The group's principal activity is to provide private mortgage insurance, also known as mortgage guaranty insurance, to residential mortgage lenders. The service provided by the group helps to protect the lender against loss from defaults on low down payment residential mortgage loans. There are two types of private mortgage insurance coverage, primary and pool. Primary insurance provides mortgage default protection on individual loans and covers unpaid loan principal, delinquent interest and expenses associated with the default and subsequent foreclosure. Pool insurance offers lenders an additional credit enhancement for certain mortgage/backed securities and provides coverage for the full amount of the net loss on each individual loss included in the pool.
