NEW YORK (

TheStreet

) -- Private mortgage insurers have been thrust in the limelight as banks submit mortgage insurance claims in the wake of the housing crisis.

Reports this week said that

Bank of America

(BAC) - Get Report

is suing Old Republic Insurance, a subsidiary of

Old Republic International

(ORI) - Get Report

for denying claims on defaulted mortgages.

The Charlotte-based institution says that the insurer is "manufacturing excuses" to deny claims on the soured loans, according to media reports.

Over the past several months stocks in some of the largest publicly-traded mortgage insurers have been on a roller-coaster ride of foreclosure crisis headlines. But despite the poor press and increasing claims activity, applications for private mortgage insurance continue to rise, according to company filings.

For investors, some of the largest private mortgage insurers offer some surprises, especially when it comes to determining which companies offer the most stability.

Weiss Ratings is known for being the most conservative among ratings agencies, and has assigned financial strength ratings of D-plus (Weak) to the main mortgage insurance subsidiaries of

American International Group

(AIG) - Get Report

and

Genworth Financial

(GNW) - Get Report

, based on the most recent available statutory data, as of December 31, 2009.

The main mortgage insurance subsidiaries of

MGIC Investment Corp.

MTG,

Radian Group

(RDN) - Get Report

,

PMI Group

( PMI) and

Old Republic International

(ORI) - Get Report

were all also assigned financial strength ratings of D.

Triad Guaranty Insurance Corp.

is held by

Triad Guaranty, Inc.

(TGIC)

. The insurance subsidiary stopped accepting new business in July 2008 and is in voluntary run-off. As such, it was assigned a financial strength rating of E (Very Weak) by Weiss Ratings.

Melissa Gannon, the vice president of Weiss Ratings, said the mortgage insurance group is "writing new business, but that is not yet reflected in the statutory numbers," adding that she doesn't think new mortgage insurance volume "will be anything major until the overall housing market improves and is stable."

MGIC Investment Corp

MGIC Investment Corp. of Milwaukee reported a third-quarter net loss of $51.5 million, or 26 cents a share, improving from a net loss of $517.8 million, or $4.17 a share during the third quarter of 2009. Insurance losses for the third quarter declined to $384.6 million from $971 million a year earlier, and net premiums earned were up slightly to $296.5 million.

SNL Financial reported that main subsidiary

Mortgage Guaranty Insurance Corp.

reported that its inventory of primary delinquent loans at the end of October was 219,934 loans, down from 222,373 at the beginning of the month, and that 14,844 loans were cured.

MGIC's shares closed at $9.01 Wednesday, more than doubling over the previous year. Out of eight analysts covering the company, six rate the shares buy, one has a hold rating and one recommends investors part with the shares.

Michael Grasher of PiperJaffray has an "overweight" or buy rating on the shares and raised his 12-month target for the shares on Thursday to $11.50 from $11.00.

Radian Group

Radian Group of Philadelphia was upgraded by Moody's on Wednesday to B3 from Caa1, and the ratings agency affirmed the B1 rating for

Radian Insurance

, with a positive outlook. The upgrades followed the holding company's pricing of a $400 million offering of convertible senior notes, with an option for the underwriters to issue an additional $50 million.

The company reported net income of $112.2 million, or 84 cents a share, for the third quarter, compared to a net loss of $70.5 million, or 86 cents a share, a year earlier. The biggest factor in the earnings improvement was a $229.8 million increase in the value of derivatives during the third quarter, compared with a decline of $30.9 million in the third quarter of 2009.

Radian reported that mortgage insurance delinquencies had declined for three straight quarters.

Shares closed at $8.46 Wednesday, up 50% over the previous year. Out of eight analysts covering Radian Group, five rate the shares a buy, two analysts have hold ratings and one recommends investors sell the shares.

Grasher has a neutral rating on Radian's shares, with a $9 price target.

PMI Group

PMI Group of Walnut Creek, Calif. reported a third-quarter net loss of $281.1 million, or $1.74 a share, compared to a net loss of $93.2 million, or $1.13 a share, a year earlier. The results for the third quarter included a "non-cash provision of $200.2 million as a result of an increase in the Company's deferred tax asset valuation allowance," which the company stressed didn't affect its statutory financial results.

Total revenue increased to $235.9 million from $207.6 million a year earlier, mainly from investment gains.

PMI reported that new insurance written for the third quarter totaled roughly $2 billion, rising for three straight quarters. Primary loans in default declined to 131,891 as of September 30, from 138,431 at the end of the second quarter.

PMI's shares closed at $3.27 Wednesday, up 47% from the previous year. Out of six analysts covering the company, three have buy ratings on the shares, two recommend investors hold and one recommends selling the shares.

Bruce Harting of Barclays Capital has an "Underweight" or sell rating on the shares and said after PMI's third-quarter earnings release that "with the credit outlook still highly uncertain, book value can still drop significantly even when fundamental trends appear to be firming."

Old Republic International

Old Republic International of Chicago reported a third-quarter net loss of $38.9 million, or 16 cents a share, compared to positive earnings of $7.4 million, or 3 cents a share during the third quarter of 2009. Earnings performance was boosted by $21.7 million in income tax credits during the third quarter and $36.5 million in income tax credits a year earlier.

The pre-tax operating loss from the company's mortgage guaranty business during the third quarter was $94 million, rising from $77.8 million during the third quarter of 2009.

On Thursday, the

Charlotte Observer

reported that

Bank of America

(BAC) - Get Report

was

suing Old Republic

for over $160 million for denying insurance claims on thousands of loans.

Shares closed at $12.90 Wednesday, up 25% over the past year. Out of five analysts covering Old Republic Group, three rate the shares a buy and the other two analysts recommend holding the shares.

Elizabeth Malone of Wunderlich Securities rates Old Republic a buy, with a $19 price target, saying that her firm expects "losses to level off," adding that the company's "title insurance operation is performing despite market turmoil."

American International Group

AIG reported third-quarter net loss to common shareholders of $2.4 billion, or $17.62 a share, mainly resulting from restructuring costs of $4.5 billion. In comparison, the company earned $455 million, or 68 cents a share, during the third quarter of 2009.

Mortgage Guaranty revenue totaled $252 million during the third quarter, or 57% of the company's total revenues of $439 million. Mortgage revenue declined 14% year-over-year.

Shares closed at $42.99 Wednesday, rising 14% over the previous year. Two out of four analysts covering AIG rate the shares a hold, while the other two recommend investors sell the shares.

John Hall of Wells Fargo Securities rates AIG "Underperform," or sell, saying that although "IG's fully executed capital plan leads to a solidified capital structure," his firm finds it "difficult to rationalize an 11x multiple on a pre-tax earnings stream that may be achieved over a long period of time."

Genworth Financial

Genworth Financial of Richmond, Va. reported third-quarter net income to common stockholders of $83 million, or 17 cents a share, increasing from $19 million, or 4 cents a share, a year earlier. Third-quarter results benefitted from strong growth in international sales, while losses from the U.S. mortgage insurance segment totaled $152 million, increasing from $116 million a year earlier.

Standard & Poor's Ratings Services on November 2 affirmed its investment-grade BBB long-term counterparty rating for Genworth Financial, and BBB- ratings for

Genworth Mortgage Insurance Corp.

and

Genworth Residential Mortgage Insurance Corp of North Carolina

, with a negative outlook.

Genworth's shares closed at $12.06 Wednesday, up 7% over the previous year. Out of 17 analysts covering Genworth, seven rate the shares a buy, nine have hold ratings and just one recommends investors sell the shares.

Edward Spehar of Bank of America Merrill Lynch has a neutral rating for Genworth and a price objective of $13. He lowered his 2011 earnings estimate to $1.25 from $1.60 on Wednesday, because of "elevated uncertainty in U.S. Mortgage Insurance" and expressed "disappointment in the Retirement and Protection business."

--

Written by Philip van Doorn in Jupiter, Fla. and Laurie Kulikowski in New York.

To contact Philip van Doorn, click here:

Philip van Doorn

.

Philip W. van Doorn is a member of TheStreet's banking and finance team, commenting on industry and regulatory trends. He previously served as the senior analyst for TheStreet.com Ratings, responsible for assigning financial strength ratings to banks and savings and loan institutions. Mr. van Doorn previously served as a loan operations officer at Riverside National Bank in Fort Pierce, Fla., and as a credit analyst at the Federal Home Loan Bank of New York, where he monitored banks in New York, New Jersey and Puerto Rico. Mr. van Doorn has additional experience in the mutual fund and computer software industries. He holds a bachelor of science in business administration from Long Island University.