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Note 7 - Reinsurance | 9 Months Ended
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Sep. 30, 2015
Reinsurance Disclosures [Abstract] |
Reinsurance | Reinsurance The effect of reinsurance on net premiums written and earned is as follows:
| Three Months Ended September 30, |  | Nine Months Ended September 30,
(In thousands) | 2015 |  | 2014 |  | 2015 |  | 2014
Net premiums written-insurance: |  |  |  |  |  |  |
Direct | $ | 253,262 |  |  | $ | 262,826 |  |  | $ | 766,708 |  |  | $ | 730,685 |
Assumed | 7 |  |  | (219 | ) |  | 62 |  |  | (668 | )
Ceded | (11,101 | ) |  | (16,832 | ) |  | (31,612 | ) |  | (49,342 | )
Net premiums written-insurance | $ | 242,168 |  |  | $ | 245,775 |  |  | $ | 735,158 |  |  | $ | 680,675 |
Net premiums earned-insurance: |  |  |  |  |  |  |
Direct | $ | 242,260 |  |  | $ | 235,406 |  |  | $ | 734,221 |  |  | $ | 672,453 |
Assumed | 10 |  |  | 11 |  |  | 33 |  |  | 35 |
Ceded | (14,837 | ) |  | (17,590 | ) |  | (44,789 | ) |  | (52,253 | )
Net premiums earned-insurance | $ | 227,433 |  |  | $ | 217,827 |  |  | $ | 689,465 |  |  | $ | 620,235 |
In 2012, Radian Guaranty entered into two separate QSR agreements with a third-party reinsurance provider. As of September 30, 2015, RIF ceded under the Initial QSR Transaction and the Second QSR Transaction was approximately $0.9 billion and $1.4 billion, respectively. The Second QSR Transaction provides that, effective December 31, 2015, Radian Guaranty will have the ability, at its option, to recapture half of the reinsurance ceded with respect to conventional GSE loans, which would result in Radian Guaranty reassuming the related RIF in exchange for an expected payment of a profit commission amount from the reinsurer. Our results for the three and nine months ended September 30, 2015 include accruals of $0.7 million and $6.5 million, respectively, for this expected profit commission, based on experience to date for the Second QSR Transaction and our current expectation to exercise our option to recapture half of the ceded RIF on December 31, 2015. The following tables show the amounts related to the QSR Transactions for the periods indicated:
| Initial QSR Transaction
| Three Months Ended September 30, |  | Nine Months Ended September 30,
(In thousands) | 2015 |  | 2014 |  | 2015 |  | 2014
Ceded premiums written | $ | 3,437 |  |  | $ | 4,668 |  |  | $ | 11,326 |  |  | $ | 15,018 |
Ceded premiums earned | 5,068 |  |  | 6,578 |  |  | 17,510 |  |  | 20,188 |
Ceding commissions written | 745 |  |  | 1,166 |  |  | 2,453 |  |  | 3,754 |
| Second QSR Transaction
| Three Months Ended September 30, |  | Nine Months Ended September 30,
(In thousands) | 2015 |  | 2014 |  | 2015 |  | 2014
Ceded premiums written | $ | 5,029 |  |  | $ | 9,082 |  |  | $ | 11,953 |  |  | $ | 24,447 |
Ceded premiums earned | 7,135 |  |  | 7,699 |  |  | 18,942 |  |  | 21,481 |
Ceding commissions written | 1,998 |  |  | 3,179 |  |  | 6,437 |  |  | 8,557 |
Radian Guaranty has ceded the maximum amount permitted under the QSR Transactions (up to $1.6 billion of ceded RIF for each); therefore, Radian Guaranty is no longer ceding NIW under these transactions. Effective January 1, 2015, the ceding commission was reduced from 25% to 20% for two-thirds of the reinsurance ceded under the Initial QSR Transaction. Ceded losses to date under the QSR Transactions have been immaterial.

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