What changed in this filing

/stocks — the workspaceLOADING

Item 1. Business

2023-02-28 compared with 2022-02-28 · 161 added, 172 removed, 578 unchanged (37% of the section changed)

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For the full years ended December 31, 2022, 2021 and 2020 we generated new insurance written (“NIW”) of $66.5 billion, $97.0 billion and $99.9 billion, respectively.

Net income was $547 million and $370 million in 2021 and 2020, respectively.

Adjusted operating income was $551 million and $373 million for 2021 and 2020, respectively.

Net income was $704 million, $547 million and $370 million in 2022, 2021 and 2020, respectively.

Adjusted operating income was $709 million, $551 million and $373 million for 2022, 2021 and 2020, respectively.

We have a rigorous approach to writing new insurance risk based on decades of loan-level data and experience in the mortgage insurance industry.

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The IPO, Private Sale, and Over-Allotment Option (collectively the “Offering”) closed on September 20, 2021, and Genworth Holdings retained all net proceeds from the Offering.

We operate a majority of our business through our primary insurance subsidiary, Genworth Mortgage Insurance Corporation (“GMICO”).

GMICO is an approved insurer by the GSEs.

GMICO has been re-named Enact Mortgage Insurance Corporation effective February 7, 2022.

We operate a majority of our business through our primary insurance subsidiary, Enact Mortgage Insurance Corporation (“EMICO”).

EMICO is an approved insurer by the GSEs.

EMICO was renamed from Genworth Mortgage Insurance Corporation effective February 7, 2022.

Our operations are all domestic with the exception of a run-off insurance block with reference properties in Mexico (“run-off business”), which is immaterial to our results.

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Differentiate Enact from competitors

• Strive to deliver best-in-class underwriting to well-established, deep and diversified customer base.

• Strive to deliver best-in-class underwriting to a well-established, deep and diversified customer base.

• Invest to increase differentiation, drive efficiencies, and enhance decision-making.

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United States Mortgage Market

The United States residential mortgage market is one of the largest in the world with over $11.4 trillion of mortgage debt outstanding as of the third quarter of 2021 and includes a range of private and government sponsored participants.

The United States residential mortgage market is one of the largest in the world and includes a range of private and government sponsored participants.

Private industry participants include mortgage banks, mortgage brokers, commercial, regional and investment banks, savings institutions, credit unions, real estate investment trusts, mortgage insurers and the GSEs.

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The secondary market includes institutions buying and selling mortgages in the form of whole loans or securitized assets, such as mortgage-backed securities (“MBS”).

For a description of certain impacts of COVID-19 on the mortgage market, see “Item 1A.

Risk Factors—Risks Relating to Our Business—The ongoing COVID-19 pandemic has and could continue to adversely impact our business, results of operations and financial condition.”

The GSEs are the largest participants in the secondary mortgage market, buying residential mortgages from banks and other primary lenders as part of their government mandate to provide liquidity and stability in the United States housing finance system.

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This credit protection and the resulting liquidity it provides through secondary market sales allows mortgage lenders to increase their lending capacity, manage risk and expand prospective homeowners’ access to financing, many of whom are FTHBs.

Mortgage insurance also provides lenders and investors a means to diversify their exposures, mitigate mortgage credit risk and may offer certain financial institutions that portfolio Low-Down Payment Loans credit against their regulatory capital requirements.

Mortgage insurance also provides lenders and investors a means to diversify their exposures, mitigate mortgage credit risk and may offer credit against regulatory capital requirements to certain financial institutions that portfolio Low Down Payment Loans.

Today, mortgage insurance products are primarily geared towards GSE secondary market sales.

The increase in penetration of private mortgage insurance in the mortgage market can be attributed to both the introduction of new GSE products designed to serve Low Down Payment Loan borrowers and more competitive pricing by private mortgage insurers relative to the Federal Housing Administration (“FHA”).

In addition, there are potential

opportunities for the demand for and use of mortgage insurance to the extent that the private label securitization market expands in the future.

In addition, there are potential opportunities for the demand for and use of mortgage insurance to the extent that the private label securitization market expands in the future.

The overall new business opportunity in the private mortgage insurance market is also reflective of the mix between purchase and refinancing originations.

Historically, due to the higher prevalence of Low-Down Payment Loans in purchase originations, mortgage insurance utilization has been meaningfully higher for purchase originations than for refinances.

Historically, due to the higher prevalence of Low-

Down Payment Loans in purchase originations, mortgage insurance utilization has been meaningfully higher for purchase originations than for refinances.

Our principal sources of competition are government (federal, state and local) agencies, such as the FHA and the United States Department of Veterans Affairs (“VA”) and other private mortgage insurers.

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(public holding companies of competitors listed).

Since 2012, we have maintained between a 12.0% and 19.2% per quarter share of the mortgage insurance market by per annum NIW, based on data from Inside Mortgage Finance .

Since 2012, we have maintained between a 12.0% and 19.2% per quarter share of the private mortgage insurance market by per annum NIW, based on data from Inside Mortgage Finance .

GSEs, Portfolio Lenders, Reinsurers and Other Capital Markets Participants

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In addition, investors can make use of risk-sharing structures designed to mitigate the impact of mortgage defaults in place of private mortgage insurance.

Finally, although their presence is a fraction of what it was in the past, there are

products designed to eliminate the need for private mortgage insurance, such as “simultaneous seconds,” which combine a first lien loan with a second lien loan in order to meet the 80% LTV threshold required for sale to the GSEs without certain credit protections.

Finally, although their presence is a fraction of what it was in the past, there are products designed to eliminate the need for private mortgage insurance, such as “simultaneous seconds,” which combine a first lien loan with a second lien loan in order to meet the 80% LTV threshold required for sale to the GSEs without certain credit protections.

Our Products and Services

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Generally, our risk across all policies written is approximately 25% of the underlying primary insurance in-force (“IIF”), but may vary from policy to policy, typically between 6% and 35% coverage.

We file our premium rates, as required, with state insurance departments and the District of Columbia.

We file our premium rates, as required, with insurance departments of U.S.

States and the District of Columbia.

Premium rates cannot be changed after the issuance of coverage.

Premium payments for primary mortgage insurance coverage are typically made by the borrower and are referred to as borrower-paid mortgage insurance (“BPMI”).

Premium payments for primary mortgage insurance coverage are typically made by the borrower and are referred to as borrower-paid mortgage insurance.

Loans for which premiums are paid by the lender are referred to as lender-paid mortgage insurance.

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Pool mortgage insurance transactions provide coverage on a finite set of individual loans identified by the pool policy.

Pool policies contain coverage percentages and provisions limiting the insurer’s obligation to pay claims until a threshold amount is reached (known as a “deductible”) or capping the insurer’s potential aggregate liability for claims payments (known as a “stop loss”) or a combination of both provisions.

potential aggregate liability for claims payments (known as a “stop loss”) or a combination of both provisions.

Pool mortgage insurance is typically used to provide additional credit enhancement for certain secondary market mortgage transactions.

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The distribution of our exposure by book year is influenced by market size opportunities, our commercial strategies and the persistency of our in-force policies.

As a result of low persistency for our in-force book, a large origination market and commercial success in the market, the 2021 and 2020 book years represent 40% and 31% of our primary IIF, respectively.

In 2021 and 2020, our portfolio was impacted by low persistency, a large origination market and commercial success in the market, leading to a concentration in recent years as the 2022, 2021 and 2020 book years represent 25%, 33% and 22%, respectively, of our primary IIF.

Our primary exposures from legacy books originated prior to 2009 continue to resolve in an orderly fashion and represented 3% of both our primary IIF and primary RIF as of December 31, 2022.

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We actively monitor our portfolio for concentrations at the state, metropolitan statistical area and metropolitan division level in addition to economic and performance trends in these markets.

As of December 31, 2021, our

largest state concentration was in California, which represented 11% of primary RIF.

As of December 31, 2022 , our largest state concentration was in California, which represented 12% of primary RIF.

Our largest MSA/MD is the Chicago-Naperville, IL Metropolitan Division, which represents 3% of primary RIF.

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Finally, our consulting services provide customers with strategy and process consulting to help improve quality, reduce costs and grow their business.

In 2019, we launched a separate mortgage insurance policy underwritten by our wholly owned subsidiary, Genworth Mortgage Insurance Corporation of North Carolina (“GMIC-NC” whose name was changed to Enact Mortgage Insurance Company of North Carolina on February 7, 2022), to insure primary individually underwritten residential mortgage loans as well as portfolios of residential mortgage loans at or after origination that are not intended for sale to the GSEs.

Given that GMIC-NC is not a GSE approved insurer, it is not subject to the requirements mandated by PMIERs.

Accordingly, we are able to utilize GMIC-NC in a manner that provides us with greater flexibility with our master policies and in our ability to efficiently use the capital of our subsidiaries, each with customers who retain loans in their own portfolio.

We also believe utilizing GMIC-NC in this manner provides us strategic optionality if the private label MBS market increases.

In 2019, we launched a separate mortgage insurance policy underwritten by our wholly owned subsidiary, Enact Mortgage Insurance Corporation of North Carolina (“EMIC-NC”), to insure primary individually underwritten residential mortgage loans as well as portfolios of residential mortgage loans at or after origination that are not intended for sale to the GSEs.

Given that EMIC-NC is not a GSE approved insurer, it is not subject to the requirements mandated by PMIERs.

Accordingly, we are able to utilize EMIC-NC in a manner that provides us with greater flexibility with our master policies and in our ability to efficiently use the capital of our subsidiaries, each with customers who retain loans in their own portfolio.

We also believe utilizing EMIC-NC in this manner provides us strategic optionality if the private label MBS market increases.

Technology that supports connectivity with our customers is critical.

As an established private mortgage insurance provider, we have long-standing relationships with our customers’ technology

organizations, as well as with the key pricing and loan origination/servicing platform providers.

As an established private mortgage insurance provider, we have long-standing relationships with our customers’ technology organizations, as well as with the key pricing and loan origination/servicing platform providers.

In addition, we have an experienced technology integration team that allows us to quickly customize loan delivery solutions for our customers.

By providing customers an easy way to quote and order our mortgage insurance products, either through our award-winning ordering and rate quote website or directly within customers’ systems, we believe we make the transaction easy, allowing us to drive repeat volume.

By providing customers an easy way to quote and order our mortgage

insurance products, either through our award-winning ordering and rate quote website or directly within customers’ systems, we believe we make the transaction easy, allowing us to drive repeat volume.

Risk Management and Oversight

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The results of these analyses inform our risk appetite, credit policy, pricing and targeted risk selection strategies.

In addition, the results of these stress tests and our desire to reduce loss volatility inform our CRT strategy, including traditional reinsurance and mortgage insurance-linked notes “(MILNs”).

In addition, the results of these stress tests and our desire to reduce loss volatility inform our CRT strategy.

Customer Qualification

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Loans are underwritten on either a delegated or non-delegated basis, but all loans pass through our eligibility rules engine to screen out those outside of our guidelines.

We regularly monitor national and local market conditions, the performance of our

products and the performance of our customers against our expectations for mix and profitability.

We regularly monitor national and local market conditions, the performance of our products and the performance of our customers against our expectations for mix and profitability.

We adjust our underwriting, pricing and risk selection strategies on a regular basis to ensure that our products remain competitive and consistent with our risk and profitability objectives.

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We update our plan no less than annually to accommodate changes in business processes and third-party providers and test the plan regularly through tabletop exercises.

In the fourth quarter of 2019, we tested our plan against a pandemic scenario.

We implemented a business continuity plan in response to COVID-19 and employees have been successfully working from home since March 2020 and will continue to work from home until at least March 2022.

See “Item 1A.

Risk Factors—Risks Relating to Our Business—The ongoing COVID-19 pandemic has and could continue to adversely impact our business, results of operations and financial condition.” for a discussion on the COVID-19 virus.

While we instituted a hybrid return to office staffing model in March 2022, we previously implemented a business continuity plan in response to COVID-19 and operated successfully with a remote workforce from March 2020 through March 2022.

We have used a decentralized team of underwriters and other key functional employees for many years and all employees are capable and equipped to work remotely so that we can continue providing service to our customers through prolonged absences from the office.

We establish and maintain underwriting guidelines based on our risk appetite.

We require borrowers to have a verified capacity and willingness to support their obligation and a well-supported valuation of the collateral.

Our guidelines require borrowers to have a verified capacity and willingness to support their obligation and a well-supported valuation of the collateral.

Our underwriting guidelines incorporate credit eligibility requirements that, among other things, limit our coverage to mortgages that meet our thresholds with respect to borrower FICO scores, maximum LTVs, documentation requirements and maximum Debt-to-Income (“DTI”) Ratio.

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Many of our customers use the GSEs’ automated loan underwriting systems, Desktop Underwriter and Loan Product Advisor, for making credit determinations.

We generally accept the underwriting decisions and documentation requirements made by GSEs’ underwriting systems, subject to our review as well as certain limitations and requirements.

We generally accept the underwriting decisions and documentation requirements made by the GSEs’ underwriting systems, subject to our review as well as certain limitations and requirements.

Over the past few years, more customers have requested expedited underwriting services.

To meet customer demand, we invested in technologies, automation, data science and analytics to develop our

proprietary mortgage insurance underwriting system.

To meet customer demand, we invested in technologies, automation, data science and analytics to develop our proprietary mortgage insurance underwriting system.

Our mortgage insurance underwriting system enables the capability to meet customer demand in a timely manner without sacrificing the accuracy of our underwriting decisions.

Specifically, it has contributed to a substantial increase in our underwriters’ productivity, more than doubling the number of loans our underwriters have processed on a daily basis since 2015, while remaining within our quality control tolerances.

We believe our mortgage insurance underwriting system also differentiates us from the competition by allowing us to efficiently provide customized turn times from submission of a loan package to an underwriting decision for our customers and perform fee-based contract underwriting services.

We believe our mortgage insurance underwriting system also differentiates us from the competition by allowing us to efficiently provide

customized turn times from submission of a loan package to an underwriting decision for our customers and perform fee-based contract underwriting services.

Our policies are issued through one of two underwriting programs:

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We delegate to eligible lender customers the ability to underwrite mortgage insurance based on our delegated underwriting guidelines.

To perform delegated underwriting, customers must be approved by our risk management group.

To perform delegated underwriting, customers must be approved by our risk management team.

Some customers prefer to assume underwriting responsibility because it is more efficient within their loan origination process, and they are comfortable attesting that the data submitted is true and correct when making our insurance decision.

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Upon satisfactory completion of this review, we agree to waive our right to rescind coverage under certain circumstances.

For the years ended December 31, 2021 and 2020, approximately 65% and 59% of our NIW by loan count went through our delegated underwriting services, respectively.

For the years ended December 31, 2022 and 2021, approximately 71% and 65%, respectively, of our NIW by loan count went through our delegated underwriting services.

Pricing is highly competitive in the mortgage insurance industry, with industry participants competing for market share, customer relationships and overall value.

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The model assesses the performance of new business under expected and stress scenarios on an individualized loan basis, which is used to determine pricing and inform our risk selection strategy that optimizes economic value by balancing return and volatility.

Additionally, during the COVID-19 pandemic, we have implemented pricing changes commensurate with changes in macroeconomic conditions that we believe align our risk and return profile.

Our policy has been to set and charge premium rates commensurate with the underlying risk of each loan we insure.

Our proprietary pricing platform, however, provides us with a more flexible, granular and analytical approach to selecting and pricing risk.

Using our platform, we can quickly change price to

modify our risk selection levels in response to changing economic conditions, new analytical insights or industry pricing trends.

Using our platform, we can quickly change price to modify our risk selection levels in response to changing economic conditions, new analytical insights or industry pricing trends.

Credit Risk Transfer

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Our CRT program also provides capital relief under PMIERs and state insurance capital requirements.

In normal market conditions, we believe our CRT program also enhances our return profile.

In normal market

conditions, we believe our CRT program also enhances our return profile.

Given the volatility protection and capital relief at attractive terms, CRT enables us to employ an “acquire, manage and distribute” strategy.

We believe our CRT program is a material component of our strategy and helps to protect future business performance and stockholder capital under stress scenarios.

Our CRT program distributes risk to both highly-rated counterparties through our traditional reinsurance program, as well as to MILN investors via fully collateralized special purpose reinsurance vehicles.

Our CRT program distributes risk to both highly rated counterparties through our traditional reinsurance program, as well as to insurance-linked note (“ILN”) investors via fully collateralized special purpose reinsurance vehicles.

Our reinsurance transactions generally cover a subset of loans in a given book year and have been structured as excess of loss (“XOL”) coverage where typically both the attachment and detachment points of the ceded risk tier are within the PMIERs capital requirements at inception, providing both loss volatility protection and PMIERs capital credit.

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We select the type and structure of our CRT transactions based on a variety of factors including, but not limited to, capacity, cost, flexibility, sustainability and diversification.

Since 2015, we have executed $3.8 billion of CRT transactions across both traditional reinsurance arrangements and MILN transactions through December 31, 2021, with approximately 90% of our RIF insurance covered under our current CRT program.

Since 2015, we have executed $4.6 billion of CRT transactions across both traditional reinsurance arrangements and ILN transactions through December 31, 2022, with approximately 89% of our RIF insurance covered under our current CRT program.

We expect to begin transferring losses at an approximate 30 to 35% lifetime book year loss ratio and extend up to an approximate 60 to 70% lifetime book year loss ratio at current pricing assumptions and depending on our co-participation level within the reinsurance tier.

Through our traditional reinsurance transactions, we have executed $2.8 billion of XOL reinsurance coverage with highly rated reinsurers covering the 2009 to 2022 book years.

Subsequent to year end 2021, on January 27, 2022 we completed an XOL reinsurance transaction covering a portion of NIW from January 1, 2022 to December 31, 2022 that provides up to $294 million of reinsurance coverage.

The Company’s traditional reinsurance coverage is provided by a panel of reinsurance partners each currently rated “A-” or better by Standard & Poor’s (“S&P”) or A.M.

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These reinsurers are contractually required to collateralize a portion (typically 20 to 30%) of the reinsurance exposures consistent with PMIERs.

Through our MILN transactions, we have executed $1.8 billion of XOL reinsurance coverage supported by capital markets investors via fully collateralized special purpose reinsurance vehicles covering a portion of the 2014 to 2021 book years.

Through our ILN transactions, we have executed $1.8 billion of XOL reinsurance coverage supported by capital markets investors via fully collateralized special purpose reinsurance vehicles covering a portion of the 2014 to 2021 book years.

The notes are non-recourse to us and our affiliates.

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We consider a loan to be delinquent when it is two or more mortgage payments past due.

The incidence of delinquency is affected by a variety of factors, including housing price appreciation or depreciation, unemployment, the level of borrower income, divorce, illness, interest rate levels, general borrower creditworthiness and macroeconomic conditions, including the impact of pandemics such as COVID-19.

Risk Factors—Risks Relating to Our Business—The ongoing

COVID-19 pandemic has and could continue to adversely impact our business, results of operations and financial condition.” and “—A deterioration in economic conditions or a decline in home prices may adversely affect our loss experience.” Delinquencies that are not cured result in a claim.

Risk Factors—Risks Relating to Our Business—A deterioration in economic conditions, a severe recession or a decline in home prices, all of which could be driven by many potential factors, including inflation, may adversely affect our loss experience.” Delinquencies that are not cured result in a claim.

Our loss mitigation and claims area is led by seasoned personnel who are supported by default tracking and claims processing capabilities within our integrated platform.

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These efforts have traditionally involved loan modifications intended to enable qualified borrowers to make restructured loan payments or efforts to sell the property, thereby potentially reducing claim amounts.

With the COVID-19 pandemic, we have experienced unprecedented use of forbearance plans nationwide to assist borrowers including the ability to extend forbearance beyond 12 months.

Historically, the use of forbearance plans were limited to 12 months and used for a natural disaster that impacted a region of the country.

With the COVID-19 pandemic, we have experienced unprecedented use of forbearance plans nationwide to assist

borrowers including the ability to extend forbearance beyond 12 months.

Historically, the use of forbearance plans was limited to 12 months and used for a natural disaster that impacted a region of the country.

At the conclusion of the forbearance term, a borrower may either bring the borrower’s loan current, defer any missed payments until the end of their loan, or the loan can be modified through a repayment plan or extension of the mortgage term.

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Various factors affect the frequency and severity of claims, including LTV at the time of foreclosure, size and coverage percentage of a loan, property values, employment levels and interest rates.

Any delays in foreclosure, including foreclosure moratoriums imposed by state and local governments and the GSEs due to COVID-19, could cause our losses to increase as expenses accrue for longer periods or if the value of foreclosed homes further decline during such foreclosure delays.

Any delays in foreclosure, including foreclosure moratoriums imposed by state and local governments and the GSEs, such as those due to COVID-19, could cause our losses to increase as expenses accrue for longer periods or if the value of foreclosed homes further decline during such foreclosure delays.

For loans insured on or after October 1, 2014, 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.

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• Acquisition option—pay the full claim amount and acquire title to the property.

In 2021 and 2020, we settled over half of our claims through the third-party sale or acquisition options due largely to continued home price appreciation.

In 2022 and 2021, we settled over half of our claims through the third-party sale or acquisition options due largely to embedded home price appreciation.

Claim activity is not evenly spread across the coverage period of loans we insure.

The frequency of delinquencies may not correlate directly with the number of claims received because the rate at which

delinquencies are cured is influenced by borrowers’ financial resources and circumstances, as well as regional economic differences.

The number of delinquencies may not correlate directly with the number of claims received because the rate at which delinquencies are cured is influenced by borrowers’ financial resources and circumstances, as well as regional economic differences.

For those loans that fail to cure, whether delinquency leads to a claim principally depends upon the borrower’s equity at the time of delinquency and the borrower’s or the insured’s ability to sell the home for an amount sufficient to satisfy all amounts due under the mortgage loan.

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We also periodically receive claim notices that request coverage for costs and expenses associated with items not covered under our policies, such as losses resulting from property damage to a covered home.

We actively review claim notices to ensure we pay only for covered expenses.

We actively review claim notices to ensure we

pay only for covered expenses.

We deem a reduction in the claim amount paid relative to the amount requested in the claim notice to be a curtailment.

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Technology costs are managed by the continued automation of key business processes, reducing our application portfolio and using contract employees to scale resource capacity as needed.

We also have a dedicated “AI, Innovation & Automation” team to help ensure that we focus on using the latest technologies to further automate our business and differentiate our products and services.

In addition, we have a dedicated “AI, Innovation & Automation” team to ensure that we focus on using the latest technologies to further automate our business and differentiate our products and services.

Cybersecurity

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Ratings are important to maintaining public confidence in us and our ability to market our products.

Rating organizations review the financial

performance and condition of most insurers and provide opinions regarding financial strength, operating performance and ability to meet obligations to policyholders.

As of February 28, 2022, GMICO, our principal U.S.

mortgage insurance subsidiary, was rated “BBB” (Good) by S&P, “Baa2” (Adequate) by Moody’s and “BBB+” (Good) by Fitch Ratings, Inc.

Rating organizations review the financial performance and condition of most insurers and provide opinions regarding financial strength, operating performance and ability to meet obligations to policyholders.

As of February 28, 2023, EMICO, our principal U.S.

mortgage insurance subsidiary, was rated “BBB+” by S&P, “Baa1” by Moody’s and “BBB+” by Fitch Ratings, Inc.

(“Fitch”) in terms of financial strength.

Investment Portfolio

Oversight and management of our investment portfolio and compliance with our investment guidelines will continue to be delegated by our board of directors to our Parent’s investment committee and chief investment officer.

Under the terms of our Shared Services Agreement, the Company is charged a fee by our Parent.

The total investment expenses paid to our Parent were $5.2 million for each of the years ended December 31, 2021 and 2020, respectively.

The investment portfolios of our insurance subsidiaries are directed by the Enact Investment Committee, a management-level committee, with Genworth serving as the investment manager.

Under the terms of our investment management agreement, the Company is charged an investment management fee by our Parent.

The total investment expenses paid to our Parent were $5.5 million and

$5.2 million for the years ended December 31, 2022 and 2021, respectively.

See Note 11 to our audited consolidated financial statements for further information.

The investment portfolio of EHI is directed by a separate newly formed management-level EHI Investment Committee with a third-party investment manager.

In addition, for certain asset classes, we utilize external asset management.

In the future, we may choose to more broadly engage external asset managers.

Our senior management team along with our board of directors review investment performance and strategy on a periodic basis.

Our senior management team, along with our board of directors, reviews investment performance and strategy on a periodic basis.

As of December 31, 2022, the fair value of our investment portfolio was $4.9 billion of fixed maturity assets, of which 98% was rated as investment grade.

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Our investment policies and strategies are subject to change depending on regulatory, economic and market conditions, as well as our prevailing operating objectives.

however, we have made no changes to our investment strategies as a result of COVID-19.

For more information regarding our investment portfolio, see “Item 7.

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As of December 31, 2022, we had 496 full-time employees, all of whom work in the United States.

Of those employees, 55% are located in our Raleigh, North Carolina office and the remaining 45% are in the field, predominantly working in sales and underwriting.

Our employee population is made up of 58% women and 25% people of color.

Of our employees, 46% work in our Raleigh, North Carolina office and the remaining 54% are in the field, predominantly working in sales and underwriting.

We supplement our workforce, as needed, with independent contractors.

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• Our compensation package, including salary, incentive bonus and long-term incentives, aligns employee and stockholder interests, as well as rewards our employees for serving all of our current and future customers.

• In addition to a competitive compensation program, we also offer our employees benefits such as life and health insurance, paid time off, paid parental leave, financial planning and a retirement savings plan.

• We offer a multitude of professional development and career enrichment courses, including in the areas of leadership, professional skills training and industry-specific matters, as well as tuition reimbursement benefits and student loan repayment options to aid career progression.

• Our cultural and demographic-based employee resource groups help to build an inclusive culture through company-wide events, participation in our recruitment efforts and by educating our employees on the experiences and perspectives of others.

• In addition to a competitive compensation program, we offer our employees benefits such as life and health insurance, paid time off, paid parental leave, childcare subsidies, retirement savings plans, financial planning services, an Employee Assistance Program and a broad fitness reimbursement program to support physical and mental health.

• We offer a multitude of professional development and career enrichment courses, including in the areas of leadership, professional skills, and industry-specific matters, as well as a mentor program and an extensive training program for future senior leaders.

We also offer tuition reimbursement benefits and student loan repayment options to aid career progression.

We routinely assess talent, engage in deep succession planning at all levels of the organization and provide feedback to our employees through a performance review process.

• Our employee-led Diversity & Inclusion Council helps to build an inclusive culture through company-wide events, participation in our recruitment efforts and by educating our employees on the experiences and perspectives of others.

We continue to focus on building a pipeline of talent to create more opportunities for workplace diversity and to support greater representation within our Company.

• We champion civic engagement through paid volunteer time for our employees, event sponsorship programs, employee-directed charitable gifts and through our commitment to environmental sustainability.

In addition to our internally focused efforts, we have a number of employee-led externally focused diversity, equity and inclusion initiatives.

• We champion civic engagement through paid volunteer time for employees, event sponsorship programs, employee-directed charitable gifts with a 100% company match, and through our commitment to environmental sustainability.

• We empower employees to share their unique perspectives by promoting initiatives that increase access to our Senior Leadership Team and encouraging open-door policies.

We value the voice of our employees and use a best-in-class third party approach to gather employee feedback.

• We celebrate our talent by showcasing employee achievements and expertise in industry publications, at events and conferences, and on social media.

By amplifying their reach and ours, in 2022, 10 employees were recognized as award winners by external organizations, and we were recognized as an organization on three occasions.

As the severity of COVID-19 started to unfold at the beginning of 2020, our response included the implementation of policies to protect our employees.

In early March 2020, we closed our offices and implemented a complete work from home policy which will remain in place until at least March 2022.

To further support our employees, we are also providing additional financial, health and wellness resources, as well as a flexible work schedule to allow employees additional time for self-care and the care of family members during the crisis.

In early March 2020, we closed our offices and implemented a complete work from home policy through March 2022, as well as providing additional financial, health and wellness resources.

We instituted a return to office plan in March 2022 which operates as a hybrid working model for a majority of our Raleigh-based employees.

Our insurance operations are generally subject to extensive oversight and a wide variety of laws and regulations.

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The extent of this regulation varies, but state insurance laws and regulations generally grant both broad and specific regulatory powers to agencies or officials to examine the affairs of our insurance subsidiaries and to enforce statutes and administrative rules or exercise discretion affecting almost every aspect of their businesses.

For example, state insurance laws and regulations typically

govern the financial condition of insurers, including standards for solvency, types and concentrations of permissible investments, establishment and maintenance of reserves, credit for reinsurance, requirements for capital adequacy, and the business conduct of insurers, including marketing, sales practices and claims handling.

For example, state insurance laws and regulations typically govern the financial condition of insurers, including standards for solvency, types and concentrations of permissible investments, establishment and maintenance of reserves, credit for reinsurance, requirements for capital adequacy, and the business conduct of insurers, including marketing, sales practices and claims handling.

State insurance laws and regulations also usually require the licensing of insurers and agents, and the approval of policy forms and rates.

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Certain of our insurance subsidiaries are subject to the Insurance Holding Company Act in North Carolina and are required to furnish various types of information concerning the operations of, and the interrelationships and transactions among, companies within our holding company system that may affect the operations, management or financial condition of the insurers within such holding company system.

Under state insurance laws and regulations, our insurance subsidiaries must file reports, including detailed annual and quarterly financial statements, with the insurance regulator in North Carolina and the NAIC, and our operations and accounts are subject to periodic or target examination by any insurance regulator of a jurisdiction in which we conduct business.

Under state insurance laws and regulations, our insurance subsidiaries must file reports, including detailed annual and quarterly financial statements, with the insurance regulator in North Carolina and the National Association of Insurance Commissioners (“NAIC”), and our operations and accounts are subject to periodic or target examination by any insurance regulator of a jurisdiction in which we conduct business.

Mortgage guaranty insurers generally are limited by state insurance laws and regulations to directly writing only mortgage guaranty insurance business to the exclusion of other types of insurance.

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although such presumption may be rebutted.

In considering an application to acquire control of an insurer, the insurance commissioner generally considers factors such as the experience, competence and financial strength of the applicant, the integrity of the applicant’s board of directors and executive officers, the acquirer’s plans for the management and operation of the insurer, and any anti-

competitive results that may arise from the acquisition.

Most jurisdictions also now require a person seeking to acquire control of an insurer licensed but not domiciled in that jurisdiction to make a filing prior to completing an acquisition if the acquirer and its affiliates and the target insurer and its affiliates have specified market shares in the same lines of insurance in that jurisdiction.

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In certain situations, state insurance laws and regulations also require that a controlling person of an insurer submit prior notice to the insurer’s domiciliary insurance regulator of a divestiture of control.

Similarly, with respect to our contract underwriting entity, Genworth Financial Services, Inc., prior approval from state banking commissioners is required in some jurisdictions prior to acquiring control of our contract underwriting entity, which is licensed or has an approved license exemption in most states.

Similarly, with respect to our contract underwriting entity, Enact Financial Services, Inc., prior approval from state banking commissioners is required in some jurisdictions prior to acquiring control of our contract underwriting entity, which is licensed or has an approved license exemption in most states.

Our insurance subsidiaries’ payment of dividends or other distributions to our holding company is regulated by the state insurance laws and regulations of their respective domiciliary states.

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In addition, insurance regulators may prohibit the payment of ordinary dividends and distributions or other payments by our insurers (such as a payment under a tax sharing agreement, for employment or other services) if they determine that such payment could be adverse to our policyholders or would not be fair and reasonable to the insurer.

National Association of Insurance Commissioners (“NAIC”)

National Association of Insurance Commissioners

The NAIC is an organization, the mandate of which is to benefit state insurance regulatory authorities and consumers by promulgating model insurance laws and regulations for adoption by the states.

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Uniform statutory accounting practices are established by the NAIC and are generally adopted by regulators in the various state jurisdictions.

Due to differences in methodology between SAP and U.S.

Due to differences in methodology between SAP and United States generally accepted accounting principles (“U.S.

GAAP”), the values for assets, liabilities and equity reflected in financial statements prepared in accordance with U.S.

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In this Annual Report, we show policyholder position as statutory capital.

The NAIC is in the process of reviewing the minimum capital and surplus requirements for mortgage insurers and considering changes to the MGI Model, revisions to Statement of Statutory Accounting Principles No.

58—Mortgage Guaranty Insurance and the development of a mortgage guaranty supplemental filing.

In late 2019 and early 2021, the MGIWG released exposure drafts of the revised MGI Model, including new proposed mortgage guaranty insurance capital requirements for mortgage insurers, and the mortgage guaranty supplemental filing, which currently remains under development.

The NAIC is in the process of considering changes to the Mortgage Guaranty Insurance Model Act (the “MGI Model”) and revisions to Statement of Statutory Accounting Principles No.

58—Mortgage Guaranty Insurance.

In 2020 the NAIC developed a mortgage guaranty supplemental filing.

In September 2022, the Mortgage Guaranty Insurance Working Group (the “MGIWG”) released its most recent exposure drafts of the revised MGI Model.

The process for developing this framework is ongoing, and the outcome of this process remains uncertain.

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or (v) any changes to our operations that may be necessary to comply, any of which could have a material adverse effect on our business, results of operations and financial condition.

We also cannot predict

whether other regulatory initiatives will be adopted and what impact, if any, such initiatives, if adopted as laws, may have on our business, results of operations and financial condition.

We also cannot predict whether other regulatory initiatives will be adopted and what impact, if any, such initiatives, if adopted as laws, may have on our business, results of operations and financial condition.

Group Capital Requirements .

The NAIC and international insurance regulators, including the International Association of Insurance Supervisors (“IAIS”), have developed group capital standards.

The NAIC developed a group capital calculation (“GCC”) tool using an RBC aggregation methodology for all entities within the insurance holding company system, including non-United States entities.

The NAIC has developed a group capital calculation (“GCC”) tool using an RBC aggregation methodology for all entities within the insurance holding company system, including non-U.S.

The GCC provides regulators with an additional tool for conducting group-wide supervision and enhances transparency into how capital is allocated.

In December 2020, the NAIC also adopted the GCC Template and Instructions as well as amendments to the Holding Company System Model Act and Regulation to require, subject to certain exceptions, the ultimate controlling person of every insurer subject to the holding company registration requirement to file an annual group capital calculation with its lead state;

however, the template and instructions are currently undergoing revisions by the NAIC’s Group Capital Calculation (E) Working Group as the working group conducts a trial implementation of the GCC with volunteer insurer groups in 2021.

The NAIC has stated that the calculation will be a regulatory tool and does not constitute a requirement or standard, but there can be no guarantee that will remain the case.

The amendments to the Holding Company System Model Act and Regulation, which implement the annual filing requirement for the GCC, now have to be adopted by state legislatures in order to become effective.

See also “Item 1A.

Risk Factors— Risks Relating to Regulatory Matters—Inability to maintain sufficient regulatory capital could result in restrictions or prohibitions on our doing business or impact our financial strength ratings which could have a material adverse impact on our business, results of operations and financial condition.

The IAIS spent several years developing a risk-based global insurance capital standard (“ICS”) based upon 10 key principles, which will apply to internationally active insurance groups.

We are part of the broader group of insurance companies of our Parent.

The IAIS adopted a revised version of the ICS in 2019 and it began a five-year monitoring period in 2020 prior to final implementation.

It is unclear how the development of group capital measures by the NAIC and IAIS will interact with existing capital requirements for insurance companies in the United States and with international capital standards.

In December 2020, the NAIC adopted amendments to the Holding Company System Model Act and Regulation.

The amendments adopt a Group Capital Calculation Template and Instructions (“GCC Template and Instructions”) as well as an annual filing requirement for the GCC.

The amendments were adopted by Virginia, Genworth’s insurance holding company group’s lead state, in 2022.

During 2021, certain insurance groups agreed to voluntarily submit data to lead states using the newly adopted template as part of a trial implementation phase.

Based on the trial results and feedback from these insurance groups, the NAIC implemented changes to the GCC Template and Instructions.

In May 2022, the Group Capital Calculation Working Group of the NAIC adopted the 2022 GCC Instructions and Template, which will be used by a number of states, including Delaware and Virginia, for year end 2022 filings.

The GCC also adopted guidance for insurance regulators to use in reviewing GCC submissions in the form of changes to the NAIC Financial Analysis Handbook.

It is unclear how the development of group capital measures by the NAIC will interact with existing capital requirements for U.S.

insurance companies.

State insurance laws and regulations require our insurance subsidiaries to establish a special statutory contingency reserve reflected in their statutory financial statements to provide for payable claims and other expenses and purposes in the event of significant economic declines.

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Although the federal government generally does not directly regulate the insurance business, federal initiatives often have an impact on our business in a variety of ways.

From time to time, federal measures are proposed that may significantly affect the insurance business.

From time to time, federal measures

are proposed that may significantly affect the insurance business.

These areas include financial services regulation, securities regulation, derivatives regulation, money laundering, privacy regulation and taxation.

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However, April 27, 2021, the CFPB promulgated a final rule delaying the mandatory compliance date of the Amended QM Rule until October 1, 2022 and noting that the Amended QM Rule and Seasoned QM Final Rule would be reconsidered at a later time.

As provided under the final rule, the prior 43% DTI-based QM Rule definition, the new price-based (APOR) definition and the QM Patch will all remain available to lenders for loan applications received prior to October 1, 2022.

As provided under the final rule, the prior 43% DTI-based QM Rule definition, the new price-based Average Prime Offer Rate (“APOR”) definition and the QM Patch all remained available to lenders for loan applications received prior to October 1, 2022.

However, on April 8, 2021, Fannie Mae issued Lender Letter 2021-09 and Freddie Mac issued Bulletin 2021-13 stating that due to the requirements of the Preferred Stock Purchase Agreements (“PSPAs”) between the Treasury Department and each of the GSEs they would only acquire loans that meet the new price-based (APOR) definition set forth under the Amended QM Rule for applications received on or after July 1, 2021.

We believe that loans which previously qualified under the 43% DTI-based QM Rule definition and the QM Patch will continue to qualify under the new price-based (APOR) definition and therefore we expect little impact from this change.

In October 2022, the SEC adopted final rules requiring the recovery of erroneously awarded compensation as mandated by the Dodd-Frank Act.

The rules will, among other things, require national securities exchanges to establish listing standards that would require listed companies to adopt and comply with a compensation recovery policy, often known as a clawback policy, and require listed companies to provide disclosure about such policies and how they are being implemented.

In the event a company is required to prepare an accounting restatement, including to correct an error that would result in a material misstatement if the error were corrected in the current period or left uncorrected in the current period, the company must recover from any current or former executive officers incentive-based compensation that was erroneously awarded during the three years preceding the date such a restatement was required.

The recoverable amount would be the amount of incentive-based compensation received in excess of the amount that otherwise would have been received had it been determined based on the restated financial measure.

The updated listing standards related to clawback policies will become effective no later than November 28, 2023.

Listed companies will be required to adopt a clawback policy no later than 60 days following the applicable listing standards effective date and make the required disclosure in proxy and information statements, as well as annual reports filed after the adoption of their clawback policy.

We are currently awaiting the finalization of the relevant listing standards and are evaluating our existing clawback policy to determine if any updates are required.

On August 25, 2022, the SEC adopted final rules implementing the pay versus performance requirement as mandated by the Dodd-Frank Act.

The rules require public companies to disclose the relationship between their executive compensation and financial performance in proxy or information statements in which executive compensation disclosures are required.

Under the new rules, companies will be required to provide a table disclosing specified executive compensation and financial performance measures for the five most recently completed fiscal years after an initial phase-in period.

Companies are also required to describe the relationship between the actual executive compensation paid, as defined by the new rules, and each of the financial performance measures in the table, as well as the company’s total shareholder return (“TSR”) and the TSR of its selected peer group.

In addition, companies are required to disclose three to seven financial performance measures they determine to be the most important performance measures for linking executive compensation actually paid to company performance.

These final rules are effective in proxy and information statements for fiscal years ending on or after December 16, 2022 and will be reflected in our proxy statement for the year ended December 31, 2022.

Agency Qualification Requirements

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In addition, the PMIERs require private mortgage insurers to obtain the prior consent of the GSEs before taking certain actions, which may include entering into various intercompany agreements and commuting or reinsuring risk, among others.

As of December 31, 2021, we met the PMIERs financial and operational requirements, based in part on our entry into a series of reinsurance transactions, and currently hold a reasonable amount in excess of the financial requirements.

The PMIERs include financial requirements for mortgage insurers under which a mortgage insurer’s “Available Assets” (generally only the most liquid assets of an insurer) must meet or exceed “Minimum Required Assets” (which are based on an insurer’s RIF and are calculated from tables of factors with several risk dimensions and are subject to a floor amount) and otherwise generally establish when a mortgage insurer is qualified to issue coverage that will be acceptable to the respective GSE for

acquisition of high LTV mortgages.

As of December 31, 2022, we met the PMIERs financial and operational requirements and currently hold a reasonable amount in excess of the financial requirements.

The GSEs may amend or waive PMIERs at their discretion, impose additional conditions or restrictions on us and also have broad discretion to interpret PMIERs, which could impact the calculation of our “Available Assets” and/or “Minimum Required Assets”.

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They include quality control requirements that are designed to ensure that approved insurers have a strong internal risk management infrastructure and senior management oversight.

During 2020, the GSEs issued several amendments to PMIERS.

The December 4, 2020 PMIERS Amendment extended the application of reduced PMIERs capital factors to each non-performing loan that has an initial missed monthly payment occurring on or after March 1, 2020 and prior to April 1, 2021 and capital preservation period from March 31, 2021 to June 30, 2021.

On June 30, 2021, the GSEs issued a revised and restated version of the PMIERs Amendment that replaced the version issued on December 4, 2020.

The June 30, 2021 version allows loans that enter a forbearance plan due to a COVID-19 hardship on or after April 1, 2021 to remain eligible for extended application of the reduced PMIERs capital factor for as long as the loan remains in forbearance.

The June 30, 2021 version also imposed temporary capital preservation provisions through December 31, 2021 that required an approved insurer to meet certain PMIERs minimum required asset buffers (150% in the third quarter of 2021 and 115% in the fourth quarter of 2021) or otherwise obtain prior written GSE approval before paying any dividends, pledging or transferring assets to an affiliate or entering into any new, or altering any existing, arrangements under tax sharing and intercompany expense-sharing agreements, even if such insurer had a surplus of available assets.

For loans that became non-performing due to a COVID-19 hardship, PMIERs was temporarily amended with respect to each non-performing loan that (i) had an initial missed monthly payment occurring on or after March 1, 2020 and prior to April 1, 2021 or (ii) is subject to a forbearance plan granted in response to a financial hardship related to COVID-19, the terms of which are materially consistent with terms of forbearance plans offered by the GSEs.

The risk-based required asset amount factor for the non-performing loan is the greater of (a) the applicable risk-based required asset amount factor for a performing loan were it not delinquent, and (b) the product of a 0.30 multiplier and the applicable risk-based required asset amount factor for a non-performing loan.

During 2020 and 2021, the GSEs issued several amendments to PMIERS.

Many of the provisions are no longer applicable but for loans that became non-performing due to a COVID-19 hardship, PMIERs was temporarily amended with respect to each non-performing loan that (i) had an initial missed monthly payment occurring on or after March 1, 2020 and prior to April 1, 2021 or (ii) is subject to a forbearance plan granted in response to a financial hardship related to COVID-19, the terms of which are materially consistent with terms of forbearance plans offered by the GSEs.

applicable risk-based required asset amount factor for a non-performing loan.

In the case of (i) above, absent the loan being subject to a forbearance plan described in (ii) above, the 0.30 multiplier is applicable for no longer than three calendar months beginning with the month in which the loan became a non-performing loan due to having missed two monthly payments.

Loans subject to a forbearance plan described in (ii) above include those that are either in a repayment plan or loan modification trial period following the forbearance plan unless reported to the approved insurer that the loan is no longer in such forbearance plan, repayment plan, or loan modification trial period.

In addition, the PMIERs Amendment imposed permanent revisions to the risk-based required asset amount factor for non-performing loans for properties located in future FEMA-Declared Major Disaster Areas eligible for individual assistance.

In addition, the PMIERs Amendment made permanent revisions to the risk-based required asset amount factor for non-performing loans for properties located in future FEMA-Declared Major Disaster Areas eligible for individual assistance.

Under PMIERs, we are subject to these operational and financial requirements.

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As of December 31, 2022, we had estimated available assets of $5,206 million against $3,156 million net required assets under PMIERs compared to available assets of $5,077 million against $3,074 million net required assets as of December 31, 2021.

The sufficiency ratio as of December 31, 2021 was 165% or $2,003 million above the published PMIERs requirements, compared to 137% or $1,229 million above the published PMIERs requirements as of December 31, 2020, which was above the requirement imposed by the GSE Restrictions that require us to maintain a PMIERs sufficiency ratio of 115% in 2021.

The sufficiency ratio as of December 31, 2022 was 165% or $2,050 million above the published PMIERs requirements, compared to 165% or $2,003 million above the published PMIERs requirements as of December 31, 2021.

Sufficiency was above the requirements imposed by the GSE Restrictions that require us to maintain a PMIERs sufficiency ratio of 120% in 2022 and 115% in 2021.

For information with respect to higher PMIERs sufficiency ratios in future periods as a result of the GSE Restrictions, see “Item 1A.

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Both GSEs reserved the right to periodically review the reinsurance transactions for treatment under PMIERs.

In connection with the COVID-19 pandemic, on September 30, 2020, GMICO entered into the Master Policy Alternatives Agreement, pursuant to which GMICO agreed to temporarily waive or grant alternatives, extensions and flexibilities around various requirements included in certain policies owned by the GSEs.

The Master Policy Alternatives Agreement became effective on September 30, 2020 and was terminated on July 31, 2021.

The Master Policy Alternatives Agreement included several provisions aimed at avoiding claim denial and cancellation of coverage resulting from the COVID-19 pandemic.

In addition, pursuant to the Master Policy Alternatives Agreement, the GSEs provided monthly reports regarding which loans participate in forbearance plans granted in response to a COVID-19 hardship.

In September 2020, subsequent to the issuance of our 2025 Senior Notes, the GSEs imposed the GSE Restrictions with respect to capital on our business.

In May 2021, in connection with their conditional approval of the consummation of our IPO, the GSEs confirmed the GSE Restrictions will remain in effect until the following collective GSE Conditions are met:

(i) GMICO obtains a “BBB+”/“Baa1” (or higher) rating from Standard & Poor’s, Moody’s or Fitch for two consecutive quarters and (ii) our Parent achieves a debt leverage ratio (excluding U.S.

(i) EMICO obtains a “BBB+”/“Baa1” (or higher) rating from Standard & Poor’s, Moody’s or Fitch for two consecutive quarters and (ii) our Parent achieves a debt leverage ratio (excluding U.S.

life business equity) that is less than 25% and a cash coverage ratio that is at least 2.5 for two consecutive quarters.

Prior to the satisfaction of the GSE Conditions, the GSE Restrictions require (a) GMICO to maintain 115% of PMIERs Minimum Required Assets through 2021, 120% during 2022 and 125% thereafter, (b) the Company to retain available liquidity the greater of either 13.5% of outstanding EHI debt or $300 million of its holding company cash that can be drawn down exclusively for Company debt service or to contribute to GMICO to meet its regulatory capital needs including PMIERs and (c) prior written approval must be received from the GSEs before any additional debt issuance by either GMICO or the Company.

In addition, GMICO is not permitted to make any dividends or distributions that would cause the PMIERs Available Assets to fall below the PMIERs Minimum Required Assets percentages set forth in clause (a) above.

Prior to the satisfaction of the GSE Conditions, the GSE Restrictions require (a) EMICO to maintain 115% of PMIERs Minimum Required Assets through 2021, 120% during 2022 and 125% thereafter, (b) the Company to retain available liquidity the greater of either 13.5% of outstanding EHI debt or $300 million of its holding company cash that can be drawn down exclusively for Company debt service or to contribute to EMICO to meet its regulatory capital needs including PMIERs and (c) prior written approval must be received from the GSEs before any additional debt issuance by either EMICO or the Company.

In addition, EMICO is not permitted to make any dividends or distributions that would cause the PMIERs Available Assets to fall below the PMIERs Minimum Required Assets percentages set forth in clause (a) above.

In addition, in calculating PMIERs Available Assets relative to any dividend or distribution, PMIERs Available Assets shall be calculated consistent with the capital preservation provisions of the PMIERs Amendment, and any amendments thereto.

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However, if our Parent no longer owns directly or indirectly 50% or more of our common stock, Fannie Mae agreed to reconsider the GSE Restrictions.

In addition, in the event that the Parent were to hold less than 80% of our common stock by either voting power or value, we would cease to be a member of the Genworth Consolidated Group and may be required to make a payment to the Parent in respect of tax benefits for which we received credit under the Tax Allocation Agreement, but which had not been utilized by the Genworth Consolidated Group at such time.

In addition, in the event that the Parent were to hold less than 80% of our common

stock by either voting power or value, we would cease to be a member of the Genworth Consolidated Group and may be required to make a payment to the Parent in respect of tax benefits for which we received credit under the Tax Allocation Agreement, but which had not been utilized by the Genworth Consolidated Group at such time.

These tax benefits would be available to reduce our tax liabilities in periods after we leave the Genworth Consolidated Group, subject to any applicable limitation that may apply with respect to such period or tax benefit.

EHI maintained the requisite ratings for two consecutive quarters prior to the end of 2022.

As of December 31, 2022, Genworth believes that they achieved their financial metrics for the quarters ended September 30, 2022 and December 31, 2022.

Once confirmed by the GSEs, EHI will no longer be subject to GSE Restrictions and Conditions.

Although we expect we will continue to retain our eligibility status with the GSEs, there can be no assurance these conditions will continue.

See “Item 1A.

Risk Factors—Risks Relating to Regulatory Matters—If we are unable to continue to meet the requirements mandated by PMIERs, the GSE Restrictions and any additional restrictions imposed on us by the GSEs, we may not be eligible to write new insurance on loans acquired by the GSEs, which would have a material adverse effect on our business, results of operations and financial condition” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Trends and Conditions.”

Risk Factors—Risks Relating to Our Business—If we are unable to continue to meet the requirements mandated by PMIERs, the GSE Restrictions and any additional restrictions imposed on us by the GSEs, we may not be eligible to write new insurance on loans acquired by the GSEs, which would have a material adverse effect on our business, results of operations and financial condition” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations—Trends and Conditions.”

Other Federal Regulation

We and other private mortgage insurers are impacted by federal regulation of residential mortgage transactions with respect to mortgage originators and lenders, purchasers of mortgage loans such as Fannie Mae and Freddie Mac and governmental insurers such as the FHA and the VA.

Mortgage origination and servicing transactions are subject to compliance with various state and federal laws, including RESPA, HOPA, FCRA, the Fair Housing Act, the Truth In Lending Act, the Gramm-Leach-Bliley Act of 1999 (the “GLB Act”), the Dodd-Frank Act and others, including those discussed in this section.

Mortgage origination and servicing transactions are subject to compliance with various state and federal laws, including RESPA, HOPA, Fair Credit Reporting Act (“FCRA”), the Fair Housing Act, the Truth In Lending Act, the Gramm-Leach-Bliley Act of 1999 (the “GLB Act”), the Dodd-Frank Act and others, including those discussed in this section.

Among other things, these laws and their implementing regulations prohibit payments for referrals of settlement service business, require fairness and non-discrimination in granting or facilitating the granting of insurance, govern the circumstances under which companies may obtain and use consumer credit information, and provide for other consumer protections.

Additionally, changes in federal housing legislation and other laws and regulations that affect the demand for private mortgage insurance may have a material effect on private mortgage insurers.

For example, in December 2020, the FHFA promulgated the Enterprise Capital Framework that imposes a new capital framework on the GSEs, including risk-based and leverage capital requirements and buffers in excess of regulatory minimums that can be drawn down in periods of financial stress.

For example, in December 2020, the Federal Housing Finance Agency (“FHFA”) promulgated the Enterprise Capital Framework that imposes a new capital framework on the GSEs, including risk-based and leverage capital requirements and buffers in excess of regulatory minimums that can be drawn down in periods of financial stress.

This rule is part of the process to potentially end the conservatorships of the GSEs.

The final rule could cause the GSEs to increase their guarantee pricing in order to meet the new capital requirements.

On December 14, 2022, the SEC adopted amendments to Rule 10b5-1 under the Securities Exchange Act of 1934 and added new disclosure requirements to enhance investor protections against insider trading.

The amendments add new conditions to the availability of the affirmative defense to insider trading provided by Rule 10b5-1(c), including cooling-off periods for directors, officers and persons other than issuers.

The amendments create new disclosure requirements regarding a company’s insider trading policies and procedures and the adoption and termination (including modification) of Rule 10b5-1 and certain other trading arrangements by directors and officers.

The amendments also create new disclosure requirements for executive and director compensation regarding certain equity compensation awards granted in close proximity to a company’s disclosure of material nonpublic information.

Companies must also identify transactions made pursuant to a plan that is intended to satisfy the affirmative defense conditions of Rule 10b5-1(c).

Beneficial ownership reports filed on or after April 1, 2023 will be required to comply with the amendments and public companies will be required to comply with the new disclosure requirements in periodic reports and any proxy or information statements for full fiscal periods beginning on or after April 1, 2023.

The Real Estate Settlement Procedures Act of 1974 (“RESPA”) applies to most residential mortgages insured by private mortgage insurers.

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HOPA provides for the automatic termination, or cancellation upon a borrower’s request, of the borrower’s obligation to pay for private mortgage insurance upon satisfaction of certain conditions.

HOPA applies to owner-occupied residential mortgage loans regardless of lien priority and to borrower-paid mortgage insurance (“BPMI”) closed after July 29, 1999.

HOPA applies to owner-occupied residential mortgage loans regardless of lien priority and to borrower-paid mortgage insurance closed after July 29, 1999.

HOPA requires lenders to automatically terminate a borrower’s obligation to pay for mortgage insurance coverage once the LTV ratio reaches 78% of the original value.

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For borrower-initiated cancellation of mortgage insurance, the borrower must have a “good payment history” as defined by HOPA.

Fair Credit Reporting Act (“FCRA”) imposes restrictions on the permissible use of credit report information and requires mortgage insurance companies to provide “adverse action” notices to consumers in the event an application for mortgage insurance is declined or offered at less than the best available rate for the loan program applied for due to information contained in a consumer’s credit report.

FCRA imposes restrictions on the permissible use of credit report information and requires mortgage insurance companies to provide “adverse action” notices to consumers in the event an application for mortgage insurance is declined or offered at less than the best available rate for the loan program applied for due to information contained in a consumer’s credit report.

There has been past class action litigation over these FCRA adverse action notices involving the mortgage insurance industry, including court-approved settlements.

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Numerous courts have held that the Fair Housing Act prohibits discriminatory insurance practices.

In addition, both the Department of Justice (the “DOJ”) and the CFPB have pursued claims

under the Fair Housing Act on a disparate impact theory as well.

In addition, both the Department of Justice (the “DOJ”) and the CFPB have pursued claims under the Fair Housing Act on a disparate impact theory as well.

There has been litigation over the Fair Housing Act involving other mortgage insurers, resulting in some cases in court-approved settlements.

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The joint statement addressed flexibility around required notices from servicers and the existing requirements related to continuity of contact and reasonable diligence steps required when the forbearance ends.

This guidance could reduce claims and mitigate losses, but may also contribute to delays in foreclosure and have an adverse impact on resolution of claims with respect to the servicing of mortgage loans covered by our insurance policies.

This guidance could reduce claims and

mitigate losses but may also contribute to delays in foreclosure and have an adverse impact on resolution of claims with respect to the servicing of mortgage loans covered by our insurance policies.

The CARES Act provides financial assistance for businesses and individuals and targeted regulatory relief for financial institutions.

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The forbearance could be extended for an additional 180 days, up to a year in total, or shortened at the request of the borrower.

In addition, on February 25, 2021, the Federal Housing Finance Agency (“FHFA”) announced that borrowers with a mortgage backed by the GSEs who are in an active COVID-19 forbearance plan as of February 28, 2021 may request up to two additional forbearance extensions for a maximum of 18 months of total forbearance relief.

In addition, on February 25, 2021, the FHFA announced that borrowers with a mortgage backed by the GSEs who are in an active COVID-19 forbearance plan as of February 28, 2021 may request up to two additional forbearance extensions for a maximum of 18 months of total forbearance relief.

In addition, the CARES Act provides that furnishers of credit reporting information, including servicers, should continue to report a loan as current to credit reporting agencies if the loan is subject to a payment accommodation, such as forbearance, so long as the borrower abides by the terms of the accommodation.

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The effective date of both rules was March 1, 2021, with a mandatory compliance date for the Amended QM Rule of July 1, 2021.

On April 27, 2021, the CFPB promulgated a final rule delaying the mandatory compliance date of the Amended QM Rule until October 1, 2022 and noting that the Amended QM Rule and Seasoned QM Final Rule would be reconsidered at a later time.

On April 27, 2021, the CFPB promulgated a final rule delaying the mandatory compliance date of the Amended QM Rule until October

1, 2022 and noting that the Amended QM Rule and Seasoned QM Final Rule would be reconsidered at a later time.

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The Dodd-Frank Act separately granted statutory authority to HUD (for FHA-insured loans), the VA (for VA-guaranteed loans), the USDA and RHS to develop their own definitions of a QM in consultation with the CFPB.

The Dodd-Frank Act separately granted statutory authority to the United States Department of Housing and Urban Development (“HUD”) (for FHA-insured loans), the VA (for VA-guaranteed loans), the United States Department of Agriculture (“USDA”) and Rural Housing Service (“RHS”) to develop their own definitions of a QM in consultation with the CFPB.

In December 2013, HUD adopted a separate definition of a QM for loans insured by the FHA.

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The Dodd-Frank Act requires an originator or issuer to retain a specified percentage of the credit risk exposure on securitized mortgages that do not meet the definition of a QRM.

As required by the Dodd-Frank Act, in 2015 the Federal Banking Agencies, the FHFA, the SEC and HUD adopted a joint final rule implementing the QRM rules that aligns the definition of a QRM with that of a QM.

As required by the Dodd-Frank Act, in 2015 the Federal Banking Agencies, the FHFA, the U.S.

Securities and Exchange Commission (“SEC”) and HUD adopted a joint final rule implementing the QRM rules that aligns the definition of a QRM with that of a QM.

In December 2019, the Federal Banking Agencies initiated a review of certain provisions of the risk retention rule, including the QRM definition.

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If the QRM definition is changed in a manner that is unfavorable to us, such as to require a large down payment for a loan to qualify as a QRM, without giving consideration to mortgage insurance in computing LTV ratios, the attractiveness of originating and securitizing loans with lower down payments may be reduced, which may adversely affect the future demand for mortgage insurance.

See “Item 1A.

Risk Factors—Risks Relating to Our Business—Our business, results of operations and financial condition could be adversely impacted if, and to the extent that, the Consumer Financial Protection Bureau’s final rule defining a QM results in a reduction of the size of the origination market or creates incentives to use government mortgage insurance programs.”

In 1988, the Basel Committee developed Basel I which set out international benchmarks for assessing banks’ capital adequacy requirements.

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In December 2017, the Basel Committee published the 2017 Basel III Revisions that were generally targeted for implementation by each participating country by January 1, 2023.

In March 2020, the Basel Committee revised the target date for implementation to January 1, 2023.

Under these revisions to the international framework, banks using the standardized approach to determine their credit risk may consider mortgage insurance in calculating the exposure amount for real estate but will determine the risk-weight for residential mortgages based on the LTV ratio at loan origination, without consideration of mortgage insurance.

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Therefore, under the 2017 Basel III Revisions, mortgage insurance could not mitigate credit and lower the capital charge under the standardized approach.

It is possible that the Federal Banking Agencies could determine that their current capital rules are at least as stringent as the 2017 Basel III Revisions, in which case no change would be mandated.

It is possible that the Federal Banking Agencies could determine that their current capital rules are at least as stringent as the

2017 Basel III Revisions, in which case no change would be mandated.

However, if the Federal Banking Agencies decide to implement the 2017 Basel III Revisions as specifically drafted by the Basel Committee, mortgage insurance would not lower the LTV ratio of residential loans for capital purposes, and therefore may decrease the demand for mortgage insurance.

It remains unclear whether new guidelines will be proposed or finalized in the United States in response to the most recent 2017 Basel III Revisions.

Other Laws and Regulations

Privacy of Consumer Information and Cybersecurity

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Some states have recently enacted new privacy and information security requirements and new insurance laws that require certain regulated entities to implement and maintain comprehensive information security programs to safeguard the personal information of insureds and enrollees.

The Gramm-Leach-Bliley (“GLB”) Act and the FCRA impose privacy and information security requirements on financial institutions, including obligations to protect and safeguard consumers’ nonpublic

personal information and creditworthiness information, respectively, and limitations on the use and sharing of such information.

The GLB Act and the FCRA impose privacy and information security requirements on financial institutions, including obligations to protect and safeguard consumers’ nonpublic personal information and creditworthiness information, respectively, and limitations on the use and sharing of such information.

The GLB Act requires administrative, technical and physical safeguards to ensure the security, confidentiality, integrity and the proper disposal of nonpublic personal information, and the FCRA imposes similar information security requirements regarding the protection of creditworthiness information.

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This law became effective March 21, 2020.

All fifty states also require entities to provide notification to affected state residents and, in certain instances, state regulators, such as state attorneys general or state insurance commissions, in the event of certain security breaches affecting personal information, though some of these laws include exemptions for entities regulated by the GLB Act.

The New York Department Financial Services (“NYDFS”) published a cybersecurity regulation, which became effective on March 1, 2017, and requires all banks, insurance companies, and other financial services institutions and licensees regulated by the NYDFS, including several of our subsidiaries, to establish a cybersecurity program.

All fifty states also require entities to provide notification to affected state residents and, in certain instances, state regulators, such as state attorneys general or state insurance

commissions, in the event of certain security breaches affecting personal information, though some of these laws include exemptions for entities regulated by the GLB Act.

The NYDFS published initial cybersecurity regulation effective on March 1, 2017, which, along with subsequent guidance, requires all banks, insurance companies, and other financial services institutions and licensees regulated by the NYDFS, including several of our subsidiaries, to establish a cybersecurity program.

The NYDFS cybersecurity regulation includes specific technical safeguards as well as requirements regarding governance, incident planning, training, data management, system testing and regulator notification in the event of certain cybersecurity events.

We actively take steps to ensure that we comply with the NYDFS cybersecurity regulation.

On February 4, 2021, the NYDFS issued a circular letter announcing its Cyber Insurance Risk Framework, which describes best practices the agency recommends NYDFS-regulated insurers use to manage cyber insurance risk, including rigorously measuring insureds’ cyber risk, educating and incentivizing insureds to adopt cybersecurity measures and training employees to better understand and evaluate cyber risk.

The circular letter does not establish new legal standards, but does reflect the NYDFS’s interpretation of existing legal and regulatory requirements.

In addition, on March 2, 2021, Virginia enacted the Virginia Consumer Data Protection Act (“VCDPA”) which will become effective on January 1, 2023.

In addition, on March 2, 2021, Virginia enacted the Virginia Consumer Data Protection Act (“VCDPA”) which became effective on January 1, 2023.

The VCDPA borrows heavily from the California Consumer Privacy Act of 2018 (the “CCPA”) and the European Union General Data Protection Regulation (“EU GDPR”) and includes exemptions that may be broader than the CCPA in certain respects, including an exemption for any data or financial institution subject to the GLB Act.

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North Carolina has not adopted a version of the Insurance Data Security Model Law.

We anticipate that more states will begin adopting the Insurance Data Security Model Law, sometimes with state-specific modifications, in the near term,

although it is not yet an accreditation standard.

We anticipate that more states will begin adopting the Insurance Data Security Model Law, sometimes with state-specific modifications, in the near term, although it is not yet an accreditation standard.

The NAIC has also adopted a guidance document that sets forth twelve principles for effective insurance regulation of cybersecurity risks based on similar regulatory guidance adopted by the Securities Industry and Financial Markets Association and the “Roadmap for Cybersecurity Consumer Protections,” which describes the protections to which the NAIC believes consumers should be entitled from their insurance companies, agents and other businesses concerning the collection and maintenance of consumers’ personal information, as well as what consumers should expect when such information has been involved in a data breach.

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The CCPA requires certain companies doing business in California to disclose to California consumers information regarding the companies’ privacy practices and the privacy rights that businesses must offer to California residents to access and delete their personal information.

The CCPA’s definition of “personal information” is more expansive than those found in other privacy laws in the United States applicable to GMICO.

Failure to comply with the CCPA risks regulatory fines, and the CCPA grants a private right of action and statutory damages for an unauthorized access and exfiltration, theft, or disclosure of certain types of personal information resulting from the company’s violation of a duty to maintain reasonable security procedures and practices.

The CCPA also provides authority to the California Attorney General to seek civil penalties for intentional violations of the CCPA.

The California Attorney General began enforcement of the CCPA on July 1, 2020.

On June 1, 2020, the California Attorney General filed proposed final regulations for review and approval by California’s Office of Administrative Law (“OAL”).

On August 14, 2020, the California Attorney General announced that OAL had approved, and provided additional regulations to, the proposed final regulations.

Therefore, as of August 14, 2020, the California Attorney General’s regulations are finalized and enforceable by the California Attorney General, subject to any legal challenges.

On December 10, 2020, the California Attorney General proposed modifications to the regulations that went into effect on August 14, 2020.

The abbreviated comment period for these proposed modifications closed on December 28, 2020.

Following the closure of the public comment period, the California Attorney General submitted the regulations for approval by the OAL, which granted approval for the modified regulations on March 15, 2021.

The CCPA includes a number of limited exceptions, including an exception for data that is collected, processed, sold, or disclosed pursuant to the GLB Act.

This exception, however, does not apply to the private cause of action afforded to individuals for information security incidents.

The CCPA was amended by popular referendum due to a new ballot initiative, the California Privacy Rights Act (“CPRA”), which was included on the November 2020 ballot in California and approved by California voters.

The majority of CPRA provisions will go into effect on January 1, 2023.

In the interim, the CPRA will require additional investment in compliance programs and potential modifications to business processes.

In particular, the CPRA will create a California data protection agency to enforce the statute and will impose new requirements relating to additional consumer rights, data minimization and other obligations.

The CPRA also extends certain exemptions under the CCPA through December 31, 2022.

Specifically, the CCPA exempts from its requirements certain information collected in employment or business-to-business contexts.

As noted above, state governments, Congress and agencies may consider and enact additional legislation or promulgate regulations governing privacy, cybersecurity and data breach reporting requirements.

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Available Information

Our Annual Report on Form 10-K, Quarterly Reports on Form 10-Q, Current Reports on Form 8-K and amendments to those reports filed or furnished pursuant to Section 13(a) or 15(d) of the Exchange Act are available, without charge, on our website, www.enactmi.com, as soon as reasonably practicable

after we file or furnish such reports with the SEC.

The public may read and copy any electronic materials we file or furnish with the SEC at the SEC’s website, www.sec.gov.

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Compared sentence by sentence after normalising whitespace, quotation marks, case and digits, so re-formatting and restated figures do not read as changed language. Wording changes appear as one removal and one addition. The current filing and the prior one are authoritative.

What changed 10-K

Item 1. Business