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WINSTON-SALEM, N.C.—When a Greensboro company secured $653 million in reinsurance, the Triad Business Journal turned to Womble Bond Dickinson attorney Jonathan Reich for insights into the complex reinsurance process.
Arch Mortgage Insurance announced recently that it has secured the reinsurance for a portfolio of mortgages issued by the company. Reich explained that the way the company structured the transaction, by tapping into the capital markets, gives it greater capacity to issue mortgage insurance in the future.
“Before this, reinsurance was typically bought through insurance companies, not through the capital markets,” Reich tells the Triad Business Journal. “If they can go through capital markets through transactions this way, as the world kind of sits, there is basically an unlimited amount of money they can get.”
He also explained that buying securities linked to mortgage insurance diversifies the risks for investors “since the insurance market is not directly correlated to the rest of the financial market.”
Click here to read “Greensboro Company Secures $653M in Reinsurance by Tapping the Capital Market. Here’s What That Means” in the Triad Business Journal (subscription required).
Jonathan Reich ’s diverse litigation practice ranges from complex commercial and business litigation involving fraud and unfair business practices to defending products liability, wrongful death, and catastrophic personal injury cases. A significant amount of his practice is devoted to insurance coverage and bad faith, insurance procurement and subrogation matters.
