Reinsurance News

Kemper transfers more than half of Q4 cat losses to reinsurers

14th January 2019 - Author: Matt Sheehan

U.S insurer Kemper Corporation has estimated that its fourth quarter 2018 results will include pre-tax catastrophe losses of $25 million to $30 million, net of reinsurance.

kemper-logoKemper’s catastrophe aggregate reinsurance program is expected to absorb between $30 million to $35 million of the company’s losses for the quarter.

2018 was the first year that the insurer entered into a catastrophe aggregate reinsurance program.

The program was designed to mitigate Kemper’s capital and earnings volatility related to high-frequency, low-severity catastrophe events.

Kemper explained during an earnings call that the catastrophe losses it incurred during the quarter were largely attributable to the California wildfires, which impacted the state’s Butte and Ventura counties in November.

The company also announced during the call that it had repaid $215 million of its $250 million term loan that is due June 29, 2020.

The term loan was drawn on June 29, 2018 to fund Kemper’s $1.4 billion acquisition of auto insurer Infinity Property and Casualty Corporation, which was announced in February 2018.

With $11 billion in assets, the Kemper family of companies is one of the largest insurers in the U.S, providing insurance for auto, home, life, health and valuables through more than 30,000 agents and brokers.

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