Arizona Seizes PMI's Main Subsidiary

NEW YORK (TheStreet) -- Mortgage insurer PMI Group (PMI) says Arizona regulators have seized its primary subsidiary.

In a message posted on the home page of its Web site, the company said the Arizona Department of Insurance has obtained an order giving it "full possession, management and control" of PMI Mortgage Insurance Co. The order is dated Oct. 20.

Under regulators' control, the company on Monday will begin paying only 50% of claims, the message says. The remaining amount will be deferred as policyholder claims, the message adds.

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In August, Arizona ordered PMI Mortgage Insurance to stop selling new insurance policies.

Like other mortgage insurers, PMI got hit hard by losses on policies written during the housing bubble.

The company's shares have fallen from more than $4 one year ago to recent levels of about 30 cents.

This article was written by a staff member of TheStreet.

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