Industry News

PMI Group posts $87 million Q3 loss

Claims, losses outweigh 20% increase in revenue
Published on Oct 31, 2007

Mortgage insurer PMI Group Inc. said Tuesday it lost $86.8 million during the third quarter as the company boosted revenue but saw paid claims, loss adjustments and reserves for losses grow to $372 million. In U.S. mortgage insurance operations, revenues for the quarter were actually up 20 percent compared to a year ago, to $241 million, thanks to growth in net premiums written and earned. But profits were dented by $92.6 million in claims and a $254 million increase in reserves for losses attributed to an increase in notices of default, increased claim rates and larger claims. The default rate on 786,301 primary policies in force hit 6.45 percent during the quarter, compared with 5.64 percent in the previous quarter and 5.4 percent a year ago. PMI Mortgage Insurance Co. and its affiliated mortgage reinsurance companies had $120 billion in insurance at force at the end of the third quarter, a 20 percent increase from a year ago. But mortgages with loan-to-value ratios o...

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