Kemper CEO Says 2016 Results Reflect ‘Substantial Progress’

Catastrophe losses and higher personal auto expenses led, in part, to a sizable drop in net income for Kemper Corp. in 2016. In Q4, the insurer saw those numbers improve compared to the previous year.

Kemper said it produced $31.2 million in net income during Q4, or $0.60 per share. In 2015, that number was $4.6 million, or $0.09 per share. For all of 2016, Kemper produced $16.8 million in net income, or $0.33 per share, versus nearly $86 million, or $1.65 per share in 2015.

Catastrophe losses and related loss adjustment expenses created a negative $74.8 million impact on net income in 2016, up sizably from $44.4 million in 2015. While that number is high in comparison, the negative catastrophe loss impact was $8.2 million in the fourth quarter versus $10.4 million in the 2015 fourth quarter, Kemper said.

Kemper President and CEO Joseph P. Lacher Jr. said the insurer is “making substantial progress, especially in our nonstandard personal auto lines.”

The property/casualty combined ratio was 103.3 during the fourth quarter, but that is an improvement over 108.3 produced during Q4 in 2015. For the year, the number was 105.6, up from 103.6 in 2015.

Kemper’s financial results included:

• $309.1 million in net premiums written during Q4, up from $374.7 million in the 2015 fourth quarter. For the year, there were $1.6 billion in net premiums written compared to $1.4 billion in 2015.

• Net premiums earned surpassed $409 million during the 2016 fourth quarter compared to $392.1 million in the 2015 fourth quarter. There were $1.6 billion in net premiums earned in 2016, up from more than $1.4 billion in 2015.

• Net investment income grew to $79.9 million in the fourth quarter, $0.5 million higher than the previous year, due to higher interest income on fixed maturities and non-alternative equity securities, partially offset by lower returns on the alternative investments.

Source: Kemper