Dean Mitchell: Yeah. So, Jake, thanks for the question. I think on the XOL, we’ve identified that as approximately $250 million. I think it was $255 million of PMIERs credit. And then a little bit to Geoff’s point earlier — Geoff’s question earlier, the quota share will be predicated. It’s a 21% session on our 2024 NIW. So it’s going to be predicated on the NIW levels that we produce over the course of the coming year. So harder to give you a discrete number at this point in time that’ll be firmed up as our NIW numbers or levels crystallize over the course of 2024.
Jake Fuller: Got you. All right. Thank you, guys.
Rohit Gupta: Thank you.
Dean Mitchell: Thank you.
Operator: Thank you. And our next question coming from the line of Arren Cyganovich with Citi. Your line is open.
Arren Cyganovich: Thanks. I was wondering if you could talk a little bit about the expectations for insurance in-force growth for the year. You mentioned that your production or the industry production might be kind of flattish with year-over-year, but you saw some pretty nice insurance in-force growth this year, even while your production slowed. Just wondering if you’ll see kind of similar dynamics given the high persistency?
Rohit Gupta: Good morning, Arren. So I will take an attempt at that. I think — so obviously, the piece parts are the amount of NIW we can add in 2024 and what lasts to be seen in our existing book. Given our guidance on MI market size, you can actually range-bound our new insurance written for 2024 based on that number. And obviously, 2023 full market size is not yet known because we — only two of the companies have reported for Q4, but I think that’s a narrow range. So that gives you an idea on insurance in-force growth driven by NIW. I think the big question becomes on lapse, and lapse is highly dependent on interest rates in the market. I think the confidence we have and Dean mentioned this in our prepared remarks, that as we talk about lapse in our books, the fact that only 4% of our book — 4% of policies have a 50 basis points threshold for a refinance incentive right now, or they’re within the 50 basis point threshold, gives you an idea on the refinance exposure.
But as interest rates change in the market, which is both driven by 10-year treasury yield and the spread, I think that can change that number. So I’m not kind of giving you a straight answer, but we can see an increase in our insurance in-force growth based on those dynamics. But I would say if the market size is small, that growth is going to be kind of subdued by that factor itself.
Arren Cyganovich: Okay. Got it. That’s helpful. And the follow-up to that would be on the persistency. I looked at the risk or the insurance in-force that you have laid out with the mortgage rates. And really, it’s only the 2023 vintage, which is about 20% of the book, and that’s currently kind of at current mortgage rates. So would you have to see mortgage rates kind of fall by 50 basis points or more to really see a notable decline in the persistency?
Dean Mitchell: Yeah. I think that’s right. So you lay out on page 10 of our earnings presentation, we give the if by book year and the associated average mortgage rate. And you’re exactly correct that really the only cohort that is really, on average, near the current prevailing mortgage interest rate is 2023. And that is about 20% of our overall insurance in-force portfolio. You need to see a meaningful change in rate to economically incent the 2023 borrowers to refinance and quite frankly, the earlier vintages, it takes a much bigger change in mortgage rates for that economic incentive to emerge.
Arren Cyganovich: Okay. Thank you.
Dean Mitchell: Thanks, Arren.
Operator: Thank you. And that’s all the time we have for the Q&A session. I will now turn the call back over to Mr. Rohit Gupta for any closing remarks.
Rohit Gupta: Thanks, Livia. Thank you, everyone. We appreciate your interest in Enact and I look forward to seeing some of you in Florida at the Bank of America Financial Services conference. Thank you,
Operator: Ladies and gentlemen, that does conclude the conference for today. Thank you for your participation. You may now disconnect.
