MGIC Investment (MGC) Q3 2026 Earnings Report

The call reflected solid financial performance, strong capital and reinsurance flexibility, favorable loss development, disciplined expenses, and substantial shareholder returns. These positives were tempered by continued credit normalization, rising delinquency rates, constrained origination growth, gradual premium-yield compression, and uncertainty around future mortgage-insurance cancellation rules. Overall, the positive operating and financial developments significantly outweighed the stated challenges.

Management expects the general trend in the delinquency rate to be a slow increase; the in-force premium yield was 38 basis points and is expected to continue on a similar path to the past couple of years, with no real change to the path or pace, while the gross premium yield is expected to keep “grinding a little bit lower.” Operating expenses for the full year are now expected to be slightly below the low end of the $190 million to $200 million range. The initial ultimate claim rate assumption remains 7.5%, with ultimate loss rates moving into the, say, low single digits, call that 3%, 4% on a fully developed basis, and if credit performance remains good, there is opportunity for favorable development. The next change to the new notice claim rate assumption is likely to be to increase it, not to decrease it; if the company continues to operate in a relatively low unemployment environment and a relatively stable home price environment, the current assumption could continue to come out as too conservative. The estimated after-tax cost of capital for the forward quota share transactions is around the 3% range.