Slide 1: First Quarter 2017 Earnings
May 4, 2017 First Quarter 2017 Earnings
Slide 2: Preliminary Matters
Preliminary Matters Caution Regarding Forward‐Looking Statements This presentation may contain or incorporate by reference information that includes or is based on forward‐looking statements within the meaning of the safe‐harbor provisions of the Private Securities Litigation Reform Act of 1995. For
Slide 3: Create Long-term Shareholder Value
Create Long‐term Shareholder Value Diversified sources of earnings; Sustainable competitive Growing returns Strong capital/liquidity advantages and build and book value per positions; core capabilities share over time Disciplined approach to capital mgmt Strategic focus: Consumer‐related businesses
Slide 4: First Quarter 2017 Highlights
First Quarter 2017 Highlights Three Months Ended (Dollars in millions, except per Mar. 31, Dec. 31, Sept. 30, June 30, Mar. 31, share amounts) 2017 2016 2016 2016 2016 Net Income (Loss) Per Share $ (0.01) $ 0.60 $ (0.32) $ 0.08 $ (0.04) Net Operating Income (Loss) Per Share¹ $ (0.08) $ 0.56 $ (0.40)
Slide 5: Improving Underlying Operating Performance
Improving Underlying Operating Performance Three Months Ended Dollars per Unrestricted Share ‐ Diluted Mar. 31, Dec. 31, Sept. 30, June 30, Mar. 31, Variance 2017 2016 2016 2016 2016 QoQ Income (Loss) from Continuing Operations $ (0.01) $ 0.56 $ (0.36) $ 0.08 $ (0.04) 0.03 Net Realized Gains and Imp
Slide 6: Stable and Predictable Life & Health Earnings
Stable and Predictable Life & Health Earnings Revenues (MM) Revenues $205 $201 $207 $206 $206 • Earned premiums increased $3.2 million $55 $50 $55 $54 $53 over 1Q16 • Life increased $1.3 million, driven by increased volume at Reserve National; $150 $151 $152 $152 $153 Home Service premiums increased
Slide 7: Preferred Auto Challenged—Taking Actions
Preferred Auto Challenged—Taking Actions Earned Premiums by Line (MM) $185 $184 $187 $186 $181 Preferred Auto • 1Q17 underlying combined ratio increased $11 $11 $11 $11 $11 5.3 percentage points $68 $68 $69 $68 $66 • Preferred auto remains challenged by adverse loss cost trends and claims $106 $105
Slide 8: Improving Trends in Nonstandard Personal Auto
Improving Trends in Nonstandard Personal Auto Earned Premiums by Line (MM) $197 $205 $207 $211 $216 Legacy Personal Auto • 1Q17 underlying combined ratio improved 5.7 percentage points, primarily from $126 $130 $132 $136 $120 higher average earned premiums • Net written premiums increased 5 percent
Slide 9: Consistent Portfolio Returns: High Quality, Moderate Risk
Consistent Portfolio Returns: High Quality, Moderate Risk Strong Performance Despite Low Rates Overview • Investment portfolio produced an (MM) $80 $82 annualized pre‐tax equivalent book yield $74 $78 $67 $11 $15 of 5.4 percent in 1Q17, compared to 4.6 $7 $10 percent in 1Q16 • More than 75 percent o
Slide 10: Strong Current Capital Position with Ample Liquidity
Strong Current Capital Position with Ample Liquidity Strong Parent Company Liquidity Risk‐Based Capital Ratios (MM) Life & Health Legacy P&C (%) $555 $566 $524 $513 $382 $225 $225 $225 $225 $225 420 335 375 330 415 335 415 325 $330 $341 $299 $288 $157 2013 2014 2015 2016 1Q17 2014 2015 2016 2017E Bo
Slide 11: Kemper
y KEMPER
Slide 12: Appendix
Appendix
Slide 13: Non-GAAP Financial Measures
Non‐GAAP Financial Measures Diluted Consolidated Net Operating Income (Loss) Per Unrestricted Share is an after‐tax, non‐GAAP financial measure computed by excluding from Diluted Income (Loss) from Continuing Operations Per Unrestricted Share the after‐tax per unrestricted share impact of net realiz
Slide 14: Non-GAAP Financial Measures
Non‐GAAP Financial Measures Underlying Operating Performance is a non‐GAAP financial measure that is computed by excluding from the Diluted Income (Loss) from Continuing Operations Per Unrestricted Share the after‐tax per unrestricted share impact of 1) net realized gains on sales of investments, 2)
Slide 15: Non-GAAP Financial Measures
Non‐GAAP Financial Measures Underlying Combined Ratio is a non‐GAAP financial measure that is computed by excluding the current year catastrophe and LAE ratio and the prior‐year reserve development ratio (both non‐catastrophe and catastrophes) from the combined ratio. The most directly comparable GA
Slide 16: Non-GAAP Financial Measures
Non‐GAAP Financial Measures Underlying Combined Ratio – Continued For the Three Months Ended 1Q16 2Q16 3Q16 4Q16 1Q17 Legacy Nonstandard Personal Automobile Underlying Combined Ratio 102.5% 99.1% 96.1% 97.8% 96.8% Current Year Catastrophe Loss and LAE Ratio 2.2% 2.9% 2.2% (0.1%) 1.4% Prior Years Non