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8-K - 8-K - Essent Group Ltd.form8-kx4q2019earnings.htm
Exhibit 99.1

Essent Group Ltd. Reports Fourth Quarter 2019 Results & Increases Quarterly Dividend
HAMILTON, Bermuda--(BUSINESS WIRE)--February 14, 2020--Essent Group Ltd. (NYSE: ESNT) today reported net income for the quarter ended December 31, 2019 of $147.0 million or $1.49 per diluted share, compared to $128.5 million or $1.31 per diluted share for the quarter ended December 31, 2018. For the full year 2019, net income was $555.7 million.
Essent also announced today that its Board of Directors has declared a quarterly cash dividend of $0.16 per common share. The dividend is payable on March 20, 2020, to shareholders of record on March 10, 2020.
“We are pleased with our strong financial results for both the fourth quarter and full year 2019 as the operating environment remains favorable and credit continues to perform well,” said Mark Casale, Chairman and Chief Executive Officer. “Also, during the quarter we were pleased with Moody’s upgrade of our financial strength rating to A3. We believe that this upgrade is a validation of our progress in making Essent a stronger and more sustainable franchise through the programmatic use of reinsurance.”
Financial Highlights:
Insurance in force as of December 31, 2019 was $164.0 billion, compared to $161.0 billion as of September 30, 2019 and $137.7 billion as of December 31, 2018.

New insurance written for the fourth quarter was $15.8 billion, compared to $18.7 billion in the third quarter of 2019 and $11.4 billion in the fourth quarter of 2018.

Net premiums earned for the fourth quarter were $207.7 million, compared to $203.5 million in the third quarter of 2019 and $173.3 million in the fourth quarter of 2018.

The expense ratio for the fourth quarter was 19.9%, compared to 20.4% in the third quarter of 2019 and 22.8% in the fourth quarter of 2018.

The provision for losses and LAE for the fourth quarter was $10.9 million, compared to a provision of $10.0 million in the third quarter of 2019 and a benefit of $1.0 million in the fourth quarter of 2018. The provision in the fourth quarter of 2018 included a $9.9 million release of the $11.1 million reserve associated with loans identified as related to Hurricanes Harvey and Irma that was established in the fourth quarter of 2017.

The percentage of loans in default as of December 31, 2019 was 0.85%, compared to 0.75% as of September 30, 2019 and 0.66% as of December 31, 2018.

The combined ratio for the fourth quarter was 25.1%, compared to 25.3% in the third quarter of 2019 and 22.2% in the fourth quarter of 2018.

Other income for the fourth quarter includes a $3.6 million loss for the change in the fair value of embedded derivatives in certain of our third-party reinsurance agreements, compared to a loss of $0.8 million in the third quarter of 2019.  There were no changes in fair value of embedded derivatives in the fourth quarter of 2018.

The consolidated balance of cash and investments at December 31, 2019 was $3.5 billion, including cash and investment balances at Essent Group Ltd. of $98.4 million.

The combined risk-to-capital ratio of the U.S. mortgage insurance business, which includes statutory capital for both Essent Guaranty, Inc. and Essent Guaranty of PA, Inc., was 12.6:1 as of December 31, 2019.

On October 17, 2019, Moody’s Investors Service (“Moody’s”) upgraded the financial strength rating of Essent Guaranty, Inc. to A3 from Baa1.

On January 31, 2020, Essent announced that its wholly-owned subsidiary, Essent Guaranty, Inc., obtained $495.9 million of fully collateralized excess of loss reinsurance coverage on mortgage insurance policies written by Essent in January through August 2019 from Radnor Re 2020-1 Ltd., a newly formed Bermuda special purpose insurer. Radnor Re 2020-1 Ltd. is not a subsidiary or an affiliate of Essent Group Ltd.





Conference Call
Essent management will hold a conference call at 10:00 AM Eastern time today to discuss its results. The conference call will be broadcast live over the Internet at http://ir.essentgroup.com/investors/webcasts-and-presentations/event-calendar/default.aspx. The call may also be accessed by dialing 833-287-0797 inside the U.S., or 647-689-4456 for international callers, using passcode 3788913 or by referencing Essent.

A replay of the webcast will be available on the Essent website approximately two hours after the live broadcast ends for a period of one year. A replay of the conference call will be available approximately two hours after the call ends for a period of two weeks, using the following dial-in numbers and passcode: 800-585-8367 inside the U.S., or 416-621-4642 for international callers, passcode 3788913.

In addition to the information provided in the company's earnings news release, other statistical and financial information, which may be referred to during the conference call, will be available on Essent's website at http://ir.essentgroup.com/investors/financial-information/quarterly-financial-supplements/default.aspx.

Forward-Looking Statements
This press release may include “forward-looking statements” which are subject to known and unknown risks and uncertainties, many of which may be beyond our control. Forward-looking statements generally can be identified by the use of forward-looking terminology such as "may," "will," “should,” “expect,” "plan," "anticipate," "believe," “estimate,” “predict,” or "potential" or the negative thereof or variations thereon or similar terminology. Actual events, results and outcomes may differ materially from our expectations due to a variety of known and unknown risks, uncertainties and other factors. Although it is not possible to identify all of these risks and factors, they include, among others, the following: changes in or to Fannie Mae and Freddie Mac (the “GSEs”), whether through Federal legislation, restructurings or a shift in business practices; failure to continue to meet the mortgage insurer eligibility requirements of the GSEs; competition for customers; lenders or investors seeking alternatives to private mortgage insurance; an increase in the number of loans insured through Federal government mortgage insurance programs, including those offered by the Federal Housing Administration; decline in new insurance written and franchise value due to loss of a significant customer; decline in the volume of low down payment mortgage originations; the definition of "Qualified Mortgage" reducing the size of the mortgage origination market or creating incentives to use government mortgage insurance programs; the definition of "Qualified Residential Mortgage" reducing the number of low down payment loans or lenders and investors seeking alternatives to private mortgage insurance; the implementation of the Basel III Capital Accord discouraging the use of private mortgage insurance; a decrease in the length of time that insurance policies are in force; uncertainty of loss reserve estimates; deteriorating economic conditions; our non-U.S. operations becoming subject to U.S. Federal income taxation; becoming considered a passive foreign investment company for U.S. Federal income tax purposes; and other risks and factors described in Part I, Item 1A “Risk Factors” of our Annual Report on Form 10-K for the year ended December 31, 2018 filed with the Securities and Exchange Commission on February 19, 2019. Any forward-looking information presented herein is made only as of the date of this press release, and we do not undertake any obligation to update or revise any forward-looking information to reflect changes in assumptions, the occurrence of unanticipated events, or otherwise.

About the Company
Essent Group Ltd. (NYSE: ESNT) is a Bermuda-based holding company (collectively with its subsidiaries, “Essent”) which, through its wholly-owned subsidiary, Essent Guaranty, Inc., offers private mortgage insurance for single-family mortgage loans in the United States. Essent provides private capital to mitigate mortgage credit risk, allowing lenders to make additional mortgage financing available to prospective homeowners. Headquartered in Radnor, Pennsylvania, Essent Guaranty, Inc. is licensed to write mortgage insurance in all 50 states and the District of Columbia, and is approved by Fannie Mae and Freddie Mac. Essent also offers mortgage-related insurance, reinsurance and advisory services through its Bermuda-based subsidiary, Essent Reinsurance Ltd. Essent is committed to supporting environmental, social and governance (ESG) initiatives that are relevant to the company and align with the companywide dedication to responsible corporate citizenship that positively impacts the community and people served. Additional information regarding Essent may be found at www.essentgroup.com and www.essent.us.

Source: Essent Group Ltd.





 
 
 
 
 
 
Essent Group Ltd. and Subsidiaries
Financial Results and Supplemental Information (Unaudited)
Quarter and Year Ended December 31, 2019
 
 
 
 
 
 
Exhibit A
 
Condensed Consolidated Statements of Comprehensive Income (Unaudited)
Exhibit B
 
Condensed Consolidated Balance Sheets (Unaudited)
Exhibit C
 
Historical Quarterly Data
Exhibit D
 
New Insurance Written
Exhibit E
 
Insurance in Force and Risk in Force
Exhibit F
 
Other Risk in Force
Exhibit G
 
Portfolio Vintage Data
Exhibit H
 
Reinsurance Vintage Data
Exhibit I
 
Portfolio Geographic Data
Exhibit J
 
Defaults, Reserve for Losses and LAE, and Claims
Exhibit K
 
Investments Available for Sale
Exhibit L
 
Insurance Company Capital
Exhibit M
 
Reconciliation of Non-GAAP Financial Measure - Adjusted Book Value per Share






 
 
 
 
 
 
 
Exhibit A

 
 
 
 
 
 
 
 
Essent Group Ltd. and Subsidiaries
Condensed Consolidated Statements of Comprehensive Income (Unaudited)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended December 31,
 
Year Ended December 31,
(In thousands, except per share amounts)
2019
 
2018
 
2019
 
2018
Revenues:
 
 
 
 
 
 
 
Net premiums written
$
196,493

 
$
176,437

 
$
760,845

 
$
685,287

Decrease (increase) in unearned premiums
11,178

 
(3,136
)
 
16,580

 
(35,795
)
Net premiums earned
207,671

 
173,301

 
777,425

 
649,492

Net investment income
21,977

 
18,597

 
83,542

 
64,091

Realized investment gains, net
833

 
158

 
3,229

 
1,318

Other income (loss)
(1,719
)
 
1,068

 
3,371

 
4,452

Total revenues
228,762

 
193,124

 
867,567

 
719,353

 
 
 
 
 
 
 
 
Losses and expenses:
 
 
 
 
 
 
 
Provision for losses and LAE
10,929

 
(999
)
 
32,986

 
11,575

Other underwriting and operating expenses
41,231

 
39,449

 
165,369

 
150,900

Interest expense
2,218

 
2,611

 
10,151

 
10,179

Total losses and expenses
54,378

 
41,061

 
208,506

 
172,654

 
 
 
 
 
 
 
 
Income before income taxes
174,384

 
152,063

 
659,061

 
546,699

Income tax expense
27,426

 
23,535

 
103,348

 
79,336

Net income
$
146,958

 
$
128,528

 
$
555,713

 
$
467,363

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Earnings per share:
 
 
 
 
 
 
 
Basic
$
1.50

 
$
1.32

 
$
5.68

 
$
4.80

Diluted
1.49

 
1.31

 
5.66

 
4.77

 
 
 
 
 
 
 
 
Weighted average shares outstanding:
 
 
 
 
 
 
 
Basic
97,830

 
97,450

 
97,762

 
97,403

Diluted
98,376

 
98,066

 
98,227

 
97,974

 
 
 
 
 
 
 
 
Net income
$
146,958

 
$
128,528

 
$
555,713

 
$
467,363

 
 
 
 
 
 
 
 
Other comprehensive income (loss):
 
 
 
 
 
 
 
Change in unrealized appreciation (depreciation) of investments
(6,540
)
 
18,456

 
85,180

 
(25,741
)
Total other comprehensive income (loss)
(6,540
)
 
18,456

 
85,180

 
(25,741
)
Comprehensive income
$
140,418

 
$
146,984

 
$
640,893

 
$
441,622

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Loss ratio
5.3
%

(0.6
)%

4.2
%

1.8
%
Expense ratio
19.9


22.8


21.3


23.2

Combined ratio
25.1
%

22.2
 %

25.5
%

25.0
%





 
 
 
Exhibit B

 
 
 
 
Essent Group Ltd. and Subsidiaries
Condensed Consolidated Balance Sheets (Unaudited)
 
 
 
 
 
 
December 31,
 
December 31,
(In thousands, except per share amounts)
2019
 
2018
Assets
 
 
 
Investments
 
 
 
Fixed maturities available for sale, at fair value
$
3,035,385

 
$
2,605,666

Short-term investments available for sale, at fair value
315,362

 
154,400

Total investments available for sale
3,350,747

 
2,760,066

Other invested assets
78,873

 
30,952

Total investments
3,429,620

 
2,791,018

Cash
71,350

 
64,946

Accrued investment income
18,535

 
17,627

Accounts receivable
40,655

 
36,881

Deferred policy acquisition costs
15,705

 
16,049

Property and equipment
17,308

 
7,629

Prepaid federal income tax
261,885

 
202,385

Other assets
18,367

 
13,436

 
 
 
 
Total assets
$
3,873,425

 
$
3,149,971

 
 
 
 
Liabilities and Stockholders' Equity
 
 
 
Liabilities
 
 
 
Reserve for losses and LAE
$
69,362

 
$
49,464

Unearned premium reserve
278,887

 
295,467

Net deferred tax liability
249,620

 
172,642

Credit facility borrowings, net of deferred costs
224,237

 
223,664

Other accrued liabilities
66,474

 
43,017

Total liabilities
888,580

 
784,254

 
 
 
 
Commitments and contingencies
 
 
 
 
 
 
 
Stockholders' Equity
 
 
 
Common shares, $0.015 par value:
 
 
 
Authorized - 233,333; issued and outstanding - 98,394 shares in 2019 and 98,139 shares in 2018
1,476

 
1,472

Additional paid-in capital
1,118,655

 
1,110,800

Accumulated other comprehensive income (loss)
56,187

 
(28,993
)
Retained earnings
1,808,527

 
1,282,438

Total stockholders' equity
2,984,845

 
2,365,717

 
 
 
 
Total liabilities and stockholders' equity
$
3,873,425

 
$
3,149,971

 
 
 
 
Return on average equity
20.8
%
 
21.7
%






 
 
 
 
 
 
 
 
 
 
 
 
 
 
Exhibit C
 
Essent Group Ltd. and Subsidiaries
Supplemental Information
Historical Quarterly Data
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2019
 
2018
Selected Income Statement Data
 
December 31
 
September 30
 
June 30
 
March 31
 
December 31
 
September 30
 
June 30
 
March 31
(In thousands, except per share amounts)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenues:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net premiums written
 
$
196,493

 
$
198,304

 
$
188,404

 
$
177,644

 
$
176,437

 
$
175,221

 
$
168,404

 
$
165,225

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net premiums earned (1)
 
207,671

 
203,473

 
188,490

 
177,791

 
173,301

 
166,675

 
156,958

 
152,558

Other revenues (2)
 
21,091

 
22,914

 
23,402

 
22,735

 
19,823

 
18,323

 
16,810

 
14,905

Total revenues
 
228,762

 
226,387

 
211,892

 
200,526

 
193,124

 
184,998

 
173,768

 
167,463

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Losses and expenses:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Provision for losses and LAE (3)
 
10,929

 
9,990

 
4,960

 
7,107

 
(999
)
 
5,452

 
1,813

 
5,309

Other underwriting and operating expenses
 
41,231

 
41,588

 
41,520

 
41,030

 
39,449

 
36,899

 
36,428

 
38,124

Interest expense
 
2,218

 
2,584

 
2,679

 
2,670

 
2,611

 
2,500

 
2,618

 
2,450

Total losses and expenses
 
54,378

 
54,162

 
49,159

 
50,807

 
41,061

 
44,851

 
40,859

 
45,883

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Income before income taxes
 
174,384

 
172,225

 
162,733

 
149,719

 
152,063

 
140,147

 
132,909

 
121,580

Income tax expense (4)
 
27,426

 
27,595

 
26,328

 
21,999

 
23,535

 
24,136

 
21,154

 
10,511

Net income
 
$
146,958

 
$
144,630

 
$
136,405

 
$
127,720

 
$
128,528

 
$
116,011

 
$
111,755

 
$
111,069

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Earnings per share:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
   Basic
 
$
1.50

 
$
1.48

 
$
1.39

 
$
1.31

 
$
1.32

 
$
1.19

 
$
1.15

 
$
1.14

   Diluted
 
1.49

 
1.47

 
1.39

 
1.30

 
1.31

 
1.18

 
1.14

 
1.13

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Weighted average shares outstanding:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
   Basic
 
97,830

 
97,822

 
97,798

 
97,595

 
97,450

 
97,438

 
97,426

 
97,298

   Diluted
 
98,376

 
98,257

 
98,170

 
98,104

 
98,066

 
98,013

 
97,866

 
97,951

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Other Data:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
   Loss ratio (5)
 
5.3
%
 
4.9
%
 
2.6
%
 
4.0
%
 
(0.6
)%
 
3.3
%
 
1.2
%
 
3.5
%
   Expense ratio (6)
 
19.9

 
20.4

 
22.0

 
23.1

 
22.8

 
22.1

 
23.2

 
25.0

      Combined ratio
 
25.1
%
 
25.3
%
 
24.7
%
 
27.1
%
 
22.2
 %
 
25.4
%
 
24.4
%
 
28.5
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Return on average equity (annualized)
 
20.1
%
 
20.8
%
 
20.9
%
 
20.9
%
 
22.4
 %
 
21.5
%
 
21.8
%
 
22.6
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(1) Net premiums earned also includes premiums earned on GSE and other risk share. See Exhibit F.
(2) Certain of our third-party reinsurance agreements contain an embedded derivative as the premium ceded under those agreements will vary based on changes in interest rates. Other revenues for the three months ended December 31, 2019, September 30, 2019, June 30, 2019 and March 31, 2019 include unfavorable decreases of $3,585 and $760 and favorable increases of $1,160 and $1,424, respectively, in the fair value of these embedded derivatives.
(3) Provision for losses and LAE for the three months ended December 31, 2018 includes a $9,941 reduction associated with previously identified hurricane-related defaults based on the performance to date and our expectations of the amount of ultimate losses on the remaining delinquencies.
(4) Income tax expense for the three months ended March 31, 2019 and 2018 was reduced by $1,956 and $9,549, respectively, of excess tax benefits associated with the vesting of common shares and common share units during each period. Income tax expense for the three months ended September 30, 2018 includes $1,450 of expense associated with accrual to return adjustments associated with the completion of the 2017 U.S. federal income tax return.
(5) Loss ratio is calculated by dividing the provision for losses and LAE by net premiums earned.
(6) Expense ratio is calculated by dividing other underwriting and operating expenses by net premiums earned.





 
 
 
 
 
 
 
 
 
 
 
 
 
 
Exhibit C, continued
 
Essent Group Ltd. and Subsidiaries
Supplemental Information
Historical Quarterly Data
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2019
 
2018
Other Data, continued:
 
December 31
 
September 30
 
June 30
 
March 31
 
December 31
 
September 30
 
June 30
 
March 31
($ in thousands)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
U.S. Mortgage Insurance Portfolio
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Flow:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
New insurance written
 
$
15,839,836

 
$
18,719,876

 
$
17,973,505

 
$
10,945,307

 
$
11,408,542

 
$
13,913,191

 
$
12,850,642

 
$
9,336,150

New risk written
 
3,966,363

 
4,695,611

 
4,485,217

 
2,713,389

 
2,838,530

 
3,430,942

 
3,201,610

 
2,295,314

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Bulk:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
New insurance written
 
$

 
$
6,133

 
$
29,524

 
$
55,002

 
$

 
$

 
$

 
$

New risk written
 

 
842

 
2,129

 
6,542

 

 

 

 

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total:
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Average gross premium rate (7)
 
0.51
%
 
0.52
%
 
0.51
%
 
0.50
%
 
0.50
%
 
0.51
%
 
0.52
%
 
0.52
%
Average net premium rate (8)
 
0.49
%
 
0.49
%
 
0.49
%
 
0.48
%
 
0.49
%
 
0.50
%
 
0.51
%
 
0.52
%
New insurance written
 
$
15,839,836

 
$
18,726,009

 
$
18,003,029

 
$
11,000,309

 
$
11,408,542

 
$
13,913,191

 
$
12,850,642

 
$
9,336,150

New risk written
 
$
3,966,363

 
$
4,696,453

 
$
4,487,346

 
$
2,719,931

 
$
2,838,530

 
$
3,430,942

 
$
3,201,610

 
$
2,295,314

Insurance in force (end of period)
 
$
164,005,853

 
$
160,962,192

 
$
153,317,157

 
$
143,181,641

 
$
137,720,786

 
$
131,249,957

 
$
122,501,246

 
$
115,250,949

Gross risk in force (end of period) (9)
 
$
41,402,950

 
$
40,540,289

 
$
38,531,090

 
$
35,925,830

 
$
34,482,448

 
$
32,786,194

 
$
30,579,106

 
$
28,691,561

Risk in force (end of period)
 
$
38,947,857

 
$
38,784,584

 
$
37,034,687

 
$
34,744,417

 
$
33,892,869

 
$
32,361,782

 
$
30,154,694

 
$
28,267,149

Policies in force
 
702,925

 
693,085

 
666,705

 
629,808

 
608,135

 
581,570

 
546,576

 
517,215

Weighted average coverage (10)
 
25.2
%
 
25.2
%
 
25.1
%
 
25.1
%
 
25.0
%
 
25.0
%
 
25.0
%
 
24.9
%
Annual persistency
 
77.5
%
 
82.1
%
 
84.8
%
 
85.1
%
 
84.9
%
 
84.0
%
 
83.0
%
 
83.5
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Loans in default (count)
 
5,947

 
5,232

 
4,405

 
4,096

 
4,024

 
3,538

 
3,519

 
4,442

Percentage of loans in default
 
0.85
%
 
0.75
%
 
0.66
%
 
0.65
%
 
0.66
%
 
0.61
%
 
0.64
%
 
0.86
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Other Risk in Force
 
 
 
 
 
 
 
 
 
 
 
 
 
 
GSE and other risk share (11)
 
$
895,374

 
$
849,184

 
$
802,530

 
$
771,175

 
$
655,384

 
$
612,750

 
$
592,493

 
$
557,692

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Credit Facility
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Borrowings outstanding
 
$
225,000

 
$
225,000

 
$
225,000

 
$
225,000

 
$
225,000

 
$
225,000

 
$
225,000

 
$
265,000

Undrawn committed capacity
 
$
275,000

 
$
275,000

 
$
275,000

 
$
275,000

 
$
275,000

 
$
275,000

 
$
275,000

 
$
110,000

Weighted average interest rate (end of period)
 
3.51
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(7) Average gross premium rate is calculated by dividing annualized premiums earned for the U.S. mortgage insurance portfolio, before reductions for premiums ceded under third-party reinsurance, by average insurance in force for the period.
(8) Average net premium rate is calculated by dividing annualized net premiums earned for the U.S. mortgage insurance portfolio by average insurance in force for the period.
(9) Gross risk in force includes risk ceded under third-party reinsurance.
(10) Weighted average coverage is calculated by dividing end of period gross risk in force by end of period insurance in force.
(11) GSE and other risk share includes GSE risk share and other reinsurance transactions. Essent Re provides insurance or reinsurance relating to the risk in force on loans in reference pools acquired by Freddie Mac and Fannie Mae.






 
 
 
 
 
 
 
 
 
 
Exhibit D
 
 
 
 
 
 
 
 
 
 
 
 
 
Essent Group Ltd. and Subsidiaries
Supplemental Information
New Insurance Written: Flow
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
NIW by Credit Score
 
Three Months Ended
 
Year Ended
 
December 31, 2019
 
December 31, 2018
 
December 31, 2019
 
December 31, 2018
($ in thousands)
 
 
 
 
 
 
 
 
 
 
 
>=760
$
6,486,486

40.9
%
 
$
4,737,774

41.5
%
 
$
25,738,423

40.5
%
 
$
19,903,369

41.9
%
740-759
2,880,429

18.2

 
1,959,523

17.2

 
11,152,853

17.6

 
8,076,182

17.0

720-739
2,401,806

15.2

 
1,665,931

14.6

 
9,340,180

14.7

 
6,875,823

14.5

700-719
1,860,120

11.7

 
1,349,689

11.8

 
7,555,687

11.9

 
5,715,076

12.0

680-699
1,235,223

7.8

 
875,125

7.7

 
5,248,330

8.3

 
3,722,490

7.8

<=679
975,772

6.2

 
820,500

7.2

 
4,443,051

7.0

 
3,215,585

6.8

Total
$
15,839,836

100.0
%
 
$
11,408,542

100.0
%
 
$
63,478,524

100.0
%
 
$
47,508,525

100.0
%
 
 
 
 
 
 
 
 
 
 
 
 
Weighted average credit score
745

 
 
745

 
 
744

 
 
745

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
NIW by LTV
 
Three Months Ended
 
Year Ended
 
December 31, 2019
 
December 31, 2018
 
December 31, 2019
 
December 31, 2018
($ in thousands)
 
 
 
 
 
 
 
 
 
 
 
85.00% and below
$
2,084,932

13.2
%
 
$
1,384,296

12.1
%
 
$
7,874,266

12.4
%
 
$
5,731,894

12.1
%
85.01% to 90.00%
4,757,915

30.0

 
3,124,625

27.4

 
17,847,603

28.1

 
13,227,075

27.8

90.01% to 95.00%
6,771,196

42.7

 
4,955,729

43.4

 
26,852,903

42.3

 
20,579,615

43.3

95.01% and above
2,225,793

14.1

 
1,943,892

17.1

 
10,903,752

17.2

 
7,969,941

16.8

Total
$
15,839,836

100.0
%
 
$
11,408,542

100.0
%
 
$
63,478,524

100.0
%
 
$
47,508,525

100.0
%
 
 
 
 
 
 
 
 
 
 
 
 
Weighted average LTV
92
%
 
 
92
%
 
 
92
%
 
 
92
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
NIW by Product
 
Three Months Ended
 
Year Ended
 
December 31, 2019
 
December 31, 2018
 
December 31, 2019
 
December 31, 2018
Single Premium policies
 
10.4
%
 
 
13.5
%
 
 
11.1
%
 
 
15.3
%
Monthly Premium policies
 
89.6

 
 
86.5

 
 
88.9

 
 
84.7

 
 
100.0
%
 
 
100.0
%
 
 
100.0
%
 
 
100.0
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
NIW by Purchase vs. Refinance
 
Three Months Ended
 
Year Ended
 
December 31, 2019
 
December 31, 2018
 
December 31, 2019
 
December 31, 2018
Purchase
 
71.8
%
 
 
93.3
%
 
 
80.4
%
 
 
91.8
%
Refinance
 
28.2

 
 
6.7

 
 
19.6

 
 
8.2

 
 
100.0
%
 
 
100.0
%
 
 
100.0
%
 
 
100.0
%





 
 
 
 
 
 
 
 
 
Exhibit E

 
 
 
 
 
 
 
 
 
 
Essent Group Ltd. and Subsidiaries
Supplemental Information
Insurance in Force and Risk in Force
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Portfolio by Credit Score
IIF by FICO score
December 31, 2019
 
September 30, 2019
 
December 31, 2018
($ in thousands)
 
 
 
 
 
 
 
 
>=760
 
$
68,123,523

41.5
%
 
$
67,408,766

41.9
%
 
$
59,249,659

43.0
%
740-759
 
27,886,603

17.0

 
27,178,330

16.9

 
22,843,145

16.6

720-739
 
24,069,139

14.7

 
23,459,055

14.6

 
19,898,885

14.5

700-719
 
19,183,219

11.7

 
18,728,884

11.6

 
15,714,206

11.4

680-699
 
13,713,164

8.4

 
13,418,919

8.3

 
11,299,829

8.2

<=679
 
11,030,205

6.7

 
10,768,238

6.7

 
8,715,062

6.3

Total
$
164,005,853

100.0
%
 
$
160,962,192

100.0
%
 
$
137,720,786

100.0
%
 
 
 
 
 
 
 
 
 
 
Weighted average credit score
745

 
 
745

 
 
746

 
 
 
 
 
 
 
 
 
 
 
Gross RIF by FICO score
December 31, 2019
 
September 30, 2019
 
December 31, 2018
($ in thousands)
 
 
 
 
 
 
 
 
>=760
 
$
17,082,683

41.3
%
 
$
16,877,750

41.6
%
 
$
14,789,783

42.9
%
740-759
 
7,056,654

17.0

 
6,857,369

16.9

 
5,736,432

16.6

720-739
 
6,150,334

14.9

 
5,980,949

14.8

 
5,036,063

14.6

700-719
 
4,873,597

11.8

 
4,743,360

11.7

 
3,943,925

11.4

680-699
 
3,491,755

8.4

 
3,406,811

8.4

 
2,846,297

8.3

<=679
 
2,747,927

6.6

 
2,674,050

6.6

 
2,129,948

6.2

Total
$
41,402,950

100.0
%
 
$
40,540,289

100.0
%
 
$
34,482,448

100.0
%
 
 
 
 
 
 
 
 
 
 
Portfolio by LTV
IIF by LTV
December 31, 2019
 
September 30, 2019
 
December 31, 2018
($ in thousands)
 
 
 
 
 
 
 
 
85.00% and below
 
$
17,128,008

10.5
%
 
$
16,918,870

10.5
%
 
$
15,123,578

11.0
%
85.01% to 90.00%
 
46,771,386

28.5

 
46,021,398

28.6

 
41,020,839

29.8

90.01% to 95.00%
 
76,611,494

46.7

 
75,528,177

46.9

 
66,028,990

47.9

95.01% and above
 
23,494,965

14.3

 
22,493,747

14.0

 
15,547,379

11.3

Total
$
164,005,853

100.0
%
 
$
160,962,192

100.0
%
 
$
137,720,786

100.0
%
 
 
 
 
 
 
 
 
 
 
Weighted average LTV
92
%
 
 
92
%
 
 
92
%
 
 
 
 
 
 
 
 
Gross RIF by LTV
December 31, 2019
 
September 30, 2019
 
December 31, 2018
($ in thousands)
 
 
 
 
 
 
 
 
85.00% and below
 
$
1,977,361

4.8
%
 
$
1,953,058

4.8
%
 
$
1,741,823

5.1
%
85.01% to 90.00%
 
11,249,383

27.2

 
11,065,886

27.3

 
9,819,171

28.5

90.01% to 95.00%
 
21,981,598

53.1

 
21,633,852

53.4

 
18,912,421

54.8

95.01% and above
 
6,194,608

14.9

 
5,887,493

14.5

 
4,009,033

11.6

Total
$
41,402,950

100.0
%
 
$
40,540,289

100.0
%
 
$
34,482,448

100.0
%
 
 
 
 
 
 
 
 
 
 
Portfolio by Loan Amortization Period
IIF by Loan Amortization Period
December 31, 2019
 
September 30, 2019
 
December 31, 2018
($ in thousands)
 
 
 
 
 
 
 
 
FRM 30 years and higher
 
$
154,905,519

94.5
%
 
$
151,594,009

94.2
%
 
$
128,083,429

93.0
%
FRM 20-25 years
 
2,854,560

1.7

 
2,872,964

1.8

 
2,965,782

2.2

FRM 15 years
 
3,300,715

2.0

 
3,367,326

2.1

 
3,445,447

2.5

ARM 5 years and higher
 
2,945,059

1.8

 
3,127,893

1.9

 
3,226,128

2.3

Total
$
164,005,853

100.0
%
 
$
160,962,192

100.0
%
 
$
137,720,786

100.0
%





 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Exhibit F

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Essent Group Ltd. and Subsidiaries
Supplemental Information
Other Risk in Force
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
2019
 
2018
($ in thousands)
 
December 31
 
September 30
 
June 30
 
March 31
 
December 31
 
September 30
 
June 30
 
March 31
GSE and other risk share (1):
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Premiums earned
 
$
9,867

 
$
9,284

 
$
8,622

 
$
7,894

 
$
7,333

 
$
6,886

 
$
6,715

 
$
6,267

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Risk in Force
 
$
895,374

 
$
849,184

 
$
802,530

 
$
771,175

 
$
655,384

 
$
612,750

 
$
592,493

 
$
557,692

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Weighted average credit score
 
745

 
746

 
748

 
747

 
748

 
749

 
748

 
751

Weighted average LTV
 
85
%
 
85
%
 
85
%
 
85
%
 
85
%
 
85
%
 
85
%
 
84
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(1) GSE and other risk share includes GSE risk share and other reinsurance transactions. Essent Reinsurance Ltd. ("Essent Re") provides insurance or reinsurance relating to the risk in force on loans in reference pools acquired by Freddie Mac and Fannie Mae.






 
 
 
 
 
 
 
 
 
 
 
 
Exhibit G

 
 
 
 
 
 
 
 
 
 
 
 
 
Essent Group Ltd. and Subsidiaries
Supplemental Information
Portfolio Vintage Data
December 31, 2019
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Insurance in Force
 
 
Year
Original
Insurance
Written
($ in thousands)
Remaining
Insurance
in Force
($ in thousands)
% Remaining of Original
Insurance
Number of Policies in Force
% Purchase
>90% LTV
>95% LTV
FICO < 700
FICO >= 760
% FRM
Incurred Loss Ratio (Inception to Date) (1)
Number of Loans in Default
 
 
 
 
 
 
 
 
 
 
 
 
 
2010
$
245,898

$
3,354

1.4
%
25

55.5
%
43.8
%
0.0
%
2.6
%
55.8
%
100.0
%
2.6
%
1

2011
3,229,720

154,793

4.8

902

68.8

58.1

0.4

6.3

52.7

97.9

3.7

18

2012
11,241,161

1,144,794

10.2

6,165

72.2

70.8

0.8

4.9

57.3

99.2

2.1

84

2013
21,152,638

3,411,648

16.1

18,397

78.9

67.4

2.4

7.7

51.2

98.8

2.3

250

2014
24,799,434

5,972,714

24.1

33,081

89.5

67.7

4.9

16.0

41.0

97.4

3.0

535

2015
26,193,656

9,896,050

37.8

48,804

85.1

60.4

2.8

14.7

43.8

98.3

2.7

669

2016
34,949,319

19,022,616

54.4

86,915

84.1

59.0

7.1

13.5

45.7

98.7

2.9

948

2017
43,858,322

29,606,165

67.5

135,204

87.8

60.6

14.6

15.8

41.9

97.3

4.2

1,623

2018
47,508,525

35,318,382

74.3

152,372

92.3

62.4

18.7

15.6

39.9

97.9

6.0

1,398

2019
63,569,183

59,475,337