California Code, Insurance Code - INS § 12640.08

A mortgage guaranty insurer shall not insure loans secured by properties in a single housing tract or a contiguous tract in excess of ten (10) percent of the insurer's policyholders surplus.  In determining the amount of such risk, applicable reinsurance in any assuming insurer authorized to transact mortgage guaranty insurance in this State shall be deducted from the total direct risk insured.  “Contiguous,” for the purposes of this section, means not separated by more than one-half mile.