Summary of Enact's Q2 2026 Earnings Call

1Key Financial Results and Metrics

Adjusted Operating Income: $177 million, or $1.26 per diluted share, up from $1.15 per share year-over-year.

Adjusted Return on Equity: 13.2%.

New Insurance Written (NIW): $15 billion, up 19% sequentially and 15% year-over-year.

Total Insurance in Force: $274 billion, a 1% increase from Q1 2026 and a 2% increase year-over-year.

Persistency Rate: 80%, flat sequentially but down 2 points year-over-year.

Loss Ratio: 14%, with total losses of $33 million, down from $37 million in Q1 2026.

Operating Expenses: $52 million, leading to an expense ratio of 21%.

Capital Return Guidance: Increased to $550 million - $600 million for 2026, up from $500 million.

2Strategic Updates and Business Highlights

Enact launched the Enact Loan Level Assistant (ELLA), a generative AI tool aimed at improving underwriting efficiency and decision-making.

The company continues to focus on disciplined underwriting and risk management, with a strong emphasis on leveraging technology for operational efficiency.

Enact Re performed well, contributing to attractive risk-adjusted returns.

The company received recognition as one of the best places to work by the Triangle Business Journal.

3Forward Guidance and Outlook

Enact expects to maintain a strong capital position with a PMIERs sufficiency ratio of 161%.

The company anticipates continued strong performance in the housing market, supported by resilient credit fundamentals.

The outlook for the base premium rate is expected to remain relatively flat for the remainder of 2026, with potential slight downward pressure.

4Bad News, Challenges, or Points of Concern

The macroeconomic environment remains volatile due to elevated interest rates and geopolitical uncertainties, which could impact housing transaction volumes.

The company noted that while credit performance is currently strong, there may be an uptick in delinquency rates in the second half of the year due to seasonal trends and the aging of newer vintages with less home price appreciation.

Competitive pressures in the mortgage insurance market persist, although pricing remains attractive on a risk-adjusted basis.

5Notable Q&A Insights

Management indicated that the base premium rate is expected to be flat for 2026, despite some quarter-over-quarter volatility.

There is an expectation of increased delinquencies in the second half of 2026 due to seasonal factors and the characteristics of newer loan vintages.

The rollout of VantageScore 4 is ongoing, with the company adapting its underwriting processes to incorporate this new scoring model.

Management emphasized that while home price appreciation has created affordability challenges, it also supports credit performance in the existing portfolio. Overall, Enact reported a strong quarter with solid financial metrics and strategic initiatives, while acknowledging potential challenges in the macroeconomic landscape and competitive environment.