Milliman’s mortgage insurance and lender loan loss reserving framework leverages our unique combination of independence and depth of industry expertise to tailor custom models designed from either proprietary or industry data sources. Our models estimate the potential frequency and loss given default of mortgage loans from origination to their final termination.

Advantages of Milliman’s modeling framework include:

• Responsiveness to changes in macro-economic conditions
• Custom model training to client data and servicing history if available
• Loan performance segmentation analysis for borrower, credit, product, geography and age of portfolio
• Transparency of approach with complete model documentation and validation

The marriage of mortgage insurance and mortgage lending experience developed over the past 20 years and leading modeling techniques have yielded among the most auditor-respected modeling approaches in the industry. Clients leverage Milliman’s loan loss reserving framework for:

• Benchmarking and validation of internal processes and modeling methodology
• Delinquent portfolio valuation, loss reserving and risk management
• Appointed actuary responsibilities for mono-line mortgage and financial guarantors
• IRS dispute defense

Milliman’s extensive experience in consulting to the mortgage insurance industry yields unique perspective in reserve estimation. The Milliman framework examines a variety of methods to arrive at a best estimate of future delinquency related losses in consideration of a company’s definition of reserveable occurrence.