Q2 2026 Kemper Corp Earnings Call Transcript
Key Points
- Underlying results improved sequentially, with the normalized underlying combined ratio improving 0.8 points to 102.0%.
- Personal auto combined ratio improved 1.3 points to 105.2%, driven by rate and non-rate actions.
- Commercial auto delivered strong underlying performance with a combined ratio of 93.7% and 9.2% year-over-year PIF growth.
- Life business generated stable earnings of $18 million, supported by growth in earned premiums and favorable mortality and lapse experience.
- Restructuring program identified over $80 million in cumulative annualized run-rate savings, up $20 million from last quarter.
- Reported GAAP results were significantly impacted by a $460 million non-cash goodwill impairment in the specialty auto segment.
- Personal auto remains unprofitable, requiring double-digit rate increases in California, with only a 6.9% filing pending.
- Commercial auto experienced $17.7 million of prior-year reserve development, marking successive quarters of adverse development.
- California concentration remains high, with a 10% sequential decline in policies in force as part of the profit restoration strategy.
- A $16.6 million after-tax allowance for credit losses was recorded related to surplus notes issued by Kemper Reciprocal Exchange.
Good morning, ladies and gentlemen, and welcome to Kemper's second-quarter 2026 earnings conference call. My name is Samantha, and I will be your coordinator today. (Operator Instructions) As a reminder, this conference call is being recorded for replay purposes.
I would now like to introduce your host for today's conference call, Michael Marinaccio, Kemper's Vice President of Corporate Development and Investor Relations. Mr. Marinaccio, you may begin.
Thank you. Good morning, everyone, and welcome to Kemper's discussion of our second-quarter 2026 results. This morning, you'll hear from Steve McAnena, Kemper's President and CEO; and Brad Camden, Kemper's Executive Vice President and Chief Financial Officer.
We'll make a few opening remarks to provide context around our second-quarter results, followed by a Q&A session. During the interactive portion of our call, our presenters will be joined by Chris Flint, Kemper's Executive Vice President and President of Kemper Life; and John
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