Kemper Announces First Quarter Preliminary Results and Schedule for Earnings Release

Kemper Corporation (NYSE: KMPR) today announced that after the markets close on Wednesday, May 1, Kemper will issue its first quarter 2024 earnings release, financial supplement, and Form 10-Q. Following their publication, these documents will be available in the investor section of kemper.com.

PRELIMINARY RESULTS

Preliminary results for the first quarter of 2024 include estimated net income and adjusted consolidated net operating income¹ of between $65 million and $75 million.

Kemper Auto (Specialty P&C)

Preliminary combined ratios are:

New Business Production and Policies In Force (“PIF") Change

• Re-acceleration began in early February 2024; strong demand across all markets.
• Compared to the fourth quarter of 2023:
  • New written premium increased over 200%.
  • New policies issued increased over 150%.
  • Rate of sequential quarterly PIF decline slowed to 5.5% compared to 8.9% in the fourth quarter of 2023.

Kemper Life

• After-tax income was approximately $12 million.

Capital and Liquidity

• Parent company liquidity was approximately $1.1 billion.
• Insurance subsidiaries are well-capitalized.

CONFERENCE CALL DETAILS

Kemper will host its conference call to discuss first quarter 2024 results on Wednesday, May 1, at 5:00 pm Eastern (4:00 pm Central). The conference call will be accessible via the internet and telephone at 888.259.6580, access code 70282475. To listen via webcast, register online at the investor section of kemper.com at least 15 minutes before the webcast to install any necessary software. A replay of the webcast will be available online at the investor section of kemper.com.

¹ Non-GAAP financial measure. All non-GAAP financial measures are denoted with footnote 1 throughout this release. See below for further explanation on the use of non-GAAP financial measures.

USE OF NON-GAAP FINANCIAL MEASURES

Adjusted Consolidated Net Operating Income¹ is computed by excluding from Net Income Attributable to Kemper Corporation the after-tax impact of:

(i) Income (Loss) from Change in Fair Value of Equity and Convertible Securities;

(ii) Net Realized Investment Gains (Losses);

(iii) Impairment (Losses) Gains;

(iv) Acquisition and Disposition Related Transaction, Integration, Restructuring and Other Costs;

(v) Debt Extinguishment, Pension Settlement and Other Charges;

(vi) Goodwill Impairment Charges;

(vii) Non-Core Operations; and

(viii) Significant non-recurring or infrequent items that may not be indicative of ongoing operations.

Significant non-recurring items are excluded when (a) the nature of the charge or gain is such that it is reasonably unlikely to recur within two years and (b) there has been no similar charge or gain within the prior two years. The most directly comparable GAAP financial measure is Net Income Attributable to Kemper Corporation. Kemper excluded no applicable significant non-recurring items from the Adjusted Consolidated Net Operating Income calculation for the three months ended March 31, 2024.

Kemper believes that Adjusted Consolidated Net Operating Income provides investors with a valuable measure of its ongoing performance because it reveals underlying operational performance trends that otherwise might be less apparent if the items were not excluded. (Loss) Income from Change in Fair Value of Equity and Convertible Securities, Net Realized Investment Gains and Impairment Gains (Losses) related to investments included in Kemper’s results may vary significantly between periods and are generally driven by business decisions and external economic developments such as capital market conditions that impact the values of the Kemper’s investments, the timing of which is unrelated to the insurance underwriting process. Acquisition and Disposition Related Transaction, Integration, Restructuring and Other Costs may vary significantly between periods and are generally driven by the timing of acquisitions and business decisions unrelated to the insurance underwriting process. Debt Extinguishment, Pension Settlement and Other Charges relate to (i) loss from early extinguishment of debt, which is driven by Kemper’s financing and refinancing decisions and capital needs, as well as external economic developments such as debt market conditions, the timing of which is unrelated to the insurance underwriting process; (ii) settlement of pension plan obligations which are business decisions made by Kemper, the timing of which is unrelated to the underwriting process; and (iii) other charges that are non-standard, not part of the ordinary course of business, and unrelated to the insurance underwriting process.

Goodwill impairment charges are excluded because they are infrequent and non-recurring charges. Non-core operations include the results of our Preferred Insurance business, which we expect to fully exit. These results are excluded because they are not relevant to our ongoing operations and do not qualify for Discontinued Operations under Generally Accepted Accounting Principles ("GAAP"). Significant non-recurring items are excluded because, by their nature, they are not indicative of Kemper’s business or economic trends. The preceding non-GAAP financial measures should not be considered a substitute for the comparable GAAP financial measures, as they do not fully recognize the profitability of Kemper’s businesses.

Underlying Combined Ratio¹ is computed by adding the Current Year Non-catastrophe Losses and LAE (Loss Adjustment Expense) Ratio with the Insurance Expense Ratio. The most directly comparable GAAP financial measure is the Combined Ratio, which is computed by adding Total Incurred Losses and LAE Ratio, including the impact of catastrophe losses and loss and LAE reserve development from prior years, with the Insurance Expense Ratio.

Kemper believes Underlying Losses and LAE and the Underlying Combined Ratio are useful to investors and uses these financial measures to reveal the trends in Kemper’s Specialty Property & Casualty Insurance segment that may be obscured by catastrophe losses and prior-year reserve development. These catastrophe losses may cause Kemper’s loss trends to vary significantly between periods due to their incidence of occurrence and magnitude and can have a significant impact on incurred losses, LAE and the Combined Ratio. Prior-year reserve developments are caused by unexpected loss development on historical reserves. Because reserve development relates to the re-estimation of losses from earlier periods, it has no bearing on the performance of Kemper’s insurance products in the current period. Kemper believes it is useful for investors to evaluate these components separately and in the aggregate when reviewing Kemper’s underwriting performance.

Caution Regarding Forward-Looking Statements

This press release 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. We caution investors that these forward-looking statements are not guarantees of future performance, and actual results may differ materially. Such statements involve known and unknown risks, uncertainties, and other factors, including but not limited to:

• changes in the frequency and severity of insurance claims;
• claim development and the process of estimating claim reserves;
• the impacts of inflation;
• changes in the interest rate environment;
• supply chain disruption;
• product demand and pricing;
• effects of governmental and regulatory actions;
• litigation outcomes and trends;
• investment risks;
• cybersecurity risks;
• impact of catastrophes; and
• other risks and uncertainties detailed in Kemper’s Annual Report on Form 10-K and subsequent filings with the Securities and Exchange Commission (“SEC”).

Kemper assumes no obligation to publicly correct or update any forward-looking statements as a result of events or developments subsequent to the date of this press release.

About Kemper

The Kemper family of companies is one of the nation's leading specialized insurers. With approximately $13 billion in assets, Kemper is improving the world of insurance by providing affordable and easy-to-use personalized solutions to individuals, families and businesses through its Kemper Auto and Kemper Life brands. Kemper serves over 4.9 million policies, is represented by 23,700 agents and brokers, and has 8,100 associates dedicated to meeting the ever-changing needs of its customers. Learn more about Kemper.

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