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Contracts Accounted for as Insurance (Tables) | 9 Months Ended
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Sep. 30, 2025
Insurance [Abstract] |
Net Earned Premiums | Net Earned Premiums
| Third Quarter |  | Nine Months
| 2025 |  | 2024 |  | 2025 |  | 2024
| (in millions)
Financial guaranty insurance: |  |  |  |  |  |  |
Scheduled net earned premiums | $ | 77 |  |  | $ | 73 |  |  | $ | 228 |  |  | $ | 216 |
Accelerations from refundings and terminations | 5 |  |  | 14 |  |  | 14 |  |  | 56 |
Accretion of discount on net premiums receivable | 10 |  |  | 8 |  |  | 28 |  |  | 23 |
Financial guaranty insurance net earned premiums | 92 |  |  | 95 |  |  | 270 |  |  | 295 |
Specialty net earned premiums | 2 |  |  | 2 |  |  | 4 |  |  | 5 |
Net earned premiums | $ | 94 |  |  | $ | 97 |  |  | $ | 274 |  |  | $ | 300 |
Gross Premium Receivable, Net of Commissions Payable on Assumed Business Roll Forward | Gross Premium Receivable, Net of Commissions Payable on Assumed Business and Allowance for Credit Losses Roll Forward
| Nine Months
| 2025 |  | 2024
| (in millions)
Beginning of year | $ | 1,551 |  |  | $ | 1,468 |
Less: Specialty insurance premium receivable | 1 |  |  | 1 |
Financial guaranty insurance premiums receivable | 1,550 |  |  | 1,467 |
New business and supplemental premiums, net of commissions | 214 |  |  | 278 |
Gross premiums received, net of commissions | (265) |  |  | (267) |
Adjustments: |  |  |
Changes in the expected term and debt service assumptions | (23) |  |  | (28) |
Accretion of discount, net of commissions on assumed business | 26 |  |  | 19 |
Foreign exchange gain (loss) on remeasurement | 81 |  |  | 43 |
Change in allowance for credit losses | (1) |  |  | — |
Financial guaranty insurance premium receivable | 1,582 |  |  | 1,512 |
Specialty insurance premium receivable | 1 |  |  | 1 |
September 30, | $ | 1,583 |  |  | $ | 1,513 |
Financial Guaranty Insurance Expected Future Premium Collections and Earnings
| As of September 30, 2025
|  |  | Future Net Premiums to be Earned (2)
| Future Premiums to be Collected (1) |  | Earnings of Deferred Premium Revenue |  | Accretion of Discount |  | Total
| (in millions)
2025 (October 1 - December 31) | $ | 60 |  |  | $ | 78 |  |  | $ | 10 |  |  | $ | 88 |
2026 | 157 |  |  | 294 |  |  | 37 |  |  | 331 |
2027 | 131 |  |  | 272 |  |  | 35 |  |  | 307 |
2028 | 125 |  |  | 258 |  |  | 33 |  |  | 291 |
2029 | 113 |  |  | 240 |  |  | 31 |  |  | 271 |
2030-2034 | 439 |  |  | 954 |  |  | 130 |  |  | 1,084 |
2035-2039 | 346 |  |  | 627 |  |  | 96 |  |  | 723 |
2040-2044 | 266 |  |  | 414 |  |  | 63 |  |  | 477 |
2045-2049 | 201 |  |  | 275 |  |  | 36 |  |  | 311 |
2050-2054 | 123 |  |  | 142 |  |  | 16 |  |  | 158 |
After 2054 | 121 |  |  | 104 |  |  | 12 |  |  | 116 |
Total | $ | 2,082 |  |  | $ | 3,658 |  |  | $ | 499 |  |  | $ | 4,157 |
____________________ (1) Net of assumed commissions payable. (2) Net of reinsurance.
Selected Information for Policies Paid in Installments | Selected Information for Financial Guaranty Insurance Policies with Premiums Paid in Installments
| As of
| September 30, 2025 |  | December 31, 2024
| (dollars in millions)
Premiums receivable, net of commissions payable | $ | 1,582 |  | $ | 1,550
Deferred premium revenue | 1,855 |  | 1,901
Weighted-average risk-free rate used to discount premiums | 2.6% |  | 2.5%
Weighted-average period of premiums receivable (in years) | 12.0 |  | 12.3
Loss and LAE Reserve and Salvage and Subrogation Recoverable Net of Reinsurance Insurance Contracts | The following table provides information on net reserve (salvage), which includes loss and LAE reserves and salvage and subrogation recoverable, both net of reinsurance. Net Reserve (Salvage) by Sector
|  | As of
Sector |  | September 30, 2025 |  | December 31, 2024
|  | (in millions)
Public finance: |  |  |  |
U.S. public finance |  | $ | (67) |  |  | $ | (14) |
Non-U.S. public finance |  | 21 |  |  | 5 |
Public finance |  | (46) |  |  | (9) |
Structured finance: |  |  |  |
U.S. RMBS |  | (156) |  |  | (151) |
Other structured finance |  | 60 |  |  | 33 |
Structured finance |  | (96) |  |  | (118) |
Total |  | $ | (142) |  |  | $ | (127) |
Reconciliation of Net Expected Loss to be Paid and Net Expected Loss to be Expensed Financial Guaranty Insurance Contracts | The table below provides a reconciliation of net expected loss to be paid (recovered) for financial guaranty insurance contracts to net expected loss to be expensed. Expected loss to be paid (recovered) for financial guaranty insurance contracts differs from expected loss to be expensed due to: (i) the contra-paid, which represents the claim payments made and recoveries received that have not yet been recognized in the statements of operations; (ii) salvage and subrogation recoverable for transactions that are in a net recovery position where the Company has not yet received recoveries on claims previously paid (and therefore recognized in income but not yet received); and (iii) loss reserves that have already been established (and therefore expensed but not yet paid). Reconciliation of Net Expected Loss to be Paid (Recovered) to Net Expected Loss to be Expensed Financial Guaranty Insurance Contracts
| As of September 30, 2025
| (in millions)
Net expected loss to be paid (recovered) - financial guaranty insurance | $ | 91 |
Contra-paid, net | 23 |
Salvage and subrogation recoverable, net | 449 |
Loss and LAE reserve - financial guaranty insurance contracts, net of reinsurance | (306) |
Net expected loss to be expensed (present value) | $ | 257 |
Net Expected Loss to be Expensed Insurance Contracts | The following table provides a schedule of the expected timing of financial guaranty net expected losses to be expensed. The amount and timing of actual loss and LAE may differ from the estimates shown below due to factors such as accelerations, commutations, changes in expected lives and updates to loss estimates. This table excludes amounts related to FG VIEs, which are eliminated in consolidation. Net Expected Loss to be Expensed Financial Guaranty Insurance Contracts
| As of September 30, 2025
| (in millions)
2025 (October 1 - December 31) | $ | 3 |
2026 | 14 |
2027 | 17 |
2028 | 20 |
2029 | 18 |
2030-2034 | 81 |
2035-2039 | 37 |
2040-2044 | 19 |
2045-2049 | 25 |
2050-2054 | 20 |
After 2054 | 3 |
Net expected loss to be expensed (present value) | 257 |
Future expected accretion | 27 |
Total expected future loss and LAE | $ | 284 |
Loss and LAE Reported on the Consolidated Statements of Operations | The following table presents the loss and LAE (benefit) reported in the condensed consolidated statements of operations by sector for insurance contracts. Loss and LAE (Benefit) by Sector
|  | Third Quarter |  | Nine Months
Sector |  | 2025 |  | 2024 |  | 2025 |  | 2024
|  | (in millions)
Public finance: |  |  |  |  |  |  |  |
U.S. public finance |  | $ | (5) |  |  | $ | (11) |  |  | $ | 46 |  |  | $ | (12) |
Non-U.S. public finance |  | (2) |  |  | — |  |  | 18 |  |  | — |
Public finance |  | (7) |  |  | (11) |  |  | 64 |  |  | (12) |
Structured finance: |  |  |  |  |  |  |  |
U.S. RMBS |  | $ | (25) |  |  | $ | (39) |  |  | $ | (25) |  |  | $ | (42) |
Other structured finance |  | 2 |  |  | (1) |  |  | (1) |  |  | — |
Structured finance |  | (23) |  |  | (40) |  |  | (26) |  |  | (42) |
Loss and LAE (benefit) |  | $ | (30) |  |  | $ | (51) |  |  | $ | 38 |  |  | $ | (54) |
BIG Net Par Outstanding and Number of Risks | Financial Guaranty Portfolio BIG Net Par Outstanding and Number of Risks As of September 30, 2025
|  | Net Par Outstanding |  | Number of Risks (2)
Description |  | Financial Guaranty Insurance (1) |  | Credit Derivatives |  | Total |  | Financial Guaranty Insurance (1) |  | Credit Derivatives |  | Total
|  | (dollars in millions)
BIG 1 |  | $ | 7,226 |  |  | $ | 25 |  |  | $ | 7,251 |  |  | 92 |  |  | 3 |  |  | 95 |
BIG 2 |  | 2,893 |  |  | 4 |  |  | 2,897 |  |  | 10 |  |  | 1 |  |  | 11 |
BIG 3 |  | 1,230 |  |  | — |  |  | 1,230 |  |  | 95 |  |  | 3 |  |  | 98 |
Total BIG |  | $ | 11,349 |  |  | $ | 29 |  |  | $ | 11,378 |  |  | 197 |  |  | 7 |  |  | 204 |
Financial Guaranty Portfolio BIG Net Par Outstanding and Number of Risks As of December 31, 2024
|  | Net Par Outstanding |  | Number of Risks (2)
Description |  | Financial Guaranty Insurance (1) |  | Credit Derivatives |  | Total |  | Financial Guaranty Insurance (1) |  | Credit Derivatives |  | Total
|  | (dollars in millions)
BIG 1 |  | $ | 8,074 |  |  | $ | 28 |  |  | $ | 8,102 |  |  | 98 |  |  | 3 |  |  | 101 |
BIG 2 |  | 702 |  |  | 4 |  |  | 706 |  |  | 12 |  |  | 1 |  |  | 13 |
BIG 3 |  | 1,374 |  |  | — |  |  | 1,374 |  |  | 97 |  |  | 3 |  |  | 100 |
Total BIG |  | $ | 10,150 |  |  | $ | 32 |  |  | $ | 10,182 |  |  | 207 |  |  | 7 |  |  | 214 |
_____________________ (1) Includes FG VIEs. (2) A risk represents the aggregate of the financial guaranty policies that share the same revenue source for purposes of making debt service payments. The following tables provide information on financial guaranty insurance contracts categorized as BIG. Financial Guaranty Insurance BIG Transaction Loss Summary As of September 30, 2025
| Gross |  | Net Total BIG
| BIG 1 |  | BIG 2 |  | BIG 3 |  | Total BIG |
| (dollars in millions)
Number of risks (1) | 92 |  |  | 10 |  |  | 95 |  |  | 197 |  |  | 197 |
Remaining weighted-average period (in years) | 12.8 |  | 26.5 |  | 5.6 |  | 17.2 |  | 17.2
Outstanding exposure: |  |  |  |  |  |  |  |  |
Par | $ | 7,232 |  |  | $ | 2,893 |  |  | $ | 1,236 |  |  | $ | 11,361 |  |  | $ | 11,349 |
Interest | 5,051 |  |  | 4,459 |  |  | 337 |  |  | 9,847 |  |  | 9,845 |
Total (2) | $ | 12,283 |  |  | $ | 7,352 |  |  | $ | 1,573 |  |  | $ | 21,208 |  |  | $ | 21,194 |
Expected cash outflows (inflows) | $ | 398 |  |  | $ | 2,378 |  |  | $ | 1,244 |  |  | $ | 4,020 |  |  | $ | 4,012 |
Potential recoveries (3) | (659) |  |  | (2,134) |  |  | (1,111) |  |  | (3,904) |  |  | (3,894) |
Subtotal | (261) |  |  | 244 |  |  | 133 |  |  | 116 |  |  | 118 |
Discount | 92 |  |  | (107) |  |  | (12) |  |  | (27) |  |  | (27) |
Expected losses to be paid (recovered) | $ | (169) |  |  | $ | 137 |  |  | $ | 121 |  |  | $ | 89 |  |  | $ | 91 |
Deferred premium revenue | $ | 331 |  |  | $ | 106 |  |  | $ | 108 |  |  | $ | 545 |  |  | $ | 545 |
Reserves (salvage) | $ | (249) |  |  | $ | 67 |  |  | $ | 36 |  |  | $ | (146) |  |  | $ | (143) |
Financial Guaranty Insurance BIG Transaction Loss Summary As of December 31, 2024
| Gross |  | Net Total BIG
| BIG 1 |  | BIG 2 |  | BIG 3 |  | Total BIG |
| (dollars in millions)
Number of risks (1) | 98 |  |  | 12 |  |  | 97 |  |  | 207 |  |  | 207 |
Remaining weighted-average period (in years) | 18.6 |  | 8.8 |  | 6.1 |  | 16.6 |  | 16.6
Outstanding exposure: |  |  |  |  |  |  |  |  |
Par | $ | 8,080 |  |  | $ | 702 |  |  | $ | 1,382 |  |  | $ | 10,164 |  |  | $ | 10,150 |
Interest | 7,546 |  |  | 371 |  |  | 421 |  |  | 8,338 |  |  | 8,335 |
Total (2) | $ | 15,626 |  |  | $ | 1,073 |  |  | $ | 1,803 |  |  | $ | 18,502 |  |  | $ | 18,485 |
Expected cash outflows (inflows) | $ | 4,016 |  |  | $ | 342 |  |  | $ | 1,307 |  |  | $ | 5,665 |  |  | $ | 5,656 |
Potential recoveries (3) | (4,201) |  |  | (293) |  |  | (1,132) |  |  | (5,626) |  |  | (5,616) |
Subtotal | (185) |  |  | 49 |  |  | 175 |  |  | 39 |  |  | 40 |
Discount | 43 |  |  | 29 |  |  | (23) |  |  | 49 |  |  | 49 |
Expected losses to be paid (recovered) | $ | (142) |  |  | $ | 78 |  |  | $ | 152 |  |  | $ | 88 |  |  | $ | 89 |
Deferred premium revenue | $ | 333 |  |  | $ | 49 |  |  | $ | 116 |  |  | $ | 498 |  |  | $ | 498 |
Reserves (salvage) | $ | (226) |  |  | $ | 35 |  |  | $ | 62 |  |  | $ | (129) |  |  | $ | (128) |
____________________ (1)A risk represents the aggregate of the financial guaranty policies that share the same revenue source for purposes of making debt service payments. (2)Includes amounts related to FG VIEs. (3)Represents expected inflows from future payments by obligors pursuant to restructuring agreements, settlements, excess spread on any underlying collateral and other estimated recoveries. Potential recoveries also include recoveries on certain investment grade credits, related mainly to exposures that were previously BIG and for which claims have been paid in the past.

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