The covered portfolio includes loans originated during the Global Financial Crisis
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Arch Mortgage Insurance Company (Arch MI) has announced it has secured $341,790,000 of indemnity reinsurance from Bellemeade, a purpose reinsurer.
The indemnity reinsurance, an agreement where one party is guaranteed compensation for losses or damages incurred by another, came from a pool representing nearly $23 billion of Bellemeade’s mortgages, Arch MI said in its announcement. The insurance-linked security (ILS) transaction gave Arch MI collateralized coverage for possible losses on a portion of its mortgage insurance portfolio.
The reinsurance covered a portfolio of Arch MI-issued policies affiliated through 2015 from 2009, according to Arch MI.
“This subject portfolio is unique in that it contains policies covering loans originated during the crisis, some of which have been modified. Those policies, plus the pre- and post-crisis collateral in the pool resulted in a transaction that was very appealing to investors and demonstrates Arch’s continued efforts to creatively manage capital and risk positions in our mortgage business,” said Jim Bennison, executive vice president of Alternative Markets at Arch Capital Group.
