following table presents our net losses and LAE paid for the three and six months ended June 30, 2025 and 2024.

Current wording

The following table presents our net losses and LAE paid for the three and nine months ended September 30, 2025 and 2024.

Previous wording

The primary average RIF on all loans was $71,741, $70,475, and $69,284 at June 30, 2025, December 31, 2024, and June 30, 2024, respectively.

Current wording

The primary average RIF on all loans was $72,480, $70,475, and $69,658 at September 30, 2025, December 31, 2024, and September 30, 2024, respectively.

Previous wording

On our primary business, the highest claim frequency years have typically been the third and fourth year after loan origination. However, the pattern of claim frequency can be affected by many factors, including persistency and deteriorating economic conditions. Deteriorating economic conditions can result in increasing claims following a period of declining claims. As of June 30, 2025, 55% of our primary RIF was written subsequent to December 31, 2021, 77% of our primary RIF was written subsequent to December 31, 2020, and 89% of our primary RIF was written subsequent to December 31, 2019.

Current wording

On our primary business, the highest claim frequency years have typically been the third and fourth year after loan origination. However, the pattern of claim frequency can be affected by many factors, including persistency and deteriorating economic conditions. Deteriorating economic conditions can result in increasing claims following a period of declining claims. As of September 30, 2025, 58% of our primary RIF was written subsequent to December 31, 2021, 79% of our primary RIF was written subsequent to December 31, 2020, and 90% of our primary RIF was written subsequent to December 31, 2019.

Previous wording

Underwriting and other expenses, net for the three and six months ended June 30, 2025 were $50.4 million and $101.8 million, respectively, compared with $52.7 million and $111.7 million for the three and six months ended June 30, 2024. The decrease in underwriting and other expenses, net for the six months ended June 30, 2025 compared with the same period in the prior year was primarily due to a decrease in employee costs. See Note 15 - “Segment Reporting,” to our consolidated financial statements for additional discussion of significant segment expenses.

Current wording

Underwriting and other expenses, net for the three and nine months ended September 30, 2025 were $47.8 million and $149.5 million, respectively, compared with $51.0 million and $162.7 million for the three and nine months ended September 30, 2024. The decrease in underwriting and other expenses, net for the nine months ended September 30, 2025 compared with the same period in the prior year was primarily due to a decrease in employee costs. See Note 15 - “Segment Reporting,” to our consolidated financial statements for additional discussion of significant segment expenses.

Previous wording

The underwriting expense ratio is the ratio, expressed as a percentage, of the underwriting and operating expenses, net and amortization of DAC to net premiums written. The underwriting expense ratio for the three and six months ended June 30, 2025, decreased compared with the same period in the prior year primarily due to a decrease in underwriting and other expenses, net, and an increase in net premiums written.

Current wording

The underwriting expense ratio is the ratio, expressed as a percentage, of the underwriting and operating expenses, net and amortization of DAC to net premiums written. The underwriting expense ratio for the three and nine months ended September 30, 2025, decreased compared with the same period in the prior year primarily due to a decrease in underwriting and other expenses, net, and an increase in net premiums written.

Previous wording

Our effective tax rate for the three and six months ended June 30, 2025 and 2024 approximated the statutory tax rate of 21%. We expect a modest decrease in our effective tax rate for the remainder of 2025 compared with 2024 due to purchases of transferable federal tax credits.

Current wording

Our effective tax rate for the nine months ended September 30, 2025 and 2024 approximated the statutory tax rate of 21%. We expect a modest decrease in our effective tax rate for the remainder of 2025 compared with 2024 due to purchases of transferable federal tax credits.