We enter into third-party reinsurance transactions to actively manage our risk, ensure compliance with PMIERs, state regulatory and other applicable capital requirements, (respectively, as defined therein), and support the growth of our business. The Wisconsin Office of the Commissioner of Insurance (Wisconsin OCI) has approved and the GSEs have indicated their non-objection to all such transactions (subject to certain conditions and ongoing review).


	For the three months ended June 30,				For the six months ended June 30,
	2026		2025		2026		2025
	(In Thousands)
Net premiums written
Direct	$	187,213	$	177,914	$	373,219	$	352,329
Ceded (1)	(31,864)		(33,861)		(66,044)		(64,890)
Net premiums written	$	155,349	$	144,053	$	307,175	$	287,439

Net premiums earned
Direct	$	189,388	$	182,931	$	378,374	$	363,387
Ceded (1)	(31,864)		(33,865)		(66,044)		(64,955)
Net premiums earned	$	157,524	$	149,066	$	312,330	$	298,432

NMIC is party to nine quota share reinsurance treaties – the 2018 QSR Transaction, effective January 1, 2018, the 2020 QSR Transaction, effective April 1, 2020, the 2021 QSR Transaction, effective January 1, 2021, the 2022 QSR Transaction, effective October 1, 2021, the 2022 Seasoned QSR Transaction, effective July 1, 2022, the 2023 QSR Transaction, effective January 1, 2023, the 2024 QSR Transaction, effective January 1, 2024, the 2025 QSR Transaction, effective January 1, 2025, and the 2026 QSR Transaction, effective January 1, 2026 – which we refer to collectively as the QSR Transactions.

Under each of the QSR Transactions, NMIC cedes a proportional share of its risk on eligible policies to panels of third-party reinsurance providers in exchange for reimbursement of ceded claims and claim expenses on covered policies, a ceding commission and a profit commission (up to a contractually defined maximum) that varies directly and inversely with ceded claims.

NMIC holds optional termination rights which provide it with the discretion to terminate each QSR Transaction on or after a specified date. NMIC may also terminate any or all of the QSR Transactions without penalty if, due to a change in PMIERs requirements, it is no longer able to take full PMIERs asset credit for the RIF ceded under the respective agreements. Additionally, under the terms of the QSR Transactions, NMIC may elect to selectively terminate its engagement with individual reinsurers on a run-off basis (i.e., reinsurers continue providing coverage on all risk ceded prior to the termination date, with no new cessions going forward) or cut-off basis (i.e., the reinsurance arrangement is completely terminated with NMIC recapturing all previously ceded risk) under certain circumstances. Such selective termination rights arise when, among other reasons, a reinsurer experiences a deterioration in its capital position below a prescribed threshold and/or a reinsurer breaches (and fails to cure) its collateral posting obligations under the relevant agreement.

Inception Date

Covered Production

Ceding Percentage

Ceding Commission

Profit Commission

2018 QSR

1/1/2018

1/1/2018 – 12/31/2018

1/1/2019 – 12/31/2019

16%

13% (1)

42%

up to 45%

2020 QSR

4/1/2020

4/1/2020 – 12/31/2020

21%

45%

up to 45%

2021 QSR

1/1/2021

1/1/2021 – 10/30/2021

20%

35%

up to 54%

2022 QSR

10/1/2021

10/30/2021 – 12/31/2022

20%

up to 68%

2022 Seasoned QSR

7/1/2022

1/1/2013 – 12/31/2016

7/1/2019 –3/31/2020

48% (2)

53%

up to 38%

2023 QSR

1/1/2023

1/1/2023 – 12/31/2023

20%

up to 63%

2024 QSR

1/1/2024

1/1/2024 – 12/31/2024

20%

up to 56%

2025 QSR

1/1/2025

1/1/2025 – 12/31/2025

20%

up to 62%

2026 QSR

1/1/2026

1/1/2026 – 12/31/2026

25%

21%

up to 61%

NMIC has also entered into two additional quota share reinsurance treaties that will provide sequential coverage for mortgage insurance policies to be written in 2027 and 2028 (the 2027 QSR Transaction and 2028 QSR Transaction). Under the terms of the 2027 QSR Transaction, NMIC will cede premiums earned related to 35% of the risk on eligible policies written between January 1, 2027 and December 31, 2027. Under the terms of the 2028 QSR Transaction, NMIC will cede premiums earned related to 25% of the risk on eligible policies written between January 1, 2028 and December 31, 2028.

The following table shows amounts related to the QSR Transactions:


	As of and for the three months ended June 30,				As of and for the six months ended June 30,
	2026		2025		2026		2025
	(In Thousands)
Ceded risk-in-force	$	12,637,648	$	12,764,708	$	12,637,648	$	12,764,708
Ceded premiums earned	(38,505)		(40,227)		(76,435)		(81,238)
Ceded claims and claim expenses (1)	3,127		3,253		8,017		3,776
Ceding commission earned	10,172		9,669		20,377		19,437
Profit commission	19,400		19,958		36,531		43,356

NMIC had aggregate reinsurance recoverables related to the QSR Transactions of $40.4 million and $38.6 million as of June 30, 2026 and December 31, 2025, respectively. NMIC's reinsurance recoverable balance is supported by collateral trust accounts established and maintained by each reinsurer in accordance with the terms of the QSR Transactions and the PMIERs funding requirements for risk ceded to non-affiliated reinsurers.

We remain directly liable for all claim payments if we are unable to collect the recoverables due from our reinsurers and establish an allowance for expected credit loss against our reinsurance recoverable if we do not expect to recover amounts due from one or more of our reinsurance counterparties. Our reinsurance recoverable is reported net of such allowance, if any. We actively monitor the counterparty credit profiles of our reinsurers and each is required to partially collateralize its obligations under the terms of the QSR Transactions. The allowance for credit loss established against our reinsurance recoverable was deemed immaterial as of June 30, 2026 and December 31, 2025.

NMIC is party to nine excess-of-loss reinsurance agreements with broad panels of third-party reinsurers – the 2022-1 XOL Transaction, effective April 1, 2022, the 2022-2 XOL Transaction, effective July 1, 2022, the 2022-3 XOL Transaction, effective October 1, 2022, the 2023-1 XOL Transaction, effective January 1, 2023, the 2023-2 XOL Transaction, effective July 1, 2023, the 2024 XOL Transaction, effective January 1, 2024, the 2025 XOL Transaction, effective January 1, 2025, the 2026-1 XOL Transaction, effective January 1, 2026, and the 2026-2 XOL Transaction, effective April 1, 2026 – which we refer to collectively as the XOL Transactions. Each XOL Transaction provides NMIC with aggregate excess-of-loss reinsurance coverage on a defined portfolio of mortgage insurance policies. Under each agreement, NMIC retains a first layer of aggregate loss exposure on covered policies and the reinsurers then provide second layer loss protection up to a defined reinsurance coverage amount. The reinsurance coverage amount of each XOL Transaction is set to approximate the PMIERs minimum required assets of its reference pool and decreases from its peak over a ten-year period in the event the PMIERs minimum required assets of the pool declines. NMIC retains losses in excess of the outstanding reinsurance coverage amount.

Under the terms of the XOL Transactions, NMIC makes risk premium payments to its third-party reinsurance providers for the outstanding reinsurance coverage amount and ceded aggregate premiums earned of $11.2 million and $22.2 million during the three and six months ended June 30, 2026, respectively, and $10.4 million and $20.5 million during the three and six months ended June 30, 2025, respectively. NMIC applies claims paid on covered policies against its first layer aggregate retained loss exposure under each agreement. NMIC did not cede any incurred losses on covered policies under the XOL Transactions during the three and six months ended June 30, 2026 and 2025, as the aggregate first layer risk retention for each agreement was not exhausted during such periods.

NMIC holds optional termination rights which provide it with the discretion to terminate each XOL Transaction on or after a specified date. NMIC may also elect to terminate the XOL Transactions at any point if the outstanding reinsurance coverage amount amortizes to 10% or less of the reinsurance coverage amount provided at inception, or if it determines that it will no longer be able to take full PMIERs asset credit for the coverage. Additionally, under the terms of the treaties, NMIC may selectively terminate its engagement with individual reinsurers under certain circumstances. Such selective termination rights arise when, among other reasons, a reinsurer experiences a deterioration in its capital position below a prescribed threshold, and/or a reinsurer breaches (and fails to cure) its collateral posting obligation.

The following table presents the inception date, covered production period, initial and current reinsurance coverage amount, and initial and current first layer retained aggregate loss under each outstanding XOL Transaction. Current amounts are presented as of June 30, 2026.


($ values in thousands)	Inception Date	Covered Production	Initial Reinsurance Coverage		Current Reinsurance Coverage		Initial First Layer Retained Loss		Current First Layer Retained Loss (1)
2022-1 XOL	April 1, 2022	10/1/2021 – 3/31/2022	$	289,741	$	125,849	$	133,366	$	127,071
2022-2 XOL	July 1, 2022	4/1/2022 – 6/30/2022	154,306		102,346		78,906		70,282
2022-3 XOL	October 1, 2022	7/1/2022 – 9/30/2022	96,779		67,726		106,265		98,355
2023-1 XOL	January 1, 2023	10/1/2022 – 6/30/2023	89,864		53,594		146,513		139,186
2023-2 XOL	July 1, 2023	7/1/2023 – 12/31/2023	100,777		52,089		136,875		133,319
2024 XOL	January 1, 2024	1/1/2024 – 12/31/2024	162,500		127,186		312,172		309,628
2025 XOL	January 1, 2025	1/1/2025 – 12/31/2025	283,849		265,838		321,331		321,279
2026-1 XOL(2)	January 1, 2026	1/1/2026 – 12/31/2026	98,359		98,359		183,282		183,282
2026-2 XOL (3)	April 1, 2026	10/1/2020 - 3/31/2021	148,109		140,691		17,042		17,042

(1) NMIC applies claims paid on covered policies against its first layer aggregate retained loss exposure and cedes reserves for incurred claims and claim expenses to each applicable XOL Transaction and recognizes a reinsurance recoverable if such incurred claims and claim expenses exceed its current first layer retained loss.

(2) The initial reinsurance coverage, current reinsurance coverage, initial first layer retained loss and current first layer retained loss for the 2026-1 XOL Transaction will increase as incremental covered production is ceded under the transaction through December 31, 2026.

NMIC has also entered into two additional excess-of-loss reinsurance treaties that will incept and provide coverage in future periods. The 2026-3 XOL Transaction will incept on October 1, 2026 and provide $160 million of aggregate excess-of-loss coverage for mortgage insurance policies covered under the existing 2021-2 ILN Transaction, and the 2027 XOL Transaction will provide $125 million of aggregate excess-of-loss coverage for mortgage insurance policies to be written in 2027.

NMIC is party to a reinsurance agreement with Oaktown Re VII Ltd. (a special purpose reinsurance entity referred to as Oaktown Re) effective October 26, 2021 that provides aggregate excess-of-loss reinsurance coverage on a defined portfolio of mortgage insurance policies originated between April 1, 2021 and September 30, 2021. Under the agreement, NMIC retains $146.2 million of first layer aggregate loss exposure on covered policies and Oaktown Re then provides second layer loss protection up to the outstanding reinsurance coverage amount. NMIC then retains losses in excess of the reinsurance coverage amount. The reinsurance coverage amount provided by Oaktown Re decreases from $363.6 million at inception over a 12.5 year period as the underlying insured mortgages are amortized or repaid, and/or the mortgage insurance coverage is canceled, and was $149.0 million as of June 30, 2026. The outstanding reinsurance coverage amount stops amortizing if certain credit enhancement or delinquency thresholds, as defined in the agreement, are triggered.

Under the terms of the excess-of-loss reinsurance agreement, Oaktown Re is required to fully collateralize its outstanding reinsurance coverage amount to NMIC with funds deposited into a segregated reinsurance trust. Such trust funds are required to be invested in short-term U.S. Treasury money market funds at all times. Oaktown Re financed its collateral requirement through the issuance of mortgage insurance-linked notes to unaffiliated investors. Such insurance-linked notes mature 12.5 years from the inception date of their associated reinsurance agreement. As the reinsurance coverage decreases, a corresponding amount of collateral held in trust by Oaktown Re is distributed to noteholders as amortization of the outstanding insurance-linked note principal balance. We refer to NMIC’s reinsurance agreement with and the insurance-linked note issued by Oaktown Re as the 2021-2 ILN Transaction.

NMIC applies claims paid on covered policies against its first layer aggregate retained loss exposure under the Oaktown Re excess-of-loss agreement. NMIC did not cede any incurred losses on covered policies to Oaktown Re during the three and six months ended June 30, 2026 and 2025, as the aggregate first layer risk retention was not exhausted during such periods. The first layer aggregate retained loss layer was $142.5 million as of June 30, 2026.

NMIC holds optional termination rights under the 2021-2 ILN Transaction, including, among others, an optional call feature which provides NMIC the discretion to terminate the transaction on or after a prescribed date, and a clean-up call if the outstanding reinsurance coverage amount amortizes to 10% or less of the reinsurance coverage amount at inception or if NMIC

reasonably determines that changes to GSE or rating agency asset requirements would cause a material and adverse effect on the capital treatment afforded to NMIC under the agreement. In addition, there are certain events that trigger mandatory termination of the agreement, including NMIC’s failure to pay premiums or consent to reductions in a trust account to make principal payments to noteholders, among others.

NMIC has previously been party to other insurance-linked note transactions that it has elected to terminate in accordance with their respective terms. Effective April 27, 2026, NMIC exercised its optional call to terminate a reinsurance agreement with and the associated insurance-linked notes issued by Oaktown Re VI Ltd. In connection with the termination, NMIC's excess of loss reinsurance agreement with Oaktown Re VI Ltd. was commuted and the insurance-linked notes issued by Oaktown Re VI Ltd. were redeemed in full with a distribution of remaining collateral assets.

NMIC ceded aggregate premiums in connection with current and previously outstanding insurance-linked notes transactions of $1.5 million and $3.9 million during the three and six months ended June 30, 2026, respectively, and $3.2 million and $6.6 million during the three and six months ended June 30, 2025, respectively.