Bermudian-domiciled mortgage insurer Essent Group Ltd’s profits for the fourth quarter of last year received an $85.1 million boost from US tax reform.

Essent said today it made net income of $162.6 million, or $1.65 per share, during the last three months of last year.

The one-time impact of the reduced US corporate income tax rate on the company’s net deferred tax liability position contributed 86 cents per share to the results.

Essent said net income for the full year 2017 was $379.7 million, or $3.99 per share.

The company reported that two of last year’s hurricanes had contributed to an increase in defaults among the mortgages it insures.

Mark Casale, chairman and chief executive officer, said Essent had continued to a high credit quality and profitable mortgage insurance portfolio during 2017.

“During the year, we continued growing our earnings and generating strong returns,” Mr Casale said. “As we head into our ninth year of writing mortgage insurance, our outlook for 2018 on our business and housing remains positive.”

Loans in default at December 31, 2017 were 4,783 compared to 2,153 as of September 30, 2017 and 1,757 as of December 31, 2016. Total loans in default increased by 2,630 in the quarter, including 2,288 defaults that we have identified as related to hurricanes Harvey and Irma.

The percentage of loans in default as of December 31, 2017 was 0.96 per cent, compared to 0.46 per cent as of September 30, 2017 and 0.47 per cent as of December 31, 2016.

Essent said its insurance in force as of December 31, 2017 was $110.5 billion, up from $103.9 billion three months earlier and $83.3 billion from a year earlier.

New insurance written for the fourth quarter was $11.2 billion and $43.9 billion for the full year.

Net premiums earned for the fourth quarter were $148 million, compared to $116.8 million in 2016. For the full year 2017, net premiums earned were $530.1 million, compared to $422.7 million for 2016.

The expense ratio for the fourth quarter was 24.7 per cent, compared to 29.8 per cent a year earlier. For the full year 2017, the expense ratio was 27.5 per cent, down from 30.9 per cent in 2016.

Essent’s combined ratio for the fourth quarter, reflecting the proportion of premium dollars paid out on claims and expenses, was 36.4 per cent, compared to 33.1 per cent in the fourth quarter of 2016.