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Core Business: Private Mortgage Insurance (PMI)
Enact Holdings, Inc., operating primarily through its subsidiary Enact Mortgage Insurance Corporation (EMICO), is a leading provider of private mortgage insurance in the United States. Established in 1981 and headquartered in Raleigh, North Carolina, Enact offers mortgage insurance solutions that enable lenders to provide affordable financing options to homebuyers with down payments as low as 3%. These solutions are crucial for borrowers who might otherwise struggle to afford a home.
Approved by Fannie Mae and Freddie Mac, Enact is licensed to operate in all 50 states and the District of Columbia. The company's mortgage insurance products provide private capital to mitigate mortgage credit risk, allowing lenders to make additional mortgage financing available to prospective homeowners.
Complementary Business: Mortgage Reinsurance
In addition to its core mortgage insurance offerings, Enact operates Enact Re Ltd., a Bermuda-based subsidiary specializing in mortgage-related insurance and reinsurance. Enact Re provides reinsurance solutions to the government-sponsored enterprises (GSEs) and reinsures a portion of Enact's new insurance written. This reinsurance segment enhances Enact's ability to manage risk and capital, contributing to the company's overall financial strength and stability.
Enact has entered into multiple quota share reinsurance agreements, ceding portions of its expected new insurance written to a panel of highly rated reinsurers. For instance, in December 2024, Enact announced two quota share reinsurance agreements, ceding approximately 27% of a portion of expected new insurance written for the periods from January 1, 2025, through December 31, 2025, and from January 1, 2026, through December 31, 2026.
Furthermore, Enact has secured excess of loss (XOL) reinsurance coverage through insurance-linked note (ILN) transactions. In November 2023, Enact completed its sixth ILN issuance, securing $248 million of fully collateralized XOL reinsurance coverage for a portfolio of existing seasoned mortgage insurance policies.
Technology and Innovation
Enact integrates technology into its operations to enhance efficiency and customer experience. The company offers Rate360℠, a pricing engine that provides tailored mortgage insurance rates based on each loan's characteristics. Lenders can easily access these rates through platforms like Rate Express® or Optimal Blue, streamlining the quoting and ordering process.
As of 2024, Enact continues to demonstrate resilience and adaptability in the evolving mortgage and housing finance landscape. The company's diversified business model, encompassing private mortgage insurance, reinsurance, and technology solutions, positions it well to navigate changing market conditions and meet the needs of lenders, borrowers, and investors.
Enact's comprehensive approach, combining core mortgage insurance with complementary services and technological innovation, underscores its commitment to supporting homeownership and contributing to the stability and growth of the U.S. housing finance system.
