Kemper Corporation has reported a net loss of $74.7 million for the second quarter of 2022, compared to a net loss of $62.6 million from the second quarter of 2021.
Total revenues for the quarter decreased $68.7 million (5%), to $1,433.8 million, compared to the second quarter of 2021, driven by an $81.3 million decrease in the change in fair value of equity and convertible securities, $13.3 million of lower Preferred P&C earned premiums, and an $8.2 million decrease in net realized investment gains, partially offset by $33.4 million of higher Specialty P&C earned premiums.
Adjusted consolidated net operating loss was $39.7 million for Q2 22, compared to adjusted consolidated net operating loss of $99.4 million from Q2 21.
Additionally, Kemper Corporations specialty Property & Casualty Insurance segment reported net operating loss of $38.9 million for the second quarter of 2022, compared to net operating loss of $91.7 million in the second quarter of 2021. Kemper noted that results improved due primarily to lower development on prior year claims.
At the same time, the segment’s underlying combined ratio was 108.8% for the quarter compared to 107.3% in the same period last year.
Net investment income increased $4.6 million to $118.5 million in the quarter, compared to the prior year quarter.
Joseph P. Lacher, Jr., President, CEO and Chairman , said: “Our second quarter results showed progress and commitment towards restoring profitability. “This was highlighted by our rate filing actions that exceeded the expectations we outlined in the first quarter.
“These actions are beginning to earn in and will accelerate throughout the remainder of this year and next. This should offset ongoing environmental pressures and ultimately help us achieve target underwriting profitability.”
Meanwhile, Kemper has also announced that it has agreed to sell Reserve National Insurance Company and its subsidiaries, which are predominantly focused on accident and health insurance, to Medical Mutual of Ohio for $90 million.
The transaction is subject to regulatory approval and other closing conditions with an expected closing in late 2022 or early 2023.
Lacher, added: “This transaction aligns with Kemper’s strategic intent and is a great fit for Medical Mutual of Ohio. It will allow Kemper to increase our focus and invest additional resources in the P&C and life insurance businesses that are providing sustainable, competitive advantages to better deliver value to all our stakeholders.”
Kemper expects to record a gain upon completion of the transaction.
Tom Dewey, Medical Mutual Executive Vice President, People and Strategy, commented: “This is an opportunity for Medical Mutual to strengthen our market position, as this transaction allows us to immediately expand our current product offerings. And while Ohio is our home, we also look at this as an opportunity to strategically expand our geographic footprint as a framework for future growth.”
