But its revenue topped analysts' estimates and delinquencies declined over the course of the year. The stock gained more than 9 percent in Thursday afternoon trading.
Mortgage insurance is typically required for borrowers who are unable to afford a down payment of 20 percent. The industry suffered mounting losses as mortgage defaults skyrocketed during the housing meltdown, leading to a spike in claims.
For the period ended Dec. 31, MGIC lost $386.7 million, or $1.91 per share. That compares with a loss of $135.3 million, or 67 cents per share, a year earlier.
The current quarter included a one-time charge of $267.5 million related to the settlement of a Freddie Mac dispute. MGIC also boosted its loss reserve estimates by about $100 million during the period to account for probable settlements on rescission disputes with Countrywide and another unnamed lender.
Revenue dropped 17 percent to $371.4 million from $447 million. Still, this beat Wall Street's estimate of $279.6 million.
MGIC's stock climbed 27 cents, or 9.5 percent, to $3.06 in afternoon trading. Over the past year, the shares have traded between 66 cents and $5.15.
Net premiums written fell to $260.7 million from $263.8 million. New insurance written increased to $7 billion from $4.2 billion.
MGIC Investment Corp. lost $927.1 million, or $4.59 per share, for the year. In 2011 it lost $485.9 million, or $2.42 per share. MGIC has posted annual losses going back to 2007. Annual revenue fell 8 percent to $1.38 billion from $1.5 billion.
The percentage of delinquent loans at 2012's end was 11.87 percent, excluding bulk loans. This is down from 13.79 percent at the end of 2011. The percentage of delinquent loans when bulk loans are included was 13.9 percent for 2012. This compares with 16.11 percent for 2011's end.