UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, DC 20549

FORM 8-K

CURRENT REPORT

Pursuant to Section 13 or 15(d) of

The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): December 30, 2010

Radian Group Inc.

(Exact Name of Registrant as Specified in Its Charter)

Registrant’s telephone number, including area code: (215) 231-1000

(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

Severance Agreements for Named Executive Officers

On December 30, 2010, Radian Group Inc. (“Radian Group”) and its principal operating subsidiary, Radian Guaranty Inc. (“Radian Guaranty”) (Radian Group and Radian Guaranty each are referred to herein as the “Company”), entered into severance agreements (the “Agreements” and each an “Agreement”) with certain of the Company’s named executive officers (each, an “Executive”). As discussed below, the Agreements replace various existing agreements between the Company and the Executives as part of a new termination pay strategy for the Company. This strategy is designed with the primary purposes of: (1) responsibly tailoring termination payments based on executive positions and current market standards, (2) enhancing clarity regarding future potential severance payments to such named executive officers, (3) applying a more consistent approach to severance among the Company’s executive officers, (4) imposing certain restrictive covenants that are important to the Company, and (5) eliminating enhanced payouts based on an Executive’s termination in connection with a change-in-control of the Company.

Under the Agreement, if the Executive’s employment is terminated by the Company for any reason other than Cause or Disability (as such terms are defined in the Agreement) or by the Executive for Good Reason (as such term is defined in the Agreement), the Executive will be entitled to the following:

In order to receive any severance amounts under the Agreement, the Executive must execute a general release of claims against the Company and its affiliates. The Agreement does not provide for accelerated vesting of equity awards granted to the Executive or for a tax gross up if

amounts payable under the Agreement would constitute an “excess parachute payment” within the meaning of section 280G of the Internal Revenue Code. In addition, under the Agreement, the Executive has agreed not to compete with the Company and not to solicit the Company’s employees or customers for a period of time (either twelve (12) or eighteen (18) months, the “Restricted Period”) following termination of the Executive’s employment for any reason.

The following table highlights (i) the severance payments (excluding the prorated target incentive award payment) and Restricted Period for each Executive who is a party to the Agreements and (ii) the various prior agreements that were terminated in conjunction with each Executive entering into the new Agreements.

The Agreement also provides, consistent with the Company’s standard severance policy for senior executive officers, that: (i) the Company will reimburse the Executive for the monthly cost of continued health coverage for the Executive and his or her spouse and dependents under the Company’s health plan for the Restricted Period, and (ii) the Company will provide executive outplacement services for up to twelve (12) months after termination. The Agreements have an initial term ending on December 31, 2011 and will automatically renew for one (1) additional year unless the Company provides notice of nonrenewal at least 45 days prior written notice that the Agreements will not be extended.

The foregoing summary is not a complete description of the Agreements and is qualified in its entirety by reference to the full text of the Agreements, which are filed as exhibits to this Current Report on Form 8-K.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Exhibit Index