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Investing in mortgage-insurance stocks starts with underwriting and capital research, not a ticker list. Identify the insurer and its business mix, read its latest annual and quarterly filings, compare new insurance written, insurance in force, risk in force, persistency, claims and delinquencies, then test whether capital remains adequate under housing and credit stress. Public examples include MGIC Investment Corporation (NYSE: MTG) and Radian Group Inc. (NYSE: RDN); they illustrate the work involved and are not recommendations or a complete industry universe.
Mortgage insurers cover qualifying mortgage-credit exposures for lenders and mortgage investors. Premiums and investment income can be attractive when borrowers perform, but a housing or employment downturn can increase claims just as new mortgage volume falls. The objective is to understand that cycle, the insurer’s ability to absorb losses, and the quality of the earnings before deciding whether further personal research is warranted.
What mortgage-insurance companies actually earn
Private mortgage insurance (PMI) generally covers a portion of a lender’s loss when a borrower defaults on a qualifying mortgage. The insurer receives premiums over the life of the policy and invests available assets. Results therefore depend on several linked variables:
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- The credit quality, loan-to-value ratio, geography and vintage of the loans insured.
- How long policies remain active, which determines premium persistence.
- Delinquencies, cures, claims and the ultimate severity of paid losses.
- Investment income, operating expenses, reinsurance costs and the capital required to support the risk.
Low borrower equity makes home prices and employment especially important. A decline in property values can reduce the collateral available after foreclosure, while job losses can increase missed payments. MGIC Investment Corporation’s 2025 Form 10-K states: “Economic downturns and/or declines in home prices may lead to increased losses.” That is a risk-factor statement from the issuer, not a forecast.
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Which public companies can you study?
MGIC Investment Corporation and Radian Group Inc. are prominent U.S.-listed examples in the filings reviewed for this guide. MGIC’s 2025 filing describes a U.S. private mortgage-insurance industry with six active mortgage insurers and affiliates. Radian has historically reported mortgage insurance alongside other businesses, and its 2025 Form 10-K says its acquisition of Inigo closed on February 2, 2026. The same filing describes planned divestitures of its Mortgage Conduit, Title and Real Estate Services businesses. Check later filings for the completed transactions and resulting segment mix.
| Issuer example | What to establish before comparing | Why the distinction matters |
|---|---|---|
| MGIC Investment Corporation (NYSE: MTG) | Mortgage-insurance production, insured portfolio, claims, PMIERs resources and statutory capital. | A relatively focused mortgage-insurance profile can make housing-credit trends easier to isolate, but definitions and reinsurance still affect every ratio. |
| Radian Group Inc. (NYSE: RDN) | Mortgage-insurance results by segment, the effect of Inigo, any divestitures and consolidated versus pro forma figures. | A broader specialty-insurance mix means consolidated revenue, earnings and capital ratios may not be directly comparable with a pure mortgage-insurance measure. |
Do not treat this table as a buy list. It is a starting point for identifying legal entities, insurance subsidiaries and reporting segments. A stock’s valuation, dividend yield and total return require dated market data that can change every trading day.
A filing-first process for researching a mortgage-insurance stock
- Confirm the issuer. Write down the ticker, parent company, mortgage-insurance subsidiary, jurisdictions and every operating segment. Make sure the financial statements you are reading belong to the entity that actually writes the policies.
- Read the latest Form 10-K. Start with the business description, risk factors, underwriting discussion, reinsurance, investment portfolio, debt, liquidity and dividend restrictions. Note the definitions used for insurance in force (IIF), risk in force (RIF), new insurance written (NIW), delinquencies and losses.
- Read the newest Form 10-Q. Look for changes since year-end: production, persistency, delinquency trends, reserve development, capital cushions, reinsurance renewals, investment duration, acquisitions and divestitures. A quarterly filing can materially change the interpretation of an annual figure.
- Build a same-period comparison. Place each company in one worksheet with the reporting date, accounting basis, gross or net treatment and definitions beside every number. Compare NIW, IIF, RIF, persistency, premium yield, delinquencies, incurred losses, PMIERs resources and statutory capital.
- Separate reported from adjusted results. Preserve the reconciliation whenever management presents an adjusted operating measure. Do not substitute an issuer-defined metric for GAAP net income without showing what has been removed or added.
- Check capital and liquidity. Review PMIERs Available Assets, Minimum Required Assets, the excess cushion, statutory policyholder resources, holding-company cash, debt maturities, ratings and the ability of insurance subsidiaries to pay dividends.
- Review reinsurance. Identify ceded risk, counterparties, collateral, renewal dates, cost and the capital credit granted under applicable rules. A lower net exposure can still leave the company dependent on a counterparty or on renewal terms.
- Recheck immediately before acting. Investor-relations filing pages and the SEC database can contain a newer 10-Q, 8-K, statutory statement or transaction update than the document you first analyzed. Use the newest available information and record its date.
Metrics that explain production and retention
New insurance written (NIW)
NIW is the amount of new mortgage exposure insured during a period. It is a flow measure, not the size of the existing book. Read it with total mortgage originations, private-PMI penetration, market share and underwriting mix. MGIC’s 2025 Form 10-K, citing Inside Mortgage Finance, reports an NIW-based market share of 19.4% in 2025 versus 18.6% in 2024. Those percentages describe the cited years and source’s methodology; they are not a live market-share estimate.
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Insurance in force (IIF) and risk in force (RIF)
IIF describes the insured mortgage exposure under the insurer’s definition. RIF represents the portion of that exposure that could become an insurance claim, again subject to the company’s stated gross or net basis. They are not interchangeable. Two insurers can report similar IIF but different RIF because of loan-to-value distributions, coverage percentages, cancellations, rescissions or reinsurance.
Increasing IIF can enlarge the premium base and diversify policy vintages. It also increases the portfolio that could produce claims and may increase required assets under PMIERs. Check whether growth is organic, acquired, gross or net of ceded risk before drawing a conclusion.
Persistency
Persistency measures how long policies remain in force, commonly through a percentage that remains active after a specified period. Refinancing and interest rates influence cancellations: borrowers who refinance or pay down a loan can terminate coverage. Higher persistency may retain premium income, but the value depends on premium rates, borrower risk, claim development and duration. A high figure is not automatically better if it reflects a riskier or less profitable book.
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Metrics that explain credit performance
Delinquencies, cures and claims
Track delinquency counts and rates by loan age, product, geography and severity. A newly delinquent loan may cure, receive a workout or proceed to a claim; therefore a delinquency percentage is an early indicator, not a final loss estimate. Look for roll rates from early to late delinquency, cure rates, paid claims and claim severity.
Premium yield and earned premiums
Premium yield relates earned premium to the relevant insured exposure under the issuer’s definition. Compare it with policy mix, pricing, persistency and the proportion of single-premium versus recurring-premium policies where disclosed. A rising yield can reflect pricing or mix rather than improved underwriting.
Incurred losses and reserve development
Use incurred losses, paid claims, loss ratios and reserve development together. Current-period claims may not capture the lifetime risk of a long-lived portfolio. Favorable development can reduce current expense after earlier reserves prove adequate; adverse development can reverse that benefit. Read the assumptions for default timing, cure behavior, house prices and claim severity in the notes.
Why PMIERs and statutory capital deserve separate analysis
Private mortgage insurers that support covered government-sponsored-enterprise business must satisfy the Private Mortgage Insurer Eligibility Requirements (PMIERs). The central comparison is eligible Available Assets against Minimum Required Assets. Delinquent loans can require more assets, while qualifying reinsurance can reduce the required amount or provide capital credit. The cushion and the ratio both matter, as do asset eligibility, delinquency status, counterparty quality and possible rule changes.
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Repair common Windows errors and clear accumulated junk for a smoother, more stable PC - no reinstall needed.Free scan · no reinstall| Capital figure | Issuer and period | Reported amount | How to read it |
|---|---|---|---|
| PMIERs Available Assets | MGIC Investment Corporation, December 31, 2025 | $5.7 billion | Eligible resources under the issuer’s PMIERs calculation; not a cash balance available for any purpose. |
| Excess over PMIERs Minimum Required Assets | MGIC Investment Corporation, December 31, 2025 | $2.5 billion | A period-specific cushion that can change with delinquencies, asset values, reinsurance and rule assumptions. |
| Risk-to-capital ratio | MGIC Investment Corporation, December 31, 2025 | 10.0-to-1 | Interpret only with the filing’s statutory numerator, denominator and jurisdictional rules. |
| Excess over required minimum policyholder position | MGIC Investment Corporation, December 31, 2025 | $3.6 billion | A statutory measure, distinct from PMIERs and not an industry average. |
| PMIERs Available Assets | Radian Guaranty, December 31, 2025 | $5.4 billion | Radian’s mortgage-insurance subsidiary measure; compare its definitions and segment structure with MGIC’s. |
| PMIERs cushion | Radian Guaranty, December 31, 2025 | $1.6 billion, or 41% | The reported cushion for that subsidiary and date, not a prediction of future losses or an equity valuation. |
| Risk-to-capital ratio | MGIC Investment Corporation, June 30, 2026 | 9.9-to-1 | Reported in the Q2 2026 Form 10-Q; review the updated denominator and policyholder-position explanation. |
| Excess over required minimum policyholder position | MGIC Investment Corporation, June 30, 2026 | $3.6 billion | The Q2 2026 statutory figure; it should not be mixed with year-end PMIERs data without matching dates. |
Statutory risk-to-capital ratios and PMIERs cushions answer different questions. A company can show a strong cushion under one framework while facing pressure under another if delinquencies rise, assets lose eligibility or reinsurance receives less credit. Never infer liquidity, profitability or a fair stock price from a single capital ratio.
How to compare MGIC and Radian without creating a false ranking
| Comparison area | Questions to ask | What can invalidate a simple ranking |
|---|---|---|
| Business mix | What percentage of earnings and capital comes from mortgage insurance? Which acquisitions or divestitures changed the perimeter? | Radian’s specialty-insurance and planned-transaction activity can make consolidated figures unlike a focused PMI company. |
| Production | How did NIW change against industry originations and private-PMI penetration? What underwriting mix drove it? | Market share can rise during a shrinking market, and volume can grow while risk quality deteriorates. |
| Portfolio | What are IIF, RIF, persistency, loan vintages, geography and coverage levels? | Gross and net measures, policy cancellations and reinsurance alter exposure. |
| Credit results | Are delinquencies curing? How are paid and incurred losses developing? | Losses emerge over time; one quarter may not represent lifetime economics. |
| Capital | What are PMIERs Available Assets, Minimum Required Assets, cushion and statutory resources? | Definitions, eligible-asset rules, reinsurance credit and reporting dates differ. |
| Earnings and cash | What are premiums, investment income, expenses, GAAP earnings, holding-company cash and dividend capacity? | Insurance-subsidiary capital may not be freely transferable to the parent. |
| Valuation | What market price, share count, enterprise value, book value and date are being used? | Valuation is not established by issuer filings alone and changes with the stock price. |
Housing-cycle and operating risks to model
Home prices and employment
Stress a scenario with falling home prices, higher unemployment and slower cures. More borrowers can default, collateral recoveries can weaken and claims can increase. The same downturn can reduce new mortgage originations, limiting fresh premium production.
Mortgage volume and competitive pressure
Originations vary with rates, affordability, refinancing and housing turnover. Private insurers also compete with one another and with government-backed mortgage programs. Lower insurance penetration or aggressive pricing can reduce NIW or premium yield even when the insurer’s underwriting remains disciplined.
Capital pressure and eligibility
Rising delinquencies can increase Minimum Required Assets under PMIERs. A shrinking cushion may constrain growth, distributions or eligibility for covered business. Read the company’s contingency actions, asset composition and ability to raise or retain capital.
Reinsurance and counterparties
Reinsurance transfers some risk and can improve capital efficiency, but it introduces counterparty exposure, renewal risk, pricing risk and dependence on regulatory or GSE recognition. Determine whether protection is collateralized, how much risk is retained and what happens when contracts expire.
Regulation and GSE rules
Insurance requirements, PMIERs provisions, state regulation and GSE eligibility can change. A failure to meet requirements can affect the business even if accounting earnings remain positive. Treat management’s discussion as a description of current rules, not a guarantee that rules will stay unchanged.
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Interest rates and the investment portfolio
Rates affect refinancing and policy persistency. They also change the value and income of the insurer’s fixed-income portfolio. MGIC’s Q2 2026 filing reported an effective duration of 4.1 years for its fixed-income portfolio at June 30, 2026. Duration measures sensitivity to rate movements; it is not a forecast of realized investment returns. Also inspect credit-spread exposure, liquidity, unrealized losses and the maturity schedule.
Execution and structural change
Acquisitions, integrations and divestitures can alter reported growth, expenses, capital allocation and segment comparisons. For Radian, verify the status and financial effect of the Inigo acquisition and planned business disposals in filings issued after the 2025 Form 10-K.
Building a practical research worksheet
Create one row per company and one column per metric. Add the reporting date and a definition column so a number cannot be copied without context.
- Production: NIW, estimated industry originations, private-PMI penetration and market share.
- Exposure: IIF, RIF, coverage, policy vintages, geography and persistency.
- Credit: new delinquencies, total delinquency rate, cures, paid claims, incurred losses and reserve development.
- Capital: PMIERs Available Assets, Minimum Required Assets, excess cushion, statutory risk-to-capital and policyholder position.
- Risk transfer: ceded exposure, reinsurance counterparties, collateral, renewal dates and capital credit.
- Financial results: earned premiums, investment income, expenses, GAAP net income, adjusted measures and the reconciliation.
- Parent-company resilience: cash, debt maturities, ratings, subsidiary dividend restrictions and expected capital needs.
- Market data: share price, market capitalization, book value, valuation multiples and dividend yield, each labeled with an observation date.
Use consistent periods. If one company reports a calendar-year figure and another reports a quarter, leave the comparison unmade rather than implying precision. Record whether a value is gross, net, statutory, GAAP or management-defined.
Common mistakes that lead to bad investment conclusions
- Buying a capital ratio. A low risk-to-capital ratio or large PMIERs cushion does not guarantee future profits, liquidity or loss-absorbing capacity.
- Equating IIF with RIF. Insured balance and potential claim exposure are different measures.
- Ignoring the business perimeter. Acquisitions and divestitures can make consolidated growth look stronger or weaker without changing mortgage-insurance fundamentals.
- Using a single quarter of claims. Mortgage losses develop through delinquency, cure, workout and claim stages.
- Overlooking reinsurance. Net results may depend on contract terms, collateral and counterparties that are not visible in a headline ratio.
- Comparing unmatched dates. Year-end PMIERs data cannot be used as if it were a current quarter figure.
- Assuming market share equals profitability. A larger share can come with lower pricing, higher risk or greater capital consumption.
- Treating issuer-adjusted earnings as GAAP. Read the reconciliation and understand recurring versus one-time items.
- Assuming a filing gives a current valuation. Stock price, market capitalization, consensus estimates and dividend yield require dated market sources.
A decision framework before placing any trade
- Business test: Can you explain exactly which mortgage-insurance subsidiaries generate the earnings and what other segments change the result?
- Cycle test: What happens to NIW, persistency, delinquencies, claims and investment income if rates, home prices or employment move against the company?
- Capital test: Does the insurer retain a meaningful cushion after a plausible delinquency shock, and can the parent meet obligations without relying on restricted subsidiary cash?
- Risk-transfer test: Would a reinsurance counterparty failure or renewal at a higher price materially change capital or earnings?
- Valuation test: Are current market metrics based on the same share count, period and accounting basis as the operating numbers?
- Evidence test: Can each material conclusion be traced to a dated filing or market observation, with uncertainty stated where the evidence is incomplete?
If any test cannot be answered, the appropriate action is more research or no position. Mortgage-insurance stocks can offer exposure to housing-credit economics, but they are cyclical financial securities whose downside may arrive through both falling earnings and tighter capital requirements.
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