Strengthened by $213 million from a public offering, Amerin Corp. plans to expand its already ambitious mortgage insurance operations.

The Chicago company offered 13.3 million shares at $16 each, and will use the largest chunk - $100 million - to boost the capital levels of its two insurance companies. Amerin will use another $46 million to retire convertible preferred stock and the balance for general corporate purposes.

As structured by lead underwriter Morgan Stanley & Co., Amerin chairman Gerald L. Friedman and president Stuart M. Brafman retained 43% of the company's stock, in an offering that was completed at the end of November.

The two industry veterans, whose experience includes senior executive stints at Milwaukee-based Mortgage Guaranty Insurance Corp., or MGIC, organized Amerin in late 1991.

Quick out of the starting block, Amerin wrested market share from giants like MGIC and PMI Mortgage Insurance Co. For the first nine months of 1995, Amerin reported $20.7 million of net premiums. The figure compares with $5.4 million for the first nine months of 1994.

Amerin has snared 5% of the market for primary insurance by working with seven of the 10 largest mortgage banks, including Countrywide Funding Corp. and Norwest Mortgage.

Amerin's executives believe the company is poised for growth because of its ties to large mortgage lenders and because of the expansion in the mortgage insurance industry. Right now, annual insurance originations are running at a $131.4 billion annual clip and are expected to increase.

Mortgage insurance protects lenders against defaults by acting as a safety net for loans. Mortgage insurance may also be required by Fannie Mae and Freddie Mac as a condition for buying a loan and then selling it into the secondary market.

To keep ahead of its rivals, Amerin offers mortgage insurance products not available from competitors.

For instance, Amerin offers a product that requires lenders to pay premiums. Lenders recoup the money through higher interest rates to borrowers. The product is a switch from the traditional approach in which borrowers pay the premiums.

While management is upbeat about Amerin's future, the company must still negotiate some obstacles. For instance, Amerin does not have much of a track record, so the company has not weathered the claims that are typically produced in a policy's later years.

Right now, Amerin's claims-paying ability is judged to be quite sound. The company carries the second-highest ratings from Moody's Investors Service Inc. and Standard & Poor's Corp.

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