VI. Regulation 43 Radian Mortgage Assurance Inc. (“RMAI”).   RMAI is domiciled and licensed in Pennsylvania as a stock casualty  insurance company authorized to carry on the business of credit insurance, which includes the authority to write mortgage  guaranty insurance. It is a monoline insurer restricted to writing only residential mortgage guaranty insurance. In addition to  Pennsylvania, RMAI is authorized to write mortgage guaranty insurance (or in states where there is no specific authorization  for mortgage guaranty insurance, the applicable line of insurance under which mortgage guaranty insurance is regulated), in  each of the other 49 states and the District of Columbia, other than Rhode Island where it operates under an industrial insured  exemption. However, in light of its limited capital position, RMAI currently is prohibited from writing new business in six  states without the addition of new capital. In addition to New York, Radian Asset Assurance is authorized to write financial guaranty or surety insurance (or in one  state where there is no specific authorization for financial guaranty insurance, credit insurance) in each of the other 49 states,  the District of Columbia, Guam, the U.S.  Virgin Islands and the Commonwealth of Puerto Rico. Radian Asset Assurance . Radian Asset Assurance is domiciled and licensed in New York as a monoline financial  guaranty insurer. Radian Asset Assurance is also licensed under the New York insurance law to write some types of surety  insurance and credit insurance.  Radian Guaranty . Radian Guaranty is domiciled and licensed in Pennsylvania as a stock casualty insurance company  authorized to carry on the business of credit insurance, which includes the authority to write mortgage guaranty insurance. It is  a monoline insurer, restricted to writing only residential mortgage guaranty insurance. In addition to Pennsylvania, Radian  Guaranty is authorized to write mortgage guaranty insurance (or in states where there is no specific authorization for mortgage  guaranty insurance, the applicable line of insurance under which mortgage guaranty insurance is regulated) in each of the other  49 states, the District of Columbia and Guam. Given the significant losses incurred by many mortgage and financial guaranty insurers in the recent past, our insurance  subsidiaries have been subject to heightened scrutiny by insurance regulators, and in particular , the insurance regulatory  authorities of the states in which our subsidiaries are domiciled.  Each insurance subsidiary is required by the insurance regulatory authority of its state of domicile, and the insurance  regulatory authority of each other jurisdiction in which it is licensed to transact business, to make various filings with those  insurance regulatory authorities and with the NAIC, including quarterly and annual financial statements prepared in accordance  with statutory accounting principles. In addition, our insurance subsidiaries are subject to examination by the insurance  regulatory authorities of each of the states in which they are licensed to transact business. Our insurance subsidiaries’ premium rates and policy forms are generally subject to regulation in every state in which our  insurers are licensed to transact business. These regulations are intended to protect policyholders against the adverse ef fects of  excessive, inadequate or unfairly discriminatory rates and to encourage competition in the insurance marketplace. In most states  where our insurance subsidiaries are licensed, premium rates and policy forms must be filed with the state insurance regulatory  authority and, in some states, must be approved, before their use. Changes in premium rates may be subject to actuarial  justification, generally on the basis of the insurer ’s loss experience, expenses and future projections. In addition, states may  consider general default experience in the mortgage insurance industry in assessing the premium rates char ged by mortgage  insurers. Insurance regulations address, among other things, the licensing of companies to transact business, claims handling,  reinsurance requirements, premium rates and policy forms of fered to customers, financial statements, periodic reporting,  permissible investments and adherence to financial standards relating to surplus, dividends and other measures of solvency  intended to assure the satisfaction of obligations to policyholders. We and our insurance subsidiaries are subject to comprehensive regulation principally designed for the protection of  policyholders, rather than for the benefit of investors, by the insurance departments in the various states where our insurance  subsidiaries are licensed to transact business. Insurance laws vary from state to state, but generally grant broad supervisory  powers to agencies or officials to examine insurance companies and enforce rules or exercise discretion af fecting almost every  significant aspect of the insurance business. A. State Regulation