Kemper Corporation has reported a net loss of $76.2 million for the third quarter of 2022, compared to a net loss of $75.3 million for the third quarter of 2021.
Total revenues for Q3 of 2022 decreased $67.0 million, or 5%, to $1,377.6 million, compared to Q3 of the previous year, driven by $28.8 million of lower Specialty P&C earned premiums, a $22.2 million decrease in net realised investment gains, $14.4 million of lower Preferred P&C earned premiums, and a $10.6 million decrease in the change in fair value of equity and convertible securities.
The Adjusted Consolidated Net Operating Loss for the quarter was $30.5 million, adds Kemper, compared to the Adjusted Consolidated Net Operating Loss of $75.8 million for Q3 of 2021.
The company notes that the net loss in Q3 included an $8.8 million after-tax loss attributable to the change in fair value of equity and convertible securities.
Additionally, The Specialty Property & Casualty Insurance segment reported a net operating loss of $28.7 million for Q3, compared to a net operating loss of $59.3 million in Q3 of 2021. Results improved due primarily to a lower underlying loss ratio, says Kemper.
The company states that the segment’s Underlying Combined Ratio was 106.8%, compared to 108.9% in Q3 of 2021, adding that the decrease is driven primarily by lower frequency trends as a result of ongoing profit improvement initiatives.
The Life & Health Insurance segment reported a net operating income of $12.6 million in Q3 this year compared to $2.8 million Q3 of 2021, primarily driven by lower mortality in life insurance products.
Joseph P. Lacher, Jr., President, CEO and Chairman, commented, “Our quarterly results show continued progress toward restoring underwriting profitability. The cumulative benefit of the rate and non-rate actions taken over the past year continue to earn in at an accelerated pace.
“In addition, we announced a series of strategic initiatives to further strengthen the Kemper franchise. These include a restructuring program and operating model improvements that will decrease capital requirements, lower costs, enhance customer product offerings, and reduce our risk profile. This will better position us to serve the needs of our customers and employees, and provide significant long-term shareholder value.”
Total Shareholders’ Equity by the quarter’s end was $2,437.6 million, a decrease of $1,570.1 million, or 39%, since year-end 2021.
Kemper states this was chiefly driven by a decrease in the fair value of the Company’s fixed-income bond portfolio, a net operating loss, and cash dividends to shareholders.
Kemper and its direct non-insurance subsidiaries ended the quarter with cash and investments of $449.8 million, and the $600.0 million revolving credit agreement was undrawn. On August 3, 2022, the company announced that its Board of Directors declared a quarterly dividend of $0.31 per share, or $20.1 million. The dividend was paid on August 29, 2022, to its shareholders of record as of August 15, 2022.
The company also observes that as adjusted for the Acquisitions of American Access Casualty Company and Infinity Property and Casualty Corporation, the net loss was $72.7 million for Q3 of 2022, compared to a net loss of $68.6 million for Q3 of 2021.
