<PAGE>   1
                                                                  Exhibit 10.18

                                 VARIABLE SHARE
                       QUOTA SHARE REINSURANCE AGREEMENT

Reinsured:          COMMONWEALTH MORTGAGE ASSURANCE COMPANY
                    (AND AFFILIATES)

Reinsurer:          CAPITAL MORTGAGE REINSURANCE COMPANY

Effective Date:     January 1,1995

Term:               Continuous from the Effective Date until terminated as
                    provided below.

Definitions:        When used in this Agreement, the following terms shall have
                    the specific meanings shown unless the context of any
                    provision hereof clearly indicates otherwise. Any
                    definitions set forth herein shall (i) include the singular
                    as well as plural, and (ii) all accounting terms involving
                    premium and loss calculations shall have the meanings
                    ascribed to them under statutory accounting principles
                    prescribed or permitted under the laws and regulations of
                    the Commonwealth of Pennsylvania.

                    "Affiliate" means any insurance company controlled by,
                    controlling or under common control with the Reinsured or
                    Reinsurer, as applicable.

                    "Losses" means losses paid plus allocated loss adjustment
                    expenses paid by the Reinsured during the Term of this
                    Agreement arising from Covered Business and reported by the
                    Reinsured within its statutory financial statements, net of
                    any salvage in connection therewith. Reinsured's
                    determination of Losses shall be binding on the Reinsurer.

                    "Calendar Year" means each whole calendar year, i.e. each
                    January 1 through December 31.

                    "Calendar Year's Earned Premium" means for any Calendar
                    Year, the amount of gross earned premium allocable to
                    Covered Business and reported by the Reinsured within its
                    statutory financial statement for the particular Calendar
                    Year.

                    "Calendar Year's Losses" means, for any Calendar Year, the
                    amount of Losses allocable to Covered Business and reported
                    by the Reinsured within its year-end statutory

<PAGE>   2
                    financial statement for the particular Calendar Year.

                    "Calendar Year's Ever to Date Written Premium" means for any
                    particular Calendar Year, the aggregate amount of all gross
                    written premium allocable to Covered Business reported by
                    the Reinsured within its year-end financial statements for
                    the period from Underwriting Year through the end of the
                    particular Calendar Year.

                    "Calendar Year's Ever to Date Covered Losses" means, for any
                    particular Calendar Year, the aggregate amount of all Losses
                    reimbursed, or reimbursable by the Reinsurer hereunder,
                    whether under the Calendar Year Variable Quota Share
                    Coverage or the Underwriting Year Excess Coverage, from the
                    Effective Date through the end of the particular Calendar
                    Year.

                    "Underwriting Year" means the Calendar Year beginning
                    January 1, 1995 and ending December 31, 1995.

                    "Underwriting Year's Written Premium" means the gross
                    written premium allocable to Covered Business written by the
                    Reinsured during the Underwriting Year.


                    "Underwriting Year's Net Losses" means the aggregate of all
                    Losses allocable to Covered Business minus the amount of
                    such Losses reimbursed, or reimbursable by the Reinsurer
                    pursuant to this Agreement from the Effective Date through
                    the end of a particular Calendar Year.

                    "Gross Risk in Force" means the aggregate amount of exposure
                    arising from Covered Business calculated by multiplying the
                    unpaid principal balance of each mortgage loan insured by
                    Reinsured by the coverage percentage for each such loan.

Covered Business:   All primary mortgage guaranty insurance policies issued by
                    the Reinsured during the Underwriting Year.

                                       2

<PAGE>   3
Exclusions:              Pool Insurance
                         Reinsurance Assumed
                         Any policy issued as a replacement for an
                         outstanding mortgage insurance policy of any entity
                         acquired by Reinsured.

Coverages:               Calendar Year Variable Quota Share Coverage:
                         The Reinsurer will assume as reinsurance and be liable
                         for:

                         (i)       7.5% of the amount of each Calendar Year's
                                   Losses that do not exceed 55% of such
                                   Calendar Year's Earned Premium.

                         (ii)      11.25% of the amount of each Calendar Year's
                                   Losses that exceed 55% but are less than or
                                   equal to 180% of such Calendar Year's Earned
                                   Premium. Provided, however, that for any
                                   Calendar Year in which such Calendar Year's
                                   Losses exceed 55% of such Calendar Year's
                                   Earned Premium, Reinsurer shall assume and be
                                   liable for an additional 3.75% of such
                                   Calendar Year's Losses up to 55% of such
                                   Calendar Year's Earned Premium.

                         (iii)     15% of the amount of each Calendar Year's
                                   Losses that exceed 180% of such Calendar
                                   Year's Earned Premium.

                         (iv)      100% of the amount of each Calendar Year's
                                   Losses that exceed 85% of the Reinsured's
                                   Gross Risk in Force at the end of such
                                   Calendar Year and are not covered pursuant to
                                   provisions (i) through (iii) above.

                         Underwriting Year Excess Coverage: The Reinsurer will
                         assume as reinsurance and be liable for:

                         (i)       100% of the Underwriting Year's Net Losses
                                   incurred by the Reinsured during Calendar
                                   Years one through four, to the extent that 8%
                                   of the Underwriting Year's Written Premium,
                                   plus any unpaid ceding commission, exceeds
                                   the Calendar Year's Ever to Date Covered
                                   Losses at the end of

                                       3
<PAGE>   4
                                   the fourth Calendar Year of this Agreement.

                         (ii)      100% of the Underwriting Year's Net Losses
                                   incurred by the Reinsured during Calendar
                                   Years five through seven, to the extent that
                                   8% of the premium allocable to the
                                   Underwriting Year and collected during the
                                   first and second Calendar Years of this
                                   Agreement plus any unpaid ceding commission,
                                   exceeds the Calendar Year's Ever to Date
                                   Covered Losses at the end of the seventh
                                   Calendar Year of this Agreement


                         (iii)     100% of the Underwriting Year's Net Losses
                                   incurred by the Reinsured through the end of
                                   the tenth Calendar Year of this Agreement, to
                                   the extent that 8% of the premium allocable
                                   to the Underwriting Year, plus any unpaid
                                   ceding commission, exceeds the Calendar
                                   Year's Ever to Date Covered Losses, at the
                                   end of the tenth Calendar Year of this
                                   Agreement.

Premium:            The Reinsured shall pay to the Reinsurer a premium (the
                    "Premium") during the Term of this Agreement equal to 15% of
                    the Reinsured's gross written premium allocable to Covered
                    Business during each calendar quarter. The Premium, net of
                    any ceding commission due hereunder, shall be due and
                    payable within thirty (30) days after the end of such
                    calendar quarter and shall be remitted as set forth below.

Ceding
Commission:         The Reinsurer shall pay to the Reinsured a ceding
                    commission of thirty-two percent (32%) of the Premium paid
                    hereunder, provided, however, that for any Calendar Year for
                    which such Calendar Year's Losses exceed fifty-five percent
                    (55%) of such Calendar Year's Earned Premium, no ceding
                    commission shall be paid.

                                       4
<PAGE>   5

Loss
Payments:           Calendar Year Variable Quota Share Coverage

                    The Reinsurer shall pay to the Reinsured a provisional
                    payment for Losses reinsured under the Calendar Year
                    Variable Quota Share Coverage equal to 7.5% of the amount of
                    Reinsured's Losses during each calendar quarter during the
                    Term of this Agreement no later than the later of (i) thirty
                    (30) days after the end of such calendar quarter, and (ii)
                    ten (10) business days following the receipt by Reinsurer of
                    a schedule setting forth the amount of Reinsured's Losses
                    during such quarter. Sixty (60) days after the end of each
                    Calendar Year (or any shorter period in the event of a
                    termination) the Reinsured shall prepare and forward to
                    Reinsurer a loss account showing for such Calendar Year (or
                    shorter period) and the Underwriting Year, all Losses,
                    Written Premium, Earned Premium and Gross Risk in Force.
                    Within ten (10) days after Reinsurer's receipt of the loss
                    account for a particular Calendar Year (or shorter period),
                    the Reinsurer and the Reinsured shall transfer funds between
                    them so as to reconcile the difference between (i) the
                    Reinsured's Calendar Year's Losses reimbursed and
                    reimbursable hereunder, and (ii) the sum of the provisional
                    payments for Losses and payments of ceding commissions made
                    by Reinsurer with respect to the calendar quarters during
                    such Calendar Year (or shorter period).

                    Underwriting Year Excess Coverage

                    The Reinsurer shall remit to the Reinsured a provisional
                    payment of any amounts due Reinsured under the Underwriting
                    Year Excess Coverage on or before the last business day of
                    the fourth, seventh and tenth Calendar Years of this
                    Agreement. Reinsured shall provide Reinsurer with a
                    provisional loss account no later than thirty (30) days
                    prior to the end of any such Calendar Year.

                    Sixty (60) days after the end of the fourth, seventh and
                    tenth Calendar Years of this Agreement, the Reinsured shall
                    prepare and forward to Reinsurer a loss account showing for
                    such Calendar Year and the Underwriting Year, all Losses,
                    Written Premium, Earned Premium and Gross Risk in Force.
                    Within ten (10) business days after Reinsurer's receipt of
                    the loss account for the fourth, seventh

                                       5
<PAGE>   6
                         and tenth Calendar Years, the Reinsurer and the
                         Reinsured shall transfer funds between them so as to
                         reconcile the difference between (i) the Reinsured's
                         Underwriting Year's Net Losses, and (ii) the sum of the
                         provisional payments made by Reinsurer under the
                         Underwriting Year Excess Coverage with respect to such
                         Calendar Year.

CANCELLATION,
TERMINATION:             A. This Agreement is non-cancelable by either party
                         hereto for a period of ten years from the effective
                         date hereof, except as provided in Section (B) below.

                         B. Upon the occurrence of one or more of the following
                         events, the Reinsured, upon providing ninety (90) days
                         prior written notice to Reinsurer, shall have the right
                         to terminate this Agreement on a cut-off basis,
                         providing that such event or events have not been
                         corrected prior to the expiration of such ninety (90)
                         day period:

                         1. Notice from Standard & Poor's Corporation ("S&P"),
                         Moody's Investor Services, Inc. ("Moody's"), or any
                         other nationally recognized rating agency that rates
                         the Reinsured, confirmation of which shall be provided
                         to the Reinsurer, that the Reinsured's then-current
                         financial strength or claims-paying rating cannot be
                         maintained because of the reinsurance coverage provided
                         hereunder.

                         2. Receipt by the Reinsured of written notice from the
                         Pennsylvania Department of Insurance, or any other
                         regulatory authority, a copy of which notice shall be
                         provided to the Reinsurer, denying to Reinsured full
                         financial statement credit according to the statutory
                         requirements of the Commonwealth of Pennsylvania or any
                         other jurisdiction in which the failure of Reinsured to
                         obtain such full financial statement credit would have
                         a material adverse impact on the Reinsured.

                         3. Each party shall have the right to terminate this
                         Agreement in the event of any actual or alleged breach
                         or non-performance of a material provision of this
                         Agreement by the other party which is not corrected or
                         cured within thirty (30) days of the receipt by such
                         other party of a written notice specifying the nature
                         of the claimed breach or non-performance.

                                       6
<PAGE>   7
               4.  Each party shall have the right to terminate this Agreement
               on December 31, 2004 (or any subsequent December 31) by providing
               at least ninety (90) days prior written notice of its intention
               to terminate this Agreement.

               After a termination cut-off pursuant to this Section, the
               Reinsurer shall pay to the Reinsured a profit commission equal to
               (i) 8% of the current Calendar Year's Ever to Date Written
               Premium, plus (ii) any unpaid ceding commission not paid in any
               Calendar Year when the Underwriting Year's Ever to Date Covered
               Losses exceeded fifty-five percent (55%) of such Calendar Year's
               Earned Premium, minus (iii) such Calendar Year's Ever to Date
               Covered Losses.

               At any termination of this Agreement, the Reinsurer shall refund
               to the Reinsured, in addition to any other sums due to the
               Reinsured hereunder, 14.67% of the Reinsured's ceded unearned
               premium with respect to Covered Business as of the date of such
               termination.

Financial
Statement
Credit:        The Reinsurer shall take all steps necessary for the Reinsured to
               obtain full financial statement credit according to the statutory
               requirements of the Commonwealth of Pennsylvania, the State of
               New York, and any other jurisdiction in which the failure of
               Reinsured to obtain such full financial statement credit would
               have a material adverse impact on the Reinsured.

Trust
Agreement:     Upon the execution of this Agreement by the parties, the
               Reinsurer shall establish a trust account (the "Trust") for the
               benefit of the Reinsured at a financial institution and under a
               trust agreement acceptable to Reinsured. The Reinsured shall
               promptly reimburse the Reinsurer for the reasonable and customary
               fees and expenses of the administration of the Trust.

               The payments of Premium (net of any ceding commissions due) by
               the Reinsured hereunder shall be made in two parts: (i) an amount
               equal to (14.67%) of any Premium shall be remitted directly to
               the Reinsurer; and (ii) any remaining Premium due, net of any
               ceding commission, shall be


                                       7
<PAGE>   8
               deposited directly into the Trust.

               Deposits of Premium into the Trust shall be invested at the
               discretion of the Reinsurer, provided, however, that at each
               quarter-end (i) at least ninety-five percent (95%) of the assets
               of the Trust shall consist of instruments or securities
               determined, as of the date of each quarter-end, to be of
               investment grade as defined from time to time by S&P and/or
               Moody's, (ii) at least fifty percent (50%) of the investments and
               cash assets of the Trust shall consist of cash or cash
               equivalents, or securities determined, as of the date of
               purchase, to be of the highest investment grade as determined
               from time to time by S&P and/or Moody's, and (iii) none of the
               assets of the Trust may be invested in instruments or securities
               with any real estate-related risk, and (iv) none of the assets of
               the Trust may be invested in instruments or securities of the
               Reinsurer, Reinsured or any Affiliate of either. Reinsurer shall
               be entitled to the investment income generated by the Trust.

               The Reinsured has the right and the obligation to withdraw assets
               from the Trust at any time and from time to time, as the
               Reinsured shall elect, in satisfaction of Reinsurer's obligations
               hereunder, provided that such obligations have not been
               previously reimbursed by to the Reinsured by the Reinsurer. In
               the event that, at any time, the assets of the Trust are
               insufficient to satisfy fully the obligations of the Reinsurer
               hereunder, the Reinsurer shall satisfy such shortfall directly as
               provided hereinabove.

               The Reinsurer may withdraw, and retain for its own account, all
               investment income earned on the Trust's assets at any time and
               from time to time as the Reinsurer shall elect. The trustee shall
               allow no other withdrawals or substitutions of assets from or to
               the Trust except as permitted hereunder.

               The trustee shall immediately honor all withdrawal requests made
               in accordance herewith and take all steps necessary to transfer
               the applicable assets held under the Trust to the appropriate
               party.

               Any disputes arising from the Trust may not be the subject of an
               arbitration proceeding between the parties unless both Reinsured
               and Reinsurer agree


                                       8
<PAGE>   9
                    in writing to such an arbitration proceeding.

OTHER PROVISIONS:   This Agreement is subject to the negotiation and execution
                    of a formal reinsurance treaty and a trust agreement both
                    acceptable to the parties containing in addition to the
                    terms and conditions set forth herein, ordinary and
                    customary clauses set forth in reinsurance transactions
                    generally, including, but not limited to the following:

                    Follow the Fortunes Clause
                    Offset Clause
                    Errors and Omissions Clause
                    Inspections Clause
                    Taxes Clause
                    Service and Suit Clause
                    Insolvency Clause
                    Arbitration Clause
                    Assignment Clause
                    Notices Clause
                    Waiver Clause
                    Negotiated Agreement Clause
                    Governing Law Clause (PA)
                    Salvage Clause
                    Subrogation Clause
                    Access to Records Clause
                    Reports Clause
                    Parental Wrap of Reinsurer Clause
                    Penalty Interest for Late Payments


Agreed to and accepted by:

COMMONWEALTH MORTGAGE ASSURANCE COMPANY

By: /s/ Frank P. Filipps
   -------------------------------------
     Frank P. Filipps, President and
     Chief Executive Officer

Date: 4/14/95
     --------------------


CAPITAL MORTGAGE REINSURANCE COMPANY

By: /s/ [Illegible]
   -------------------------------------

Date: April 18, 1995
     --------------------


                                       9