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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

(Mark One)


☒			QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period ended March 31, 2025


☐			TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from to

Commission File Number: 001-40399

Enact Holdings, Inc.

(Exact name of registrant as specified in its charter)


Delaware						46-1579166
(State or other jurisdiction of incorporation or organization)						(I.R.S. Employer Identification Number)

8325 Six Forks Road

Raleigh, North Carolina 27615

(919) 846-4100

(Address, including zip code, and telephone number, including area code, of registrant’s principal executive offices)

Securities registered pursuant to Section 12(b) of the Act:

Title of each class

Trading Symbol

Name of each exchange on which registered

Common Stock, par value $0.01 per share

ACT

The Nasdaq Stock Market, LLC

Indicate by check mark whether the Registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the Registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes ☒ No ☐

Indicate by check mark whether the Registrant has submitted electronically every Interactive Data File required to be submitted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the Registrant was required to submit such files). Yes ☒ No ☐

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, a smaller reporting company or an emerging growth company. See the definitions of “large accelerated filer,” “accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.


Large accelerated filer	☒	Accelerated filer	☐
Non-accelerated filer	☐	Smaller reporting company	☐
		Emerging growth company	☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ☐

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No ☒

As of April 30, 2025, there were 150,066,274 shares of Common Stock, par value $0.01 per share, outstanding.

TABLE OF CONTENTS


			Page
Part I. Financial Information			4
Item 1. Financial Statements			4
Condensed Consolidated Balance Sheet s (Unaudited)			4
Condensed Consolidated Statements of Incom e (Unaudited)			5
Condensed Consolidated Statements of Comprehensive Incom e (Unaudited)			6
Condensed Consolidated Statements of Changes in Equit y (Unaud ited)			7
Condensed Consolidated Statements of Cash Flow s (Unaudi ted)			8
Notes to Condensed Consolidated Financial Statement s (Unaudited)			9
Item 2. Management's Discussion and Analysis of Financial Condition and Results of Operations			30
Item 3. Quantitative and Qualitative Disclosures About Market Risk			55
Item 4. Controls and Procedures			56
Part II. Other Information			57
Item 1. Legal Proceedings			57
Item 1A. Risk Factors			57
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds			57
Item 5. Other Information			57
Item 6. Exhibits			59
Signatures			60

Cautionary Note Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q, including Management’s Discussion and Analysis of Financial Condition and Results of Operations, contains “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act. These forward-looking statements may address, among other things, our expected financial and operational results, the related assumptions underlying our expected results and the quotations of management. These forward-looking statements are distinguished by use of words such as “will,” “would,” “anticipate,” “expect,” “believe,” “designed,” “plan,” or “intend,” the negative of these terms and similar references to future periods. These views involve risks and uncertainties that are difficult to predict and, accordingly, our actual results may differ materially from the results discussed in our forward-looking statements. Our forward-looking statements contained herein speak only as of the date of this quarterly report.

Although Enact Holdings, Inc. (the “Company”) believes the expectations reflected in such forward-looking statements are based on reasonable assumptions, the Company can give no assurance that its expectations will be achieved and it undertakes no obligation to update publicly any forward-looking statements as a result of new information, future events, or otherwise, except as required by applicable law. Factors or events that we cannot predict, including the following, may cause our actual results to differ from those expressed in forward-looking statements:

•inability to continue to maintain the private mortgage insurer eligibility requirements (“PMIERs”) or any other restrictions imposed on us by the Federal National Mortgage Association (“Fannie Mae”) and the Federal Home Loan Mortgage Corporation (“Freddie Mac”), government-sponsored enterprises collectively referred to as the “GSEs”;

•deterioration in economic conditions, a decline in home prices or a severe recession, including from the impact of tariffs and other government economic policies;

•uncertainty around the time loans remain in our delinquent inventory including effects of forbearance programs and foreclosure timing;

•uncertainty of our loss reserve estimates or inaccuracies in our models;

•competition for our customers or the loss of a significant customer;

•changes to the charters or practices of the GSEs, including actions or decisions to decrease or discontinue the use of mortgage insurance;

•lenders or investors seeking alternatives to private mortgage insurance;

•failure of our risk management or loss mitigation strategies;

•risks related to emerging and changing technologies, including artificial intelligence;

•fluctuations in interest rates;

•limited availability of capital and the need to seek additional capital on unfavorable terms;

•limited availability of reinsurance;

•adverse actions by rating agencies;

•competition with government-owned enterprises and GSEs;

•failure to manage the risk in our investment portfolio;

•disruption in the servicing of mortgages covered by our insurance policies or poor servicer performance;

•unanticipated claims arising under and risks associated with our delegated underwriting program or contract underwriting program;

•inadequacy of the premiums we charge to compensate for the losses we incur;

•decrease in the volume of Low-Down Payment Loan originations;

•failure to protect our confidential customer information;

•adverse changes in regulatory requirements;

•inability to maintain sufficient regulatory capital;

•risks relating to our continuing relationship with Genworth Financial, Inc.;

•changes in tax laws;

•litigation, regulatory investigations or other actions;

•inability to attract and retain key employees;

•failure or any compromise of the security of our computer systems, disaster recovery systems, business continuity plans and failures to safeguard or breaches of confidential information; and

•occurrence of natural or man-made disasters or public health emergencies, including pandemics and disasters caused or exacerbated by climate change.

We provide additional information regarding these and other risks and uncertainties in our Annual Report on Form 10-K for the fiscal year ended December 31, 2024, as filed with the U.S. Securities and Exchange Commission (“SEC”) on February 28, 2025. In addition, unlisted factors may present significant additional obstacles to the realization of forward-looking statements. We therefore caution you against relying on any forward-looking statements.

Part I. Financial Information

Item 1. Financial Statements

ENACT HOLDINGS, INC.

CONDENSED CONSOLIDATED BALANCE SHEETS


	March 31, 2025		December 31, 2024
(Amounts in thousands, except par value amount)	(Unaudited)
Assets

Fixed maturity securities available-for-sale, at fair value (amortized cost of $5,992,370 and $5,876,502; allowance for credit losses of $273 and $0)	$	5,815,337	$	5,624,773
Short-term investments, at fair value	3,696		3,367
Total investments	5,819,033		5,628,140
Cash and cash equivalents	635,269		599,432
Accrued investment income	49,653		49,595
Deferred acquisition costs	23,322		23,771
Premiums receivable	46,451		53,031
Other assets	103,352		102,549
Deferred tax asset	44,440		65,013
Total assets	$	6,721,520	$	6,521,531
Liabilities and equity
Liabilities:
Loss reserves	$	542,528	$	524,715
Unearned premiums	107,519		114,680
Other liabilities	208,667		142,990
Long-term borrowings	743,399		743,050

Total liabilities	1,602,113		1,525,435
Equity:
Common stock ($0.01 par value; 600,000 shares authorized; 150,765 shares issued and outstanding as of March 31, 2025, and 152,318 shares issued and outstanding as of December 31, 2024)	1,508		1,523
Additional paid-in capital	2,007,776		2,076,788
Accumulated other comprehensive income	(152,482)		(207,455)
Retained earnings	3,262,605		3,125,240
Total equity	5,119,407		4,996,096
Total liabilities and equity	$	6,721,520	$	6,521,531

See Notes to Condensed Consolidated Financial Statements

ENACT HOLDINGS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF INCOME

(Unaudited)


	Three months ended March 31,
(Amounts in thousands, except per share amounts)	2025		2024
Revenues:
Premiums	$	244,786	$	240,747
Net investment income	63,037		57,111
Net investment gains (losses)	(3,243)		(6,684)
Other income	2,196		402
Total revenues	306,776		291,576
Losses and expenses:
Losses incurred	30,541		19,501
Acquisition and operating expenses, net of deferrals	50,094		50,934
Amortization of deferred acquisition costs and intangibles	2,429		2,259
Interest expense	12,291		12,961

Total losses and expenses	95,355		85,655
Income before income taxes	211,421		205,921
Provision for income taxes	45,643		44,933
Net income	$	165,778	$	160,988

Net income per common share:
Basic	$	1.09	$	1.01
Diluted	$	1.08	$	1.01
Weighted average common shares outstanding:
Basic	151,831		158,818
Diluted	152,907		160,087

See Notes to Condensed Consolidated Financial Statements

ENACT HOLDINGS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Unaudited)


	Three months ended March 31,
(Amounts in thousands)	2025		2024
Net income	$	165,778	$	160,988
Other comprehensive income (loss), net of taxes:
Net unrealized gains (losses) on securities without an allowance for credit losses	58,894		(7,079)

Foreign currency translation gain (loss)	(3,921)		2
Other comprehensive income (loss)	54,973		(7,077)
Total comprehensive income (loss)	$	220,751	$	153,911

See Notes to Condensed Consolidated Financial Statements

ENACT HOLDINGS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY

(Unaudited)


	Three months ended March 31, 2025
(Amounts in thousands)	Common stock		Additional paid-in capital		Accumulated other comprehensive income (loss)		Retained earnings		Total equity
Balance as of December 31, 2024	$	1,523	$	2,076,788	$	(207,455)	$	3,125,240	$	4,996,096

Comprehensive income (loss):
Net income	—		—		—		165,778		165,778
Other comprehensive income (loss), net of taxes	—		—		54,973		—		54,973

Repurchase of common stock	(19)		(65,264)		—		—		(65,283)
Stock-based compensation expense and exercises and other	4		(3,748)		—		(325)		(4,069)
Dividends	—		—		—		(28,088)		(28,088)

Balance as of March 31, 2025	$	1,508	$	2,007,776	$	(152,482)	$	3,262,605	$	5,119,407


	Three months ended March 31, 2024
(Amounts in thousands)	Common stock		Additional paid-in capital		Accumulated other comprehensive income (loss)		Retained earnings		Total equity
Balance as of December 31, 2023	$	1,593	$	2,310,891	$	(230,400)	$	2,550,263	$	4,632,347

Comprehensive income (loss):
Net income	—		—		—		160,988		160,988
Other comprehensive income (loss), net of taxes	—		—		(7,077)		—		(7,077)

Repurchase of common stock	(17)		(49,707)		—		—		(49,724)
Stock-based compensation expense and exercises and other	1		3,014		—		(328)		2,687
Dividends	—		—		—		(25,457)		(25,457)

Balance as of March 31, 2024	$	1,577	$	2,264,198	$	(237,477)	$	2,685,466	$	4,713,764

See Notes to Condensed Consolidated Financial Statements

ENACT HOLDINGS, INC.

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Unaudited)


	Three months ended March 31,
(Amounts in thousands)	2025		2024
Cash flows from operating activities:
Net income	$	165,778	$	160,988
Adjustments to reconcile net income to net cash provided by operating activities:
Net investment (gains) losses	3,243		6,684
Amortization of fixed maturity securities discounts and premiums	(3,411)		(2,437)
Amortization of deferred acquisition costs and intangibles	2,429		2,259
Acquisition costs deferred	(1,242)		(1,399)
Deferred income taxes	4,492		1,032
Stock-based compensation expense	3,872		3,937
Amortization of debt issuance costs	349		674


Change in certain assets and liabilities:
Accrued investment income	(59)		(1,891)
Premiums receivable	6,580		1,143
Other assets	(904)		447
Loss reserves	17,813		13,252
Unearned premiums	(7,161)		(10,444)
Other liabilities	34,945		13,051
Net cash provided by operating activities	226,724		187,296
Cash flows from investing activities:
Purchases of fixed maturity securities available-for-sale	(505,026)		(409,240)
Purchases of limited partnerships and equity interests	(500)		(5,512)
Proceeds from sales of fixed maturity securities available-for-sale	142,643		190,227
Proceeds from maturities of fixed maturity securities available-for-sale	276,497		104,412
Net change in short-term investments	(322)		10,254
Other	(2,867)		(3,609)
Net cash used in investing activities	(89,575)		(113,468)
Cash flows from financing activities:



Repurchase of common stock	(65,283)		(49,724)
Dividends paid	(28,088)		(25,457)
Other	(7,941)		—
Net cash used in financing activities	(101,312)		(75,181)

Net increase (decrease) in cash and cash equivalents	35,837		(1,353)
Cash and cash equivalents at beginning of period	599,432		615,683
Cash and cash equivalents at end of period	$	635,269	$	614,330

See Notes to Condensed Consolidated Financial Statements

ENACT HOLDINGS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(1)Nature of business, organization structure and basis of presentation

The accompanying unaudited condensed consolidated financial statements include, on a consolidated basis, the accounts of Enact Holdings, Inc. (“EHI,” together with its subsidiaries, the “Company,” “we,” “us” or “our”). EHI is a subsidiary of Genworth Financial, Inc. (“Genworth”) and has been since EHI’s incorporation in Delaware in 2012. In September 2021, we completed a minority initial public offering (“IPO”) of 18.4% of EHI’s common stock.

We are engaged in the business of writing and assuming residential mortgage guaranty insurance. The insurance protects lenders and investors against certain losses resulting from nonpayment of loans secured by mortgages, deeds of trust, or other instruments constituting a lien on residential real estate. We offer private mortgage insurance products predominantly insuring prime-based, individually underwritten residential mortgage loans (“primary mortgage insurance”). Our primary mortgage insurance enables borrowers to buy homes with a down payment of less than 20% of the home’s value. Primary mortgage insurance also facilitates the sale of these low down payment mortgage loans in the secondary mortgage market, most of which are sold to government-sponsored enterprises. We also selectively enter into insurance transactions with lenders and investors, under which we insure a portfolio of loans at or after origination.

We also perform fee-based contract underwriting services for mortgage lenders. The provision of underwriting services by mortgage insurers eliminates the duplicative lender and mortgage insurer underwriting activities and expedites the approval process.

We operate our business through our primary insurance subsidiary, Enact Mortgage Insurance Corporation, (“EMICO”), formerly known as Genworth Mortgage Insurance Corporation, with operations in all 50 states and the District of Columbia. EMICO is an approved insurer by the Federal National Mortgage Association (“Fannie Mae”) and the Federal Home Loan Mortgage Corporation (“Freddie Mac”). Fannie Mae and Freddie Mac are government-sponsored enterprises, and we refer to them collectively as the “GSEs.”

We also offer mortgage-related insurance and reinsurance through our wholly owned Bermuda-based subsidiary, Enact Re Ltd. ("Enact Re"). As of March 31, 2025, Enact Re reinsured EMICO’s new and existing insurance in-force under quota share reinsurance agreements and invests in new business opportunities for Enact, including assumption of excess-of-loss reinsurance relating to GSE risk share.

We operate our business in a single segment, which is how our chief operating decision maker (“CODM”), who is our Chief Executive Officer, reviews our financial performance and allocates resources.

The accompanying condensed consolidated financial statements are unaudited and have been prepared in accordance with U.S. generally accepted accounting principles (“U.S. GAAP”). Preparing financial statements in conformity with U.S. GAAP requires us to make estimates and assumptions that affect reported amounts and related disclosures. Actual results could differ from those estimates. These unaudited condensed consolidated financial statements include all adjustments (including normal recurring adjustments) considered necessary by management to present a fair statement of the financial position, results of operations and cash flows for the periods presented. The results reported in these unaudited condensed consolidated financial statements should not be regarded as necessarily indicative of results that may be expected for the entire year. The unaudited condensed consolidated financial statements included herein should be read in conjunction with the audited consolidated financial statements and related notes for the years ended December 31, 2024 and 2023.

ENACT HOLDINGS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(2)Accounting changes

Accounting Pronouncements Recently Adopted

We have not adopted new accounting pronouncements in 2025.

Accounting Pronouncements Not Yet Adopted

Income Tax Disclosure

In December 2023, the FASB issued new accounting guidance to improve income tax disclosures. The guidance requires annual disclosure of specific categories in the income tax rate reconciliation, separate disclosure of additional information related to reconciling items that meet a quantitative threshold and additional disclosures about income taxes paid, among other qualitative and quantitative disclosure improvements. The guidance will have no impact on our consolidated financial statements but will expand our disclosures effective for annual reporting periods beginning on January 1, 2025 using the prospective or retrospective method, which we are in the process of developing.

Income Statement Disaggregation

In November 2024, the FASB issued ASU 2024-03, Income Statement - Reporting Comprehensive Income - Expense Disaggregation Disclosures (Subtopic 220-40): Disaggregation of Income Statement Expenses, which requires disaggregated disclosures in the notes to the financial statements of certain categories of expenses included in our consolidated statements of income, including employee compensation, depreciation and intangible asset amortization. This guidance is effective for us for annual reporting periods beginning on January 1, 2027 and interim periods beginning on January 1, 2028 using the prospective or retrospective method, with early adoption permitted. We are currently evaluating the impact the guidance may have on our processes, controls and disclosures.

(3)Investments

Net Investment Income

Sources of net investment income were as follows for the periods indicated:


	Three months ended March 31,
(Amounts in thousands)	2025		2024
Fixed maturity securities available-for-sale	$	58,452	$	51,156
Cash, cash equivalents and short-term investments	6,623		7,645
Gross investment income before expenses and fees	65,075		58,801
Investment expenses and fees	(2,038)		(1,690)
Net investment income	$	63,037	$	57,111

ENACT HOLDINGS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Net Investment Gains (Losses)

The following table sets forth net investment gains (losses) for the periods indicated:


	Three months ended March 31,
(Amounts in thousands)	2025		2024
Fixed maturity securities available-for-sale:
Gross realized gains	$	369	$	203
Gross realized (losses)	(3,497)		(6,876)
Net realized gains (losses)	(3,128)		(6,673)

Change in allowance for credit losses on fixed maturity securities	(273)		—
Change in allowance for credit losses on commitment	158		(11)

Net investment gains (losses)	$	(3,243)	$	(6,684)

There was no allowance for credit losses recorded on fixed maturity securities classified as available-for-sale as of December 31, 2024, or activity during the three months ended March 31, 2024.

Unrealized Investment Gains (Losses)

Net unrealized gains and losses on available-for-sale securities reflected as a separate component of accumulated other comprehensive income (“AOCI”) were as follows as of the dates indicated:


(Amounts in thousands)	March 31, 2025		December 31, 2024
Net unrealized gains (losses) on investment securities:
Fixed maturity securities	$	(176,760)	$	(251,729)
Short-term investments	4		(3)
Unrealized gains (losses) on investment securities	(176,756)		(251,732)
Income taxes	28,026		44,108
Net unrealized investment gains (losses)	$	(148,730)	$	(207,624)

The change in net unrealized gains (losses) on available-for-sale securities reported in accumulated other comprehensive income was as follows as of and for the periods indicated:


	Three months ended March 31,
(Amounts in thousands)	2025		2024
Beginning balance	$	(207,624)	$	(230,556)

Unrealized gains (losses) arising during the period:
Unrealized gains (losses) on investment securities	71,848		(15,665)
Provision for income taxes	(15,425)		3,314
Change in unrealized gains (losses) on investment securities	56,423		(12,351)
Reclassification adjustments to net investment (gains) losses, net of taxes of $(657) and $(1,401), respectively	2,471		5,272
Change in net unrealized investment gains (losses)	58,894		(7,079)
Ending balance	$	(148,730)	$	(237,635)

ENACT HOLDINGS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Amounts reclassified out of accumulated other comprehensive income to net investment gains (losses) include realized gains (losses) on sales of securities, which are determined on a specific identification basis.

Fixed Maturity Securities Available-For-Sale

As of March 31, 2025, the amortized cost, gross unrealized gains (losses) and fair value of our investment securities were as follows:


(Amounts in thousands)	Amortized cost		Gross unrealized gains		Gross unrealized losses		Allowance for credit losses		Fair value
U.S. government, agencies and GSEs	$	287,643	$	2,800	$	(1,435)	$	—	$	289,008
State and political subdivisions	540,495		1,571		(65,925)		—		476,141
Non-U.S. government	113,342		780		(969)		—		113,153
U.S. corporate	2,978,401		20,555		(98,751)		—		2,900,205
Non-U.S. corporate	786,865		5,589		(23,228)		(273)		768,953
Residential mortgage-backed	111,660		505		(482)		—		111,683
Commercial mortgage-backed	20,597		105		—		—		20,702
Other asset-backed	1,153,367		5,513		(23,388)		—		1,135,492
Total fixed maturity securities available-for-sale	$	5,992,370	$	37,418	$	(214,178)	$	(273)	$	5,815,337
Short-term investments	3,692		4		—		—		3,696
Total investments	$	5,996,062	$	37,422	$	(214,178)	$	(273)	$	5,819,033

As of December 31, 2024, the amortized cost, gross unrealized gains (losses) and fair value of our investment securities were as follows:


(Amounts in thousands)	Amortized cost		Gross unrealized gains		Gross unrealized losses		Fair value
U.S. government, agencies and GSEs	$	281,858	$	590	$	(5,085)	$	277,363
State and political subdivisions	541,715		1,388		(75,627)		467,476
Non-U.S. government	85,566		94		(1,858)		83,802
U.S. corporate	2,943,900		11,363		(129,584)		2,825,679
Non-U.S. corporate	800,141		2,533		(30,050)		772,624
Residential mortgage-backed	8,394		27		(57)		8,364
Other asset-backed	1,214,928		4,716		(30,179)		1,189,465
Total fixed maturity securities available-for-sale	$	5,876,502	$	20,711	$	(272,440)	$	5,624,773
Short-term investments	3,370		1		(4)		3,367
Total investments	$	5,879,872	$	20,712	$	(272,444)	$	5,628,140

ENACT HOLDINGS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Gross Unrealized Losses and Fair Values of Fixed Maturity Securities Available-For-Sale

The following table presents the gross unrealized losses and fair values of our fixed maturity securities for which an allowance for credit losses has not been recorded, aggregated by investment type and length of time that individual fixed maturity securities have been in a continuous unrealized loss position, as of March 31, 2025:


	Less than 12 months					12 months or more					Total
(Dollar amounts in thousands)	Fair value		Gross unrealized losses		Number of securities	Fair value		Gross unrealized losses		Number of securities	Fair value		Gross unrealized losses		Number of securities
Fixed maturity securities:
U.S. government, agencies and GSEs	$	75,658	$	(1,180)	12	$	18,126	$	(255)	7	$	93,784	$	(1,435)	19
State and political subdivisions	47,020		(2,623)		11	392,765		(63,302)		81	439,785		(65,925)		92
Non-U.S. government	30,832		(467)		45	9,776		(502)		1	40,608		(969)		46
U.S. corporate	649,982		(11,504)		177	1,246,554		(87,247)		232	1,896,536		(98,751)		409
Non-U.S. corporate	123,572		(2,410)		52	313,493		(20,818)		61	437,065		(23,228)		113
Residential mortgage-backed	75,399		(468)		26	2,433		(14)		4	77,832		(482)		30
Other asset-backed	156,138		(919)		69	449,391		(22,469)		116	605,529		(23,388)		185
Total for fixed maturity securities in an unrealized loss position	$	1,158,601	$	(19,571)	392	$	2,432,538	$	(194,607)	502	$	3,591,139	$	(214,178)	894

We did not recognize an allowance for credit losses on securities in an unrealized loss position included in the table above. Based on a qualitative and quantitative review of the issuers of the securities, we believe the unrealized losses are largely due to changes in interest rates and recent market volatility and are not indicative of credit losses. The issuers continue to make timely principal and interest payments.

For all securities in an unrealized loss position without an allowance for credit losses, we expect to recover the amortized cost based on our estimate of the amount and timing of cash flows to be collected. We do not intend to sell, nor do we expect that we will be required to sell these securities prior to recovering our amortized cost.

ENACT HOLDINGS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

The following table presents the gross unrealized losses and fair values of our fixed maturity securities, aggregated by investment type and length of time that individual fixed maturity securities have been in a continuous unrealized loss position, as of December 31, 2024:


	Less than 12 months					12 months or more					Total
(Dollar amounts in thousands)	Fair value		Gross unrealized losses		Number of securities	Fair value		Gross unrealized losses		Number of securities	Fair value		Gross unrealized losses		Number of securities
Fixed maturity securities:
U.S. government, agencies and GSEs	$	157,596	$	(4,704)	32	$	19,998	$	(381)	9	$	177,594	$	(5,085)	41
State and political subdivisions	48,280		(2,366)		17	396,638		(73,261)		84	444,918		(75,627)		101
Non-U.S. government	56,631		(1,236)		76	9,692		(622)		1	66,323		(1,858)		77
U.S. corporate	881,643		(20,844)		265	1,379,860		(108,740)		264	2,261,503		(129,584)		529
Non-U.S. corporate	195,648		(4,015)		102	385,508		(26,035)		74	581,156		(30,050)		176
Residential mortgage-backed	3,313		(31)		3	2,822		(26)		4	6,135		(57)		7
Other asset-backed	101,549		(1,168)		49	527,531		(29,011)		130	629,080		(30,179)		179
Total for fixed maturity securities in an unrealized loss position	$	1,444,660	$	(34,364)	544	$	2,722,049	$	(238,076)	566	$	4,166,709	$	(272,440)	1,110

Contractual Maturities of Fixed Maturity Securities Available-For-Sale

The scheduled maturity distribution of fixed maturity securities as of March 31, 2025, is set forth below. Actual maturities may differ from contractual maturities because issuers of securities may have the right to call or prepay obligations with or without call or prepayment penalties.


(Amounts in thousands)	Amortized cost		Fair value
Due one year or less	$	264,671	$	263,849
Due after one year through five years	1,709,680		1,646,604
Due after five years through ten years	2,261,321		2,171,249
Due after ten years	471,074		465,758
Subtotal	4,706,746		4,547,460
Residential mortgage-backed	111,660		111,683
Commercial mortgage-backed	20,597		20,702
Other asset-backed	1,153,367		1,135,492
Total fixed maturity securities available-for-sale	$	5,992,370	$	5,815,337

As of March 31, 2025, securities issued by the finance and insurance, utilities, technology and communications, consumer—non-cyclical, and energy industry groups represented approximately 30%, 13%, 12%, 11%, and 10% respectively, of our domestic and foreign corporate fixed maturity securities portfolio. No other industry group comprised more than 9% of our investment portfolio.

As of March 31, 2025, we did not hold any fixed maturity securities in any single issuer, other than securities issued or guaranteed by the U.S. government, which exceeded 10% of equity.

As of March 31, 2025, and December 31, 2024, $23.3 million and $25.7 million, respectively, of securities in our portfolio were on deposit with various state insurance commissioners in order to comply with relevant insurance regulations.

ENACT HOLDINGS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

In connection with its reinsurance activities, the Company is required to maintain assets in trusts for the benefit of its contractual counterparties. As of March 31, 2025 and December 31, 2024, the fair value of the assets on deposit in these trusts was $200.9 million and $141.9 million, respectively, of which $27.5 million and $6.3 million, respectively, related to cash and cash equivalents.

During 2024, the Company entered into an agreement to invest in a limited partnership with an expected term of ten years. The investment is recorded within Other assets. As of March 31, 2025, we have committed to additionally fund approximately $9.5 million over the remaining life of the fund.

(4)Fair value

Recurring fair value measurements

We hold fixed maturity securities and short-term investments, which are carried at fair value. The fair value of fixed maturity securities and short-term investments are estimated primarily based on information derived from third-party pricing services (“pricing services”), internal models and/or broker quotes, which use a market approach, income approach or a combination of the market and income approach depending on the type of instrument and availability of information. In general, a market approach is utilized if there is readily available and relevant market activity for an individual security. In certain cases where market information is not available for a specific security but is available for similar securities, that security is valued using market information for similar securities, which is also a market approach. When market information is not available for a specific security (or similar securities) or is available but such information is less relevant or reliable, an income approach or a combination of a market and income approach is utilized. For securities with optionality, such as call or prepayment features (including asset-backed securities), an income or combination approach may be used. These valuation techniques may change from period to period, based on the relevance and availability of market data.

Further, while we consider the valuations provided by pricing services and broker quotes to be of high quality, management determines the fair value of our investment securities after considering all relevant and available information.

In general, we first obtain valuations from pricing services. If prices are unavailable for public securities, we obtain broker quotes. For all securities, excluding certain private fixed maturity securities, if neither a pricing service nor broker quotes valuation is available, we determine fair value using internal models. For certain private fixed maturity securities where we do not obtain valuations from pricing services, we utilize an internal model to determine fair value since transactions for similar securities are not readily observable and these securities are not typically valued by pricing services.

Given our understanding of the pricing methodologies and procedures of pricing services, the securities valued by pricing services are typically classified as Level 2 unless we determine the valuation process for a security or group of securities utilizes significant unobservable inputs, which would result in the valuation being classified as Level 3.

Broker quotes are typically based on an income approach given the lack of available market data. As the valuation typically includes significant unobservable inputs, we classify the securities where fair value is based on our consideration of broker quotes as Level 3 measurements.

For private fixed maturity securities, we utilize an income approach where we obtain public bond spreads and utilize those in an internal model to determine fair value. Other inputs to the model include rating and weighted-average life, as well as sector which is used to assign the spread. We then add an additional premium, which represents an unobservable input, to the public bond spread to adjust for the liquidity and other features of our private placements. We utilize the estimated market yield to discount

ENACT HOLDINGS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

the expected cash flows of the security to determine fair value. We utilize price caps for securities where the estimated market yield results in a valuation that may exceed the amount that would be received in a market transaction. When a security does not have an external rating, we assign the security an internal rating to determine the appropriate public bond spread that should be utilized in the valuation. While we generally consider the public bond spreads by sector and maturity to be observable inputs, we evaluate the similarities of our private placement with the public bonds, any price caps utilized, liquidity premiums applied, and whether external ratings are available for our private placements to determine whether the spreads utilized would be considered observable inputs, and therefore be classified as Level 2. We classify private securities without an external rating or public bond spread as Level 3. In general, a significant increase (decrease) in credit spreads would have resulted in a significant decrease (increase) in the fair value for our fixed maturity securities as of March 31, 2025.

For remaining securities priced using internal models, we determine fair value using an income approach. We maximize the use of observable inputs but typically utilize significant unobservable inputs to determine fair value. Accordingly, the valuations are typically classified as Level 3.

Our assessment of whether or not there were significant unobservable inputs related to fixed maturity securities was based on our observations obtained through the course of managing our investment portfolio, including interaction with other market participants, observations related to the availability and consistency of pricing and/or rating, and understanding of general market activity such as new issuance and the level of secondary market trading for a class of securities. Additionally, we considered data obtained from pricing services to determine whether our estimated values incorporate significant unobservable inputs that would result in the valuation being classified as Level 3.

A summary of the inputs used for our fixed maturity securities and short-term investments based on the level in which instruments are classified is included below. We have combined certain classes of instruments together as the nature of the inputs is similar.

Level 1 measurements

There were no fixed maturity securities classified as Level 1 as of March 31, 2025, and December 31, 2024.

Level 2 measurements

Fixed maturity securities:

Third-party pricing services

In estimating the fair value of fixed maturity securities, approximately 91% of our portfolio was priced using third-party pricing services as of March 31, 2025. These pricing services utilize industry-standard valuation techniques that include market-based approaches, income-based approaches, a combination of market-based and income-based approaches or other proprietary, internally generated models as part of the valuation processes. These third-party pricing vendors maximize the use of publicly available data inputs to generate valuations for each asset class. Priority and type of inputs used may change frequently as certain inputs may be more direct drivers of valuation at the time of pricing. Examples of significant inputs incorporated by pricing services may include sector and issuer spreads, seasoning, capital structure, security optionality, collateral data, prepayment assumptions, default assumptions, delinquencies, debt covenants, benchmark yields, trade data, dealer quotes, credit ratings, maturity and weighted-average life. We conduct regular meetings with our pricing services for the purpose of understanding the methodologies, techniques and inputs used by the third-party pricing providers.

ENACT HOLDINGS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

The following table presents a summary of the significant inputs used by our pricing services for certain fair value measurements of fixed maturity securities that are classified as Level 2 as of March 31, 2025:

(Amounts in thousands)

Fair value

Primary methodologies

Significant inputs

U.S. government, agencies and GSEs

289,008

Price quotes from trading desk, broker feeds

Bid side prices, trade prices, Option Adjusted Spread (“OAS”) to swap curve, Bond Market Association OAS, Treasury Curve, Agency Bullet Curve, maturity to issuer spread

State and political subdivisions

476,141

Multi-dimensional attribute-based modeling systems, third-party pricing vendors

Trade prices, material event notices, Municipal Market Data benchmark yields, broker quotes

Non-U.S. government

113,153

Matrix pricing, spread priced to benchmark curves, price quotes from market makers

Benchmark yields, trade prices, broker quotes, comparative transactions, issuer spreads, bid-offer spread, market research publications, third-party pricing sources

U.S. corporate

2,483,692

Multi-dimensional attribute-based modeling systems, broker quotes, price quotes from market makers, internal models, OAS-based models

Bid side prices to Treasury Curve, Issuer Curve, which includes sector, quality, duration, OAS percentage and change for spread matrix, trade prices, comparative transactions, Trade Reporting and Compliance Engine (“TRACE”) reports

Non-U.S. corporate

644,100

Multi-dimensional attribute-based modeling systems, OAS-based models, price quotes from market makers

Benchmark yields, trade prices, broker quotes, comparative transactions, issuer spreads, bid-offer spread, market research publications, third-party pricing sources

Residential mortgage-backed

111,683

OAS-based models, single factor binomial models, internally priced

Prepayment and default assumptions, aggregation of bonds with similar characteristics, including collateral type, vintage, tranche type, weighted-average life, weighted-average loan age, issuer program and delinquency ratio, pay up and pay down factors, TRACE reports

ENACT HOLDINGS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)


Commercial mortgage-backed	$	20,702	Multi-dimensional attribute-based modeling systems, pricing matrix, spread matrix priced to swap curves, Trepp commercial mortgage-backed securities analytics model	Credit risk, interest rate risk, prepayment speeds, new issue data, collateral performance, origination year, tranche type, original credit ratings, weighted-average life, cash flows, spreads derived from broker quotes, bid side prices, spreads to daily updated swaps curves, TRACE reports
Other asset-backed	$	1,132,232	Multi-dimensional attribute-based modeling systems, spread matrix priced to swap curves, price quotes from market makers	Spreads to daily updated swap curves, spreads derived from trade prices and broker quotes, bid side prices, new issue data, collateral performance, analysis of prepayment speeds, cash flows, collateral loss analytics, historical issue analysis, trade data from market makers, TRACE reports

Internal models

A portion of our Level 2 U.S. corporate and non-U.S. corporate securities are valued using internal models. The fair value of these fixed maturity securities was $190.5 million and $74.4 million, respectively, as of March 31, 2025. Internally modeled securities are primarily private fixed maturity securities where we use market observable inputs such as an interest rate yield curve, published credit spreads for similar securities based on the external ratings of the instrument and related industry sector of the issuer. Additionally, we may apply certain price caps and liquidity premiums in the valuation of private fixed maturity securities. Price caps and liquidity premiums are established using inputs from market participants.

Short-term investments:

The fair value of short-term investments classified as Level 2 is determined after considering prices obtained by pricing services.

Level 3 measurements

Broker quotes

A portion of our non-U.S. corporate and other asset-backed securities are valued using broker quotes. Broker quotes are obtained from third-party providers that have current market knowledge to provide a reasonable price for securities not routinely priced by pricing services. Brokers utilized for valuation of assets are reviewed annually. The fair value of our Level 3 fixed maturity securities priced by broker quotes was $15.1 million as of March 31, 2025.

Internal models

A portion of our U.S. corporate and non-U.S. corporate securities are valued using internal models. The primary inputs to the valuation of the bond population include quoted prices for identical assets, or similar assets in markets that are not active, contractual cash flows, duration, call provisions, issuer rating, benchmark yields and credit spreads. Certain private fixed maturity securities are valued using an internal model using market observable inputs such as the interest rate yield curve, as well as published credit spreads for similar securities, which includes significant unobservable inputs. Additionally, we may apply certain price caps and liquidity premiums in the valuation of private fixed maturity securities. Price caps are established using inputs from market participants. For structured securities, the primary inputs to

ENACT HOLDINGS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

the valuation include quoted prices for identical assets, or similar assets in markets that are not active, contractual cash flows, weighted-average coupon, weighted-average maturity, issuer rating, structure of the security, expected prepayment speeds and volumes, collateral type, current and forecasted loss severity, average delinquency rates, vintage of the loans, geographic region, debt service coverage ratios, payment priority with the tranche, benchmark yields and credit spreads. The fair value of our Level 3 fixed maturity securities priced using internal models was $264.6 million as of March 31, 2025.

The following tables set forth our assets by class of instrument that are measured at fair value on a recurring basis as of the dates indicated:


	March 31, 2025
(Amounts in thousands)	Total		Level 1		Level 2		Level 3
Fixed maturity securities:
U.S. government, agencies and GSEs	$	289,008	$	—	$	289,008	$	—
State and political subdivisions	476,141		—		476,141		—
Non-U.S. government	113,153		—		113,153		—
U.S. corporate	2,900,205		—		2,674,235		225,970
Non-U.S. corporate	768,953		—		718,479		50,474
Residential mortgage-backed	111,683		—		111,683		—
Commercial mortgage-backed	20,702		—		20,702		—
Other asset-backed	1,135,492		—		1,132,232		3,260
Total fixed maturity securities	5,815,337		—		5,535,633		279,704
Short-term investments	3,696		—		3,696		—
Total	$	5,819,033	$	—	$	5,539,329	$	279,704


	December 31, 2024
(Amounts in thousands)	Total		Level 1		Level 2		Level 3
Fixed maturity securities:
U.S. government, agencies and GSEs	$	277,363	$	—	$	277,363	$	—
State and political subdivisions	467,476		—		467,476		—
Non-U.S. government	83,802		—		83,802		—
U.S. corporate	2,825,679		—		2,602,893		222,786
Non-U.S. corporate	772,624		—		716,071		56,553
Residential mortgage-backed	8,364		—		8,364		—
Other asset-backed	1,189,465		—		1,187,263		2,202
Total fixed maturity securities	5,624,773		—		5,343,232		281,541
Short-term investments	3,367		—		3,367		—
Total	$	5,628,140	$	—	$	5,346,599	$	281,541

We had no liabilities recorded at fair value as of March 31, 2025, and December 31, 2024.

ENACT HOLDINGS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

The following tables present additional information about assets measured at fair value on a recurring basis and for which we have utilized significant unobservable (Level 3) inputs to determine fair value as of or for the dates indicated:


	Beginning balance as of January 1, 2025		Total realized and unrealized gains (losses)				Purchases		Sales		Settlements		Transfer into Level 3 (1)		Transfer out of Level 3 (1)		Ending balance as of March 31, 2025			Total gains (losses) attributable to assets still held
(Amounts in thousands)			Included in net income		Included in OCI														Included in net income			Included in OCI
Fixed maturity securities:
U.S. corporate	$	222,786	$	239	$	3,167	$	—	$	—	$	(222)	$	—	$	—	$	225,970		$	239		$	3,167
Non-U.S. corporate	56,553		(6)		232		1,800		—		(8,105)		—		—		50,474			(6)			223
Other asset-backed	2,202		9		(36)		986		—		(1)		100		—		3,260			9			(35)
Total	$	281,541	$	242	$	3,363	$	2,786	$	—	$	(8,328)	$	100	$	—	$	279,704		$	242		$	3,355

	Beginning balance as of January 1, 2024		Total realized and unrealized gains (losses)				Purchases		Sales		Settlements		Transfer into Level 3 (1)		Transfer out of Level 3 (1)		Ending balance as of March 31, 2024			Total gains (losses) attributable to assets still held
(Amounts in thousands)			Included in net income		Included in OCI														Included in net income			Included in OCI
Fixed maturity securities:
U.S. corporate	$	247,205	$	(7)	$	(1,892)	$	—	$	—	$	(358)	$	4,651	$	—	$	249,599		$	(7)		$	(1,892)
Non-U.S. corporate	81,321		7		(669)		—		—		(105)		—		—		80,554			7			(669)
Other asset-backed	2,958		8		38		3,935		—		(60)		—		(2,088)		4,791			8			13
Total	$	331,484	$	8	$	(2,523)	$	3,935	$	—	$	(523)	$	4,651	$	(2,088)	$	334,944		$	8		$	(2,548)

______________

(1)The transfers into and out of Level 3 for fixed maturity securities were related to changes in the primary pricing source and changes in the observability of external information used in determining the fair value, such as external ratings or credit spreads.

Purchases, sales, and settlements represent the activity that occurred during the period that results in a change of the asset but does not represent changes in fair value for the instruments held at the beginning of the period.

The amount presented for realized and unrealized gains (losses) included in net income for fixed maturity securities primarily represents amortization and accretion of premiums and discounts on certain fixed maturity securities recorded within net investment income.

ENACT HOLDINGS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

The following table presents a summary of the significant unobservable inputs used for certain asset fair value measurements that are based on internal models and classified as Level 3 as of March 31, 2025:

(Amounts in thousands)

Valuation

technique

Fair value (1)

Unobservable

input

Range (bps)

Weighted-

average (2) (bps)

Fixed maturity securities:

U.S. corporate

Internal models

225,970

Credit spreads

14 - 174

102

Non-U.S. corporate

Internal models

38,603

Credit spreads

90 - 143

118

______________

(1)Certain classes of instruments classified as Level 3 may be excluded as a result of not being material or due to limitations in being able to obtain the underlying inputs used by certain third-party sources, such as broker quotes, used as an input in determining fair value.

(2)Unobservable inputs weighted by the relative fair value of the associated instrument.

We have certain financial instruments that are not recorded at fair value, including cash and cash equivalents and accrued investment income, the carrying value of which approximate fair value due to the short-term nature of these instruments and are not included in this disclosure.

Liabilities not required to be carried at fair value

The following represents our estimated fair value of financial liabilities that are not required to be carried at fair value, classified as Level 2, as of the dates indicated:


	March 31, 2025				December 31, 2024
(Amounts in thousands)	Carrying amount		Fair value		Carrying amount		Fair value
Long-term borrowings	$	743,399	$	769,943	$	743,050	$	764,070

(5)Loss reserves

Our reserve for losses and loss adjustment expenses (“LAE”) consisted of the following as of the dates indicated:


(Amounts in thousands)	March 31, 2025		December 31, 2024
Domestic mortgage insurance	$	537,480	$	520,032

Other reserves	5,048		4,683
Total loss reserves	$	542,528	$	524,715

ENACT HOLDINGS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Activity for the liability for domestic mortgage insurance loss reserves for the three months ended March 31, is summarized as follows:


(Amounts in thousands)	2025		2024
Gross loss reserves, beginning balance	$	520,032	$	517,515
Reinsurance recoverable, beginning balance	(2,909)		(1,294)
Net loss reserves, beginning balance	517,123		516,221

Losses and LAE incurred related to current accident year	77,842		74,364
Losses and LAE incurred related to prior accident years	(51,789)		(54,848)
Total incurred	26,053		19,516

Losses and LAE paid related to current accident year	(99)		(191)
Losses and LAE paid related to prior accident years	(8,395)		(6,548)
Total paid	(8,494)		(6,739)

Net loss reserves, ending balance	534,682		528,998
Reinsurance recoverable, ending balance	2,798		1,772
Gross loss reserves, ending balance	$	537,480	$	530,770

The liability for loss reserves represents our current best estimate; however, there may be future adjustments to this estimate and related assumptions. Such adjustments, reflecting any variety of new and adverse trends, could possibly be significant, and result in future increases to reserves by amounts that could be material to our results of operations, financial condition and liquidity.

Losses incurred related to insured events of the current accident year relate to defaults that occurred in that year and represent the estimated ultimate amount of losses to be paid on such defaults. Losses incurred related to insured events of prior accident years represent the (favorable) or unfavorable development of reserves as a result of the actual rates at which delinquencies go to claim (“claim rates”) and claim amounts being different than those we estimated when originally establishing the reserves. These estimates are based on our historical experience, which we believe is representative of expected future losses at the time of estimation. As a result of the extended period of time that may exist between the reporting of a delinquency and the claim payment, as well as changes in economic conditions and the real estate market, significant uncertainty and variability exist on amounts ultimately paid.

For the three months ended March 31, 2025, losses and LAE incurred of $78 million related to insured events of the current accident year was primarily attributable to new delinquencies compared to $74 million for the three months ended March 31, 2024.

For the three months ended March 31, 2025, we also recorded favorable reserve adjustments of $47 million primarily on prior accident year reserves, driven by cure performance of delinquencies from early 2024 and prior.

During the three months ended March 31, 2024, we released $54 million of reserves primarily driven by cure performance of delinquencies from early 2023 and prior.

ENACT HOLDINGS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(6)Reinsurance

We reinsure a portion of our policy risks to third parties in order to reduce our ultimate losses, diversify our exposures and comply with regulatory requirements. We also assume certain policy risks written by other companies.

Reinsurance does not relieve us from our obligations to policyholders. In the event that the reinsurers are unable to meet their obligations, we remain liable for the reinsured claims. We monitor both the financial condition of individual reinsurers and risk concentrations arising from similar geographic regions, activities and economic characteristics of reinsurers to lessen the risk of default by such reinsurers.

The following table sets forth the effects of reinsurance on premiums written and earned for the periods indicated:


	Three months ended March 31,
(Amounts in thousands)	2025		2024
Net premiums written:
Direct	$	263,081	$	255,160
Assumed	7,305		1,571
Ceded	(32,761)		(26,428)
Net premiums written	$	237,625	$	230,303

Net premiums earned:
Direct	$	270,242	$	265,604
Assumed	7,305		1,571
Ceded	(32,761)		(26,428)
Net premiums earned	$	244,786	$	240,747

The difference between written premiums of $237.6 million and earned premiums of $244.8 million represents the decrease in unearned premiums for the three months ended March 31, 2025. The decrease in unearned premiums was primarily the result of premiums earned over time coupled with low originations of our single premium mortgage insurance product.

Excess-of-loss reinsurance

We engage in excess-of-loss (“XOL”) insurance transactions either through a panel of traditional reinsurance providers or through collateralized reinsurance with unaffiliated special purpose insurers (“Triangle Re Entities”). During the respective coverage periods of these agreements, EMICO retains the first layer of aggregate loss exposure on covered policies while the reinsurer provides the second layer of coverage, up to the defined reinsurance coverage amount. EMICO retains losses in excess of the respective reinsurance coverage amount.

The Triangle Re Entities fully collateralize their coverage by issuing insurance-linked notes (“ILNs”) to eligible capital market investors in unregistered private offerings. Traditional reinsurance providers collateralize a portion of their coverage by holding funds in trust. We believe that the risk transfer requirements for reinsurance accounting were met as these XOL insurance transactions assume significant insurance risk and a reasonable possibility of significant loss.

EMICO has rights to terminate the ILNs or traditional XOL reinsurance agreements upon the occurrence of certain events.

ENACT HOLDINGS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

The following table presents the issue date, policy dates, initial and current first layer retained aggregate loss and initial and current reinsurance coverage amount under each reinsurance transaction. Current amounts are presented as of March 31, 2025:


Mortgage insurance-linked notes
(Amounts in millions)	Issue date	Policy dates	Initial first layer retained loss	Current first layer retained loss	Initial reinsurance coverage	Current reinsurance coverage
Triangle Re 2021-2 Ltd.	4/16/2021	9/01/2020 - 12/31/2020	$189	$187	$303	$107
Triangle Re 2021-3 Ltd.	9/02/2021	1/01/2021 - 6/30/2021	$304	$300	$372	$161
Triangle Re 2023-1 Ltd.	11/15/2023	7/01/2022 - 6/30/2023	$244	$243	$248	$220
Total						$488

Traditional excess-of-loss reinsurance
(Amounts in millions)	Issue date	Policy dates	Initial first layer retained loss	Current first layer retained loss	Initial reinsurance coverage	Current reinsurance coverage
2021 XOL	2/04/2021	1/01/2021 - 12/31/2021	$671	$663	$206	$82
2022-1 XOL	1/27/2022	1/01/2022 - 12/31/2022	$462	$451	$196	$160
2022-2 XOL	1/27/2022	1/01/2022 - 12/31/2022	$385	$374	$25	$25
2022-3 XOL	3/24/2022	7/01/2021 - 12/31/2021	$317	$312	$289	$154
2022-4 XOL	3/24/2022	7/01/2021 - 12/31/2021	$264	$260	$36	$36
2022-5 XOL	9/15/2022	1/01/2022 - 6/30/2022	$256	$249	$201	$157
2023-1 XOL	3/08/2023	1/01/2023 - 12/31/2023	$360	$358	$180	$180
2024-1 XOL	1/30/2024	1/01/2024 - 12/31/2024	$362	$362	$270	$270
2024-2 XOL	6/25/2024	7/01/2023 - 12/31/2023	$134	$134	$90	$90
2025-1 XOL	1/27/2025	1/01/2025 - 12/31/2025	$68	$68	$32	$32
2025-2 XOL	1/27/2025	1/01/2025 - 12/31/2025	$57	$57	$5	$5
Total						$1,191

On January 27, 2025, we entered into an excess-of-loss reinsurance transaction that covers a portion of expected new insurance written from January 1, 2026, through December 31, 2026, and provides reinsurance coverage of approximately $260 million.

Quota Share Reinsurance

EMICO engages in quota share reinsurance agreements with a panel of third-party reinsurers. Under the agreements, we cede a percentage of premiums earned, claims and claims expenses on eligible policies. The agreements also include a specific ceding commission and profit commission determined based on ceded claims. EMICO has rights to terminate the reinsurance agreements upon the occurrence of certain events. Reinsurance recoverables are recorded in Other assets on the consolidated balance sheets.

Agreement

Issue date

Policy dates

Ceding percentage

Ceding commission

Profit commission

QS 2023-1

6/30/2023

1/01/2023 - 12/31/2023

16.125%

20%

up to 55%

QS 2024-1

1/03/2024

1/01/2024 - 12/31/2024

21.225%

20%

up to 55%

QS 2025-1

11/26/2024

1/01/2025 - 12/31/2025

27.150%

20%

up to 62%

QS 2026-1

11/26/2024

1/01/2026 - 12/31/2026

27.000%

20%

up to 61%

ENACT HOLDINGS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

(7)Borrowings

In May 2024, we issued $750 million aggregate principal amount of Senior Notes due 2029 (the “2029 Notes”). The 2029 Notes are the Company’s unsecured senior obligations. The 2029 Notes pay interest semi-annually on May 28 and November 28 at a rate of 6.25% per year, beginning on November 28, 2024, and will mature on May 28, 2029.

At any time, or from time to time, prior to April 28, 2029 (the “Par Call Date”), the Company may redeem the 2029 Notes in whole or in part, at its option, at a redemption price equal to the greater of (i) the sum of the present values of the remaining scheduled payments of principal and interest thereon discounted to the redemption date (assuming the 2029 Notes matured on the Par Call Date) on a semi-annual basis (assuming a 360-day year consisting of twelve 30-day months) at the Treasury Rate plus 30 basis points less interest accrued to the redemption date, and (ii) 100% of the principal amount of the 2029 Notes to be redeemed, plus, in either case, accrued and unpaid interest thereon to, but excluding, the redemption date. At any time on or after the Par Call Date, the Company may redeem the 2029 Notes in whole or in part, at any time and from time to time, at a redemption price equal to 100% of the principal amount of the 2029 Notes to be redeemed, plus accrued and unpaid interest thereon to, but excluding, the redemption date.

The 2029 Notes contain customary events of default which, subject to certain notice and cure conditions, can result in the acceleration of the principal and accrued interest on the outstanding notes if we breach the terms of the indenture.

The following table sets forth long-term borrowings as of the dates indicated:


(Amounts in thousands)	March 31, 2025		December 31, 2024
6.25% Senior Notes, due 2029	$	750,000	$	750,000
Deferred borrowing charges and discount	(6,601)		(6,950)
Total	$	743,399	$	743,050

Redemption of Senior Notes due 2025

In June 2024, we exercised our right to redeem all $750 million of the outstanding aggregate principal amount of our 6.5% senior notes due 2025 (“2025 Notes”) at a price of 101% of the principal amount. We funded the redemption primarily through the proceeds of the 2029 Notes. The redemption resulted in a loss on debt extinguishment of $10.9 million.

Revolving Credit Agreement

On June 30, 2022, we entered into a credit agreement with a syndicate of lenders that provides for a five-year, unsecured revolving credit facility (the “Facility”) in the initial aggregate principal amount of $200 million, including the ability for EHI to increase the commitments under the Facility, on an uncommitted basis, by an additional aggregate principal amount of up to $100 million. Borrowings under the Facility will accrue interest at a floating rate tied to a standard short-term borrowing index, selected at EHI’s option, plus an applicable margin. The applicable margins are based on the ratings established by certain debt rating agencies for EHI’s senior unsecured debt. The Facility matures in June 2027, but under certain conditions EHI may need to repay any outstanding amounts and terminate the Facility earlier than the maturity date.

We may use borrowings under the Facility for working capital needs and general corporate purposes, including the execution of dividends to our shareholders and capital contributions to our insurance subsidiaries. The Facility contains several covenants, including financial covenants relating to minimum

ENACT HOLDINGS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

net worth, capital and liquidity levels, maximum debt to capitalization level and PMIERs compliance. We are in compliance with all covenants of the Facility and the Facility has remained undrawn through March 31, 2025.

(8)Income taxes

We compute the provision for income taxes on a separate return with benefits-for-loss method. If during the three-month periods ended March 31, 2025 and 2024, we had computed taxes using the separate return method, the provision for income taxes would have been unchanged.

(9)Related party transactions

We have various agreements with Genworth that provide for reimbursement to and from Genworth of certain administrative and operating expenses that include, but are not limited to, information technology services and administrative services (such as finance, human resources and employee benefit administration). These agreements provide for an allocation of corporate expenses to all Genworth businesses or subsidiaries. We incurred costs for these services of $2.3 million and $2.8 million for the three months ended March 31, 2025 and 2024, respectively.

The investment portfolios of our insurance subsidiaries are primarily managed by Genworth. Under the terms of the investment management agreement, we are charged a fee by Genworth. All fees paid to Genworth are charged to investment expense and are included in net investment income in the condensed consolidated statements of income. The total investment expenses paid to Genworth were $1.8 million and $1.5 million for the three months ended March 31, 2025 and 2024, respectively.

Our employees participate in certain benefit plans sponsored by Genworth and certain share-based compensation plans that utilize shares of Genworth common stock and other incentive plans.

We paid cash dividends of $22.8 million and $20.8 million to Genworth in the three months ended March 31, 2025 and 2024, respectively. The amount and timing of future dividends will be based upon the prevailing and prospective macro-economic conditions, regulatory landscape and business performance and remain subject to required approvals. We paid Genworth $53.0 million and $39.9 million related to shares repurchased in the three months ended March 31, 2025 and 2024, respectively.

We have a tax sharing agreement in place with Genworth, such that we participate in a single U.S. consolidated income tax return filing. All intercompany balances related to this agreement are settled at least annually.

The condensed consolidated financial statements include the following amounts due to and from Genworth relating to recurring service and expense agreements as of:


(Amounts in thousands)	March 31, 2025		December 31, 2024
Amounts payable to Genworth	$	9,639	$	8,197
Amounts receivable from Genworth	$	153	$	199

(10)Net income per common share

The basic earnings per share computation is based on the weighted average number of shares of common stock outstanding. For the three months ended March 31, 2025 and 2024, the calculation of dilutive weighted average shares considers the impact of restricted stock units and performance stock units issued to employees, as well as deferred stock units issued to our directors.

ENACT HOLDINGS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

The calculation of basic and diluted net income per share is as follows:


	Three months ended March 31,
(Amounts in thousands, except per share amounts)	2025		2024
Net income available to EHI common stockholders	$	165,778	$	160,988
Net income per common share:
Basic	$	1.09	$	1.01
Diluted	$	1.08	$	1.01
Weighted average common shares outstanding:
Basic	151,831		158,818
Diluted	152,907		160,087

(11)Changes in accumulated other comprehensive income

The following tables present a roll forward of accumulated other comprehensive income for the three months indicated:


(Amounts in thousands)	Net unrealized investment gains (losses)		Foreign currency translation		Total
Balance as of January 1, 2025, net of tax	$	(207,624)	$	169	$	(207,455)

Other comprehensive income (loss) before reclassifications	56,423		(3,921)		52,502
Amounts reclassified from other comprehensive income (loss)	2,471		—		2,471
Total other comprehensive income (loss)	58,894		(3,921)		54,973
Balance as of March 31, 2025, net of tax	$	(148,730)	$	(3,752)	$	(152,482)

(Amounts in thousands)	Net unrealized investment gains (losses)		Foreign currency translation		Total
Balance as of January 1, 2024, net of tax	$	(230,556)	$	156	$	(230,400)

Other comprehensive income (loss) before reclassifications	(12,351)		2		(12,349)
Amounts reclassified from other comprehensive income (loss)	5,272		—		5,272
Total other comprehensive income (loss)	(7,079)		2		(7,077)
Balance as of March 31, 2024, net of tax	$	(237,635)	$	158	$	(237,477)

ENACT HOLDINGS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

The following table presents the effect of the reclassification of significant items out of accumulated other comprehensive income (loss) on the respective line items of the consolidated statements of income, for the periods indicated:


	Amounts reclassified from accumulated other comprehensive income (loss)				Affected line item in the condensed consolidated statements of income
	Three months ended March 31,
(Amounts in thousands)	2025		2024
Net unrealized gains (losses) on investments	$	(3,128)	$	(6,673)		Net investment gains (losses)
Benefit (expense) from income taxes	657		1,401			Provision for income taxes

(12)Stockholders’ equity

Share Repurchase Program

On August 1, 2023, we announced the authorization of a share repurchase program which allowed for the repurchase of up to $100 million of EHI’s common stock. On May 1, 2024, we announced the authorization of a share repurchase program that allows for the repurchase of an additional $250 million of EHI’s common stock. Under the program, share repurchases may be made at our discretion from time to time in open market transactions in compliance with Rule 10b-18 under the Securities Exchange Act of 1934, as amended, privately negotiated transactions, or by other means, including through Rule 10b5-1 trading plans. In support, Enact has entered into an agreement with Genworth Holdings, Inc. to repurchase its Enact shares as part of the program to maintain Genworth’s current ownership interest in Enact. We expect the timing and amount of any future share repurchases will be opportunistic and will depend on a variety of factors, including EHI’s share price, capital availability, business and market conditions, regulatory requirements, and debt covenant restrictions. Each program does not obligate EHI to acquire any amount of common stock, may be suspended or terminated at any time at the Company’s discretion without prior notice, and does not have a specified expiration date.

During the three months ended March 31, 2025, the Company purchased 1,962,023 shares at an average price of $33.38 per share, excluding commissions, compared to 1,779,838 shares at an average price of $27.51 per share, excluding commissions, during the three months ended March 31, 2024. As of March 31, 2025, $27.4 million remained available under the share repurchase program that was announced on May 1, 2024. All treasury stock has been retired as of March 31, 2025.

Subsequent to quarter end, the Company purchased 693,345 shares at an average price of $34.60 per share through April 30, 2025. On April 30, 2025, we also announced the authorization of a new share repurchase program that allows for the repurchase of an additional $350 million of EHI’s common stock.

ENACT HOLDINGS, INC.

NOTES TO CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Cash Dividends

The following table presents the amount of dividends declared and paid, on a per share basis, for each quarter and annual period.


Quarter Ended	2025		2024
March 31	$	0.185	$	0.16
June 30	N/A		0.185
September 30	N/A		0.185
December 31	N/A		0.185
Total dividends per common share declared and paid	$	0.185	$	0.715

Subsequent to quarter end we announced an increase of our quarterly dividend to $0.21 per common share.

(13)Segment Reporting

We operate our business in a single reportable segment, Mortgage Insurance, which is how our CODM, who is our Chief Executive Officer, reviews our financial performance and allocates resources. We derive revenue primarily through writing and assuming residential mortgage guaranty insurance in the United States. We manage our single segment on a consolidated basis, and our reported measure of segment profit or loss is consolidated net income.

The CODM uses net income to evaluate income generated from segment assets in deciding how to reinvest profits into the core business, or into other parts of the entity, such as new business initiatives or to return capital to shareholders. Net income is also considered in our competitive analysis and financial planning processes.

Our significant segment expenses are those disclosed on our condensed consolidated statements of income and our measure of segment assets are those reported on the condensed consolidated balance sheets.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

The following discussion and analysis of our consolidated financial condition and results of operations should be read in conjunction with our unaudited condensed consolidated financial statements and related notes for the three months ended March 31, 2025 and 2024, and our audited consolidated financial statements and related notes for the years ended December 31, 2024 and 2023 within our Annual Report on Form 10-K for the fiscal year ending December 31, 2024 (the “Annual Report”).

In addition to historical information, this discussion contains forward-looking statements that involve risks, uncertainties and assumptions that could cause actual results to differ materially from management’s expectations. Factors that could cause such differences are discussed in the sections entitled “Cautionary Note Regarding Forward-Looking Statements” above and Part I, Item 1A “Risk Factors” in our Annual Report. We are not undertaking any obligation to update any forward-looking statements or other statements we may make in the following discussion or elsewhere in this document even though these statements may be affected by events or circumstances occurring after the forward-looking statements or other statements were made. Future results could differ significantly from the historical results presented in this section. References to “EHI,” “Enact,” “Enact Holdings,” the “Company,” “we” or “our” herein are, unless the context otherwise requires, to EHI on a consolidated basis.

Key Factors Affecting Our Results

There have been no material changes to the factors affecting our results, as compared to those disclosed in the Annual Report, other than the impact of items as discussed below in “—Trends and Conditions.”

Trends and Conditions

Macroeconomic environment. While inflation remained elevated in the first quarter of 2025, household balance sheets were supported by low rates of unemployment and continued earnings growth. Beginning in April 2025, the United States economy became subject to significant volatility and uncertainty, largely related to changing economic policies, including new and increasing tariffs. The ancillary effects of these tariffs and other economic policy on the domestic and global economies could materially impact the United States housing markets and our business.

The Bureau of Labor Statistics reported in March 2025 that Consumer Price Index (“CPI”) inflation was 2.4% year-over-year compared to 2.9% year-over-year in December 2024. Elevated inflation remains a challenge for the Federal Open Market Committee as it navigates heightened uncertainty. Mortgage rates remain elevated as well.

Mortgage origination remained slow in the first quarter of 2025 in response to elevated mortgage rates and sustained low housing supply. Over the past few years, housing affordability has deteriorated as elevated mortgage rates and home price appreciation outpaced median family income according to the National Association of Realtors Housing Affordability Index. National house prices continued to rise into 2025 according to the Federal Housing Finance Agency (“FHFA”) Monthly Purchase-Only House Price Index (Seasonally Adjusted).

The unemployment rate as of March 31, 2025, was 4.2%, relatively consistent with December 31, 2024. As of March 31, 2025, the number of unemployed Americans stood at approximately 7.1 million and the number of long-term unemployed Americans (over 26 weeks out of the workforce) was approximately 1.5 million.

Regulatory developments. Private mortgage insurance market penetration and eventual market size are affected in part by actions that impact housing or housing finance policy taken by the GSEs and the U.S. government, including but not limited to, the Federal Housing Administration (“FHA”) and the FHFA. In the past, these actions have included announced changes, or potential changes, to underwriting

standards, including changes to the GSEs’ automated underwriting systems, FHA pricing, GSE guaranty fees, loan limits and alternative products.

On October 24, 2022, the FHFA announced the validation and approval of both the FICO 10T credit score model and the VantageScore 4.0 credit score model for anticipated use by the GSEs as well as proposing to change the requirement that lenders provide credit reports from all three nationwide consumer reporting agencies and instead only requiring credit reports from two of the three nationwide credit reporting agencies. The validation of the new credit scores is currently expected to require lenders to deliver both credit scores for each loan sold to the GSEs. Implementation, which has been delayed beyond 2025, will require system and process updates along with coordination across stakeholders of the industry.

Competitive environment. The U.S. private mortgage insurance industry is highly competitive. Our market share is influenced by the execution of our go to market strategy, including but not limited to, pricing competitiveness relative to our peers and our selective participation in forward commitment transactions. We continue to manage the quality of new business through pricing and our underwriting guidelines, which are modified from time to time when circumstances warrant. We see the market and underwriting conditions, including the pricing environment, as being within our risk-adjusted return appetite enabling us to write new business at attractive returns. Ultimately, we expect our new insurance written with its strong credit profile and attractive pricing to positively contribute to our future profitability and return on equity.

Our portfolio. New insurance written (“NIW”) of $9.8 billion in the first quarter of 2025 decreased 7% compared to the first quarter of 2024 driven primarily by lower estimated market share. Our primary persistency rate was 84% during the first quarter of 2025 and 85% for the first quarter of 2024. The persistency rate remains higher than historical levels driven by a large percentage of our in-force policies with mortgage rates below current mortgage rates.

Net earned premiums increased approximately 2% in the first quarter of 2025 compared to the first quarter of 2024 primarily as a result of higher assumed premiums and insurance in-force growth, partially offset by higher ceded premiums.

Loss experience. Our loss ratio for the three months ended March 31, 2025, was 12% as compared to 8% for the three months ended March 31, 2024. Both periods were impacted by favorable reserve development. In the first quarter of 2025, we released $47 million of reserves, driven by cure performance of delinquencies from early 2024 and prior. This compares to the first quarter of 2024, where we recorded a $54 million reserve release primarily on delinquencies from early 2023 and prior.

New delinquencies in the first quarter of 2025 increased compared to the first quarter of 2024 due primarily to aging of our large, newer books. Current period primary delinquencies of 12,237 contributed $75 million of loss expense in the first quarter of 2025. We incurred $74 million of losses from 11,395 delinquencies that were reported in the first quarter of 2024. In determining the loss expense estimate, considerations were given to recent cure and claim experience and the prevailing and prospective economic conditions.

The severity of loss on loans that go to claim may be negatively impacted by extended forbearance and foreclosure timelines, the associated elevated expenses and the higher loan amount of the recent new delinquencies. These negative influences on loss severity could be mitigated, in part, by embedded home price appreciation. The majority of our mortgage insurance policies limit the number of months of unpaid interest and associated expenses that are included in the mortgage insurance claim amount to a maximum of 36 months.

Capital requirements and ratings. As of March 31, 2025, EMICO’s estimated risk-to-capital ratio under North Carolina law and enforced by the North Carolina Department of Insurance (“NCDOI”), EMICO’s domestic insurance regulator, was 10.5:1, compared with risk-to-capital ratios of 10.5:1 and 11.2:1 as of December 31, 2024, and March 31, 2024, respectively. EMICO’s risk-to-capital ratio remains

below the NCDOI’s maximum risk-to-capital ratio of 25:1. North Carolina’s calculation of risk-to-capital excludes the risk in-force for delinquent loans given the established loss reserves against all delinquencies. EMICO’s ongoing risk-to-capital ratio will depend principally on the magnitude of future losses incurred by EMICO, the effectiveness of ongoing loss mitigation activities, new business volume and profitability, the impact of quota share reinsurance, the amount of policy lapses and the amount of additional capital that is generated or distributed by the business.

Under PMIERs, we are subject to operational and financial requirements that private mortgage insurers must meet in order to remain eligible to insure loans that are purchased by the GSEs. As of March 31, 2025, we had estimated available assets of $4,999 million against $3,033 million net required assets under PMIERs compared to available assets of $5,095 million against $3,043 million net required assets as of December 31, 2024. The sufficiency ratio as of March 31, 2025, was 165%, or $1,966 million, above the PMIERs requirements, compared to 167%, or $2,052 million, above the PMIERs requirements as of December 31, 2024. Our PMIERs required assets benefited from a reinsurance credit of $1,880 million and $1,885 million related to third-party reinsurance as of March 31, 2025, and December 31, 2024, respectively. Our PMIERs required assets as of December 31, 2024, benefited from the application of a 0.30 multiplier applied to the risk-based required asset amount factor for certain non-performing loans as defined under PMIERs. The application of the 0.30 multiplier to all eligible delinquencies provided $28 million of benefit to our PMIERs required assets as of December 31, 2024. Use of the multiplier was discontinued effective March 31, 2025.

On August 21, 2024, the GSEs and the FHFA released updated PMIERs requirements phasing in a revision to available asset standards between March 31, 2025 and September 30, 2026. The updated standards differentiate between bonds based on credit quality and liquidity. The updates also establish limits for assets backed by residential mortgages or commercial real estate to mitigate the impact if such assets lose value during periods of housing stress. We expect to hold capital sufficiency well in excess of these requirements and do not expect the impact of these updates to be material to our sufficiency.

On January 17, 2025, Fitch upgraded the long-term financial strength and issuer credit ratings of EMICO from A- to A.

Recent transactions. In January 2025, we entered into two excess-of-loss reinsurance transactions that cover a portion of expected new insurance written from January 1, 2025, through December 31, 2025, and January 1, 2026, through December 31, 2026, and provide reinsurance coverage of approximately $225 million and $260 million, respectively.

Capital returns. In March 2025, our primary mortgage insurance operating company, EMICO, completed a dividend to EHI that supports our ability to return capital to shareholders. We paid a dividend of $0.185 per common share during the first quarter of 2025.

Subsequent to quarter end we announced an increase of our quarterly dividend to $0.21 per common share. Future dividend payments are subject to quarterly review and approval by our Board of Directors and Genworth and will be targeted to be paid in the third month of each quarter.

On May 1, 2024, we announced the authorization of a share repurchase program that allows for the repurchase of up to $250 million of EHI’s common stock. On April 30, 2025, we announced the authorization of a new share repurchase program that allows for the repurchase of an additional $350 million of EHI’s common stock. Under the programs, share repurchases may be made at our discretion from time to time in open market transactions in compliance with Rule 10b-18 under the Securities Exchange Act of 1934, as amended, privately negotiated transactions, or by other means, including through Rule 10b5-1 trading plans. In support, Enact has entered into an agreement with Genworth Holdings, Inc. to repurchase its Enact shares as part of the program to maintain Genworth’s current ownership interest in Enact. We expect the timing and amount of any future share repurchases will be opportunistic and will depend on a variety of factors, including EHI’s share price, capital availability, business and market conditions, regulatory requirements, and debt covenant restrictions. The programs

do not obligate EHI to acquire any amount of common stock, it may be suspended or terminated at any time at the Company’s discretion without prior notice, and it does not have a specified expiration date.

Returning capital to shareholders, balanced with our growth and risk management priorities, remains a priority as we look to drive shareholder value through time. Future return of capital will be shaped by our capital prioritization framework, which sets the following priorities: supporting our existing policyholders, growing our mortgage insurance business, funding attractive new business opportunities and returning capital to shareholders. Our total return of capital will also be based on our view of the prevailing and prospective macroeconomic conditions, regulatory landscape and business performance.

Results of Operations and Key Metrics

Results of Operations

Three months ended March 31, 2025, compared to three months ended March 31, 2024

The following table sets forth our consolidated results for the periods indicated:


	Three months ended March 31,						Increase (decrease) and percentage change
(Amounts in thousands)	2025			2024			2025 vs. 2024
Revenues:
Premiums	$	244,786		$	240,747		$	4,039	2	%
Net investment income	63,037			57,111			5,926		10	%
Net investment gains (losses)	(3,243)			(6,684)			3,441		(51)	%
Other income	2,196			402			1,794		NM(1)
Total revenues	306,776			291,576			15,200		5	%
Losses and expenses:
Losses incurred	30,541			19,501			11,040		57	%
Acquisition and operating expenses, net of deferrals	50,094			50,934			(840)		(2)	%
Amortization of deferred acquisition costs and intangibles	2,429			2,259			170		8	%
Interest expense	12,291			12,961			(670)		(5)	%

Total losses and expenses	95,355			85,655			9,700		11	%
Income before income taxes	211,421			205,921			5,500		3	%
Provision for income taxes	45,643			44,933			710		2	%
Net income	$	165,778		$	160,988		$	4,790	3	%
Loss ratio (2)	12		%	8		%
Expense ratio (3)	21		%	22		%
Net earned premium rate (4)	0.35%			0.36%

_______________

(1)We define “NM” as not meaningful for increases or decreases greater than 300%.

(2)Loss ratio is calculated by dividing losses incurred by net earned premiums.

(3)Expense ratio is calculated by dividing acquisition and operating expenses, net of deferrals, plus amortization of deferred acquisition costs and intangibles by net earned premiums.

(4)Net earned premium rate is calculated by dividing direct earned premium less ceded premium, by average primary IIF.

Revenues

Premiums increased for the three months ended March 31, 2025, compared to the three months ended March 31, 2024, primarily as a result of increased assumed premiums and insurance in-force growth, partially offset by higher ceded premiums. The net earned premium rate was 0.35% for the three months ended March 31, 2025, down slightly from 0.36% for the three months ended March 31, 2024.

Net investment income increased for the three months ended March 31, 2025, compared to the three months ended March 31, 2024, primarily due to higher yields as a result of elevated interest rates and higher average invested assets.

Net investment losses in the first quarter of 2025 and 2024 were driven primarily by realized losses on the sale of fixed maturity securities.

Losses and expenses

Losses incurred during the first quarter of 2025 and 2024 were both impacted by prior year development. In the first quarter of 2025, we recorded a reserve release of $47 million, driven by cure performance of delinquencies from early 2024 and prior years. In the first quarter of 2024, we recorded a reserve release of $54 million primarily related to delinquencies from early 2023 and prior years. Current period primary delinquencies of 12,237 contributed $75 million of loss expense in the three months ended March 31, 2025. This compares to $74 million of loss expense from 11,395 primary delinquencies in the first quarter of 2024.

The following table shows incurred losses for domestic mortgage insurance related to current and prior accident years for the periods indicated:


	Three months ended March 31,
(Amounts in thousands)	2025		2024
Losses and LAE incurred related to current accident year	$	77,842	$	74,364
Losses and LAE incurred related to prior accident years	(51,789)		(54,848)
Total incurred (1)	$	26,053	$	19,516

_______________

(1)Excludes other reserves.

Acquisition and operating expenses, net of deferrals, remained relatively flat for the three months ended March 31, 2025.

The expense ratio decreased slightly as a result of premium growth outpacing increases in expenses.

Interest expense primarily relates to our 2029 Notes. For additional details see Note 7 to our unaudited condensed consolidated financial statements for the three months ended March 31, 2025 and 2024.

Provision for income taxes

The effective tax rate was 21.6% and 21.8% for the three months ended March 31, 2025 and 2024, respectively.

Use of Non-GAAP Financial Measures

We use a non-U.S. GAAP (“non-GAAP”) financial measure entitled “adjusted operating income.” This non-GAAP financial measure is additionally evaluated by both management and our Board of Directors. Management also uses adjusted operating income (loss) as a basis for determining awards and compensation for senior management and to evaluate performance on a basis comparable to that used by analysts. This measure has been established in order to increase transparency for the purposes of evaluating our core operating trends and enabling more meaningful comparisons with our peers. Although “adjusted operating income” is a non-GAAP financial measure, for the reasons discussed above we believe this measure aids in understanding the underlying performance of our operations.

“Adjusted operating income” is defined as U.S. GAAP net income excluding the effects of (i) net investment gains (losses), (ii) restructuring costs and infrequent or unusual non-operating items, and (iii) gains (losses) on the extinguishment of debt.

(i)Net investment gains (losses) — The recognition of realized investment gains or losses can vary significantly across periods as the activity is highly discretionary based on the timing of individual securities sales due to such factors as market opportunities or exposure management. Trends in the profitability of our fundamental operating activities can be more clearly identified without the fluctuations of these realized gains and losses. We do not view them to be indicative of our

fundamental operating activities. Therefore, these items are excluded from our calculation of adjusted operating income.

(ii)Restructuring costs and infrequent or unusual non-operating items are also excluded from adjusted operating income if, in our opinion, they are not indicative of overall operating trends.

(iii)Gains (losses) on the extinguishment of debt are also excluded from adjusted operating income, as we do not view them to be indicative of overall operating trends.

In reporting non-GAAP measures in the future, we may make other adjustments for expenses and gains we do not consider reflective of core operating performance in a particular period. We may disclose other non-GAAP operating measures if we believe that such a presentation would be helpful for investors to evaluate our operating condition by including additional information.

Adjusted operating income is not a measure of total profitability, and therefore should not be considered in isolation or viewed as a substitute for U.S. GAAP net income. Our definition of adjusted operating income may not be comparable to similarly named measures reported by other companies, including our peers.

Adjustments to reconcile net income to adjusted operating income assume a 21% tax rate (unless otherwise indicated).

The following table includes a reconciliation of net income to adjusted operating income for the periods indicated:


	Three months ended March 31,
(Amounts in thousands)	2025		2024
Net income	$	165,778	$	160,988
Adjustments to net income:
Net investment (gains) losses	3,243		6,684
Costs associated with reorganization	629		(42)

Taxes on adjustments	(813)		(1,395)
Adjusted operating income	$	168,837	$	166,235

Adjusted operating income increased for the three months ended March 31, 2025, as compared to March 31, 2024, primarily due to increases in net investment income and earned premiums, partially offset by higher losses.

Key Metrics

Management reviews the key metrics included within this section when analyzing the performance of our business. The metrics provided in this section are on a direct basis related to our domestic mortgage insurance portfolio.

The following table sets forth selected operating performance measures on a primary basis as of or for the periods indicated:


	Three months ended March 31,
(Dollar amounts in millions)	2025		2024
New insurance written	$9,818		$10,526
Primary insurance in-force(1)	$268,366		$263,645
Primary risk in-force	$69,937		$67,950
Persistency rate	84	%	85	%
Primary policies in-force (count)	955,210		969,866
Delinquent loans (count)	22,349		19,492
Delinquency rate	2.34	%	2.01	%

_______________

(1)Represents the aggregate unpaid principal balance for loans we insure.

New insurance written (“NIW”)

NIW for the three months ended March 31, 2025, decreased 7% compared to the three months ended March 31, 2024 primarily due to lower estimated market share.

The following table presents NIW by product for the periods indicated:


	Three months ended March 31,
(Amounts in millions)	2025				2024
Primary	$	9,818	100	%	$	10,526	100	%
Pool	—		—		—		—
Total	$	9,818	100	%	$	10,526	100	%

The following table presents primary NIW by underlying type of mortgage for the periods indicated:


	Three months ended March 31,
(Amounts in millions)	2025				2024
Purchases	$	9,139	93	%	$	10,072	96	%
Refinances	679		7		454		4
Total	$	9,818	100	%	$	10,526	100	%

The following table presents primary NIW by policy payment type for the periods indicated:


	Three months ended March 31,
(Amounts in millions)	2025				2024
Monthly	$	9,229	94	%	$	10,034	95	%
Single	576		6		475		5
Other	13		—		17		—
Total	$	9,818	100	%	$	10,526	100	%

The following table presents primary NIW by FICO score for the periods indicated:


	Three months ended March 31,
(Amounts in millions)	2025				2024
Over 760	$	4,989	51	%	$	5,218	49	%
740-759	1,590		16		1,664		16
720-739	1,280		13		1,368		13
700-719	894		9		990		9
680-699	548		6		629		6
660-679 (1)	313		3		388		4
640-659	145		1		193		2
620-639	51		1		73		1
<620	8		—		3		—
Total	$	9,818	100	%	$	10,526	100	%

______________

(1)Loans with unknown FICO scores are included in the 660-679 category.

Loan-to-value (“LTV”) ratio is calculated by dividing the original loan amount, excluding financed premium, by the property’s acquisition value or fair market value at the time of origination. The following table presents primary NIW by LTV ratio for the periods indicated:


	Three months ended March 31,
(Amounts in millions)	2025				2024
95.01% and above	$	2,019	21	%	$	2,262	21	%
90.01% to 95.00%	3,571		36		3,876		37
85.01% to 90.00%	2,913		30		3,177		30
85.00% and below	1,315		13		1,211		12
Total	$	9,818	100	%	$	10,526	100	%

Debt-to-income (“DTI”) ratio is calculated by dividing the borrower’s total monthly debt obligations by total monthly gross income. The following table presents primary NIW by DTI ratio for the periods indicated:


	Three months ended March 31,
(Amounts in millions)	2025				2024
45.01% and above	$	2,852	29	%	$	3,165	30	%
38.01% to 45.00%	3,591		37		3,824		36
38.00% and below	3,375		34		3,537		34
Total	$	9,818	100	%	$	10,526	100	%

Insurance in-force (“IIF”) and Risk in-force (“RIF”)

IIF decreased since December 31, 2024, as policy lapse and cancellations outpaced NIW. The primary persistency rate was 84% and 85% for the three months ended March 31, 2025 and 2024, respectively. RIF decreased since December 31, 2024 primarily as a result of lower IIF.

The following table sets forth IIF and RIF as of the dates indicated:


(Amounts in millions)	March 31, 2025				December 31, 2024				March 31, 2024
Primary IIF	$	268,366	100	%	$	268,825	100	%	$	263,645	100	%
Pool IIF	367		—		379		—		422		—
Total IIF	$	268,733	100	%	$	269,204	100	%	$	264,067	100	%

Primary RIF	$	69,937	100	%	$	69,985	100	%	$	67,950	100	%
Pool RIF	55		—		57		—		67		—
Total RIF	$	69,992	100	%	$	70,042	100	%	$	68,017	100	%

The following table sets forth primary IIF and primary RIF by origination as of the dates indicated:


(Amounts in millions)	March 31, 2025				December 31, 2024				March 31, 2024
Purchases IIF	$	244,409	91	%	$	243,730	91	%	$	234,211	89	%
Refinances IIF	23,957		9		25,095		9		29,434		11
Total IIF	$	268,366	100	%	$	268,825	100	%	$	263,645	100	%

Purchases RIF	$	64,228	92	%	$	64,031	91	%	$	61,263	90	%
Refinances RIF	5,709		8		5,954		9		6,687		10
Total RIF	$	69,937	100	%	$	69,985	100	%	$	67,950	100	%

The following table sets forth primary IIF and primary RIF by product as of the dates indicated:


(Amounts in millions)	March 31, 2025				December 31, 2024				March 31, 2024
Monthly IIF	$	241,572	90	%	$	241,785	90	%	$	234,747	89	%
Single IIF	25,108		9		25,301		9		27,013		10
Other IIF	1,686		1		1,739		1		1,885		1
Total IIF	$	268,366	100	%	$	268,825	100	%	$	263,645	100	%

Monthly RIF	$	64,113	92	%	$	64,078	91	%	$	61,606	91	%
Single RIF	5,395		8		5,466		8		5,867		8
Other RIF	429		—		441		1		477		1
Total RIF	$	69,937	100	%	$	69,985	100	%	$	67,950	100	%

The following table sets forth primary IIF by policy year as of the dates indicated:


(Amounts in millions)	March 31, 2025				December 31, 2024				March 31, 2024
2008 and prior	$	4,706	2	%	$	4,860	2	%	$	5,420	2	%
2009-2017	8,143		3		9,045		3		12,383		5
2018	4,584		2		4,790		2		5,524		2
2019	10,966		4		11,415		4		13,126		5
2020	33,268		12		34,940		13		42,183		16
2021	54,493		20		57,266		21		66,971		25
2022	51,444		19		53,063		20		58,051		22
2023	43,938		16		45,208		17		49,556		19
2024	47,107		18		48,238		18		10,431		4
2025	9,717		4		—		—		—		—
Total	$	268,366	100	%	$	268,825	100	%	$	263,645	100	%

The following table sets forth primary RIF by policy year as of the dates indicated:


(Amounts in millions)	March 31, 2025				December 31, 2024				March 31, 2024
2008 and prior	$	1,217	2	%	$	1,256	2	%	$	1,397	2	%
2009-2017	2,119		3		2,368		3		3,267		5
2018	1,181		2		1,233		2		1,419		2
2019	2,867		4		2,984		4		3,403		5
2020	9,119		13		9,553		14		11,181		16
2021	14,427		21		15,043		21		17,174		25
2022	13,102		19		13,476		19		14,629		22
2023	11,403		16		11,719		17		12,810		19
2024	12,070		17		12,353		18		2,670		4
2025	2,432		3		—		—		—		—
Total	$	69,937	100	%	$	69,985	100	%	$	67,950	100	%

The following table presents the development of primary IIF for the periods indicated:


	Three months ended March 31,
(Amounts in millions)	2025		2024
Beginning balance	$	268,825	$	262,937
NIW	9,818		10,526
Cancellations, principal repayments and other reductions (1)	(10,277)		(9,818)
Ending balance	$	268,366	$	263,645

______________

(1)Includes the estimated amortization of unpaid principal balance of covered loans.

The following table sets forth primary IIF by LTV ratio at origination as of the dates indicated:


(Amounts in millions)	March 31, 2025				December 31, 2024				March 31, 2024
95.01% and above	$	51,280	19	%	$	50,318	18	%	$	46,259	17	%
90.01% to 95.00%	112,086		42		112,362		42		109,566		42
85.01% to 90.00%	79,332		29		79,932		30		78,214		30
85.00% and below	25,668		10		26,213		10		29,606		11
Total	$	268,366	100	%	$	268,825	100	%	$	263,645	100	%

The following table sets forth primary RIF by LTV ratio at origination as of the dates indicated:


(Amounts in millions)	March 31, 2025				December 31, 2024				March 31, 2024
95.01% and above	$	14,682	21	%	$	14,428	21	%	$	13,250	20	%
90.01% to 95.00%	32,597		47		32,686		47		31,881		47
85.01% to 90.00%	19,583		28		19,729		28		19,265		28
85.00% and below	3,075		4		3,142		4		3,554		5
Total	$	69,937	100	%	$	69,985	100	%	$	67,950	100	%

The following table sets forth primary IIF by FICO score at origination as of the dates indicated:


(Amounts in millions)	March 31, 2025				December 31, 2024				March 31, 2024
Over 760	$	115,914	43	%	$	115,554	43	%	$	111,589	43	%
740-759	43,924		17		43,955		17		43,155		17
720-739	37,643		14		37,717		14		37,068		14
700-719	29,629		11		29,819		11		29,679		11
680-699	21,082		8		21,355		8		21,628		8
660-679 (1)	11,126		4		11,245		4		11,316		4
640-659	6,068		2		6,147		2		6,109		2
620-639	2,419		1		2,461		1		2,488		1
<620	561		—		572		—		613		—
Total	$	268,366	100	%	$	268,825	100	%	$	263,645	100	%

______________

(1)Loans with unknown FICO scores are included in the 660-679 category.

The following table sets forth primary RIF by FICO score at origination as of the dates indicated:


(Amounts in millions)	March 31, 2025				December 31, 2024				March 31, 2024
Over 760	$	30,093	43	%	$	29,985	43	%	$	28,703	42	%
740-759	11,493		17		11,494		17		11,167		17
720-739	9,939		14		9,949		14		9,669		14
700-719	7,711		11		7,746		11		7,629		11
680-699	5,464		8		5,523		8		5,524		8
660-679 (1)	2,901		4		2,924		4		2,908		4
640-659	1,574		2		1,589		2		1,562		3
620-639	619		1		629		1		632		1
<620	143		—		146		—		156		—
Total	$	69,937	100	%	$	69,985	100	%	$	67,950	100	%

______________

(1)Loans with unknown FICO scores are included in the 660-679 category.

The following table sets forth primary IIF by DTI score at origination as of the dates indicated:


(Amounts in millions)	March 31, 2025				December 31, 2024				March 31, 2024
45.01% and above	$	60,714	23	%	$	59,864	22	%	$	54,943	21	%
38.01% to 45.00%	97,492		36		97,361		36		94,459		36
38.00% and below	110,160		41		111,600		42		114,243		43
Total	$	268,366	100	%	$	268,825	100	%	$	263,645	100	%

The following table sets forth primary RIF by DTI score at origination as of the dates indicated:


(Amounts in millions)	March 31, 2025				December 31, 2024				March 31, 2024
45.01% and above	$	15,910	23	%	$	15,674	22	%	$	14,265	21	%
38.01% to 45.00%	25,273		36		25,226		36		24,289		36
38.00% and below	28,754		41		29,085		42		29,396		43
Total	$	69,937	100	%	$	69,985	100	%	$	67,950	100	%

Delinquent loans and claims

Our delinquency management process begins with notification by the loan servicer of a delinquency on an insured loan. “Delinquency” is defined in our master policies as the borrower’s failure to pay when due an amount equal to the scheduled monthly mortgage payment under the terms of the mortgage. Generally, our master policies require an insured to notify us of a delinquency if the borrower fails to make two consecutive monthly mortgage payments prior to the due date of the next mortgage payment. We generally consider a loan to be delinquent and establish required reserves after the insured notifies us that the borrower has failed to make two scheduled mortgage payments. Borrowers default for a variety of reasons, including but not limited to a reduction of income, unemployment, divorce, illness/death, inability to manage credit, falling home prices and interest rate levels. Borrowers may cure delinquencies by making all of the delinquent loan payments, agreeing to a loan modification, or by selling the property in full satisfaction of all amounts due under the mortgage. In most cases, delinquencies that are not cured result in a claim under our policy.

The following table shows a roll forward of the number of primary loans in default for the periods indicated:


	Three months ended March 31,
(Loan count)	2025	2024
Number of delinquencies, beginning of period	23,566	20,432
New defaults	12,237	11,395
Cures	(13,263)	(12,160)
Claims paid	(179)	(172)
Rescissions and claim denials	(12)	(3)
Number of delinquencies, end of period	22,349	19,492

The following table sets forth changes in our direct primary case loss reserves for the periods indicated:


	Three months ended March 31,
(Amounts in thousands) (1)	2025		2024
Loss reserves, beginning of period	$	472,110	$	476,709
Claims paid	(10,018)		(6,458)
Change in reserve	27,237		15,540
Loss reserves, end of period	$	489,329	$	485,791

______________

(1)Direct primary case reserves exclude LAE, pool, IBNR and reinsurance reserves.

The following tables set forth primary delinquencies, direct primary case reserves and RIF by aged missed payment status as of the dates indicated:


	March 31, 2025
(Dollar amounts in millions)	Delinquencies	Direct primary case reserves (1)		Risk in-force		Reserves as % of risk in-force
Payments in default:
3 payments or less	10,646	$	102	$	714	14	%
4 - 11 payments	8,420	210		618		34	%
12 payments or more	3,283	177		225		79	%
Total	22,349	$	489	$	1,557	31	%


	December 31, 2024
(Dollar amounts in millions)	Delinquencies	Direct primary case reserves (1)		Risk in-force		Reserves as % of risk in-force
Payments in default:
3 payments or less	12,712	$	108	$	849	13	%
4 - 11 payments	7,701	191		545		35	%
12 payments or more	3,153	173		213		81	%
Total	23,566	$	472	$	1,607	29	%


	March 31, 2024
(Dollar amounts in millions)	Delinquencies	Direct primary case reserves (1)		Risk in-force		Reserves as % of risk in-force
Payments in default:
3 payments or less	9,506	$	87	$	600	14	%
4 - 11 payments	6,853	220		468		47	%
12 payments or more	3,133	179		197		91	%
Total	19,492	$	486	$	1,265	38	%

______________

(1)Direct primary case reserves exclude LAE, pool, IBNR and reinsurance reserves.

The total reserves as a percentage of RIF as of March 31, 2025, has increased slightly compared to December 31, 2024, as a result of fewer newer delinquencies that have a lower expected claim rate.

Primary insurance delinquency rates differ from region to region in the United States at any one time depending upon economic conditions and cyclical growth patterns. Delinquency rates are shown by region based upon the location of the underlying property, rather than the location of the lender.

The table below sets forth our primary delinquency rates for the ten largest states by our primary RIF as of March 31, 2025:

Percent of RIF

Percent of direct primary case reserves

Delinquency

rate

By state:

Enact Holdings, Inc. 10-Q