What changed in this filing

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Item 8. Financial Statements and Supplementary Data

2026-02-12 compared with 2025-02-14 · 288 added, 287 removed, 940 unchanged (38% of the section changed)

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PCAOB ID# 243 )

Consolidated Balance Sheets as of December 31, 2024 and 2023

Consolidated Statements of Operations and Comprehensive Income for each of the years in the three-year period ended December 31, 2024

Consolidated Statements of Changes in Shareholders' Equity for each of the years in the three-year period ended December 31, 2024

Consolidated Statements of Cash Flows for each of the years in the three-year period ended December 31, 2024

Consolidated Balance Sheets

Consolidated Statements of Operations and Comprehensive Income

Consolidated Statements of Changes in Shareholders' Equity

Consolidated Statements of Cash Flows

Notes to Consolidated Financial Statements 87

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We have audited the accompanying consolidated balance sheets of NMI Holdings, Inc.

(the “Company”) as of December 31, 2024 and 2023, the related consolidated statements of operations and comprehensive income, changes in shareholders’ equity, and cash flows for each of the three years in the period ended December 31, 2024, and the related notes and financial statements schedules listed in the accompanying index appearing under Part IV, Item 15 – Exhibits and Financial Statement Schedules (collectively referred to as the “consolidated financial statements”).

(the “Company”) as of December 31, 2025 and 2024, the related consolidated statements of operations and comprehensive income, changes in shareholders’ equity, and cash flows for each of the three years in the period ended December 31, 2025, and the related notes and financial statement schedules listed in the accompanying index appearing under Part IV, Item 15 – Exhibits and Financial Statement Schedules (collectively referred to as the “consolidated financial statements”).

In our opinion, the consolidated financial statements present fairly, in all material respects, the financial position of the Company at December 31, 2025 and 2024, and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2025, in conformity with accounting principles generally accepted in the United States of America.

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The primary procedures we performed to address this critical audit matter included:

• Testing the design and effectiveness of certain internal controls related to the Company’s valuation of reserve for insurance claims, including automated application controls over the source data utilized in the development of significant assumptions.

• Testing the design and operating effectiveness of certain internal controls related to the Company’s valuation of reserve for insurance claims, including automated application controls over the source data utilized in the development of significant assumptions.

• Testing a sample of the underlying loans and claims data used in management’s insurance claims reserve calculations, which supported estimates of claim frequency and claim severity, by agreeing key characteristics, of the underlying loans and claims data to source documents and data provided by third party loan servicers.

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Assets (In Thousands, except for share data)

Fixed maturities, available-for-sale, at fair value (amortized cost of $ 2,876,343 and $ 2,542,862 as of December 31, 2024 and December 31, 2023, respectively)

Fixed maturities, available-for-sale, at fair value (amortized cost of $ 3,190,174 and $ 2,876,343 )

$ 3,137,023 $ 2,723,541

Cash and cash equivalents (including restricted cash of $ 90 and $ 1,338 as of December 31, 2024 and December 31, 2023, respectively)

Cash and cash equivalents (including restricted cash of $ 0 and $ 90 )

43,937 54,308

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Total revenues 706,440 650,971 579,003

Insurance claims and claim expenses (benefits) 31,544 22,618 ( 3,594 )

Insurance claims and claim expenses 57,649 31,544 22,618

Underwriting and operating expenses 119,908 118,397 110,699

1 unchanged sentence

Interest expense 28,478 36,896 32,212

Gain from change in fair value of warrant liability — — ( 1,113 )

Total expenses 206,636 187,560 166,300

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Net income $ 388,926 $ 360,106 $ 322,110

Other comprehensive income (loss), net of tax:

Unrealized gains (losses) in accumulated other comprehensive loss, net of tax expense (benefit) of $ 3,921 , $ 17,113 and $( 54,608 ) for each of the years in the three-year period ended December 31, 2024, respectively

Other comprehensive income, net of tax:

Unrealized gains in accumulated other comprehensive loss, net of tax expense of $ 20,995 , $ 3,921 and $ 17,113 for each of the years in the three-year period ended December 31, 2025, respectively

78,983 15,113 64,380

Reclassification adjustment for realized losses (gains) included in net income, net of tax (benefit) expense of $ 0 , $( 7 ) and $ 101 for each of the years in the three-years ended December 31, 2024, respectively

Other comprehensive income (loss), net of tax

Reclassification adjustment for realized (gains) losses included in net income, net of tax expense (benefit) of $ 69 , $ 0 and $( 7 ) for each of the years in the three-years ended December 31, 2025, respectively

Other comprehensive income, net of tax

78,721 15,113 64,406

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Common stock:

shares issued related to warrant exercises 84 1 1,767 — — — 1,768

Common stock:

shares issued under stock plans, net of shares withheld for employee taxes 861 8 1,185 — — — 1,193

1 unchanged sentence

Share-based compensation expense — — 16,914 — — — 16,914

Change in unrealized investment gains/losses, net of tax benefit of $ 54,709

Change in unrealized investment gains/losses, net of tax expense of $ 17,120

— — — — 64,406 — 64,406

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Adjustments to reconcile net income to net cash provided by operating activities:

Net realized investment (gains) loss

Net realized investment (gains) losses

( 432 ) ( 23 ) 33

Gain from change in fair value of warrant liability — — ( 1,113 )

Depreciation and amortization 11,260 11,936 11,541

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285,380 205,241 143,613

Proceeds from sales of fixed-maturity investments, available-for-sale

Additions to software and equipment

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Proceeds from issuance of common stock related to employee equity plans 2,875 4,290 10,549

Proceeds from issuance of common stock related to warrant exercises — — 518

Taxes paid related to net share settlement of equity awards ( 10,980 ) ( 10,219 ) ( 9,356 )

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Interest paid $ 31,450 $ 14,013 $ 29,500

Income taxes paid (refunded)

Income taxes paid

42,362 20,027 20

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(GAAP) and our accounts are maintained in U.S.

Certain prior year amounts on our consolidated balance sheet have been reclassified to conform with our current period presentation.

Summary of Accounting Principles

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For the years ended December 31, 2025, 2024 and 2023, no customer accounted for more than 10% of our consolidated revenues.

At December 31, 2024, 2023 and 2022 approximately 10 %, 10 % and 11 %, respectively, of our total risk-in-force (RIF) was concentrated in California.

At December 31, 2025, 2024 and 2023 approximately 10 % of our total risk-in-force (RIF) was concentrated in California.

Reserves for Insurance Claims and Claim Expenses

We establish reserves for claims based on our best estimate of the ultimate claim costs for defaulted loans using the general principles contained in ASC 944, Financial Services - Insurance (ASC 944).

We establish reserves for claims based on our best estimate of the ultimate claim costs for defaulted loans.

A loan is considered to be in “default” as of the payment date at which a borrower has missed the preceding two or more consecutive monthly payments.

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, not associated with a specific claim).

The establishment of claims and claim expense reserves is subject to inherent uncertainty and requires significant judgment by management.

Reserves are established by estimating the number of loans in default that will result in a claim

NMI HOLDINGS, INC.

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DECEMBER 31, 2025

The establishment of claims and claim expense reserves is subject to inherent uncertainty and requires significant judgment by management.

Reserves are established by estimating the number of loans in default that will result in a claim payment, which is referred to as claim frequency, and the amount of claim payment expected to be paid on each such loan in default, which is referred to as claim severity.

payment, which is referred to as claim frequency, and the amount of claim payment expected to be paid on each such loan in default, which is referred to as claim severity.

Claim frequency and severity estimates are established based on historical observed experience regarding certain loan factors, such as age of the default, size of the loan and loan-to-value (LTV) ratios, and are strongly influenced by assumptions about the path of certain economic factors, such as house price appreciation, trends in unemployment and mortgage rates.

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Net investment income is recognized when earned, and includes interest and dividend income together with amortization of market premiums and discounts using the effective yield method, and is net of investment management fees and other investment-related expenses.

For asset-backed securities and any other holdings for which there is a prepayment risk, prepayment assumptions are evaluated and revised as necessary.

For asset-backed securities, mortgage-backed securities, and any other holdings for which there is a prepayment risk, prepayment assumptions are evaluated and revised as necessary.

Any adjustments required due to changes in effective yields and prepayment assumptions are recognized on a prospective basis.

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We account for premiums ceded or otherwise paid to reinsurers as a reduction to premium revenue.

NMIC entered into quota share reinsurance treaties effective September 1, 2016 and as modified April 1, 2019 (the 2016 QSR Transaction), January 1, 2018 (the 2018 QSR Transaction), April 1, 2020 and as amended January 1, 2024 (the 2020 QSR Transaction), January 1, 2021 (the 2021 QSR Transaction), October 1, 2021 (the 2022 QSR Transaction), July 1, 2022 (the 2022 Seasoned QSR Transaction), January 1, 2023 (the 2023 QSR Transaction), and January 1, 2024 (the 2024 QSR Transaction), which we refer to collectively as the QSR Transactions.

We earn profit and ceding commissions in connection with the QSR Transactions (see Note 6, “ Reinsurance” ).

NMIC entered into quota share reinsurance treaties effective January 1, 2018 (the 2018 QSR Transaction), April 1, 2020 (the 2020 QSR Transaction), January 1, 2021 (the 2021 QSR Transaction), October 1, 2021 (the 2022 QSR Transaction), July 1, 2022 (the 2022 Seasoned QSR Transaction), January 1, 2023 (the 2023 QSR Transaction), January 1, 2024 (the 2024 QSR Transaction), and January 1, 2025 (the 2025 QSR Transaction), which we refer to collectively as the QSR Transactions.

We earn profit and ceding commissions in connection with the QSR Transactions.

Profit commissions represent a percentage of the profits recognized by reinsurers that are returned to us, based on the level of claims and claim expenses that we cede.

Ceded claims and claim expenses reduce the profit commission due to NMIC under each respective QSR Transaction on a dollar-for-dollar basis.

We recognize any profit commissions we earn as a decrease to ceded earned premiums.

Ceding commissions are calculated as a percentage of ceded written premiums under the 2016 QSR Transaction or as a percentage of ceded earned premiums under the 2018, 2020, 2021, 2022, 2022 Seasoned, 2023 and 2024 QSR Transactions, and are intended to cover our costs of acquiring and servicing direct policies.

Ceding commissions are calculated as a percentage of ceded earned premiums and are intended to cover our costs of acquiring and servicing direct policies.

We recognize any ceding commissions generated under the QSR Transactions in a manner consistent with our recognition of earnings on the underlying reinsured policies.

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Under the QSR Transactions, we cede a portion of claims and claim expenses and reserves to our reinsurers, and account for such ceded reserves as “ Reinsurance Recoverables” on the consolidated balance sheets and such ceded expenses as reductions to claims and claim expenses on the consolidated statements of operations.

As of December 31, 2024 and 2023, we had $ 32.3 million and $ 27.5 million, respectively, of reinsurance recoverables under the QSR Transactions.

We remain directly liable for all claim payments if we are unable to collect the recoverables due from our reinsurers and, as such, we actively monitor and manage our counterparty credit exposure to our reinsurance providers.

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(special purpose reinsurance entities collectively referred to as the Oaktown Re Vehicles) effective April 27, 2021 and October 26, 2021, respectively.

At inception of the respective reinsurance agreements, we determined that each of the Oaktown Re Vehicles was a variable interest entity (VIE), as defined under GAAP Accounting Standards Codification (ASC) 810, because they did not have sufficient equity at risk to finance their respective activities.

At inception of the respective reinsurance agreements, we determined that Oaktown Re VI Ltd.

and Oaktown Re VII Ltd.

were variable interest entities (VIEs), because they did not have sufficient equity at risk to finance their respective activities.

We evaluated the VIEs at inception to determine whether NMIC was the primary beneficiary under each deal and, if so, whether we were required to consolidate the assets and liabilities of each VIE.

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See Note 6, “ Reinsurance” for further discussion of the reinsurance arrangements.

We account for income taxes using the liability method in accordance with ASC Topic 740, Income Taxes .

We account for income taxes using the liability method.

The liability method measures the expected future tax effects of temporary differences at the enacted tax rates applicable for the period in which the deferred asset or liability is expected to be realized or settled.

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Share-Based Compensation

We account for stock compensation in accordance with ASC 718, Compensation - Stock Compensation , measuring awards using grant date fair value and recognizing the associated compensation expense over the requisite service or performance period of the award.

Share-based compensation includes restricted stock units (RSUs) and stock option grants under our stock incentive plans.

We calculate the fair value of stock option grants using a Black-Scholes option pricing model, which takes into account various subjective assumptions.

Key assumptions used in the model include the expected volatility of our stock price, dividend yield and the risk-free interest rate, as well as the expected option term, giving consideration to the contractual terms of any award.

We account for stock compensation awards using grant date fair value and recognize the associated compensation expense over the requisite service or performance period of the award.

Share-based compensation includes restricted stock units (RSUs).

We use the simplified method to estimate expected option term during the period as sufficient historical exercise data is not available.

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Basic earnings per share is based on the weighted average number of common shares outstanding.

Diluted earnings per share is based on the weighted average number of common shares outstanding and common share equivalents that would be issuable upon the vesting of existing service-based and certain performance and service-based RSUs, and exercise of vested and unvested stock options and outstanding warrants.

Diluted earnings per share is based on the weighted average number of common shares outstanding and common share equivalents that would be issuable upon the vesting of existing service-based and performance and service-based RSUs, and exercise of vested and unvested stock options.

Common share equivalents are excluded from EPS computations in the periods in which they have an anti-dilutive effect.

NMI HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2024

Share Repurchases

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We consider items such as U.S.

Treasury Bills, certificates of deposit and money market funds with original maturities of 90 days or less to be cash equivalents.

Treasury Bills, certificates of deposit and money market funds with original maturities when purchased of 90 days or less to be cash equivalents.

NMI HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2025

Software and Equipment

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Goodwill represents the excess of the purchase price over the estimated fair value of net assets acquired from a business combination.

In accordance with ASC 350, Intangibles – Goodwill and Other , we test goodwill for impairment annually or more frequently if we believe indicators of impairment exist.

We test goodwill for impairment annually or more frequently if we believe indicators of impairment exist.

We have no t identified any impairments of goodwill through December 31, 2025.

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Other Revenues

Other revenues represent underwriting fee revenue from our subsidiary, NMIS, which provides outsourced loan review

Other revenues represent underwriting fee revenue from our subsidiary, NMIS, which provides outsourced loan review services to mortgage loan originators.

NMIS fees are earned and recognized as services are provided, with cash payments typically received one month after billing.

NMI HOLDINGS, INC.

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DECEMBER 31, 2025

services to mortgage loan originators.

NMIS fees are earned and recognized as services are provided, with cash payments typically received one month after billing.

Recent Accounting Pronouncements – Adopted

In November 2023, the FASB issued ASU 2023-07, Segment Reporting (Topic 280).

The update expands annual and interim disclosure requirements for reportable segments, primarily through enhanced disclosures about significant segment expenses.

The standard took effect for all public business entities, including those that have only a single reportable segment for fiscal years beginning after December 15, 2023.

We adopted this ASU on December 31, 2024 and have included Note 9, “ Segment Reporting ” herein in accordance with the new requirements.

On January 1 2025, we adopted ASU 2023-09, Income Taxes (Topic 740) on a retrospective basis.

The update enhances the disclosure requirements related to tax rate reconciliations and income taxes paid and did not have any effect on our consolidated statement of operations and comprehensive income or consolidated balance sheets.

See Note 11, “ Income Taxes” for more information.

Recent Accounting Pronouncements – Not Yet Adopted

In December 2023, the FASB issued ASU 2023-09, Income Taxes (Topic 740).

The update enhances the disclosure requirements related to tax rate reconciliations and income taxes paid.

The standard will take effect for all public business entities for annual reporting periods beginning after December 15, 2024.

We adopted this ASU on January 1, 2025 and will include enhanced disclosures in our fiscal year-end 2025 annual consolidated financial statements, as applicable.

In November 2024, the FASB issued ASU 2024-03, Disaggregation of Income Statement Expense (Topic 220).

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We are currently evaluating the impact the adoption of this ASU will have, if any, on our consolidated financial statements.

In September 2025, the FASB issued ASU 2025-06, Targeted Accounting for Internal-Use Software (Topic 350).

The update clarifies the criteria surrounding the capitalization of certain costs and expands related disclosure requirements.

The standard will take effect for all public business entities for annual reporting periods beginning after December 15, 2027, and interim reporting periods within those annual reporting periods.

Early adoption is permitted.

We are currently evaluating the impact the adoption of this ASU will have, if any, on our consolidated financial statements.

In December 2025, the FASB issued ASU 2025-11, Improving Interim Reporting Guidance (Topic 270).

The update establishes a principle that requires entities to disclose material events that have occurred since the end of the last annual reporting period and further clarifies interim disclosure requirements.

The standard will take effect for all public business entities for interim reporting periods beginning after December 15, 2027.

Early adoption is permitted.

We are currently evaluating the impact the adoption of this ASU will have, if any, on our consolidated financial statements.

We hold all investments on an available-for-sale basis at fair value on our consolidated balance sheets and evaluate each position quarterly for impairment.

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Asset-backed securities 72,774 — ( 2,649 ) 70,125

agency mortgage-backed securities (1)

42,109 10 ( 48 ) 42,071

Total bonds 3,103,569 33,110 ( 86,275 ) 3,050,404

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Total investments $ 3,190,174 $ 33,125 $ ( 86,276 ) $ 3,137,023

(1) 100% of our U.S.

agency mortgage-backed securities are guaranteed by Ginnie Mae which has the full faith and credit of the U.S.

federal government.

NMI HOLDINGS, INC.

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Total investments $ 2,876,343 $ 5,820 $ ( 158,622 ) $ 2,723,541

We did not own any mortgage-backed securities in our asset-backed securities portfolio at December 31, 2024 or 2023.

We did not own any mortgage-backed securities in our portfolio at December 31, 2024.

The following table presents a breakdown of the fair value of our corporate debt securities by issuer industry group as of December 31, 2025 and 2024:

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Industrial 9 9

Communications

Technology 6 7

Communications

Basic Materials

Total 100 % 100 %

As of both December 31, 2024 and 2023, approximately $ 5.3 million of our cash and investments were held in the form of U.S.

As of December 31, 2025 and 2024, approximately $ 5.4 million and $ 5.3 million, respectively, of our cash and investments were held in the form of U.S.

Treasury securities on deposit with various state insurance departments to satisfy regulatory requirements.

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Expected maturities will differ from contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties.

Because most asset-backed securities provide for periodic payments throughout their lives, they are listed below in a separate category.

Because most asset-backed securities and U.S.

agency mortgage-backed securities provide for periodic payments throughout their lives, they are listed below in a separate category.

NMI HOLDINGS, INC.

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Asset-backed securities 72,774 70,125

agency mortgage-backed securities 42,109 42,071

Total investments $ 3,190,174 $ 3,137,023

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Asset-backed securities 7 33,836 ( 53 ) 16 36,289 ( 2,596 ) 23 70,125 ( 2,649 )

agency mortgage-backed securities 2 27,109 ( 48 ) — — — 2 27,109 ( 48 )

Short-term investments 1 24,778 ( 1 ) — — — 1 24,778 ( 1 )

Total 34 $ 333,331 $ ( 1,984 ) 395 $ 1,351,427 $ ( 84,292 ) 429 $ 1,684,758 $ ( 86,276 )

* Amounts not identifiable due to rounding.

NMI HOLDINGS, INC.

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Total 98 $ 486,314 $ ( 7,848 ) 474 $ 1,578,701 $ ( 150,774 ) 572 $ 2,065,015 $ ( 158,622 )

* Amounts not identifiable due to rounding.

Allowance for Credit Losses

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DECEMBER 31, 2025

The following tables present the level within the fair value hierarchy at which our financial instruments were measured:

The following tables present our financial instruments that are measured at fair value on a recurring basis by hierarchy level:

Fair Value Measurements Using

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Asset-backed securities — 70,125 — 70,125

agency mortgage-backed securities — 42,071 — 42,071

Cash, cash equivalents and short-term investments 130,556 — — 130,556

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Proceeds from the 2024 Notes offering were primarily used to repay our then-outstanding $ 400 million senior secured notes (the 2020 Notes).

At December 31, 2024, the 2024 Notes were carried at a cost of $ 415.1 million, net of unamortized debt issuance costs and an original issue discount totaling $ 9.9 million, and had a fair value of $ 429.6 million as assessed under our Level 2 hierarchy.

At December 31, 2023, the 2020 Notes were carried at a cost of $ 397.6 million, net of unamortized debt issuance costs of $ 2.4 million, and had a fair value of $ 401.9 million.

At December 31, 2025, the 2024 Notes were carried at an amortized cost of $ 417.0 million, net of unamortized debt issuance costs and an original issue discount totaling $ 8.0 million, and had a fair value of $ 441.3 million as assessed under our Level 2 hierarchy.

At December 31, 2024 the 2024 Notes were carried at an amortized cost of $ 415.1 million, net of unamortized debt issuance costs and an original issue discount totaling $ 9.9 million, and had a fair value of $ 429.6 million .

NMI HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2025

Senior Unsecured Notes

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The 2024 Notes were issued pursuant to an indenture, dated May 21, 2024, and bear interest at a rate of 6.00 %, payable semi-annually on February 15 and August 15.

Proceeds from the 2024 Notes offering were primarily used to repay the $ 400 million aggregate principal amount outstanding and associated amounts due on the redemption of the 2020 Notes.

Remaining proceeds are available for general corporate purposes.

The 2024 Notes mature on August 15, 2029.

We may elect to redeem the 2024 Notes in whole or in part at any time prior to July 15, 2029 at a price equal to the greater of (1) the aggregate principal balance outstanding plus the present value of all future interest payments due through July 15, 2029, and (2) the aggregate principal balance due plus any accrued and unpaid

NMI HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2024

We may elect to redeem the 2024 Notes in whole or in part at any time on or after July 15, 2029 at a price equal to 100 % of the aggregate principal amount of the 2024 Notes to be redeemed plus accrued and unpaid interest thereon.

In connection with the 2024 Notes offering, we recorded capitalized debt issuance costs and an original issue discount of $ 10.9 million.

Such amounts will be amortized over the contractual life of the 2024 Notes using the effective interest method.

Such amount will be amortized over the contractual life of the 2024 Notes using the effective interest method and included in interest expense.

The effective interest rate on the 2024 Notes is 6.583 %.

At December 31, 2024, $ 9.9 million of unamortized debt issuance costs and original issue discounts remained.

At December 31 2023, $ 2.4 million of unamortized debt issuance costs remained related to the 2020 Notes.

At December 31, 2025 and 2024, $ 8.0 million and $ 9.9 million, respectively, of unamortized debt issuance costs and original issue discount remained.

At December 31, 2025 and 2024, $ 9.6 million and $ 15.6 million, respectively, of accrued and unpaid interest on the 2024 Notes was included in “ Accounts Payable and Accrued Expenses ” on our consolidated balance sheets.

During the twelve months ended December 31, 2024, we recorded a $ 6.8 million loss related to the redemption of the 2020 Notes in “ Interest Expense” on our consolidated statements of operations and comprehensive income.

At December 31, 2024 and 2023, $ 15.6 million and $ 2.5 million, respectively, of accrued and unpaid interest was included in “ Accounts Payable and Accrued Expenses ” on our consolidated balance sheets.

Revolving Credit Facility

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Borrowings under the 2024 Revolving Credit Facility may be used for general corporate purposes, including to support growth, new business production and operations, and accrue interest at a variable rate equal to, at our discretion, (i) a Base Rate (as defined in the 2024 Revolving Credit Facility) subject to a floor of 1.00 % per annum plus a margin of 0.375 % to 1.875 % per annum, or (ii) the Adjusted Term Secured Overnight Financing Rate (as defined in the 2024 Revolving Credit Facility) plus a margin of 1.375 % to 2.875 % per annum, with the margin in each of (i) or (ii) based on our applicable corporate credit rating at the time.

As of December 31, 2024 and 2023, no amounts were drawn under the 2024 or 2021 Revolving Credit Facilities, respectively.

As of December 31, 2025 and 2024, no amounts were drawn under the 2024 Revolving Credit Facility.

Under the 2024 Revolving Credit Facility, we are required to pay a quarterly commitment fee on the average daily undrawn amount of 0.175 % to 0.525 %, based on the applicable corporate credit rating at the time.

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Combined unamortized debt issuance costs are amortized through interest expense on a straight-line basis over the contractual life of the 2024 Revolving Credit Facility.

At December 31, 2024 and 2023, unamortized deferred debt issuance costs of $ 2.3 million and $ 0.8 million, respectively, were recorded in “Other Assets” on our consolidated balance sheets.

At December 31, 2025 and 2024, remaining unamortized deferred debt issuance costs of $ 1.8 million and $ 2.3 million, respectively, were recorded in “Other Assets” on our consolidated balance sheets.

Under the 2024 Revolving Credit Facility we are subject to certain covenants, including a maximum debt-to-total capitalization ratio of 35 %, a minimum consolidated net worth requirement (as defined therein), and a requirement to maintain compliance with the financial standards prescribed by the private mortgage insurer eligibility requirements (PMIERs).

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(1) Net of profit commission.

Excess-of-loss Reinsurance

Insurance-Linked Notes

NMIC is a party to reinsurance agreements with Oaktown Re VI Ltd.

and Oaktown Re VII Ltd.

(special purpose reinsurance entities collectively referred to as the Oaktown Re Vehicles) effective April 27, 2021 and October 26, 2021, respectively.

Each agreement provides NMIC with aggregate excess-of-loss reinsurance coverage on a defined portfolio of mortgage insurance policies.

Under each agreement, NMIC retains a first layer of aggregate loss exposure on covered policies and the respective Oaktown Re Vehicle then provides second layer loss protection up to a defined reinsurance coverage amount.

NMIC then retains losses in excess of the respective reinsurance coverage amounts.

NMIC makes risk premium payments to the Oaktown Re Vehicles for the applicable outstanding reinsurance coverage amount and pays an additional amount for anticipated operating expenses (capped at $ 250 thousand per year).

NMIC ceded aggregate premiums to the Oaktown Re Vehicles of $ 20.4 million, $ 31.1 million and $ 41.9 million during the years ended December 31, 2024, 2023 and 2022, respectively.

NMIC applies claims paid on covered policies against its first layer aggregate retained loss exposure under each excess-of-loss agreement.

NMIC did not cede any incurred losses on covered policies to the Oaktown Re Vehicles during the years ended December 31, 2024, 2023 and 2022, as the aggregate first layer risk retention for each applicable agreement was not exhausted during such periods.

Under the terms of each excess-of-loss reinsurance agreement, the Oaktown Re Vehicles are required to fully collateralize their outstanding reinsurance coverage amount to NMIC with funds deposited into segregated reinsurance trusts.

Such trust funds are required to be invested in short-term U.S.

Treasury money market funds at all times.

Each Oaktown Re Vehicle financed its respective collateral requirement through the issuance of mortgage insurance-linked notes to unaffiliated investors.

Such insurance-linked notes mature 12.5 years from the inception date of their associated reinsurance agreement.

We refer to NMIC’s reinsurance agreements with and the insurance-linked note issuances by Oaktown Re Vehicles individually as the 2021-1 ILN Transaction and 2021-2 ILN Transaction, and collectively as the ILN Transactions.

The respective reinsurance coverage amounts provided by the Oaktown Re Vehicles decrease over a 12.5-year period as the underlying insured mortgages are amortized or repaid, and/or the mortgage insurance coverage is canceled.

As the reinsurance coverage decreases, a prescribed amount of collateral held in trust by the Oaktown Re Vehicles is distributed to ILN Transaction noteholders as amortization of the outstanding insurance-linked note principal balances.

The outstanding reinsurance coverage amounts stop amortizing, and the distribution of collateral assets to ILN Transaction noteholders and amortization of insurance-linked note principal is suspended if certain credit enhancement or delinquency thresholds, as defined in each agreement, are triggered (each, a Lock-Out Event).

NMIC holds optional termination rights under each ILN Transaction, including, among others, an optional call feature which provides NMIC the discretion to terminate the transaction on or after a prescribed date, and a clean-up call if the outstanding reinsurance coverage amount amortizes to 10 % or less of the reinsurance coverage amount at inception or if NMIC reasonably determines that changes to GSE or rating agency asset requirements would cause a material and adverse effect on the

Quota Share Reinsurance

NMIC is party to eight quota share reinsurance treaties – the 2018 QSR Transaction, effective January 1, 2018, the 2020 QSR Transaction, effective April 1, 2020, the 2021 QSR Transaction, effective January 1, 2021, the 2022 QSR Transaction, effective October 1, 2021, the 2022 Seasoned QSR Transaction, effective July 1, 2022, the 2023 QSR Transaction, effective January 1, 2023, the 2024 QSR Transaction, effective January 1, 2024, and the 2025 QSR Transaction, effective January 1, 2025 – which we refer to collectively as the QSR Transactions.

Under each of the QSR Transactions, NMIC cedes a proportional share of its risk on eligible policies to panels of third-party reinsurance providers in exchange for reimbursement of ceded claims and claim expenses on covered policies, a ceding commission and a profit commission (up to a contractually-defined maximum) that varies directly and inversely with ceded claims.

NMIC may terminate any or all of the QSR Transactions without penalty if, due to a change in PMIERs requirements, it is no longer able to take full PMIERs asset credit for the RIF ceded under the respective agreements.

Additionally, under the terms of the QSR Transactions, NMIC may elect to selectively terminate its engagement with individual reinsurers on a run-off basis ( i.e.

, reinsurers continue providing coverage on all risk ceded prior to the termination date, with no new cessions going forward) or cut-off basis ( i.e.

, the reinsurance arrangement is completely terminated with NMIC recapturing all previously ceded risk) under certain circumstances.

Such selective termination rights arise when, among other reasons, a reinsurer experiences a deterioration in its capital position below a prescribed threshold and/or a reinsurer breaches (and fails to cure) its collateral posting obligations under the relevant agreement.

Each of the third-party reinsurance providers that is party to the QSR Transactions has an insurer financial strength rating of A- or better by S&P, A.M.

Best or both.

NMI HOLDINGS, INC.

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DECEMBER 31, 2025

capital treatment afforded to NMIC under a given agreement.

In addition, there are certain events that trigger mandatory termination of an agreement, including NMIC's failure to pay premiums or consent to reductions in a trust account to make principal payments to noteholders, among others.

Effective July 25, 2024 and December 27, 2024, NMIC exercised its optional termination rights to terminate its previously outstanding reinsurance agreements with and associated insurance-linked notes issued by Oaktown Re III Ltd.

and by Oaktown Re V Ltd., respectively.

In connection with the terminations, NMIC's excess of loss reinsurance agreements with Oaktown Re III Ltd.

and Oaktown Re V Ltd.

were commuted and the insurance-linked notes issued by Oaktown Re III Ltd.

and Oaktown Re V Ltd.

were redeemed in full with a distribution of remaining collateral assets.

The following table presents the inception date, covered production period, initial and current reinsurance coverage amount, and initial and current first layer retained aggregate loss under each outstanding ILN Transaction.

The following table presents the inception date, covered production period, contractual and optional termination dates, current cession rate, ceding commission and profit commission for each outstanding QSR Transaction.

Current amounts are presented as of December 31, 2025.

( $ values in thousands)

Inception Date Covered Production Initial Reinsurance Coverage Current Reinsurance Coverage Initial First Layer Retained Loss Current First Layer Retained Loss (1)

2021-1 ILN Transaction April 27, 2021 10/1/2020 – 3/31/2021 (2)

Inception Date

Covered Production

Contractual Termination Date

Optional Termination Date

Ceding Percentage

Ceding Commission

Profit Commission

2018 QSR 1/1/2018 1/1/2018 – 12/31/2018

1/1/2019 – 12/31/2019

2021-2 ILN Transaction October 26, 2021 4/1/2021 – 9/30/2021 (3)

12/31/2029 12/31/2022 (1)

(1) NMIC applies claims paid on covered policies against its first layer aggregate retained loss exposure and cedes reserves for incurred claims and claim expenses to each applicable ILN Transaction and recognizes a reinsurance recoverable if such incurred claims and claim expenses exceed its current first layer retained loss.

(2) Approximately 1 % of the production covered by the 2021-1 ILN Transaction has coverage reporting dates between July 1, 2019 and September 30, 2020.

(3) Approximately 2 % of the production covered by the 2021-2 ILN Transaction has coverage reporting dates between July 1, 2019 and March 31, 2021.

Under the terms of our ILN Transactions, we are required to maintain a certain level of restricted funds in premium deposit accounts with Bank of New York Mellon until the respective notes have been redeemed in full.

“ Cash and Cash Equivalents ” on our consolidated balance sheets includes restricted amounts of $ 0.1 million and $ 1.3 million as of December 31, 2024 and 2023, respectively.

The restricted balances required under these transactions will decline over time as the outstanding principal balance of the respective insurance-linked notes are amortized.

2020 QSR 4/1/2020 4/1/2020 – 12/31/2020 12/31/2030 12/31/2025 (1)

2021 QSR 1/1/2021 1/1/2021 – 10/30/2021 12/31/2031 12/31/2024 (1)

20 % 35 % up to 54 %

2022 QSR 10/1/2021 10/30/2021 – 12/31/2022 12/31/2032 12/31/2024 (2)

20 % 20 % up to 62 %

2022 Seasoned QSR 7/1/2022 1/1/2013 – 12/31/2016

7/1/2019 –3/31/2020

6/30/2032 6/30/2025 (3)

2023 QSR 1/1/2023 1/1/2023 – 12/31/2023 12/31/2033 12/31/2025 (2)

20 % 20 % up to 62 %

2024 QSR 1/1/2024 1/1/2024 – 12/31/2024 12/31/2034 12/31/2027 (1)

20 % 20 % up to 56 %

2025 QSR 1/1/2025 1/1/2025 – 12/31/2025 12/31/2035 12/31/2027 (4)

20 % 20 % up to 62 %

(1) NMIC has the option, based on certain conditions and subject to a termination fee, to terminate the agreement as of the optional termination date, or at the end of any calendar quarter thereafter which could result in NMIC recapturing the related risk.

(2) NMIC has the option, based on certain conditions and subject to a termination fee, to terminate the agreement as of the optional termination, or semi-annually thereafter, which could result in NMIC recapturing the related risk.

(3) NMIC has the option, based on certain conditions, to terminate the agreement as of June 30, 2025 or quarterly thereafter through December 31, 2027 with the payment of a termination fee, and as of March 31, 2028 or quarterly thereafter without the payment of a termination fee.

Such termination could result in NMIC recapturing the related risk.

(4) NMIC also holds a clean-up call that provides for termination of the agreement at its election at any time on or after the date that the risk on remaining covered policies falls to 10% or less of the risk on covered policies at December 31, 2025.

(5) Under the terms of the 2018 QSR Transaction, NMIC cedes premiums earned related to 21 % of the risk on eligible policies written in 2018 and 17 % of the risk on eligible policies written in 2019.

(6) Under the terms of the 2022 Seasoned QSR Transaction, NMIC cedes premiums earned related to 95 % of the risk on eligible policies after the consideration of coverage provided by other QSR transactions.

Effective January 1, 2026, NMIC amended the terms of the 2018 QSR Transaction, 2020 QSR Transaction, 2022 QSR Transaction, 2023 QSR Transaction and 2022 Seasoned QSR Transaction.

Under the amended 2018 QSR Transaction, NMIC will cede premiums earned related to 16 % of the risk on eligible policies written in 2018, 13 % of the risk on eligible policies written in 2019, and earn a 42 % ceding commission.

Under the amended 2020 QSR Transaction, NMIC will earn a 45 % ceding commission.

Under the amended Seasoned 2022 QSR Transaction, NMIC will cede premiums earned related to 48 % of the risk on eligible policies after the consideration of coverage provided by other QSR transactions and earn a 53 % ceding commission.

Additionally, effective January 1, 2026, the 2018 QSR Transaction, 2020 QSR Transaction, 2022 QSR Transaction and Seasoned 2022 QSR Transaction will earn profit commissions of up to 45 %, 45 %, 68 %, and 38 %, respectively.

The 2023 QSR Transaction will earn profit commissions of up to 63 %, 66 % and 68 % in 2026, 2027 and 2028 and beyond, respectively.

These amended QSR Transactions also extended their optional termination date through to June 30, 2028.

NMIC has also entered into three additional quota share reinsurance treaties that will provide sequential coverage for mortgage insurance policies to be written in 2026, 2027 and 2028 (the 2026 QSR Transaction, 2027 QSR Transaction and 2028 QSR Transaction).

Under the terms of the 2026 QSR Transaction, as amended in the fourth quarter of 2025, NMIC will cede premiums earned related to 25 % of the risk on eligible policies written between January 1, 2026 and December 31, 2026.

Under the terms of the 2027 QSR Transaction, NMIC will cede premiums earned related to 35 % of the risk on eligible policies written between January 1, 2027 and December 31, 2027.

Under the terms of the 2028 QSR Transaction, NMIC will cede premiums earned related to 20 % of the risk on eligible policies written between January 1, 2028 and December 31, 2028.

NMI HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2025

The following table shows amounts related to the QSR Transactions:

As of and for the years ended December 31,

2025 2024 2023

(In Thousands)

Ceded risk-in-force $ 12,805,761 $ 13,024,200 $ 12,626,541

Ceded premiums earned ( 161,216 ) ( 166,181 ) ( 167,331 )

Ceded claims and claim expenses (1)

12,581 7,045 7,436

Ceding commission earned 39,865 40,663 39,211

Profit commission 80,749 89,790 90,006

(1) Includes aggregate fees of $ 0.8 million and $ 0.7 million for the years ended December 31, 2025 and 2023, respectively, incurred in connection with the termination or amendment of certain QSR Transactions.

NMIC had aggregate reinsurance recoverables related to the QSR Transactions of $ 38.6 million and $ 31.2 million as of December 31, 2025 and 2024, respectively.

The reinsurance recoverable on loss reserves as of December 31, 2024 also included $ 1.1 million related to the 2016 QSR Transaction, which was terminated as of July 1, 2025.

NMIC's reinsurance recoverable balance is supported by collateral trust accounts established and maintained by each reinsurer in accordance with the terms of the QSR Transactions and the PMIERs funding requirements for risk ceded to non-affiliates.

Excess-of-loss Reinsurance

Traditional Reinsurance

NMIC is party to six excess-of-loss reinsurance agreements with broad panels of third-party reinsurers – the 2022-1 XOL Transaction, effective April 1, 2022, the 2022-2 XOL Transaction, effective July 1, 2022, the 2022-3 XOL Transaction, effective October 1, 2022, the 2023-1 XOL Transaction, effective January 1, 2023, the 2023-2 XOL Transaction, effective July 1, 2023, and the 2024 XOL Transaction, effective January 1, 2024 – which we refer to collectively as the XOL Transactions.

NMIC is party to seven excess-of-loss reinsurance agreements with broad panels of third-party reinsurers – the 2022-1 XOL Transaction, effective April 1, 2022, the 2022-2 XOL Transaction, effective July 1, 2022, the 2022-3 XOL Transaction, effective October 1, 2022, the 2023-1 XOL Transaction, effective January 1, 2023, the 2023-2 XOL Transaction, effective July 1, 2023, the 2024 XOL Transaction, effective January 1, 2024, and the 2025 XOL Transaction, effective January 1, 2025 – which we refer to collectively as the XOL Transactions.

Each XOL Transaction provides NMIC with aggregate excess-of-loss reinsurance coverage on a defined portfolio of mortgage insurance policies.

2 unchanged sentences

NMIC retains losses in excess of the outstanding reinsurance coverage amount.

Under the terms of the XOL Transactions, NMIC makes risk premium payments to its third-party reinsurance providers for the outstanding reinsurance coverage amount and ceded aggregate premiums of $ 38.4 million, $ 31.2 million and $ 13.9 million during the years ended December 31, 2024, 2023 and 2022, respectively.

Under the terms of the XOL Transactions, NMIC makes risk premium payments to its third-party reinsurance providers for the outstanding reinsurance coverage amount and ceded aggregate premiums earned of $ 42.2 million, $ 38.4 million and $ 31.2 million during the years ended December 31, 2025, 2024 and 2023, respectively.

NMIC applies claims paid on covered policies against its first layer aggregate retained loss exposure under each agreement.

NMIC did not cede any incurred losses on covered policies under the XOL Transactions during the years ended December 31, 2025, 2024 and 2023, as the aggregate first-layer risk retention for each agreement was not exhausted during such periods.

NMIC holds optional termination rights which provide it the discretion to terminate each XOL Transaction on or after a specified date.

NMIC holds optional termination rights which provide it with the discretion to terminate each XOL Transaction on or after a specified date.

NMIC may also elect to terminate the XOL Transactions at any point if the outstanding reinsurance coverage amount amortizes to 10% or less of the reinsurance coverage amount provided at inception, or if it determines that it will no longer be able to take full PMIERs asset credit for the coverage.

1 unchanged sentence

Such selective termination rights arise when, among other reasons, a reinsurer experiences a deterioration in its capital position below a prescribed threshold, and/or a reinsurer breaches (and fails to cure) its collateral posting obligation.

NMI HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2024

Each of the third-party reinsurance providers that is party to the XOL Transactions has an insurer financial strength rating of A- or better by S&P Global Ratings (S&P), A.M.

3 unchanged sentences

Current amounts are presented as of December 31, 2025.

NMI HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2025

( $ values in thousands)

Inception Date Covered Production Initial Reinsurance Coverage Current Reinsurance Coverage Initial First Layer Retained Loss Current First Layer Retained Loss (1)

2022-1 XOL Transaction April 1, 2022 10/1/2021 – 3/31/2022 (2)

April 1, 2022 10/1/2021 – 3/31/2022 (2)

$ 289,741 $ 146,305 $ 133,366 $ 129,238

2022-2 XOL Transaction July 1, 2022 4/1/2022 – 6/30/2022 (3)

July 1, 2022 4/1/2022 – 6/30/2022 (3)

154,306 109,595 78,906 73,393

2022-3 XOL Transaction October 1, 2022 7/1/2022 – 9/30/2022

October 1, 2022 7/1/2022 – 9/30/2022

96,779 70,905 106,265 101,460

2023-1 XOL Transaction

January 1, 2023 10/1/2022 – 6/30/2023

89,864 62,758 146,513 142,269

2023-2 XOL Transaction

July 1, 2023 7/1/2023 – 12/31/2023

100,777 62,560 136,875 135,222

2024 XOL Transaction (4)

January 1, 2024 1/1/2024 – 12/31/2024

162,500 156,731 312,172 311,559

January 1, 2025 1/1/2025 - 12/31/2025 283,849 283,849 321,331 321,331

(1) NMIC applies claims paid on covered policies against its first layer aggregate retained loss exposure and cedes reserves for incurred claims and claim expenses to each applicable XOL Transaction and recognizes a reinsurance recoverable if such incurred claims and claim expenses exceed its current first layer retained loss.

3 unchanged sentences

The current reinsurance coverage and current first layer retained loss will decrease in future periods to the extent the PMIERs minimum required assets of the covered pool declines.

In October 2024, NMIC entered into two sequential excess-of-loss reinsurance treaties that will provide aggregate coverage for mortgage insurance policies to be written in 2025 and 2026 (the 2025 XOL Transaction and 2026 XOL Transaction, respectively).

Under the terms of each agreement, NMIC will retain a first layer of aggregate loss exposure on covered policies and its reinsurance counterparties will then provide second layer loss protection up to a defined reinsurance coverage amount (of $ 283.8 million for the 2025 XOL Transaction and $ 164.2 million for the 2026 XOL Transaction).

NMIC retains losses in excess of the respective reinsurance coverage amounts.

Quota Share Reinsurance

NMIC is party to eight quota share reinsurance treaties – the 2016 QSR Transaction, effective September 1, 2016 and as modified April 1, 2019, the 2018 QSR Transaction, effective January 1, 2018, the 2020 QSR Transaction, effective April 1, 2020 and as amended January 1, 2024, the 2021 QSR Transaction, effective January 1, 2021, the 2022 QSR Transaction, effective October 1, 2021, the 2022 Seasoned QSR Transaction, effective July 1, 2022, the 2023 QSR Transaction, effective January 1, 2023 and the 2024 QSR Transaction, effective January 1, 2024 – which we refer to collectively as the QSR Transactions.

Under each of the QSR Transactions, NMIC cedes a proportional share of its risk on eligible policies to panels of third-party reinsurance providers.

Each of the third-party reinsurance providers that is party to the QSR Transactions has an insurer financial strength rating of A- or better by S&P, A.M.

Best or both.

Under the terms of the 2016 QSR Transaction, NMIC cedes premiums written related to 20.5 % of the risk on eligible primary policies written for all periods through December 31, 2017.

The 2016 QSR Transaction is scheduled to terminate on December 31, 2027.

NMIC has the option, based on certain conditions and subject to a termination fee, to terminate the agreement as of December 31, 2020, or at the end of any calendar quarter thereafter, which could result in NMIC recapturing the related risk.

Under the terms of the 2018 QSR Transaction, NMIC cedes premiums earned related to 25 % of the risk on eligible policies written in 2018 and 20 % of the risk on eligible policies written in 2019.

The 2018 QSR Transaction is scheduled to terminate on December 31, 2029.

NMIC has the option, based on certain conditions and subject to a termination fee, to terminate the agreement as of December 31, 2022, or at the end of any calendar quarter thereafter, which could result in NMIC recapturing the related risk.

Under the terms of the 2020 QSR Transaction, NMIC cedes premiums earned related to 21 % of the risk on eligible policies written between April 1, 2020 and December 31, 2020.

The 2020 QSR Transaction is scheduled to terminate on December 31, 2030.

NMIC has the option, based on certain conditions and subject to a termination fee, to terminate the

NMI HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2024

agreement as of December 31, 2025, or at the end of any calendar quarter thereafter, which could result in NMIC recapturing the related risk.

Under the terms of the 2021 QSR Transaction, NMIC cedes premiums earned related to 22.5 % of the risk on eligible policies written from January 1, 2021 to October 30, 2021.

The 2021 QSR Transaction is scheduled to terminate on December 31, 2031.

NMIC has the option, based on certain conditions and subject to a termination fee, to terminate the agreement as of December 31, 2024, or at the end of any calendar quarter thereafter, which could result in NMIC recapturing the related risk.

Under the terms of the 2022 QSR Transaction, NMIC cedes premiums earned related to 20 % of the risk on eligible policies written primarily between October 30, 2021 and December 31, 2022.

The 2022 QSR Transaction is scheduled to terminate on December 31, 2032.

NMIC has the option, based on certain conditions and subject to a termination fee, to terminate the agreement as of December 31, 2024 or semi-annually thereafter, which could result in NMIC recapturing the related risk.

Under the terms of the 2022 Seasoned QSR Transaction, NMIC cedes premiums earned related to 95 % of the net risk on eligible policies primarily for a seasoned pool of mortgage insurance policies originated between January 1, 2013 to December 31, 2016 and July 1, 2019 to March 31, 2020, that had previously been covered under the retired Oaktown Re Ltd.

and Oaktown Re IV Ltd.

reinsurance transactions, after the consideration of coverage provided by other QSR Transactions.

The 2022 Seasoned QSR Transaction is scheduled to terminate on June 30, 2032.

NMIC has the option, based on certain conditions, to terminate the agreement as of June 30, 2025 or quarterly thereafter through December 31, 2027 with the payment of a termination fee, and as of March 31, 2028 or quarterly thereafter without the payment of a termination fee.

Such termination could result in NMIC recapturing the related risk.

Under the terms of the 2023 QSR Transaction, NMIC cedes premiums earned related to 20 % of the risk on eligible policies written in 2023.

The 2023 QSR Transaction is scheduled to terminate on December 31, 2033.

NMIC has the option, based on certain conditions and subject to a termination fee, to terminate the agreement as of December 31, 2025 or semi-annually thereafter, which could result in NMIC recapturing the related risk.

Under the terms of the 2024 QSR Transaction, NMIC cedes premiums earned related to 20 % of the risk on eligible policies written in 2024.

The 2024 QSR Transaction is scheduled to terminate on December 31, 2034.

NMIC has the option, based on certain conditions and subject to a termination fee, to terminate the agreement as of December 31, 2027, or at the end of any calendar quarter thereafter, which could result in NMIC recapturing the related risk.

Additionally, under the terms of the QSR Transactions, NMIC may elect to selectively terminate its engagement with individual reinsurers on a run-off basis ( i.e.

, reinsurers continue providing coverage on all risk ceded prior to the termination date, with no new cessions going forward) or cut-off basis ( i.e.

, the reinsurance arrangement is completely terminated with NMIC recapturing all previously ceded risk) under certain circumstances.

Effective January 1, 2025, NMIC terminated its engagement with one reinsurer under the 2016, 2018 and 2021 QSR Transactions by mutual agreement on a cut-off basis with no termination fees.

Upon termination, NMIC recaptured approximately $ 100 million of previously ceded primary RIF.

NMIC will stop ceding new premiums with respect to the recaptured risk and ceded premiums under each agreement will decrease by less than 1 % in future periods.

In October 2024, NMIC entered into three sequential quota share reinsurance treaties that will provide coverage for mortgage insurance policies to be written in 2025, 2026 and 2027 (the 2025 QSR Transaction, 2026 QSR Transaction and 2027 QSR Transaction, respectively).

Under the terms of the 2025 and 2026 QSR Transactions, NMIC will cede premiums earned related to 20 % of the risk on eligible policies written between January 1, 2025 and December 31, 2026, in exchange for reimbursement of ceded claims and claims expenses on covered policies, a 20 % ceding commission, and a profit commission of up to 62 % that varies directly and inversely with ceded claims.

Under the terms of the 2027 QSR Transaction, NMIC will cede premiums earned related to 12 % of the risk on eligible policies written between January 1, 2027 and December 31, 2027, in exchange for reimbursement of ceded claims and claims expenses on covered policies, a 20 % ceding commission, and a profit commission of up to 61 % that varies directly and inversely with ceded claims.

NMIC has also entered into three additional excess-of-loss reinsurance treaties that will incept and provide coverage in future periods.

The 2026 XOL Transaction will incept on January 1, 2026 and provide $ 164.2 million of aggregate excess-of-loss coverage for mortgage insurance policies to be written in 2026.

The 2026-2 XOL Transaction will incept on April 1, 2026 and provide up to $ 160 million of aggregate excess-of-loss coverage for mortgage insurance policies covered under the existing 2021 ILN Transaction, and the 2027 XOL Transaction will provide $ 125 million of aggregate excess-of-loss coverage for mortgage insurance policies to be written in 2027.

Insurance-Linked Notes

NMIC is a party to reinsurance agreements with Oaktown Re VI Ltd.

and Oaktown Re VII Ltd.

(special purpose reinsurance entities collectively referred to as the Oaktown Re Vehicles) effective April 27, 2021 and October 26, 2021, respectively.

Each agreement provides NMIC with aggregate excess-of-loss reinsurance coverage on a defined portfolio of mortgage insurance policies.

NMIC then retains losses in excess of the respective reinsurance coverage amounts.

NMIC ceded aggregate premiums to the Oaktown Re Vehicles of $ 12.6 million, $ 20.4 million and $ 31.1 million during the years ended December 31, 2025, 2024 and 2023, respectively.

NMIC applies claims paid on covered policies against its first layer aggregate retained loss exposure under each excess-of-loss agreement.

NMIC did not cede any incurred losses on covered policies to the Oaktown Re Vehicles during the years ended December 31, 2025, 2024 and 2023, as the aggregate first layer risk retention for each applicable agreement was not exhausted during such periods.

Such trust funds are required to be invested in short-term U.S.

Treasury money market funds at all times.

Each Oaktown Re Vehicle financed its respective collateral requirement through the issuance of mortgage insurance-linked notes to unaffiliated investors.

Such insurance-linked notes mature 12.5 years from the inception date of their associated reinsurance agreement.

The respective reinsurance coverage amounts provided by the Oaktown Re Vehicles decrease over a 12.5 -year period as the underlying insured mortgages are amortized or repaid, and/or the mortgage insurance coverage is canceled.

The outstanding reinsurance coverage amounts stop amortizing, and the distribution of collateral assets to ILN Transaction noteholders and amortization of insurance-

NMI HOLDINGS, INC.

1 unchanged sentence

DECEMBER 31, 2025

The following table shows amounts related to the QSR Transactions:

As of and for the years ended December 31,

linked note principal is suspended if certain credit enhancement or delinquency thresholds, as defined in each agreement, are triggered (each, a Lock-Out Event).

NMIC holds optional termination rights under each ILN Transaction, including, among others, an optional call feature which provides NMIC the discretion to terminate the transaction on or after a prescribed date, and a clean-up call if the outstanding reinsurance coverage amount amortizes to 10 % or less of the reinsurance coverage amount at inception, or if NMIC reasonably determines that changes to GSE or rating agency asset requirements would cause a material and adverse effect on the capital treatment afforded to NMIC under a given agreement.

Current amounts are presented as of December 31, 2025.

( $ values in thousands)

Inception Date Covered Production Initial Reinsurance Coverage Current Reinsurance Coverage Initial First Layer Retained Loss Current First Layer Retained Loss (1)

April 27, 2021 10/1/2020 – 3/31/2021 (2)

$ 367,238 $ 86,881 $ 163,708 $ 162,201

(In Thousands)

Ceded risk-in-force $ 13,024,200 $ 12,626,541 $ 12,617,169

Ceded premiums earned ( 166,181 ) ( 167,331 ) ( 143,747 )

Ceded claims and claim expenses 7,045 7,436 1,620

Ceding commission earned 40,663 39,211 32,314

Profit commission 89,790 90,006 80,714

Ceded premiums written under the 2016 QSR Transaction are recorded as prepaid reinsurance premiums in “ Other Assets” on our consolidated balance sheets and amortized to ceded premiums earned in a manner consistent with the recognition of revenue on direct premiums.

Under all other QSR Transactions, premiums are ceded on an earned basis as defined in the agreement.

NMIC receives a 20 % ceding commission for premiums ceded under the QSR Transactions, except with respect to the 2022 Seasoned QSR Transaction under which it receives a 35 % ceding commission and the 2020 QSR Transaction under which it receives a 36 % ceding commission.

NMIC also receives a profit commission under each of the QSR Transactions, provided that the loss ratios on loans covered under the 2016, 2018, 2020, 2021, 2022, 2022 Seasoned, 2023 and 2024 QSR Transactions, generally remain below 60 %, 61 %, 50 %, 57.5 %, 62 %, 55 %, 62 % and 56 %, respectively, as measured annually.

Ceded claims and claim expenses under each of the QSR Transactions reduce the respective profit commission received by NMIC on a dollar-for-dollar basis.

In accordance with the terms of the 2016 QSR Transaction, rather than making a cash payment or transferring investments for ceded premiums written, NMIC established a funds withheld liability, which also includes amounts due to NMIC for ceding and profit commissions.

Any loss recoveries and any potential profit commission to NMIC are realized from this account until exhausted.

NMIC’s reinsurance recoverable balance is further supported by trust accounts established and maintained by each reinsurer in accordance with the PMIERs funding requirements for risk ceded to non-affiliates.

The reinsurance recoverable on loss reserves related to the 2016 QSR Transaction was $ 1.1 million and $ 1.7 million as of December 31, 2024 and 2023, respectively.

In accordance with the terms of the 2018, 2020, 2021, 2022, 2022 Seasoned, 2023 and 2024 QSR Transactions, cash payments for ceded premiums earned are settled on a quarterly basis, offset by amounts due to NMIC for ceding and profit commissions.

Any loss recoveries and any potential profit commission to NMIC are also recognized quarterly.

NMIC's reinsurance recoverable balance is supported by trust accounts established and maintained by each reinsurer in accordance with the PMIERs funding requirements for risk ceded to non-affiliates.

The aggregate reinsurance recoverable on loss reserves related to the 2018, 2020, 2021, 2022, 2022 Seasoned, 2023, and 2024 QSR Transactions was $ 31.2 million and $ 25.8 million as of December 31, 2024 and 2023, respectively.

October 26, 2021 4/1/2021 – 9/30/2021 (3)

363,596 175,649 146,229 143,906

(2) Approximately 1 % of the production covered by the 2021-1 ILN Transaction has coverage reporting dates between July 1, 2019 and September 30, 2020.

(3) Approximately 2 % of the production covered by the 2021-2 ILN Transaction has coverage reporting dates between July 1, 2019 and March 31, 2021.

“ Cash and Cash Equivalents ” on our consolidated balance sheets includes a de minimis restricted amount as of December 31, 2025 and $ 0.1 million as of December 31, 2024.

Reserves for Insurance Claims and Claim Expenses

5 unchanged sentences

During the year ended December 31, 2025, we paid 445 claims totaling $ 25.9 million, including 432 claims covered under the QSR Transactions representing $ 5.1 million of ceded claims and claim expenses.

We had 6,642 loans in default in our primary insured portfolio as of December 31, 2024, which represented a 1.01 % default rate against 659,567 total policies in-force and 5,099 loans in default in our primary portfolio as of December 31, 2023, which represented a 0.81 % default rate against 629,690 total policies in-force.

We had 7,661 loans in default in our primary insured portfolio as of December 31, 2025, which represented a 1.12 % default rate against 684,058 total policies in-force, and 6,642 loans in default as of December 31, 2024, which represented a 1.01 % default rate against 659,567 total policies in-force.

The size of the reserve we establish for each defaulted loan (and by extension our aggregate reserve for claims and claim expenses) reflects our best estimate of the future claim payment to be made for each individual loan in default.

Our future claims exposure is a function of the number of defaulted loans that progress to claim payment (which we refer to as frequency) and the amount to be paid to settle such claims (which we

Our future claims exposure is a function of the number of defaulted loans that progress to claim payment (which we refer to as frequency) and the amount to be paid to settle such claims (which we refer to as severity).

Our estimates of claims frequency and severity are not formulaic, rather they are broadly synthesized based on historical observed experience for similarly situated loans and assumptions about future macroeconomic factors.

NMI HOLDINGS, INC.

1 unchanged sentence

DECEMBER 31, 2025

refer to as severity).

The following table provides a reconciliation of the beginning and ending gross reserve balances for primary insurance claims and claim expenses:

12 unchanged sentences

( 57,889 ) ( 61,662 ) ( 56,390 )

Total claims and claim expenses (benefits) incurred (4)

Total claims and claim expenses incurred (4)

56,832 31,544 21,895

2 unchanged sentences

Current year (2)

1,605 638 600

Prior years (3)

1 unchanged sentence

Reinsurance terminations (5)

( 1,964 ) — ( 491 )

Total claims and claim expenses paid 18,791 8,193 3,684

10 unchanged sentences

Amounts are presented net of reinsurance and included $ 48.4 million attributed to net case reserves and $ 8.1 million attributed to net IBNR reserves for the year ended December 31, 2025, $ 54.1 million attributed to net case reserves and $ 6.3 million attributed to net IBNR reserves for the year ended December 31, 2024, and $ 50.9 million attributed to net case reserves and $ 4.5 million attributed to net IBNR reserves for the year ended December 31, 2023.

(4) Excludes a $ 0.7 million termination fee for the year ended December 31, 2023 incurred in connection with the amendment of the 2020 QSR Transaction.

(4) Excludes aggregate fees of $ 0.8 million and $ 0.7 million for the years ended December 31, 2025 and 2023, respectively, incurred in connection with the termination or amendment of certain QSR Transactions.

(5) Represents the settlement of reinsurance recoverables in conjunction with the termination or amendment of certain QSR Transactions.

The “claims incurred” section of the table above shows claims and claim expenses incurred on defaults occurring in current and prior years, including IBNR reserves, and is presented net of reinsurance.

The amount of claims incurred relating to current year defaults increased during the year ended December 31, 2024, compared to the years ended December 31, 2023 and 2022, primarily due to an increase in the total number of new delinquencies emerging during the period tied to the growth and natural seasoning of our portfolio.

The amount of claims incurred relating to current year defaults increased during the year ended December 31, 2025, compared to the years ended December 31, 2024 and 2023, primarily due to an increase in the total number of new delinquencies emerging during the period tied to the growth and natural seasoning of our portfolio and an increase in the average case reserve established against newly defaulted loans.

Our provision for claims and claim expenses during the years ended December 31, 2025, 2024 and 2023 benefited from favorable development on prior year defaults.

37 unchanged sentences

Total $ 48,346

NMI HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2024

Reconciliation of Disclosure of Incurred and Paid Claims Development to the Liability for Unpaid Claims and Claim Adjustment Expenses

8 unchanged sentences

Total gross liability for unpaid claims and claim adjustment expenses $ 196,429

NMI HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2025

The following supplementary information shows the average percentage of claims and allocated claims adjustment expenses paid in the years following the incurrence of a claim as of December 31, 2025:

4 unchanged sentences

Basic EPS is based on the weighted average number of shares of common stock outstanding.

Diluted EPS is based on the weighted average number of shares of common stock outstanding and common stock equivalents that would be issuable upon the vesting of service-based and performance and service-based RSUs, and the exercise of vested and unvested stock options and outstanding warrants.

The following table reconciles the net income and the weighted average shares of common stock outstanding used in the computations of basic and diluted EPS of common stock:

2 unchanged sentences

(In Thousands, except for per share data)

Net income $ 360,106 $ 322,110 $ 292,902

Basic weighted average shares outstanding 79,844 82,407 84,921

Basic earnings per share $ 4.51 $ 3.91 $ 3.45

Net income $ 360,106 $ 322,110 $ 292,902

Gain from change in fair value of warrant liability (1)

— — ( 1,113 )

Diluted net income $ 360,106 $ 322,110 $ 291,789

Net income – basic and diluted $ 388,926 $ 360,106 $ 322,110

Basic weighted average shares outstanding 77,626 79,844 82,407

1 unchanged sentence

Diluted weighted average shares outstanding 79,038 81,273 83,854

Diluted earnings per share $ 4.43 $ 3.84 $ 3.39

Earnings per share

Basic $ 5.01 $ 4.51 $ 3.91

Diluted $ 4.92 $ 4.43 $ 3.84

Anti-dilutive shares 1 11 2

(1) We issued 992 thousand warrants in connection with a private placement of our common stock in April 2012.

The warrants were issued with a ten-year contractual term and all unexercised warrants expired in April 2022.

Changes in the fair value of warrants were reported in our consolidated statements of operations and comprehensive income in the period in which such changes occurred.

No warrants remained outstanding as of December 31, 2024, 2023 or 2022.

NMI HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2024

Segment Reporting

We manage our business activities on a consolidated basis under a single reportable operating segment and our Chief Executive Officer (CEO) serves as the Chief Operating Decision Maker (CODM).

We manage our business activities on a consolidated basis under a single reportable operating segment and our Chief Executive Officer (CEO) serves as our Chief Operating Decision Maker (CODM).

Our Mortgage Insurance segment provides private mortgage insurance and ancillary loan review services and our CODM evaluates our performance and allocates resources based on our consolidated financial results, including consolidated revenue, expenses, net income, assets and shareholders' equity.

Among these, consolidated net income is the measure used to evaluate segment profit and loss.

Our CODM reviews these financial metrics to gauge our performance and make strategic decisions, such as whether to reinvest profits in our Mortgage Insurance segment or return capital to shareholders.

The significant revenue and expense categories that are regularly reviewed by our CODM align with those presented on our consolidated statement of operations and comprehensive income (see “ Consolidated Statement of Operations and Comprehensive Income ”), and the accounting policies governing our Mortgage Insurance segment are the same as those described in Note 2, “ Summary of Significant Accounting Policies.

Included in our consolidated statement of operations, investment income, also referred to as interest revenue, for the years ended December 31, 2024, 2023 and 2022 were $ 86.4 million, $ 68.2 million and $ 47.7 million, respectively, and are reported within " Net Investment Income.

” Amortization and depreciation expense for software, equipment, and leasehold improvements for the years ended December 31, 2024, 2023 and 2022 were $ 11.9 million, $ 11.5 million and $ 11.9 million, respectively.

The significant revenue and expense categories that are regularly reviewed by our CODM align with those presented on our consolidated statements of operations and comprehensive income, and segment assets align with total assets as presented on our consolidated balance sheets.

The accounting policies governing our Mortgage Insurance segment are the same as those described in Note 2, “ Summary of Significant Accounting Policies.

Investment income, also referred to as interest revenue, is reported within “ Net Investment Income ” on our consolidated statements of operations and was $ 104.2 million, $ 86.4 million and $ 68.2 million, respectively, for the years ended December 31, 2025, 2024 and 2023 .

Amortization and depreciation expense for software, equipment, and leasehold improvements was $ 11.3 million, $ 11.9 million and $ 11.5 million, respectively, for the years ended December 31, 2025, 2024 and 2023.

NMI HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2025

Share-Based Compensation

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The 2012 Plan expired on April 24, 2022, with all unissued shares of common stock remaining under the 2012 Plan expiring thereafter.

Share-based compensation previously issued under the 2012 Plan remains outstanding following the 2012 Plan expiry to the extent non-exercised or non-vested.

The 2014 Plan was originally approved by our stockholders at our annual meeting on May 8, 2014 and authorized 4.0 million shares of common stock to be reserved for issuance.

7 unchanged sentences

For the years ended December 31, 2025, 2024 and 2023, we incurred $ 20.2 million, $ 19.8 million and $ 16.9 million, respectively, of expenses related to awards granted under the Stock Plans and we recognized associated gross income tax benefits of $ 4.2 million, $ 4.2 million and $ 3.6 million during each respective period.

NMI HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2024

A summary of option activity during the year ended December 31, 2025 is as follows:

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Options exercised — — —

( 1 ) 4.97 12.32

Options forfeited — — —

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730 $ 5.61 $ 15.53

(1) During the year ended December 31, 2024, 1.3 thousand options were exercised with an aggregate intrinsic value of $ 24 thousand.

(1) The weighted average remaining contractual life of such options was 1.81 years as of December 31, 2025.

2 unchanged sentences

As of December 31, 2025, all outstanding options had vested and no unrecognized compensation cost related to non-vested stock options remained.

NMI HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2025

A summary of RSU activity during the year ended December 31, 2025 is as follows:

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During the years ended December 31, 2025, 2024 and 2023, we incurred approximately $ 2.0 million, $ 2.1 million and $ 1.9 million of expense related to our matching 401(k) Plan contributions, respectively.

NMI HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2024

We are a U.S.

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Total income tax expense $ 110,878 $ 103,305 $ 90,593

The following table presents a reconciliation between the federal statutory income tax rate and our effective income tax rate:

NMI HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2025

The following table presents a reconciliation between the federal statutory income tax expense and tax rate and our effective income tax expense and tax rate:

For the years ended December 31,

2025 2024 2023

Federal statutory income tax rate 21.0 % 21.0 % 21.0 %

State provision 0.7 0.6 0.6

Share-based and other compensation 0.7 0.4 0.5

Warrant gain — — ( 0.1 )

Other ( 0.1 ) — 0.4

($ Values In Thousands)

US federal statutory tax rate

$ 104,959 21.0 % $ 97,316 21.0 % $ 86,668 21.0 %

State and local income taxes, net of federal income tax effect (1)

3,036 0.6 2,839 0.6 2,401 0.6

Nontaxable or nondeductible items

2,883 0.6 3,150 0.7 1,524 0.4

Effective income tax rate

The components of our net deferred tax liability are summarized as follows:

$ 110,878 22.2 % $ 103,305 22.3 % $ 90,593 22.0 %

(1) Florida and Illinois accounted for the majority of our state and local income taxes during the years ended December 31, 2025 and 2024, and Illinois accounted for the majority for the year ended December 31, 2023.

T he components of our net deferred tax liability are summarized as follows:

As of December 31,

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Accrued expenses 1,381 1,581

Capitalized software

Other 1,881 1,265

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Contingency reserve ( 484,627 ) ( 411,421 )

Deferred acquisition costs ( 13,885 ) ( 13,586 )

Deferred policy acquisition costs

( 13,894 ) ( 13,885 )

Capitalized software — ( 306 )

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As a mortgage guaranty insurance company, we are eligible to claim a tax deduction for our statutory contingency reserve balance, subject to certain limitations outlined under IRC Section 832(e), to the extent we acquire tax and loss bonds in an amount equal to the tax benefit derived from the claimed deduction, which is our intent.

NMI HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2024

During the years ended December 31, 2025, 2024 and 2023, we purchased $ 78.1 million, $ 86.9 million and $ 80.9 million, of tax and loss bonds, respectively.

4 unchanged sentences

Our federal net operating loss carryforward arises from this limitation and the constraint on our ability to utilize the net operating loss carryforward in full during the current period.

NMI HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2025

We are required to establish a valuation allowance against our deferred tax assets when it is more likely than not that all or a portion of the asset will not be realized.

1 unchanged sentence

In the course of our review, we assess all available evidence, both positive and negative, including our expectations for future sources of income and contractual cash flows, the availability and application of tax planning strategies, and the potential reversal of temporary tax differences.

At December 31, 2024 and 2023, we recorded valuation allowances of $ 9.5 million and $ 9.2 million, respectively, against state net deferred tax assets.

The valuation allowances for both years primarily relate to state net operating losses generated by NMIH, as NMIH has historically operated at a loss and currently only generates revenue from its investment portfolio.

At both December 31, 2025 and 2024, we recorded a valuation allowance of $ 9.5 million against state net deferred tax assets.

The valuation allowance for both years primarily relates to state net operating losses generated by NMIH, as NMIH has historically operated at a loss and currently only generates revenue from its investment portfolio.

The following table presents the changes in our valuation allowance:

For the years ended December 31,

2025 2024 2023

(In Thousands)

Valuation allowance - beginning of period

$ 9,486 $ 9,169 $ 8,888

Additions charged to income tax benefit

Valuation allowance - end of period

$ 9,519 $ 9,486 $ 9,169

As of December 31, 2025 and 2024, we had zero reserves for unrecognized tax benefits as we have taken no material uncertain tax positions that would have required a reserve to be measured and recognized.

3 unchanged sentences

federal income tax returns for 2022 and subsequent years, and state income tax returns for 2021 and subsequent years, remain open by statute.

On July 4, 2025, the One Big Beautiful Bill Act (OBBBA) was enacted and included provisions that amended U.S.

federal corporate income tax law to, among other things, allow for the immediate expensing of domestic U.S.

research and development expenses, allow for the immediate expensing of certain capital expenditures, and change the U.S.

taxation of profits derived from foreign operations.

The OBBBA did not have a material impact on our effective income tax rate or consolidated financial statements.

The following table presents total income taxes paid (net of refunds received):

For the years ended December 31,

2025 2024 2023

(In Thousands)

$ 40,600 $ 19,300 $ —

$ 42,362 $ 20,027 $ 20

During the years ended December 31, 2025 and 2024, no individual state jurisdiction accounted for 5% or more of total income taxes paid.

During the year ended December 31, 2023, Florida accounted for 100 % of income taxes paid.

NMI HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2025

Software and Equipment

10 unchanged sentences

Capitalized costs for software, equipment, and leasehold improvements during the years ended December 31, 2025, 2024 and 2023 were $ 7.3 million, $ 7.4 million and $ 9.9 million, respectively.

Amortization and depreciation expense for software, equipment, and leasehold improvements for the years ended December 31, 2024, 2023 and 2022 were $ 11.9 million, $ 11.5 million and $ 11.9 million, respectively.

NMI HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2024

Amortization and depreciation expense for software, equipment, and leasehold improvements for the years ended December 31, 2025, 2024 and 2023 was $ 11.3 million, $ 11.9 million and $ 11.5 million, respectively.

Intangible Assets and Goodwill

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As of December 31, 2025 and 2024, we did not have any finance leases.

In February 2024, we renewed the lease of our data center facility, extending its term through January 2026.

Upon the extension, the ROU asset and liability associated with the lease was remeasured, using our current estimated incremental borrowing rate, resulting in an aggregate increase to ROU assets and lease liabilities of $ 0.5 million.

We did not enter into any new operating leases or recognize any new ROU assets or lease liabilities during the year ended December 31, 2025.

6 unchanged sentences

Cash paid on our operating leases for the years ended December 31, 2025, 2024 and 2023 was $ 2.4 million, $ 2.3 million and $ 1.5 million and lease expense incurred was $ 2.1 million, $ 2.1 million and $ 2.0 million during each respective period.

NMI HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2025

Future payments due under our existing operating leases as of December 31, 2025 are as follows:

Years ending December 31, (In Thousands)

2030 and thereafter 602

Total undiscounted lease payments 9,783

5 unchanged sentences

This renewal option is not included in the calculation of future lease payments due under the existing lease as presented above as it is not reasonably certain to be exercised.

NMI HOLDINGS, INC.

NOTES TO CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2024

Commitments and Contingencies

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Under the PMIERs, approved insurers must maintain available assets that equal or exceed minimum required assets , which is an amount equal to the greater of (i) $ 400 million or (ii) a total risk-based required asset amount.

The risk-based required asset amount is a function of the risk profile of an approved insurer's RIF, assessed on a loan-by-loan basis against certain risk-based factors derived from tables set out in the PMIERs , which is then adjusted on an aggregate basis for reinsurance transactions approved by the GSEs, such as with respect to our ILN Transactions, XOL Transactions and QSR Transactions.

The risk-based required asset amount is a function of the risk profile of an approved insurer's RIF, assessed on a loan-by-loan basis against certain risk-based factors derived from tables set out in the PMIERs , which is then adjusted on an aggregate basis for reinsurance transactions approved by the GSEs, such as with respect to our QSR Transactions, XOL Transactions and ILN Transactions.

The aggregate gross risk-based required asset amount for performing, primary insurance is subject to a floor of 5.6 % of performing primary adjusted RIF .

3 unchanged sentences

We continuously monitor NMIC's compliance with the PMIERs.

On August 21, 2024, the GSEs and FHFA updated PMIERs to revise the Available Asset credit mortgage insurers will receive for certain assets based on several factors, including asset class and credit rating.

The updated PMIERs will take effect on a phased basis beginning March 31, 2025 and will be fully implemented on September 30, 2026.

We do not expect the updated PMIERs to have a material impact on our available assets and risk-based required assets , and we expect to remain in full compliance with the existing and updated PMIERs, as applicable, prior to, on and after March 31, 2025.

We record a litigation liability when we determine that it is probable a litigation loss will be incurred and the amount of such anticipated loss can be reasonably estimated.

In the event we determine that a litigation loss is reasonably possible (though not probable), we disclose an estimate of the possible loss if such estimate can be reasonably established or disclose the matter with no estimate if such estimate cannot be reasonably made.

We evaluate litigation and other legal developments that could affect our accrual for probable losses or our estimated disclosure of possible losses and make ongoing adjustments to our accruals and disclosures as appropriate.

Significant judgment is required to determine both the likelihood and the estimated amount of potential losses related to such matters.

We are currently named as a defendant in a litigation proceeding pertaining to the refund of certain mortgage insurance premiums under the Homeowners Protection Act.

The case was dismissed in September 2023 and is currently pending appeal.

We do not currently expect that we will incur a material loss in connection with the case and have not recorded a litigation liability for this matter.

NMI HOLDINGS, INC.

1 unchanged sentence

DECEMBER 31, 2025

As of December 31, 2024 and 2023, we had 78.6 million and 80.9 million outstanding shares of common stock, respectively.

Holders of our common stock are entitled to one vote per share on all matters to be voted upon by stockholders, and there are no cumulative voting rights.

Holders of our common stock have no preemptive or conversion rights or other subscription rights, and there are no redemption or sinking fund provisions applicable to the common stock.

Each holder of our common stock is entitled to one vote per share on all matters to be voted upon by stockholders, and there are no cumulative voting rights.

Holders of common stock are entitled to receive dividends ratably if any are declared.

Share repurchase program

On February 10, 2022, our Board of Directors authorized a $ 125 million share repurchase program (excluding associated costs and applicable taxes, the 2022 Repurchase Program) effective through December 31, 2023.

On July 31, 2023, our Board of Directors authorized a $ 200 million share repurchase program (excluding associated costs and applicable taxes, the 2023 Repurchase Program) effective through December 31, 2025 and extended our 2022 Repurchase Program through December 31, 2025 to align its remaining tenor with that of the 2023 Repurchase Program.

The authorization provides us the flexibility, based on market and business conditions, stock price and other factors, to repurchase stock from time to time through open market purchases, privately negotiated transactions, or other means, including pursuant to Rule 10b5-1 trading plans.

During the year ended December 31, 2024, we repurchased 2.8 million shares at an average price of $ 33.98 per share (excluding associated costs and applicable taxes).

On July 31, 2023, our Board of Directors authorized a $ 200 million share repurchase program (the 2023 Repurchase Program), effective through December 31, 2025.

On February 5, 2025, our Board of Directors authorized an additional $ 250 million repurchase program (the 2025 Repurchase Program), effective through December 31, 2027, and extended the effectiveness of the 2023 Repurchase Program through December 31, 2027 to align its remaining tenor with that of the 2025 Repurchase Program.

The authorizations provide us with the flexibility, based on market and business conditions, stock price and other factors, to repurchase stock from time to time through open market purchases, privately negotiated transactions, or other means, including pursuant to Rule 10b5-1 trading plans.

During the year ended December 31, 2025 we repurchased 2.8 million shares at an average price of $ 37.44 (excluding associated costs and applicable taxes).

During the year ended December 31, 2024, we repurchased 2.8 million shares at an average price of $ 33.98 per share (excluding associated costs and applicable taxes).

25 unchanged sentences

DECEMBER 31, 2025

Re One recorded statutory income of $ 43 thousand for the year ended December 31, 2024, and a statutory loss of $ 0.4 million and $ 58 thousand for the years ended December 31, 2023 and 2022, respectively.

Re One had $ 2.1 million and $ 2.0 million of statutory capital at December 31, 2024 and 2023, respectively.

Re One recorded statutory income of $ 28 thousand and $ 43 thousand for the years ended December 31, 2025 and 2024, respectively, and a statutory loss of $ 400 thousand for the year ended December 31, 2023.

Re One had $ 2.1 million of statutory capital at December 31, 2025 and 2024.

Under applicable law in Wisconsin and 15 other states, mortgage insurers must maintain minimum amounts of statutory capital relative to RIF to continue writing new business.

1 unchanged sentence

Wisconsin and certain other states, including California and Illinois, apply a substantially similar requirement referred to as minimum policyholders' position.

As of December 31, 2024, NMIC's performing primary RIF, net of reinsurance, was approximately $ 36.6 billion and its RTC ratio was 12.7 :1.

As of December 31, 2023, NMIC's performing primary RIF, net of reinsurance, was approximately $ 29.0 billion and its RTC ratio was 11.4 :1.

As of December 31, 2025, NMIC's primary RIF, net of reinsurance, was approximately $ 42.4 billion and its RTC ratio was 13.0 :1.

As of December 31, 2024, NMIC's primary RIF, net of reinsurance, was approximately $ 36.6 billion and its RTC ratio was 12.7 :1.

Debt Service Allocation

12 unchanged sentences

Approved insurers that fail to meet the prescribed PMIERs financial requirements are not permitted to pay dividends without prior approval from the GSEs.

Subsequent events

Share repurchase program approval and extension of existing program

On February 5, 2025, our Board of Directors authorized a new $ 250 million share repurchase program (excluding associated costs and applicable taxes) effective through December 31, 2027.

The authorization provides us the flexibility, based on market and business conditions, stock price and other factors, to repurchase stock from time to time through open market repurchases, privately negotiated transactions, or other means, including pursuant to Rule 10b5-1 trading plans.

Concurrent with the new authorization, our Board of Directors also approved an extension of our existing share repurchase programs through December 31, 2027 to align its remaining tenor with that of the new $ 250 million program.

Changes in and Disagreements with Accountants on Accounting and Financial Disclosure

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 8. Financial Statements and Supplementary Data