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Insurance Activity | 6 Months Ended
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Jun. 30, 2012
Insurance Activity [Abstract] |
Insurance Activity | Note 5: Insurance Activity The Company, through WMMRC, reinsures mortgage guaranty risks of mortgage loans originated by affiliates of the Company during the period from 1997 through 2008. WMMRC is (or was) a party to reinsurance agreements with UGRIC, GMIC, MGIC, PMI, Radian, RMIC and Triad. The agreements with UGRIC and Triad were placed into runoff effective May 31, 2008. The agreements with all other primary mortgage insurers were placed into runoff effective September 26, 2008. Effective August 31, 2009, WMMRC commuted its book of business with Triad. All agreements are on an excess of loss basis, except for certain reinsurance treaties with GMIC and Radian during 2007 and 2008, which are reinsured on a 50 percent quota share basis. Pursuant to the excess of loss reinsurance treaties, WMMRC reinsures a second loss layer which ranges from 5 percent to 10 percent of the risk in force in excess of the primary mortgage insurer’s first loss percentages which range from 4 percent to 5 percent. As security for the ceding insurers, WMMRC has entered into separate trust agreements with each of the primary mortgage insurance companies whereby premiums assumed are held in trust accounts for the benefit of each separate insurer. Pursuant to the terms of the reinsurance agreements, WMMRC is required to keep such assets in trust for a minimum of five years and are subject to claims for up to ten (10) years from termination of obligations arising from the last year in which insurance business was written prior to runoff. Release of funds from the trust by WMMRC requires approval from the primary mortgage guaranty companies. Premiums assumed and earned are as follows for the periods ended June 30, 2012 and 2011 respectively:
|  | Successor |  |  |  |  | Predecessor |  |  | Successor |  |  |  |  | Predecessor |  |  | Predecessor |
|  | Three Months Ended June 30, 2012 |  |  |  |  | Three Months Ended June 30, 2011 |  |  | Period from March 20, 2012 through June 30, 2012 |  |  |  |  | Period from January 1, 2012 through March 19, 2012 |  |  | Six Months ended June 30, 2011 |
Premiums assumed |  | $ | 5,224 |  |  |  |  | $ | 8,831 |  |  | $ | 6,235 |  |  |  |  | $ | 6,130 |  |  | $ | 17,938 |
Change in unearned premiums |  |  | 44 |  |  |  |  |  | 54 |  |  |  | 52 |  |  |  |  |  | 47 |  |  |  | 118 |
Premiums earned |  | $ | 5,268 |  |  |  |  | $ | 8,885 |  |  | $ | 6,287 |  |  |  |  | $ | 6,177 |  |  | $ | 18,056 |
The components of the liability for losses and loss adjustment reserves are as follows as of June 30, 2012 and December 31, 2011:
|  | Successor |  |  |  |  | Predecessor |
|  | June 30, 2012 |  |  |  |  | December 31, 2011 |
Case-basis reserves |  | $ | 114,401 |  |  |  |  | $ | 132,970 |
IBNR reserves |  |  | 5,430 |  |  |  |  |  | 6,049 |
Premium deficit reserves |  |  | 12,827 |  |  |  |  |  | 3,100 |
Total |  | $ | 132,658 |  |  |  |  | $ | 142,119 |
Losses and loss adjustment reserve activity are as follows for the periods ended June 30, 2012 and December 31, 2011:
|  | Successor |  |  |  |  | Predecessor |
|  | June 30, 2012 |  |  |  |  | December 31, 2011 |
Balance at beginning of period |  | $ | 142,119 |  |  |  |  | $ | 190,036 |
Incurred - prior periods |  |  | 21,504 |  |  |  |  |  | 47,321 |
Paid - prior periods |  |  | (30,965 | ) |  |  |  |  | (95,238 | )
Total |  | $ | 132,658 |  |  |  |  | $ | 142,119 |

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- Definition The entire disclosure for the types of coverages and products sold, and the assets, obligations, recorded liabilities, revenues and expenses arising therefrom, and the amounts of and methodologies and assumptions used in determining the amounts of such items. + References Reference 1: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 113 -Paragraph 27 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. Reference 2: http://www.xbrl.org/2003/role/presentationRef -Publisher FASB -Name Statement of Financial Accounting Standard (FAS) -Number 60 -Paragraph 60 -LegacyDoc This reference is SUPERSEDED by the Accounting Standards Codification effective for interim and annual periods ending after September 15, 2009. This reference is included to help users transition from the previous accounting hierarchy and will be removed from future versions of this taxonomy. + Details
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