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Share Name | Share Symbol | Market | Type |
---|---|---|---|
Horace Mann Educators Corporation | NYSE:HMN | NYSE | Common Stock |
Price Change | % Change | Share Price | High Price | Low Price | Open Price | Shares Traded | Last Trade | |
---|---|---|---|---|---|---|---|---|
0.12 | 0.35% | 34.44 | 35.096 | 34.43 | 34.48 | 194,317 | 23:19:39 |
Delaware
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37-0911756
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(State or other jurisdiction of incorporation or organization)
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(I.R.S. Employer Identification No.)
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Securities registered pursuant to Section 12(b) of the Act:
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Title of each class
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Trading Symbol
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Name of each exchange
on which registered
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Common Stock, $0.001 par value
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HMN
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New York Stock Exchange
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Large accelerated filer
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☑
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Accelerated filer
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☐
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Non-accelerated filer
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☐
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Smaller reporting company
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☐
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Emerging growth company
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☐
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Page
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Item 1.
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Item 2.
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Item 3.
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Item 4.
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Item 1A.
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Item 2.
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Item 5.
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Item 6.
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/s/ KPMG LLP
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KPMG LLP
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Chicago, Illinois
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May 8, 2020
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Horace Mann Educators Corporation
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1
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Quarterly Report on Form 10-Q
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March 31, 2020
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December 31, 2019
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(Unaudited)
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ASSETS
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||||||||
Investments
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||||
Fixed maturity securities, available for sale, at fair value
(amortized cost 2020, $5,653,466; 2019, $5,456,980)
|
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$
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5,843,183
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$
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5,791,676
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Equity securities at fair value
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87,033
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101,864
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Limited partnership interests
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389,318
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383,717
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Short-term and other investments
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281,697
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361,976
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Total investments
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6,601,231
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6,639,233
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Cash
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41,247
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25,508
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|
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Deferred policy acquisition costs
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297,815
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276,668
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|
||
Deposit asset on reinsurance
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2,356,253
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2,346,166
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||
Intangible assets, net
|
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173,531
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177,217
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||
Goodwill
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49,079
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49,079
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Other assets
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498,798
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474,364
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Separate Account (variable annuity) assets
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1,954,201
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2,490,469
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Total assets
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$
|
11,972,155
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$
|
12,478,704
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LIABILITIES AND SHAREHOLDERS’ EQUITY
|
||||||||
Policy liabilities
|
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|
||||
Investment contract and policy reserves
|
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$
|
6,273,640
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$
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6,234,452
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Unpaid claims and claim expenses
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438,403
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442,854
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Unearned premiums
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266,247
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279,163
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|
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Total policy liabilities
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6,978,290
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6,956,469
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Other policyholder funds
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716,318
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647,283
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Other liabilities
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412,628
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384,173
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Short-term debt
|
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135,000
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135,000
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Long-term debt
|
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298,098
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298,025
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|
||
Separate Account (variable annuity) liabilities
|
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1,954,201
|
|
|
2,490,469
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|
||
Total liabilities
|
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10,494,535
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10,911,419
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|
||
Preferred stock, $0.001 par value, authorized
1,000,000 shares; none issued
|
|
—
|
|
|
—
|
|
||
Common stock, $0.001 par value, authorized 75,000,000 shares;
issued, 2020, 66,180,077; 2019, 66,088,808
|
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66
|
|
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66
|
|
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Additional paid-in capital
|
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481,917
|
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480,962
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|
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Retained earnings
|
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1,357,833
|
|
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1,352,539
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|
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Accumulated other comprehensive income (loss), net of tax:
|
|
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|
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Net unrealized investment gains on fixed maturity securities
|
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136,679
|
|
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230,448
|
|
||
Net funded status of benefit plans
|
|
(10,767
|
)
|
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(10,767
|
)
|
||
Treasury stock, at cost, 2020, 24,902,579 shares;
2019, 24,850,484 shares
|
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(488,108
|
)
|
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(485,963
|
)
|
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Total shareholders’ equity
|
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1,477,620
|
|
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1,567,285
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|
||
Total liabilities and shareholders’ equity
|
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$
|
11,972,155
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$
|
12,478,704
|
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Horace Mann Educators Corporation
|
2
|
Quarterly Report on Form 10-Q
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Three Months Ended
March 31, |
||||||
|
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2020
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2019
|
||||
Revenues
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Insurance premiums and contract charges earned
|
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$
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236,265
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$
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209,785
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Net investment income
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82,275
|
|
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92,800
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|
||
Net investment gains (losses)
|
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(18,464
|
)
|
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7,417
|
|
||
Other income
|
|
7,169
|
|
|
5,874
|
|
||
|
|
|
|
|
||||
Total revenues
|
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307,245
|
|
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315,876
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|
||||
Benefits, losses and expenses
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|
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|
||||
Benefits, claims and settlement expenses
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138,660
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139,384
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Interest credited
|
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51,545
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52,922
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Operating expenses
|
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60,662
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56,175
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DAC unlocking and amortization expense
|
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29,975
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24,973
|
|
||
Intangible asset amortization expense
|
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3,686
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|
|
541
|
|
||
Interest expense
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4,228
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3,303
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||
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Total benefits, losses and expenses
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288,756
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277,298
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Income before income taxes
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18,489
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38,578
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Income tax expense
|
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17
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6,412
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||
|
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|
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Net income
|
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$
|
18,472
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$
|
32,166
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|
||||
Net income per share
|
|
|
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|
||||
Basic
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$
|
0.44
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$
|
0.77
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Diluted
|
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$
|
0.44
|
|
|
$
|
0.77
|
|
|
|
|
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|
||||
Weighted average number of shares
and equivalent shares
|
|
|
|
|
||||
Basic
|
|
41,827
|
|
|
41,610
|
|
||
Diluted
|
|
42,019
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|
|
41,785
|
|
||
|
|
|
|
|
||||
Net investment gains (losses)
|
|
|
|
|
||||
Total other-than-temporary impairment losses on securities
|
|
$
|
(3,692
|
)
|
|
$
|
(236
|
)
|
Portion of losses recognized in other comprehensive income (loss)
|
|
—
|
|
|
—
|
|
||
Net other-than-temporary impairment losses
on securities recognized in earnings
|
|
(3,692
|
)
|
|
(236
|
)
|
||
Sales and other, net
|
|
4,557
|
|
|
4,838
|
|
||
Change in fair value - equity securities
|
|
(14,486
|
)
|
|
3,506
|
|
||
Change in fair value and gains (losses) realized on settlements -
derivatives
|
|
(4,843
|
)
|
|
(691
|
)
|
||
Total
|
|
$
|
(18,464
|
)
|
|
$
|
7,417
|
|
Horace Mann Educators Corporation
|
3
|
Quarterly Report on Form 10-Q
|
|
|
Three Months Ended
March 31, |
||||||
|
|
2020
|
|
2019
|
||||
Comprehensive income (loss)
|
|
|
|
|
|
|
||
Net income
|
|
$
|
18,472
|
|
|
$
|
32,166
|
|
Other comprehensive income (loss), net of tax:
|
|
|
|
|
|
|
||
Change in net unrealized investment gains
(losses) on fixed maturity securities
|
|
(93,769
|
)
|
|
113,898
|
|
||
Change in net funded status of benefit plans
|
|
—
|
|
|
—
|
|
||
Other comprehensive income (loss)
|
|
(93,769
|
)
|
|
113,898
|
|
||
Total
|
|
$
|
(75,297
|
)
|
|
$
|
146,064
|
|
Horace Mann Educators Corporation
|
4
|
Quarterly Report on Form 10-Q
|
|
|
Three Months Ended
March 31, |
||||||
|
|
2020
|
|
2019
|
||||
Common stock, $0.001 par value
|
|
|
|
|
||||
Beginning balance
|
|
$
|
66
|
|
|
$
|
66
|
|
Options exercised
|
|
—
|
|
|
—
|
|
||
Conversion of common stock units
|
|
—
|
|
|
—
|
|
||
Conversion of restricted stock units
|
|
—
|
|
|
—
|
|
||
Ending balance
|
|
66
|
|
|
66
|
|
||
|
|
|
|
|
||||
Additional paid-in capital
|
|
|
|
|
||||
Beginning balance
|
|
480,962
|
|
|
475,109
|
|
||
Options exercised and conversion of common stock units and
restricted stock units
|
|
(178
|
)
|
|
(2,104
|
)
|
||
Share-based compensation expense
|
|
1,133
|
|
|
1,331
|
|
||
Ending balance
|
|
481,917
|
|
|
474,336
|
|
||
|
|
|
|
|
||||
Retained earnings
|
|
|
|
|
||||
Beginning balance
|
|
1,352,539
|
|
|
1,216,582
|
|
||
Net income
|
|
18,472
|
|
|
32,166
|
|
||
Dividends, 2020, $0.30 per share; 2019, $0.2875 per share
|
|
(12,669
|
)
|
|
(12,127
|
)
|
||
Cumulative effect of change in accounting principle
|
|
(509
|
)
|
|
—
|
|
||
Ending balance
|
|
1,357,833
|
|
|
1,236,621
|
|
||
|
|
|
|
|
||||
Accumulated other comprehensive income (loss), net of tax:
|
|
|
|
|
||||
Beginning balance
|
|
219,681
|
|
|
84,756
|
|
||
Change in net unrealized investment gains (losses) on fixed maturity
securities
|
|
(93,769
|
)
|
|
113,898
|
|
||
Change in net funded status of benefit plans
|
|
—
|
|
|
—
|
|
||
Ending balance
|
|
125,912
|
|
|
198,654
|
|
||
|
|
|
|
|
||||
Treasury stock, at cost
|
|
|
|
|
||||
Beginning balance
|
|
(485,963
|
)
|
|
(485,963
|
)
|
||
Acquisition of shares
|
|
(2,145
|
)
|
|
—
|
|
||
Ending balance
|
|
(488,108
|
)
|
|
(485,963
|
)
|
||
Shareholders' equity at end of period
|
|
$
|
1,477,620
|
|
|
$
|
1,423,714
|
|
Horace Mann Educators Corporation
|
5
|
Quarterly Report on Form 10-Q
|
|
|
Three Months Ended
March 31, |
||||||
|
|
2020
|
|
2019
|
||||
Cash flows from operating activities
|
|
|
|
|
||||
Net income
|
|
$
|
18,472
|
|
|
$
|
32,166
|
|
Adjustments to reconcile net income to net cash provided
by operating activities
|
|
|
|
|
||||
Net investment (gains) losses
|
|
18,463
|
|
|
(7,417
|
)
|
||
Amortization of premiums and accretion of discounts on
fixed maturity securities, net
|
|
953
|
|
|
504
|
|
||
Depreciation and intangible asset amortization
|
|
5,283
|
|
|
1,357
|
|
||
Share-based compensation expense
|
|
1,220
|
|
|
1,472
|
|
||
Changes in:
|
|
|
|
|
||||
Accrued investment income
|
|
(9,460
|
)
|
|
(2,871
|
)
|
||
Insurance liabilities
|
|
65,676
|
|
|
95,616
|
|
||
Premium receivables
|
|
2,189
|
|
|
2,796
|
|
||
Deferred policy acquisitions
|
|
(4,400
|
)
|
|
(700
|
)
|
||
Reinsurance recoverables
|
|
272
|
|
|
19,024
|
|
||
Income tax liabilities
|
|
1,057
|
|
|
6,539
|
|
||
Other operating assets and liabilities
|
|
(15,743
|
)
|
|
(17,723
|
)
|
||
Other
|
|
3,449
|
|
|
(5,960
|
)
|
||
Net cash provided by operating activities
|
|
87,431
|
|
|
124,803
|
|
||
|
|
|
|
|
||||
Cash flows - investing activities
|
|
|
|
|
|
|
||
Fixed maturity securities
|
|
|
|
|
|
|
||
Purchases
|
|
(535,278
|
)
|
|
(307,451
|
)
|
||
Sales
|
|
98,158
|
|
|
59,724
|
|
||
Maturities, paydowns, calls and redemptions
|
|
237,939
|
|
|
136,141
|
|
||
Equity securities
|
|
|
|
|
||||
Purchases
|
|
(4,114
|
)
|
|
(3,569
|
)
|
||
Sales and repayments
|
|
1,457
|
|
|
15,489
|
|
||
Limited partnership interests
|
|
|
|
|
||||
Purchases
|
|
(14,120
|
)
|
|
(8,842
|
)
|
||
Sales
|
|
2,331
|
|
|
9,858
|
|
||
Change in short-term and other investments, net
|
|
73,632
|
|
|
(29,341
|
)
|
||
Acquisition of business, net of cash acquired
|
|
—
|
|
|
(18,198
|
)
|
||
Net cash used in investing activities
|
|
(139,995
|
)
|
|
(146,189
|
)
|
||
|
|
|
|
|
||||
Cash flows - financing activities
|
|
|
|
|
|
|
||
Dividends paid to shareholders
|
|
(12,383
|
)
|
|
(11,790
|
)
|
||
Acquisition of treasury stock
|
|
(2,145
|
)
|
|
—
|
|
||
Proceeds from exercise of stock options
|
|
480
|
|
|
583
|
|
||
Withholding tax payments on RSUs tendered
|
|
(1,280
|
)
|
|
(3,311
|
)
|
||
Annuity contracts: variable, fixed and FHLB funding agreements
|
|
|
|
|
|
|
||
Deposits
|
|
192,655
|
|
|
157,305
|
|
||
Benefits, withdrawals and net transfers to
Separate Account (variable annuity) assets
|
|
(101,688
|
)
|
|
(109,246
|
)
|
||
Life policy accounts
|
|
|
|
|
|
|||
Deposits
|
|
2,562
|
|
|
2,714
|
|
||
Withdrawals and surrenders
|
|
(1,194
|
)
|
|
(904
|
)
|
||
Change in deposit asset on reinsurance
|
|
(13,277
|
)
|
|
—
|
|
||
Change in book overdrafts
|
|
4,573
|
|
|
(18,590
|
)
|
||
Net cash provided by financing activities
|
|
68,303
|
|
|
16,761
|
|
||
Net increase (decrease) in cash
|
|
15,739
|
|
|
(4,625
|
)
|
||
Cash at beginning of period
|
|
25,508
|
|
|
11,906
|
|
||
Cash at end of period
|
|
$
|
41,247
|
|
|
$
|
7,281
|
|
Horace Mann Educators Corporation
|
6
|
Quarterly Report on Form 10-Q
|
Horace Mann Educators Corporation
|
7
|
Quarterly Report on Form 10-Q
|
Horace Mann Educators Corporation
|
8
|
Quarterly Report on Form 10-Q
|
Horace Mann Educators Corporation
|
9
|
Quarterly Report on Form 10-Q
|
($ in thousands)
|
|
Three Months Ended
March 31, |
||||||
|
|
2020
|
|
2019
|
||||
Fixed maturity securities
|
|
$
|
59,446
|
|
|
$
|
84,316
|
|
Equity securities
|
|
1,208
|
|
|
1,198
|
|
||
Limited partnership interests
|
|
(2,699
|
)
|
|
6,451
|
|
||
Short-term and other investments
|
|
2,857
|
|
|
3,388
|
|
||
Investment expenses
|
|
(2,225
|
)
|
|
(2,553
|
)
|
||
Net investment income - investment portfolio
|
|
58,587
|
|
|
92,800
|
|
||
Investment income - deposit asset on reinsurance
|
|
23,688
|
|
|
—
|
|
||
Total net investment income
|
|
$
|
82,275
|
|
|
$
|
92,800
|
|
($ in thousands)
|
|
Three Months Ended
March 31, |
||||||
|
|
2020
|
|
2019
|
||||
Fixed maturity securities
|
|
$
|
1,102
|
|
|
$
|
201
|
|
Equity securities
|
|
(14,723
|
)
|
|
7,907
|
|
||
Short-term investments and other
|
|
(4,843
|
)
|
|
(691
|
)
|
||
Net investment gains (losses)
|
|
$
|
(18,464
|
)
|
|
$
|
7,417
|
|
($ in thousands)
|
|
Three Months Ended
March 31, |
||||||
|
|
2020
|
|
2019
|
||||
Impairment write-downs
|
|
$
|
—
|
|
|
$
|
—
|
|
Change in intent write-downs
|
|
(3,692
|
)
|
|
(236
|
)
|
||
Net OTTI losses recognized in earnings
|
|
(3,692
|
)
|
|
(236
|
)
|
||
Sales and other, net
|
|
4,557
|
|
|
4,838
|
|
||
Change in fair value - equity securities
|
|
(14,486
|
)
|
|
3,506
|
|
||
Change in fair value and gains (losses) realized
on settlements - derivatives
|
|
(4,843
|
)
|
|
(691
|
)
|
||
Net investment gains (losses)
|
|
$
|
(18,464
|
)
|
|
$
|
7,417
|
|
Horace Mann Educators Corporation
|
10
|
Quarterly Report on Form 10-Q
|
($ in thousands)
|
|
Amortized
Cost
|
|
Unrealized
Gains
|
|
Unrealized
Losses
|
|
Fair
Value
|
||||||||
March 31, 2020
|
|
|
|
|
|
|
|
|
||||||||
Fixed maturity securities
|
|
|
|
|
|
|
|
|
||||||||
U.S. Government and federally
sponsored agency obligations: (1)
|
|
|
|
|
|
|
|
|
||||||||
Mortgage-backed securities
|
|
$
|
676,322
|
|
|
$
|
75,985
|
|
|
$
|
392
|
|
|
$
|
751,915
|
|
Other, including U.S. Treasury securities
|
|
430,193
|
|
|
38,540
|
|
|
60
|
|
|
468,673
|
|
||||
Municipal bonds
|
|
1,626,005
|
|
|
151,302
|
|
|
7,376
|
|
|
1,769,931
|
|
||||
Foreign government bonds
|
|
42,802
|
|
|
1,804
|
|
|
754
|
|
|
43,852
|
|
||||
Corporate bonds
|
|
1,649,405
|
|
|
77,572
|
|
|
41,204
|
|
|
1,685,773
|
|
||||
Other mortgage-backed securities
|
|
1,228,739
|
|
|
6,068
|
|
|
111,768
|
|
|
1,123,039
|
|
||||
Totals
|
|
$
|
5,653,466
|
|
|
$
|
351,271
|
|
|
$
|
161,554
|
|
|
$
|
5,843,183
|
|
|
|
|
|
|
|
|
|
|
||||||||
December 31, 2019
|
|
|
|
|
|
|
|
|
||||||||
Fixed maturity securities
|
|
|
|
|
|
|
|
|
||||||||
U.S. Government and federally
sponsored agency obligations: (1)
|
|
|
|
|
|
|
|
|
||||||||
Mortgage-backed securities
|
|
$
|
684,543
|
|
|
$
|
41,263
|
|
|
$
|
1,487
|
|
|
$
|
724,319
|
|
Other, including U.S. Treasury securities
|
|
436,665
|
|
|
22,824
|
|
|
621
|
|
|
458,868
|
|
||||
Municipal bonds
|
|
1,545,787
|
|
|
141,996
|
|
|
1,580
|
|
|
1,686,203
|
|
||||
Foreign government bonds
|
|
42,801
|
|
|
2,569
|
|
|
—
|
|
|
45,370
|
|
||||
Corporate bonds
|
|
1,464,444
|
|
|
118,775
|
|
|
1,795
|
|
|
1,581,424
|
|
||||
Other mortgage-backed securities
|
|
1,282,740
|
|
|
20,883
|
|
|
8,131
|
|
|
1,295,492
|
|
||||
Totals
|
|
$
|
5,456,980
|
|
|
$
|
348,310
|
|
|
$
|
13,614
|
|
|
$
|
5,791,676
|
|
(1)
|
Fair value includes securities issued by Federal National Mortgage Association (FNMA) of $413.3 million and $405.1 million; Federal Home Loan Mortgage Corporation (FHLMC) of $308.4 million and $283.1 million; and Government National Mortgage Association (GNMA) of $151.1 million and $147.4 million as of March 31, 2020 and December 31, 2019, respectively.
|
Horace Mann Educators Corporation
|
11
|
Quarterly Report on Form 10-Q
|
($ in thousands)
|
|
12 Months or Less
|
|
More than 12 Months
|
|
Total
|
||||||||||||||||||
|
|
Fair Value
|
|
Gross
Unrealized
Losses
|
|
Fair Value
|
|
Gross
Unrealized
Losses
|
|
Fair Value
|
|
Gross
Unrealized
Losses
|
||||||||||||
March 31, 2020
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Fixed maturity securities
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
U.S. Government and federally
sponsored agency obligations: |
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Mortgage-backed securities
|
|
$
|
23,168
|
|
|
$
|
302
|
|
|
$
|
1,003
|
|
|
$
|
90
|
|
|
$
|
24,171
|
|
|
$
|
392
|
|
Other
|
|
15,736
|
|
|
60
|
|
|
—
|
|
|
—
|
|
|
15,736
|
|
|
60
|
|
||||||
Municipal bonds
|
|
191,688
|
|
|
7,376
|
|
|
—
|
|
|
—
|
|
|
191,688
|
|
|
7,376
|
|
||||||
Foreign government bonds
|
|
13,225
|
|
|
754
|
|
|
—
|
|
|
—
|
|
|
13,225
|
|
|
754
|
|
||||||
Corporate bonds
|
|
549,628
|
|
|
39,268
|
|
|
5,761
|
|
|
1,936
|
|
|
555,389
|
|
|
41,204
|
|
||||||
Other mortgage-backed securities
|
|
651,595
|
|
|
71,055
|
|
|
329,304
|
|
|
40,713
|
|
|
980,899
|
|
|
111,768
|
|
||||||
Total
|
|
$
|
1,445,040
|
|
|
$
|
118,815
|
|
|
$
|
336,068
|
|
|
$
|
42,739
|
|
|
$
|
1,781,108
|
|
|
$
|
161,554
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Number of positions with a
gross unrealized loss
|
|
1,080
|
|
|
|
|
104
|
|
|
|
|
1,184
|
|
|
|
|||||||||
Fair value as a percentage of total fixed maturity securities fair value
|
|
24.7
|
%
|
|
|
|
5.8
|
%
|
|
|
|
30.5
|
%
|
|
|
|||||||||
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
December 31, 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Fixed maturity securities
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
U.S. Government and federally
sponsored agency obligations:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Mortgage-backed securities
|
|
$
|
72,422
|
|
|
$
|
1,282
|
|
|
$
|
2,620
|
|
|
$
|
205
|
|
|
$
|
75,042
|
|
|
$
|
1,487
|
|
Other
|
|
38,341
|
|
|
619
|
|
|
1,527
|
|
|
2
|
|
|
39,868
|
|
|
621
|
|
||||||
Municipal bonds
|
|
91,195
|
|
|
977
|
|
|
9,160
|
|
|
603
|
|
|
100,355
|
|
|
1,580
|
|
||||||
Foreign government bonds
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||||
Corporate bonds
|
|
58,198
|
|
|
886
|
|
|
16,622
|
|
|
909
|
|
|
74,820
|
|
|
1,795
|
|
||||||
Other mortgage-backed securities
|
|
218,710
|
|
|
1,970
|
|
|
442,791
|
|
|
6,161
|
|
|
661,501
|
|
|
8,131
|
|
||||||
Total
|
|
$
|
478,866
|
|
|
$
|
5,734
|
|
|
$
|
472,720
|
|
|
$
|
7,880
|
|
|
$
|
951,586
|
|
|
$
|
13,614
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Number of positions with a
gross unrealized loss
|
|
330
|
|
|
|
|
137
|
|
|
|
|
467
|
|
|
|
|||||||||
Fair value as a percentage of total fixed maturity securities fair value
|
|
8.3
|
%
|
|
|
|
8.2
|
%
|
|
|
|
16.5
|
%
|
|
|
Horace Mann Educators Corporation
|
12
|
Quarterly Report on Form 10-Q
|
($ in thousands)
|
|
Three Months Ended
March 31, |
||||||
|
|
2020
|
|
2019
|
||||
Cumulative credit loss (1)
|
|
|
|
|
||||
Beginning of period
|
|
$
|
1,529
|
|
|
$
|
1,529
|
|
New credit losses
|
|
185
|
|
|
—
|
|
||
Increases to previously recognized credit losses
|
|
—
|
|
|
—
|
|
||
Losses related to securities sold or paid down during the period
|
|
—
|
|
|
—
|
|
||
|
|
$
|
1,714
|
|
|
$
|
1,529
|
|
(1)
|
The cumulative credit loss amounts exclude OTTI losses on securities held as of the periods indicated that the Company intended to sell or it was more likely than not that the Company would be required to sell the security before an anticipated recovery of value.
|
($ in thousands)
|
|
Percent of Total Fair Value
|
|
March 31, 2020
|
||||||||||
|
|
March 31, 2020
|
|
December 31, 2019
|
|
Fair
Value
|
|
Amortized
Cost
|
||||||
Estimated expected maturity:
|
|
|
|
|
|
|
|
|
||||||
Due in 1 year or less
|
|
4.0
|
%
|
|
3.6
|
%
|
|
$
|
230,397
|
|
|
$
|
233,386
|
|
Due after 1 year through 5 years
|
|
26.3
|
%
|
|
27.4
|
%
|
|
1,535,965
|
|
|
1,572,373
|
|
||
Due after 5 years through 10 years
|
|
29.4
|
%
|
|
29.6
|
%
|
|
1,719,303
|
|
|
1,661,161
|
|
||
Due after 10 years through 20 years
|
|
26.5
|
%
|
|
26.1
|
%
|
|
1,550,562
|
|
|
1,435,920
|
|
||
Due after 20 years
|
|
13.8
|
%
|
|
13.3
|
%
|
|
806,956
|
|
|
750,626
|
|
||
Total
|
|
100.0
|
%
|
|
100.0
|
%
|
|
$
|
5,843,183
|
|
|
$
|
5,653,466
|
|
|
|
|
|
|
|
|
|
|
||||||
Average option-adjusted duration, in years
|
|
6.1
|
|
|
6.0
|
|
|
|
|
|
Horace Mann Educators Corporation
|
13
|
Quarterly Report on Form 10-Q
|
($ in thousands)
|
|
Three Months Ended
March 31, |
||||||
|
|
2020
|
|
2019
|
||||
Fixed maturity securities
|
|
|
|
|
||||
Proceeds received
|
|
$
|
98,158
|
|
|
$
|
59,724
|
|
Gross gains realized
|
|
4,779
|
|
|
542
|
|
||
Gross losses realized
|
|
(268
|
)
|
|
(105
|
)
|
||
|
|
|
|
|
||||
Equity securities
|
|
|
|
|
||||
Proceeds received
|
|
$
|
1,457
|
|
|
$
|
15,489
|
|
Gross gains realized
|
|
319
|
|
|
4,745
|
|
||
Gross losses realized
|
|
(556
|
)
|
|
(344
|
)
|
($ in thousands)
|
|
Three Months Ended
March 31, |
||||||
|
|
2020
|
|
2019
|
||||
Net unrealized investment gains (losses)
on fixed maturity securities, net of tax
|
|
|
|
|
||||
Beginning of period
|
|
$
|
264,410
|
|
|
$
|
111,712
|
|
Change in net unrealized investment gains
(losses) on fixed maturity securities
|
|
(103,773
|
)
|
|
140,012
|
|
||
Reclassification of net investment (gains) losses
on securities to net income
|
|
(10,761
|
)
|
|
(6,405
|
)
|
||
End of period
|
|
$
|
149,876
|
|
|
$
|
245,319
|
|
Horace Mann Educators Corporation
|
14
|
Quarterly Report on Form 10-Q
|
($ in thousands)
|
|
|
|
Gross
Amounts
Offset in the
Consolidated
Balance
Sheets
|
|
Net Amounts
of Assets/
Liabilities
Presented
in the
Consolidated
Balance
Sheets
|
|
Gross Amounts Not Offset
in the Consolidated
Balance Sheets
|
|
|
||||||||||||||
|
|
Gross
Amounts
|
|
|
|
Financial
Instruments
|
|
Cash
Collateral
Received
|
|
Net
Amount
|
||||||||||||||
March 31, 2020
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Asset derivatives:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Free-standing derivatives
|
|
$
|
2,622
|
|
|
$
|
—
|
|
|
$
|
2,622
|
|
|
$
|
1,688
|
|
|
$
|
1,060
|
|
|
$
|
(126
|
)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
December 31, 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Asset derivatives:
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||
Free-standing derivatives
|
|
13,239
|
|
|
—
|
|
|
13,239
|
|
|
7,687
|
|
|
6,640
|
|
|
(1,088
|
)
|
Horace Mann Educators Corporation
|
15
|
Quarterly Report on Form 10-Q
|
($ in thousands)
|
|
|
|
Fair Value Measurements at
|
||||||||||||||||
|
|
Carrying
|
|
Fair
|
|
Reporting Date Using
|
||||||||||||||
|
|
Amount
|
|
Value
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||||
March 31, 2020
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Financial Assets
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Investments
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Fixed maturity securities
|
|
|
|
|
|
|
|
|
|
|
||||||||||
U.S. Government and federally
sponsored agency obligations:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Mortgage-backed securities
|
|
$
|
751,915
|
|
|
$
|
751,915
|
|
|
$
|
—
|
|
|
$
|
728,583
|
|
|
$
|
23,332
|
|
Other, including U.S. Treasury securities
|
|
468,673
|
|
|
468,673
|
|
|
18,557
|
|
|
450,116
|
|
|
—
|
|
|||||
Municipal bonds
|
|
1,769,931
|
|
|
1,769,931
|
|
|
—
|
|
|
1,665,039
|
|
|
104,892
|
|
|||||
Foreign government bonds
|
|
43,851
|
|
|
43,851
|
|
|
—
|
|
|
43,851
|
|
|
—
|
|
|||||
Corporate bonds
|
|
1,685,773
|
|
|
1,685,773
|
|
|
12,147
|
|
|
1,561,933
|
|
|
111,693
|
|
|||||
Other mortgage-backed securities
|
|
1,123,040
|
|
|
1,123,040
|
|
|
—
|
|
|
1,005,845
|
|
|
117,195
|
|
|||||
Total fixed maturity securities
|
|
5,843,183
|
|
|
5,843,183
|
|
|
30,704
|
|
|
5,455,367
|
|
|
357,112
|
|
|||||
Equity securities
|
|
87,033
|
|
|
87,033
|
|
|
42,106
|
|
|
44,844
|
|
|
83
|
|
|||||
Short-term investments
|
|
100,208
|
|
|
100,208
|
|
|
97,179
|
|
|
3,029
|
|
|
—
|
|
|||||
Other investments
|
|
18,147
|
|
|
18,147
|
|
|
—
|
|
|
18,147
|
|
|
—
|
|
|||||
Totals
|
|
$
|
6,048,571
|
|
|
$
|
6,048,571
|
|
|
$
|
169,989
|
|
|
$
|
5,521,387
|
|
|
$
|
357,195
|
|
Separate Account (variable annuity) assets (1)
|
|
$
|
1,954,201
|
|
|
$
|
1,954,201
|
|
|
$
|
1,954,201
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Financial Liabilities
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Investment contract and policy reserves,
embedded derivatives
|
|
$
|
339
|
|
|
$
|
339
|
|
|
$
|
—
|
|
|
$
|
339
|
|
|
$
|
—
|
|
Other policyholder funds, embedded derivatives
|
|
$
|
87,506
|
|
|
$
|
87,506
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
87,506
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||
December 31, 2019
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Financial Assets
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Investments
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Fixed maturity securities
|
|
|
|
|
|
|
|
|
|
|
||||||||||
U.S. Government and federally
sponsored agency obligations:
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Mortgage-backed securities
|
|
$
|
724,319
|
|
|
$
|
724,319
|
|
|
$
|
—
|
|
|
$
|
711,004
|
|
|
$
|
13,315
|
|
Other, including U.S. Treasury securities
|
|
458,868
|
|
|
458,868
|
|
|
17,699
|
|
|
441,169
|
|
|
—
|
|
|||||
Municipal bonds
|
|
1,686,203
|
|
|
1,686,203
|
|
|
—
|
|
|
1,641,912
|
|
|
44,291
|
|
|||||
Foreign government bonds
|
|
45,370
|
|
|
45,370
|
|
|
—
|
|
|
45,370
|
|
|
—
|
|
|||||
Corporate bonds
|
|
1,581,424
|
|
|
1,581,424
|
|
|
14,470
|
|
|
1,463,002
|
|
|
103,952
|
|
|||||
Other mortgage-backed securities
|
|
1,295,492
|
|
|
1,295,492
|
|
|
—
|
|
|
1,161,979
|
|
|
133,513
|
|
|||||
Total fixed maturity securities
|
|
5,791,676
|
|
|
5,791,676
|
|
|
32,169
|
|
|
5,464,436
|
|
|
295,071
|
|
|||||
Equity securities
|
|
101,864
|
|
|
101,864
|
|
|
49,834
|
|
|
51,923
|
|
|
107
|
|
|||||
Short-term investments
|
|
172,667
|
|
|
172,667
|
|
|
172,667
|
|
|
—
|
|
|
—
|
|
|||||
Other investments
|
|
25,997
|
|
|
25,997
|
|
|
—
|
|
|
25,997
|
|
|
—
|
|
|||||
Totals
|
|
$
|
6,092,204
|
|
|
$
|
6,092,204
|
|
|
$
|
254,670
|
|
|
$
|
5,542,356
|
|
|
$
|
295,178
|
|
Separate Account (variable annuity) assets (1)
|
|
$
|
2,490,469
|
|
|
$
|
2,490,469
|
|
|
$
|
2,490,469
|
|
|
$
|
—
|
|
|
$
|
—
|
|
Financial Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Investment contract and policy reserves,
embedded derivatives
|
|
$
|
1,314
|
|
|
$
|
1,314
|
|
|
$
|
—
|
|
|
$
|
1,314
|
|
|
$
|
—
|
|
Other policyholder funds, embedded derivatives
|
|
$
|
93,733
|
|
|
$
|
93,733
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
93,733
|
|
Horace Mann Educators Corporation
|
16
|
Quarterly Report on Form 10-Q
|
($ in thousands)
|
|
Financial Assets
|
|
Financial
Liabilities(1)
|
||||||||||||||||||||||||
|
|
Municipal
Bonds
|
|
Corporate
Bonds
|
|
Other
Mortgage-
Backed
Securities(2)
|
|
Total
Fixed
Maturity
Securities
|
|
Equity
Securities
|
|
Total
|
|
|
||||||||||||||
Beginning balance, January 1, 2020
|
|
$
|
44,291
|
|
|
$
|
103,952
|
|
|
$
|
146,828
|
|
|
$
|
295,071
|
|
|
$
|
107
|
|
|
$
|
295,178
|
|
|
$
|
93,733
|
|
Transfers into Level 3 (3)
|
|
63,751
|
|
|
18,833
|
|
|
22,475
|
|
|
105,059
|
|
|
—
|
|
|
105,059
|
|
|
—
|
|
|||||||
Transfers out of Level 3 (3)
|
|
—
|
|
|
(10,022
|
)
|
|
(2,947
|
)
|
|
(12,969
|
)
|
|
—
|
|
|
(12,969
|
)
|
|
—
|
|
|||||||
Total gains or losses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net investment gains (losses)
included in net income related
to financial assets
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(24
|
)
|
|
(24
|
)
|
|
—
|
|
|||||||
Net realized (gains) losses
included in net income related
to financial liabilities
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
(5,042
|
)
|
|||||||
Net unrealized investment gains
(losses) included in OCI
|
|
(3,026
|
)
|
|
(5,481
|
)
|
|
(24,362
|
)
|
|
(32,869
|
)
|
|
—
|
|
|
(32,869
|
)
|
|
—
|
|
|||||||
Purchases
|
|
—
|
|
|
6,875
|
|
|
1,890
|
|
|
8,765
|
|
|
—
|
|
|
8,765
|
|
|
—
|
|
|||||||
Issuances
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
1,354
|
|
|||||||
Sales
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Settlements
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Paydowns, maturities and distributions
|
|
(124
|
)
|
|
(2,464
|
)
|
|
(3,357
|
)
|
|
(5,945
|
)
|
|
—
|
|
|
(5,945
|
)
|
|
(2,539
|
)
|
|||||||
Ending balance, March 31, 2020
|
|
$
|
104,892
|
|
|
$
|
111,693
|
|
|
$
|
140,527
|
|
|
$
|
357,112
|
|
|
$
|
83
|
|
|
$
|
357,195
|
|
|
$
|
87,506
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Beginning balance, January 1, 2019
|
|
$
|
47,531
|
|
|
$
|
80,742
|
|
|
$
|
120,211
|
|
|
$
|
248,484
|
|
|
$
|
5
|
|
|
$
|
248,489
|
|
|
$
|
78,700
|
|
Transfers into Level 3 (3)
|
|
—
|
|
|
3,074
|
|
|
21,934
|
|
|
25,008
|
|
|
—
|
|
|
25,008
|
|
|
—
|
|
|||||||
Transfers out of Level 3 (3)
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Total gains or losses
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
||||||||||||||
Net investment gains (losses)
included in net income related
to financial assets
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Net realized (gains) losses
included in net income related
to financial liabilities
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
4,334
|
|
|||||||
Net unrealized investment gains
(losses) included in OCI
|
|
344
|
|
|
2,549
|
|
|
(152
|
)
|
|
2,741
|
|
|
—
|
|
|
2,741
|
|
|
—
|
|
|||||||
Purchases
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Issuances
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
3,018
|
|
|||||||
Sales
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Settlements
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
|||||||
Paydowns, maturities and distributions
|
|
(119
|
)
|
|
(3,883
|
)
|
|
(6,203
|
)
|
|
(10,205
|
)
|
|
—
|
|
|
(10,205
|
)
|
|
(1,423
|
)
|
|||||||
Ending balance, March 31, 2019
|
|
$
|
47,756
|
|
|
$
|
82,482
|
|
|
$
|
135,790
|
|
|
$
|
266,028
|
|
|
$
|
5
|
|
|
$
|
266,033
|
|
|
$
|
84,629
|
|
(1)
|
Represents embedded derivatives, all related to the Company's fixed indexed annuity products, reported in Other policyholder funds in the Company's Consolidated Balance Sheets.
|
(2)
|
Includes U.S. Government and federally sponsored agency obligations for mortgage-backed securities and other mortgage-backed securities.
|
(3)
|
Transfers into and out of Level 3 during the three months ended March 31, 2020 and 2019 were attributable to changes in the availability of observable market information for individual fixed maturity securities. The Company's policy is to recognize transfers into and transfers out of the levels as having occurred at the end of the reporting period in which the transfers were determined.
|
Horace Mann Educators Corporation
|
17
|
Quarterly Report on Form 10-Q
|
($ in thousands)
|
||||||||||
Financial
Assets
|
|
Fair Value at March 31, 2020
|
|
Valuation Technique(s)
|
|
Unobservable Inputs
|
|
Range
(Weighted Average)
and Single Point Best Estimate (1)
|
||
Municipal bonds
|
|
$
|
104,892
|
|
|
discounted cash flow
|
|
I spread (2)
|
|
578 bps
|
Corporate bonds
|
|
111,693
|
|
|
discounted cash flow
|
|
N spread (3)
|
|
762 bps
|
|
|
|
|
|
discounted cash flow
|
|
T spread (4)
|
|
378 bps
|
||
|
|
|
|
discounted cash flow
|
|
I spread (2)
|
|
495 bps
|
||
|
|
|
|
market comparable
|
|
EV / TTM EBITDA (x) (5)
|
|
5.11x
|
||
Other mortgage-backed securities
|
|
117,195
|
|
|
discounted cash flow
|
|
constant prepayment rate
|
|
20.0%
|
|
|
|
|
|
vendor price
|
|
haircut
|
|
3.0%
|
||
|
|
|
|
market comparable
|
|
EV / TTM EBITDA (x) (5)
|
|
5.11x
|
||
|
|
|
|
discounted cash flow
|
|
N spread (3)
|
|
732 bps
|
||
|
|
|
|
discounted cash flow
|
|
PDI interest margin (6)
|
|
7.13%
|
||
|
|
|
|
discounted cash flow
|
|
SBL interest margin (7)
|
|
4.50%
|
||
Government mortgage-backed securities
|
|
23,332
|
|
|
vendor price
|
|
haircut
|
|
3.0%
|
|
|
|
|
|
discounted cash flow
|
|
N spread (3)
|
|
109 bps
|
||
|
|
|
|
discounted cash flow
|
|
constant prepayment yield
|
|
100 bps
|
||
|
|
|
|
discounted cash flow
|
|
constant default rate
|
|
0
|
||
Equity securities
|
|
83
|
|
|
Black Scholes
|
|
equity value
|
|
low - $43.27; high - $44.53
|
Financial
Liabilities
|
|
Fair Value at March 31, 2020
|
|
Valuation Technique(s)
|
|
Unobservable Inputs
|
|
Range
(Weighted Average)
and Single Point Best Estimate (1)
|
||
Derivatives
embedded in
FIA products
|
|
$
|
87,506
|
|
|
discounted cash flow
|
|
lapse rate
|
|
5.25%
|
|
|
|
|
|
|
mortality multiplier (8)
|
|
61.00%
|
||
|
|
|
|
|
|
option budget
|
|
1.50% - 2.50%
|
||
|
|
|
|
|
|
non-performance adjustment (9)
|
|
5.00%
|
(1)
|
When a range of unobservable inputs is not readily available, the Company uses a single point best estimate.
|
(2)
|
"I spread" is the interpolated weighted average life point on the "on the run" (OTR) point of the curve.
|
(3)
|
"N spread" is the interpolated weighted average life point on the swap curve.
|
(4)
|
"T spread" is a specific point on the OTR curve.
|
(5)
|
This represents the enterprise value (EV) for trailing twelve months (TTM) of EBITDA plus multiplier.
|
(6)
|
"PDI" stands for private debt investment.
|
(7)
|
"SBL" stands for broadly syndicated loans.
|
(8)
|
Mortality multiplier is applied to the Annuity 2000 table.
|
(9)
|
Determined as a percentage of a risk-free rate.
|
Horace Mann Educators Corporation
|
18
|
Quarterly Report on Form 10-Q
|
($ in thousands)
|
|
|
|
Fair Value Measurements at
|
||||||||||||||||
|
|
Carrying
|
|
Fair
|
|
Reporting Date Using
|
||||||||||||||
|
|
Amount
|
|
Value
|
|
Level 1
|
|
Level 2
|
|
Level 3
|
||||||||||
March 31, 2020
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Financial Assets
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Investments
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Other investments
|
|
$
|
163,360
|
|
|
$
|
167,127
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
167,127
|
|
Deposit asset on reinsurance
|
|
2,356,253
|
|
|
2,421,012
|
|
|
—
|
|
|
—
|
|
|
2,421,012
|
|
|||||
Financial Liabilities
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Investment contract and policy reserves,
fixed annuity contracts
|
|
4,708,953
|
|
|
4,618,673
|
|
|
—
|
|
|
—
|
|
|
4,618,673
|
|
|||||
Investment contract and policy reserves,
account values on life contracts
|
|
94,784
|
|
|
99,601
|
|
|
—
|
|
|
—
|
|
|
99,601
|
|
|||||
Other policyholder funds
|
|
628,812
|
|
|
628,812
|
|
|
—
|
|
|
570,806
|
|
|
58,006
|
|
|||||
Short-term debt
|
|
135,000
|
|
|
135,000
|
|
|
—
|
|
|
—
|
|
|
135,000
|
|
|||||
Long-term debt
|
|
298,098
|
|
|
313,516
|
|
|
—
|
|
|
313,516
|
|
|
—
|
|
|||||
|
|
|
|
|
|
|
|
|
|
|
||||||||||
December 31, 2019
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Financial Assets
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Investments
|
|
|
|
|
|
|
|
|
|
|
||||||||||
Other investments
|
|
$
|
163,312
|
|
|
$
|
167,185
|
|
|
$
|
—
|
|
|
$
|
—
|
|
|
$
|
167,185
|
|
Deposit asset on reinsurance
|
|
2,346,166
|
|
|
2,634,012
|
|
|
—
|
|
|
—
|
|
|
2,634,012
|
|
|||||
Financial Liabilities
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|||||
Investment contract and policy reserves,
fixed annuity contracts
|
|
4,675,774
|
|
|
4,609,880
|
|
|
—
|
|
|
—
|
|
|
4,609,880
|
|
|||||
Investment contract and policy reserves,
account values on life contracts |
|
93,465
|
|
|
98,332
|
|
|
—
|
|
|
—
|
|
|
98,332
|
|
|||||
Other policyholder funds
|
|
553,550
|
|
|
553,550
|
|
|
—
|
|
|
495,812
|
|
|
57,738
|
|
|||||
Short-term debt
|
|
135,000
|
|
|
135,000
|
|
|
—
|
|
|
—
|
|
|
135,000
|
|
|||||
Long-term debt
|
|
298,025
|
|
|
322,678
|
|
|
—
|
|
|
322,678
|
|
|
—
|
|
Horace Mann Educators Corporation
|
19
|
Quarterly Report on Form 10-Q
|
($ in thousands)
|
|
March 31, 2020
|
|
December 31, 2019
|
||||
Assets
|
|
|
|
|
||||
Derivatives, included in Short-term and other investments
|
|
$
|
2,622
|
|
|
$
|
13,239
|
|
|
|
|
|
|
||||
Liabilities
|
|
|
|
|
||||
FIA - embedded derivatives, included in Other policyholder funds
|
|
87,506
|
|
|
93,733
|
|
||
IUL - embedded derivatives, included in
Investment contract and policy reserves
|
|
339
|
|
|
1,314
|
|
($ in thousands)
|
|
Three Months Ended
March 31, |
||||||
|
|
2020
|
|
2019
|
||||
Change in fair value of derivatives:(1)
|
|
|
|
|
||||
Net investment gains (losses)
|
|
$
|
(11,000
|
)
|
|
$
|
4,054
|
|
|
|
|
|
|
||||
Change in fair value of embedded derivatives:
|
|
|
|
|
||||
Net investment gains (losses)
|
|
6,157
|
|
|
(4,745
|
)
|
(1)
|
Includes gains or losses recognized at the expiration of the option term or early termination and the changes in fair value for open options.
|
Horace Mann Educators Corporation
|
20
|
Quarterly Report on Form 10-Q
|
($ in thousands)
|
|
March 31, 2020
|
|
December 31, 2019
|
||||||||||||||||
|
|
Credit Rating
|
|
Notional
|
|
Fair
|
|
Notional
|
|
Fair
|
||||||||||
Counterparty
|
|
S&P
|
|
Moody's
|
|
Amount
|
|
Value
|
|
Amount
|
|
Value
|
||||||||
Bank of America, N.A.
|
|
A+
|
|
Aa2
|
|
$
|
169,100
|
|
|
$
|
1,569
|
|
|
$
|
174,900
|
|
|
$
|
8,523
|
|
Barclays Bank PLC
|
|
A
|
|
A1
|
|
132,400
|
|
|
867
|
|
|
115,300
|
|
|
3,347
|
|
||||
Citigroup Inc.
|
|
BBB+
|
|
A3
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Credit Suisse International
|
|
A+
|
|
A1
|
|
—
|
|
|
—
|
|
|
—
|
|
|
—
|
|
||||
Societe Generale
|
|
A
|
|
A1
|
|
18,400
|
|
|
186
|
|
|
27,800
|
|
|
1,369
|
|
||||
Total
|
|
|
|
|
|
$
|
319,900
|
|
|
$
|
2,622
|
|
|
$
|
318,000
|
|
|
$
|
13,239
|
|
Horace Mann Educators Corporation
|
21
|
Quarterly Report on Form 10-Q
|
($ in thousands)
|
|
March 31, 2020
|
||
Property and Casualty
|
|
$
|
9,460
|
|
Supplemental
|
|
19,621
|
|
|
Retirement
|
|
10,087
|
|
|
Life
|
|
9,911
|
|
|
Total
|
|
$
|
49,079
|
|
($ in thousands)
|
|
Weighted Average
|
|
|
||
|
|
Useful Life (in Years)
|
|
|
||
At inception:
|
|
|
|
|
||
Value of business acquired
|
|
30
|
|
$
|
94,419
|
|
Value of distribution acquired
|
|
17
|
|
53,996
|
|
|
Value of agency relationships
|
|
14
|
|
16,981
|
|
|
Value of customer relationships
|
|
10
|
|
9,080
|
|
|
Total
|
|
23
|
|
174,476
|
|
|
Accumulated amortization:
|
|
|
|
|
||
Value of business acquired
|
|
|
|
(5,545
|
)
|
|
Value of distribution acquired
|
|
|
|
(2,699
|
)
|
|
Value of agency relationships
|
|
|
|
(2,132
|
)
|
|
Value of customer relationships
|
|
|
|
(2,100
|
)
|
|
Total
|
|
|
|
(12,476
|
)
|
|
Net intangible assets subject to amortization:
|
|
|
|
$
|
162,000
|
|
Horace Mann Educators Corporation
|
22
|
Quarterly Report on Form 10-Q
|
($ in thousands)
|
|
|
||
Year Ending December 31,
|
|
|
||
2020 (excluding the three months ended March 31, 2020)
|
|
$
|
10,802
|
|
2021
|
|
13,411
|
|
|
2022
|
|
12,433
|
|
|
2023
|
|
11,577
|
|
|
2024
|
|
10,805
|
|
|
Thereafter
|
|
102,972
|
|
|
Total
|
|
$
|
162,000
|
|
Horace Mann Educators Corporation
|
23
|
Quarterly Report on Form 10-Q
|
($ in thousands)
|
|
Three Months Ended
March 31, |
||||||
|
|
2020
|
|
2019
|
||||
Property and Casualty
|
|
|
|
|
|
|
||
Beginning gross reserves (1)
|
|
$
|
386,976
|
|
|
$
|
367,180
|
|
Less: reinsurance recoverables
|
|
120,506
|
|
|
89,725
|
|
||
Net reserves, beginning of period (2)
|
|
266,470
|
|
|
277,455
|
|
||
Incurred claims and claim expenses:
|
|
|
|
|
|
|
||
Claims occurring in the current period
|
|
105,454
|
|
|
118,767
|
|
||
Decrease in estimated reserves for claims occurring
in prior periods (3)
|
|
(1,000
|
)
|
|
(2,000
|
)
|
||
Total claims and claim expenses incurred (4)
|
|
104,454
|
|
|
116,767
|
|
||
Claims and claim expense payments
for claims occurring during:
|
|
|
|
|
|
|
||
Current period
|
|
43,463
|
|
|
45,714
|
|
||
Prior periods
|
|
64,258
|
|
|
67,135
|
|
||
Total claims and claim expense payments
|
|
107,721
|
|
|
112,849
|
|
||
Net reserves, end of period (2)
|
|
263,203
|
|
|
281,373
|
|
||
Plus: reinsurance recoverables
|
|
119,045
|
|
|
78,328
|
|
||
Ending gross reserves (1)
|
|
$
|
382,248
|
|
|
$
|
359,701
|
|
(1)
|
Unpaid claims and claim expenses as reported in the Consolidated Balance Sheets also include reserves for Supplemental, Life and Retirement of $56.2 million and $33.8 million as of March 31, 2020 and 2019, respectively, in addition to Property and Casualty reserves.
|
(2)
|
Reserves net of anticipated reinsurance recoverables.
|
(3)
|
Shows the amounts by which the Company decreased its reserves in each of the periods indicated for claims occurring in previous periods to reflect subsequent information on such claims and changes in their projected final settlement costs.
|
(4)
|
Benefits, claims and settlement expenses as reported in the Consolidated Statements of Operations also include amounts for Supplemental, Life and Retirement of $34.2 million and $22.6 million for the three months ended March 31, 2020 and 2019, respectively, in addition to Property and Casualty amounts.
|
Horace Mann Educators Corporation
|
24
|
Quarterly Report on Form 10-Q
|
($ in thousands)
|
|
Gross
Amount
|
|
Ceded to
Other
Companies (1)
|
|
Assumed
from Other
Companies
|
|
Net
Amount
|
||||||||
Three months ended March 31, 2020
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Premiums written and contract deposits (2)
|
|
$
|
333,731
|
|
|
$
|
6,310
|
|
|
$
|
1,337
|
|
|
$
|
328,758
|
|
Premiums and contract charges earned
|
|
243,170
|
|
|
8,377
|
|
|
1,472
|
|
|
236,265
|
|
||||
Benefits, claims and settlement expenses
|
|
139,532
|
|
|
1,984
|
|
|
1,112
|
|
|
138,660
|
|
||||
|
|
|
|
|
|
|
|
|
||||||||
Three months ended March 31, 2019
|
|
|
|
|
|
|
|
|
|
|
|
|
||||
Premiums written and contract deposits (2)
|
|
$
|
299,093
|
|
|
$
|
5,848
|
|
|
$
|
2,149
|
|
|
$
|
295,394
|
|
Premiums and contract charges earned
|
|
213,256
|
|
|
5,822
|
|
|
2,351
|
|
|
209,785
|
|
||||
Benefits, claims and settlement expenses
|
|
142,052
|
|
|
4,292
|
|
|
1,624
|
|
|
139,384
|
|
(1)
|
Excludes the annuity reinsurance agreement accounted for using the deposit method that is discussed in Note 5.
|
(2)
|
This measure is not based on accounting principles generally accepted in the United States of America (non-GAAP). An explanation of this non-GAAP measure is contained in the Glossary of Selected Terms included as an exhibit in the Company's reports filed with the SEC.
|
Horace Mann Educators Corporation
|
25
|
Quarterly Report on Form 10-Q
|
($ in thousands)
|
|
Three Months Ended
March 31, |
||||||
|
|
2020
|
|
2019
|
||||
Insurance premiums and contract charges earned
|
|
|
|
|
||||
Property and Casualty
|
|
$
|
166,474
|
|
|
$
|
170,840
|
|
Supplemental
|
|
32,990
|
|
|
N/A
|
|
||
Retirement
|
|
7,380
|
|
|
8,578
|
|
||
Life
|
|
29,421
|
|
|
30,367
|
|
||
Total
|
|
$
|
236,265
|
|
|
$
|
209,785
|
|
|
|
|
|
|
||||
Net investment income
|
|
|
|
|
||||
Property and Casualty
|
|
$
|
10,293
|
|
|
$
|
10,218
|
|
Supplemental
|
|
3,520
|
|
|
N/A
|
|
||
Retirement
|
|
53,525
|
|
|
64,739
|
|
||
Life
|
|
15,558
|
|
|
18,052
|
|
||
Corporate and Other
|
|
(54
|
)
|
|
(23
|
)
|
||
Intersegment eliminations
|
|
(567
|
)
|
|
(186
|
)
|
||
Total
|
|
$
|
82,275
|
|
|
$
|
92,800
|
|
|
|
|
|
|
||||
Net income (loss)
|
|
|
|
|
||||
Property and Casualty
|
|
$
|
26,570
|
|
|
$
|
15,052
|
|
Supplemental
|
|
10,537
|
|
|
N/A
|
|
||
Retirement
|
|
(947
|
)
|
|
12,151
|
|
||
Life
|
|
641
|
|
|
3,277
|
|
||
Corporate and Other
|
|
(18,329
|
)
|
|
1,686
|
|
||
Total
|
|
$
|
18,472
|
|
|
$
|
32,166
|
|
($ in thousands)
|
|
March 31, 2020
|
|
December 31, 2019
|
||||
Assets
|
|
|
|
|
||||
Property and Casualty
|
|
$
|
1,256,125
|
|
|
$
|
1,327,099
|
|
Supplemental
|
|
779,077
|
|
|
747,602
|
|
||
Retirement
|
|
7,851,447
|
|
|
8,330,127
|
|
||
Life
|
|
1,978,346
|
|
|
1,964,993
|
|
||
Corporate and Other
|
|
180,866
|
|
|
172,955
|
|
||
Intersegment eliminations
|
|
(73,706
|
)
|
|
(64,072
|
)
|
||
Total
|
|
$
|
11,972,155
|
|
|
$
|
12,478,704
|
|
Horace Mann Educators Corporation
|
26
|
Quarterly Report on Form 10-Q
|
($ in thousands)
|
|
Net Unrealized Investment
Gains (Losses) on
Securities (1)(2)
|
|
Net Funded Status of
Benefit Plans (1) |
|
Total (1)
|
||||||
Beginning balance, January 1, 2020
|
|
$
|
230,448
|
|
|
$
|
(10,767
|
)
|
|
$
|
219,681
|
|
Other comprehensive income (loss) before reclassifications
|
|
(104,530
|
)
|
|
—
|
|
|
(104,530
|
)
|
|||
Amounts reclassified from AOCI
|
|
10,761
|
|
|
—
|
|
|
10,761
|
|
|||
Net current period other comprehensive income (loss)
|
|
(93,769
|
)
|
|
—
|
|
|
(93,769
|
)
|
|||
Ending balance, March 31, 2020
|
|
$
|
136,679
|
|
|
$
|
(10,767
|
)
|
|
$
|
125,912
|
|
|
|
|
|
|
|
|
||||||
Beginning balance, January 1, 2019
|
|
$
|
96,941
|
|
|
$
|
(12,185
|
)
|
|
$
|
84,756
|
|
Other comprehensive income (loss) before reclassifications
|
|
120,303
|
|
|
—
|
|
|
120,303
|
|
|||
Amounts reclassified from AOCI
|
|
(6,405
|
)
|
|
—
|
|
|
(6,405
|
)
|
|||
Net current period other comprehensive income (loss)
|
|
113,898
|
|
|
—
|
|
|
113,898
|
|
|||
Ending balance, March 31, 2019
|
|
$
|
210,839
|
|
|
$
|
(12,185
|
)
|
|
$
|
198,654
|
|
(2)
|
The pretax amounts reclassified from AOCI, $(13.6) million and $8.1 million, are included in Net investment gains (losses) and the related income tax expenses, $(2.9) million and $1.7 million, are included in Income tax expense in the Consolidated Statements of Operations for the three month periods ended March 31, 2020 and 2019, respectively.
|
($ in thousands)
|
|
Three Months Ended March 31,
|
||||||
|
|
2020
|
|
2019
|
||||
Cash
|
|
$
|
40,655
|
|
|
$
|
7,281
|
|
Restricted cash
|
|
592
|
|
|
—
|
|
||
Total cash and restricted cash shown in the Consolidated Balance Sheets and Consolidated Statements of Cash Flows
|
|
$
|
41,247
|
|
|
$
|
7,281
|
|
|
|
|
|
|
||||
Cash paid (recovered) during the three months for:
|
|
|
|
|
||||
Interest
|
|
$
|
1,414
|
|
|
$
|
399
|
|
Income taxes
|
|
(718
|
)
|
|
(125
|
)
|
Horace Mann Educators Corporation
|
27
|
Quarterly Report on Form 10-Q
|
Horace Mann Educators Corporation
|
28
|
Quarterly Report on Form 10-Q
|
•
|
Deploying prevention strategies to reduce the transmission of COVID-19 in the workplace, in accordance with recommended guidance from the CDC.
|
•
|
Transitioning employees to work remotely in a phased approach to ensure the capability of our systems and networks to support and sustain increased remote activity.
|
•
|
Adhering to social distancing requirements and implementing daily employee health screening questionnaires for essential employees continuing to work in the office locations.
|
•
|
Implementing cybersecurity measures including increasing security and network monitoring to proactively identify and prevent potential security threats and vulnerabilities.
|
•
|
Identifying and assessing critical third-party vendors and ensuring their ability to continue to perform as anticipated.
|
•
|
Preparing a phased return to work strategy based on the guidance of the CDC and scientific experts.
|
•
|
Developing a communication strategy to provide information on how customers could reach Horace Mann or their Horace Mann agent and how they could access policy and account information online.
|
•
|
Providing a 15% credit on two months' automobile premium because our customers are driving less.
|
•
|
Offering a payment grace period through June on auto, property, supplemental and life insurance payments.
|
•
|
Extending personal automobile coverage to those delivering food, medicine and other essential goods.
|
•
|
Utilizing our Customer Care Center to provide support to all agents and policyholders.
|
•
|
Accelerating planned technology solutions, including video meeting software, enhanced e-signature capabilities and dynamic online appointment setting tools.
|
•
|
Offering expanded support as needed to help agents facing COVID-19 related challenges to continue to work efficiently in a virtual environment.
|
Horace Mann Educators Corporation
|
29
|
Quarterly Report on Form 10-Q
|
($ in millions)
|
|
Three Months Ended
March 31, |
|
2020-2019
|
|||||||
|
|
2020
|
|
2019
|
|
Change %
|
|||||
Total revenues
|
|
$
|
307.3
|
|
|
$
|
315.9
|
|
|
-2.7
|
%
|
Net income
|
|
18.5
|
|
|
32.2
|
|
|
-42.5
|
%
|
||
Per diluted share:
|
|
|
|
|
|
|
|||||
Net income
|
|
0.44
|
|
|
0.77
|
|
|
-42.9
|
%
|
||
Net investment gains (losses), after tax
|
|
(0.34
|
)
|
|
0.14
|
|
|
N.M.
|
|
||
Book value per share
|
|
$
|
35.80
|
|
|
$
|
34.60
|
|
|
3.5
|
%
|
Net income return on equity - last twelve months
|
|
11.3
|
%
|
|
2.2
|
%
|
|
|
|
||
Net income return on equity - annualized
|
|
4.9
|
%
|
|
9.5
|
%
|
|
|
|
Horace Mann Educators Corporation
|
30
|
Quarterly Report on Form 10-Q
|
($ in millions)
|
|
Three Months Ended
March 31, |
|
2020-2019
|
|||||||
|
|
2020
|
|
2019
|
|
Change %
|
|||||
Insurance premiums and contract charges earned
|
|
$
|
236.3
|
|
|
$
|
209.8
|
|
|
12.6
|
%
|
Net investment income
|
|
82.3
|
|
|
92.8
|
|
|
-11.3
|
%
|
||
Net investment gains (losses)
|
|
(18.5
|
)
|
|
7.4
|
|
|
N.M.
|
|
||
Other income
|
|
7.2
|
|
|
5.9
|
|
|
22.0
|
%
|
||
Total revenues
|
|
307.3
|
|
|
315.9
|
|
|
-2.7
|
%
|
||
|
|
|
|
|
|
|
|||||
Benefits, claims and settlement expenses
|
|
138.7
|
|
|
139.4
|
|
|
-0.5
|
%
|
||
Interest credited
|
|
51.5
|
|
|
52.9
|
|
|
-2.6
|
%
|
||
Operating expenses
|
|
60.7
|
|
|
56.2
|
|
|
8.0
|
%
|
||
DAC unlocking and amortization expense
|
|
30.0
|
|
|
25.0
|
|
|
20.0
|
%
|
||
Intangible asset amortization expense
|
|
3.7
|
|
|
0.5
|
|
|
N.M.
|
|
||
Interest expense
|
|
4.2
|
|
|
3.3
|
|
|
27.3
|
%
|
||
Total benefits, losses and expenses
|
|
288.8
|
|
|
277.3
|
|
|
4.1
|
%
|
||
|
|
|
|
|
|
|
|||||
Income before income taxes
|
|
18.5
|
|
|
38.6
|
|
|
-52.1
|
%
|
||
Income tax expense
|
|
—
|
|
|
6.4
|
|
|
-100.0
|
%
|
||
Net income
|
|
$
|
18.5
|
|
|
$
|
32.2
|
|
|
-42.5
|
%
|
|
|
Three Months Ended
March 31, |
||
|
|
2020
|
|
2019
|
Investment yield, excluding limited partnership interests, pretax - annualized*
|
|
4.5%
|
|
4.8%
|
Investment yield, excluding limited partnership interests, after tax - annualized*
|
|
3.6%
|
|
3.9%
|
Horace Mann Educators Corporation
|
31
|
Quarterly Report on Form 10-Q
|
($ in millions)
|
|
Three Months Ended
March 31, |
||||||
|
|
2020
|
|
2019
|
||||
OTTI losses recognized in earnings
|
|
$
|
(3.7
|
)
|
|
$
|
(0.2
|
)
|
Sales and other, net
|
|
4.5
|
|
|
4.8
|
|
||
Change in fair value - equity securities
|
|
(14.5
|
)
|
|
3.5
|
|
||
Change in fair value and gains (losses) realized
on settlements - derivatives |
|
(4.8
|
)
|
|
(0.7
|
)
|
||
Net investment gains (losses)
|
|
$
|
(18.5
|
)
|
|
$
|
7.4
|
|
Horace Mann Educators Corporation
|
32
|
Quarterly Report on Form 10-Q
|
Horace Mann Educators Corporation
|
33
|
Quarterly Report on Form 10-Q
|
•
|
Valuation of hard-to-value fixed maturity securities, including evaluation of other-than-temporary impairments
|
•
|
Evaluation of goodwill and intangible assets for impairment
|
•
|
Valuation of life and annuity deferred policy acquisition costs
|
•
|
Valuation of liabilities for property and casualty unpaid claims and claim expenses
|
•
|
Valuation of investment contract and policy reserves
|
•
|
Valuation of assets acquired and liabilities assumed under purchase accounting
|
Horace Mann Educators Corporation
|
34
|
Quarterly Report on Form 10-Q
|
•
|
Property and Casualty
|
•
|
Supplemental
|
•
|
Retirement
|
•
|
Life
|
•
|
Corporate and Other
|
•
|
5.6 points of improvement in the Property and Casualty loss ratio for the current quarter due to improved loss ratios for both automobile and property
|
•
|
1.3 points of improvement in the expense ratio due to actions taken in 2019
|
•
|
A one-time income tax benefit of $2.8 million as a result of the CARES Act
|
Horace Mann Educators Corporation
|
35
|
Quarterly Report on Form 10-Q
|
($ in millions, unless otherwise indicated)
|
|
Three Months Ended
March 31, |
|
2020-2019
|
|||||||
|
|
2020
|
|
2019
|
|
Change %
|
|||||
Financial Data:
|
|
|
|
|
|
|
|||||
Premiums written*:
|
|
|
|
|
|
|
|||||
Automobile
|
|
$
|
109.4
|
|
|
$
|
116.8
|
|
|
-6.3
|
%
|
Property and other
|
|
44.2
|
|
|
44.9
|
|
|
-1.6
|
%
|
||
Total premiums written
|
|
153.6
|
|
|
161.7
|
|
|
-5.0
|
%
|
||
Change in unearned insurance premiums
|
|
12.9
|
|
|
9.1
|
|
|
41.8
|
%
|
||
Total insurance premiums earned
|
|
166.5
|
|
|
170.8
|
|
|
-2.5
|
%
|
||
Incurred claims and claims expenses:
|
|
|
|
|
|
|
|||||
Claims occurring in the current year
|
|
105.4
|
|
|
118.8
|
|
|
-11.3
|
%
|
||
Prior years' reserve development
|
|
1.0
|
|
|
2.0
|
|
|
-50.0
|
%
|
||
Total claims and claim expenses incurred
|
|
104.4
|
|
|
116.8
|
|
|
-10.6
|
%
|
||
Operating expenses, including DAC amortization
|
|
43.2
|
|
|
46.5
|
|
|
-7.1
|
%
|
||
Underwriting gain
|
|
18.9
|
|
|
7.5
|
|
|
152.0
|
%
|
||
Net investment income
|
|
10.3
|
|
|
10.2
|
|
|
1.0
|
%
|
||
Income before income taxes
|
|
29.8
|
|
|
17.8
|
|
|
67.4
|
%
|
||
Net income/core earnings*
|
|
26.6
|
|
|
15.0
|
|
|
77.3
|
%
|
||
|
|
|
|
|
|
|
|||||
Operating Statistics:
|
|
|
|
|
|
|
|||||
Automobile
|
|
|
|
|
|
|
|||||
Loss and loss adjustment expense ratio
|
|
65.8
|
%
|
|
70.8
|
%
|
|
-5.0
|
pts
|
||
Expense ratio
|
|
25.9
|
%
|
|
27.2
|
%
|
|
-1.3
|
pts
|
||
Combined ratio:
|
|
91.7
|
%
|
|
98.0
|
%
|
|
-6.3
|
pts
|
||
Prior years' reserve development
|
|
-0.9
|
%
|
|
-0.9
|
%
|
|
—
|
|
||
Catastrophes
|
|
0.2
|
%
|
|
0.8
|
%
|
|
-0.6
|
pts
|
||
Underlying combined ratio*
|
|
92.4
|
%
|
|
98.1
|
%
|
|
-5.7
|
pts
|
||
Property
|
|
|
|
|
|
|
|||||
Loss and loss adjustment expense ratio
|
|
56.5
|
%
|
|
62.9
|
%
|
|
-6.4
|
pts
|
||
Expense ratio
|
|
26.2
|
%
|
|
27.6
|
%
|
|
-1.4
|
pts
|
||
Combined ratio:
|
|
82.7
|
%
|
|
90.5
|
%
|
|
-7.8
|
pts
|
||
Prior years' reserve development
|
|
—
|
%
|
|
-1.9
|
%
|
|
1.9
|
pts
|
||
Catastrophes
|
|
15.8
|
%
|
|
18.3
|
%
|
|
-2.5
|
pts
|
||
Underlying combined ratio*
|
|
66.9
|
%
|
|
74.1
|
%
|
|
-7.2
|
pts
|
||
|
|
|
|
|
|
|
|||||
Risks in force (in thousands)
|
|
|
|
|
|
|
|||||
Automobile
|
|
424
|
|
|
454
|
|
|
-6.6
|
%
|
||
Property
|
|
192
|
|
|
200
|
|
|
-4.0
|
%
|
||
Total
|
|
616
|
|
|
654
|
|
|
-5.8
|
%
|
Horace Mann Educators Corporation
|
36
|
Quarterly Report on Form 10-Q
|
($ in millions, unless otherwise indicated)
|
|
Three Months Ended
March 31, |
|
2020-2019
|
||||
|
|
2020
|
|
2019
|
|
Change %
|
||
Financial Data:
|
|
|
|
|
|
|
||
Insurance premiums and contract deposits*
|
|
$
|
32.6
|
|
|
N/A
|
|
N/A
|
Insurance premiums and contract charges earned
|
|
33.0
|
|
|
N/A
|
|
N/A
|
|
Net investment income
|
|
3.5
|
|
|
N/A
|
|
N/A
|
|
Benefits and settlement expenses
|
|
10.5
|
|
|
N/A
|
|
N/A
|
|
Operating expenses (includes DAC unlocking and amortization expense)
|
|
10.1
|
|
|
N/A
|
|
N/A
|
|
Intangible asset amortization expense
|
|
3.2
|
|
|
N/A
|
|
N/A
|
|
Income before income taxes
|
|
13.4
|
|
|
N/A
|
|
N/A
|
|
Net income / core earnings*
|
|
10.5
|
|
|
N/A
|
|
N/A
|
|
|
|
|
|
|
|
|
||
Operating Statistics:
|
|
|
|
|
|
|
||
Supplemental insurance in force (thousands)
|
|
297
|
|
|
N/A
|
|
N/A
|
|
Benefits ratio (1)
|
|
31.8
|
%
|
|
N/A
|
|
N/A
|
|
Operating expense ratio (2)
|
|
27.1
|
%
|
|
N/A
|
|
N/A
|
|
Pretax profit margin (2)
|
|
36.0
|
%
|
|
N/A
|
|
N/A
|
|
Persistency
|
|
89.2
|
%
|
|
N/A
|
|
N/A
|
Horace Mann Educators Corporation
|
37
|
Quarterly Report on Form 10-Q
|
•
|
unfavorable DAC unlocking in the current quarter from equity market volatility
|
•
|
lower level of net investment income in the current quarter reflecting lower invested asset levels resulting from the prior year annuity reinsurance transaction and lower returns on alternative investments
|
Horace Mann Educators Corporation
|
38
|
Quarterly Report on Form 10-Q
|
($ in millions, unless otherwise indicated)
|
|
Three Months Ended
March 31, |
|
2020-2019
|
|||||||
|
|
2020
|
|
2019
|
|
Change %
|
|||||
Financial Data:
|
|
|
|
|
|
|
|||||
Contract charges earned
|
|
$
|
7.4
|
|
|
$
|
8.6
|
|
|
-14.0
|
%
|
Net investment income
|
|
53.5
|
|
|
64.7
|
|
|
-17.3
|
%
|
||
Interest credited
|
|
40.3
|
|
|
41.7
|
|
|
-3.4
|
%
|
||
Net interest margin without net investment gains (losses)
|
|
14.1
|
|
|
23.0
|
|
|
-38.7
|
%
|
||
Net interest margin - reinsured block
|
|
(0.9
|
)
|
|
—
|
|
|
N.M.
|
|||
Mortality loss and other reserve charges
|
|
1.6
|
|
|
0.6
|
|
|
166.7
|
%
|
||
Operating expenses
|
|
16.2
|
|
|
18.1
|
|
|
-10.5
|
%
|
||
DAC and intangible asset amortization expense, excluding DAC unlocking
|
|
5.2
|
|
|
5.4
|
|
|
-3.7
|
%
|
||
DAC unlocking
|
|
4.0
|
|
|
(2.0
|
)
|
|
N.M.
|
|
||
Income (loss) before income taxes
|
|
(1.1
|
)
|
|
14.6
|
|
|
-107.5
|
%
|
||
Net income (loss) / core earnings
|
|
(0.9
|
)
|
|
12.2
|
|
|
-107.4
|
%
|
||
Operating Statistics:
|
|
|
|
|
|
|
|||||
Annuity contract deposits*
|
|
|
|
|
|
|
|||||
Variable
|
|
$
|
57.8
|
|
|
$
|
48.8
|
|
|
18.4
|
%
|
Fixed
|
|
59.9
|
|
|
58.5
|
|
|
2.4
|
%
|
||
Total
|
|
117.7
|
|
|
107.3
|
|
|
9.7
|
%
|
||
Single
|
|
62.2
|
|
|
55.9
|
|
|
11.3
|
%
|
||
Recurring
|
|
55.5
|
|
|
51.4
|
|
|
8.0
|
%
|
||
Total
|
|
117.7
|
|
|
107.3
|
|
|
9.7
|
%
|
||
Assets under administration (AUA)
|
|
|
|
|
|
|
|||||
Annuity assets under management (1)
|
|
4,026.6
|
|
|
6,972.7
|
|
|
-42.3
|
%
|
||
Broker and advisory assets under administration
|
|
2,093.9
|
|
|
2,191.9
|
|
|
-4.5
|
%
|
||
Recordkeeping assets under administration
|
|
1,260.8
|
|
|
1,363.8
|
|
|
-7.6
|
%
|
||
Total
|
|
7,381.3
|
|
|
10,528.4
|
|
|
-29.9
|
%
|
||
Persistency
|
|
|
|
|
|
|
|||||
Variable annuities
|
|
94.5
|
%
|
|
94.3
|
%
|
|
0.2
|
pts
|
||
Fixed annuities
|
|
94.0
|
%
|
|
94.1
|
%
|
|
-0.1
|
pts
|
||
Total
|
|
94.1
|
%
|
|
94.1
|
%
|
|
|
|
||
Annuity contracts in force (thousands)
|
|
229
|
|
|
226
|
|
|
1.3
|
%
|
||
Fixed spread - YTD annualized (basis points)
|
|
151
|
|
|
142
|
|
|
9
|
bps
|
(1)
|
Amount reported as of March 31, 2020 excludes $539.6 million of assets under management held under modified coinsurance reinsurance.
|
Horace Mann Educators Corporation
|
39
|
Quarterly Report on Form 10-Q
|
($ in millions)
|
|
March 31, 2020
|
|||||||||||||||
|
|
|
|
|
|
Deferred Annuities at
|
|||||||||||
|
|
Total Deferred Annuities
|
|
Minimum Guaranteed Rate
|
|||||||||||||
|
|
Percent
of Total
|
|
Accumulated
Value (AV)
|
|
Percent of
Total Deferred
Annuities AV
|
|
Percent
of Total
|
|
Accumulated
Value
|
|||||||
Minimum guaranteed interest rates:
|
|
|
|
|
|
|
|
|
|
|
|||||||
Less than 2%
|
|
53.4
|
%
|
|
$
|
1,282.0
|
|
|
49.2
|
%
|
|
37.1
|
%
|
|
$
|
630.6
|
|
Equal to 2% but less than 3%
|
|
12.0
|
%
|
|
287.7
|
|
|
83.2
|
%
|
|
14.1
|
%
|
|
239.4
|
|
||
Equal to 3% but less than 4%
|
|
25.4
|
%
|
|
610.6
|
|
|
99.9
|
%
|
|
35.9
|
%
|
|
610.2
|
|
||
Equal to 4% but less than 5%
|
|
7.1
|
%
|
|
169.7
|
|
|
100.0
|
%
|
|
10.0
|
%
|
|
169.7
|
|
||
5% or higher
|
|
2.1
|
%
|
|
50.6
|
|
|
100.0
|
%
|
|
2.9
|
%
|
|
50.6
|
|
||
Total
|
|
100.0
|
%
|
|
$
|
2,400.6
|
|
|
70.8
|
%
|
|
100.0
|
%
|
|
$
|
1,700.5
|
|
Horace Mann Educators Corporation
|
40
|
Quarterly Report on Form 10-Q
|
($ in millions, unless otherwise indicated)
|
|
Three Months Ended
March 31, |
|
2020-2019
|
|||||||
|
|
2020
|
|
2019
|
|
Change %
|
|||||
Financial Data:
|
|
|
|
|
|
|
|||||
Insurance premiums and contract deposits
|
|
$
|
24.8
|
|
|
$
|
26.4
|
|
|
-6.1
|
%
|
Insurance premiums and contract charges earned
|
|
29.4
|
|
|
30.4
|
|
|
-3.3
|
%
|
||
Net investment income
|
|
15.6
|
|
|
18.1
|
|
|
-13.8
|
%
|
||
Benefits and settlement expenses
|
|
22.2
|
|
|
22.0
|
|
|
0.9
|
%
|
||
Interest credited
|
|
11.2
|
|
|
11.2
|
|
|
—
|
%
|
||
Operating expenses
|
|
9.1
|
|
|
9.4
|
|
|
-3.2
|
%
|
||
DAC amortization expense, excluding unlocking
|
|
1.9
|
|
|
2.0
|
|
|
-5.0
|
%
|
||
DAC unlocking
|
|
(0.1
|
)
|
|
—
|
|
|
N.M.
|
|
||
Income before income taxes
|
|
0.7
|
|
|
4.0
|
|
|
-82.5
|
%
|
||
Net income / core earnings*
|
|
0.6
|
|
|
3.3
|
|
|
-81.8
|
%
|
||
|
|
|
|
|
|
|
|||||
Operating Statistics:
|
|
|
|
|
|
|
|||||
Life insurance in force
|
|
$
|
19,295
|
|
|
$
|
18,409
|
|
|
4.8
|
%
|
Number of policies in force (thousands)
|
|
201
|
|
|
198
|
|
|
1.5
|
%
|
||
Average face amount in force (in dollars)
|
|
$
|
96,225
|
|
|
$
|
92,810
|
|
|
3.7
|
%
|
Lapse ratio (ordinary life insurance in force)
|
|
4.7
|
%
|
|
4.6
|
%
|
|
0.1
|
pts
|
||
Mortality costs
|
|
$
|
10.1
|
|
|
$
|
10.5
|
|
|
-3.8
|
%
|
Horace Mann Educators Corporation
|
41
|
Quarterly Report on Form 10-Q
|
($ in millions)
|
|
Three Months Ended
March 31, |
|
2020-2019
|
|||||||
|
|
2020
|
|
2019
|
|
Change %
|
|||||
Interest expense
|
|
$
|
4.0
|
|
|
$
|
3.0
|
|
|
33.3
|
%
|
Net investment gains (losses) pretax
|
|
(18.5
|
)
|
|
7.4
|
|
|
N.M.
|
|
||
Tax on net investment gains (losses)
|
|
(4.0
|
)
|
|
1.6
|
|
|
N.M.
|
|
||
Net investment gains (losses) after tax
|
|
(14.5
|
)
|
|
5.8
|
|
|
N.M.
|
|
||
Net income (loss)
|
|
(18.3
|
)
|
|
1.7
|
|
|
N.M.
|
|
||
Core earnings (loss)*
|
|
(3.8
|
)
|
|
(4.1
|
)
|
|
7.3
|
%
|
($ in millions)
|
|
Three Months Ended
March 31, |
|
2020-2019
|
|||||||
|
|
2020
|
|
2019
|
|
Change %
|
|||||
Net investment income - investment portfolio
|
|
$
|
58.6
|
|
|
$
|
92.8
|
|
|
-36.9
|
%
|
Investment income - Deposit asset on reinsurance
|
|
23.7
|
|
|
—
|
|
|
N.M.
|
|
||
Total net investment income
|
|
82.3
|
|
|
92.8
|
|
|
-11.3
|
%
|
||
Pretax net investment gains (losses)
|
|
(18.5
|
)
|
|
7.4
|
|
|
N.M.
|
|
||
Pretax net unrealized investment gains on fixed maturity securities
|
|
189.7
|
|
|
310.5
|
|
|
-38.9
|
%
|
Horace Mann Educators Corporation
|
42
|
Quarterly Report on Form 10-Q
|
($ in millions)
|
|
March 31, 2020
|
|||||||||||||
|
|
Number of
Issuers
|
|
Fair
Value
|
|
Amortized
Cost or Cost
|
|
Pretax Net
Unrealized
Gain (Loss)
|
|||||||
Fixed maturity securities
|
|
|
|
|
|
|
|
|
|||||||
Corporate bonds
|
|
|
|
|
|
|
|
|
|||||||
Banking & Finance
|
|
123
|
|
|
$
|
430.4
|
|
|
$
|
417.4
|
|
|
$
|
13.0
|
|
Insurance
|
|
43
|
|
|
171.4
|
|
|
163.8
|
|
|
7.6
|
|
|||
HealthCare,Pharmacy
|
|
67
|
|
|
124.9
|
|
|
119.8
|
|
|
5.1
|
|
|||
Energy (1)
|
|
72
|
|
|
120.6
|
|
|
124.4
|
|
|
(3.8
|
)
|
|||
Real Estate
|
|
37
|
|
|
114.5
|
|
|
113.7
|
|
|
0.8
|
|
|||
Technology
|
|
39
|
|
|
88.2
|
|
|
85.8
|
|
|
2.4
|
|
|||
Transportation
|
|
32
|
|
|
79.4
|
|
|
78.3
|
|
|
1.1
|
|
|||
Utilities
|
|
51
|
|
|
71.0
|
|
|
65.6
|
|
|
5.4
|
|
|||
Food and Beverage
|
|
29
|
|
|
64.2
|
|
|
61.2
|
|
|
3.0
|
|
|||
Broadcasting & Media
|
|
26
|
|
|
56.1
|
|
|
52.7
|
|
|
3.4
|
|
|||
All other corporates (2)
|
|
298
|
|
|
365.1
|
|
|
366.8
|
|
|
(1.7
|
)
|
|||
Total corporate bonds
|
|
817
|
|
|
1,685.8
|
|
|
1,649.5
|
|
|
36.3
|
|
|||
Mortgage-backed securities
|
|
|
|
|
|
|
|
|
|||||||
U.S. Government and federally sponsored agencies
|
|
275
|
|
|
534.5
|
|
|
484.5
|
|
|
50.0
|
|
|||
Commercial (3)
|
|
132
|
|
|
348.1
|
|
|
328.1
|
|
|
20.0
|
|
|||
Other
|
|
45
|
|
|
68.2
|
|
|
72.9
|
|
|
(4.7
|
)
|
|||
Municipal bonds (4)
|
|
590
|
|
|
1,769.8
|
|
|
1,625.8
|
|
|
144.0
|
|
|||
Government bonds
|
|
|
|
|
|
|
|
|
|||||||
U.S.
|
|
34
|
|
|
468.7
|
|
|
430.2
|
|
|
38.5
|
|
|||
Foreign
|
|
9
|
|
|
43.9
|
|
|
42.9
|
|
|
1.0
|
|
|||
Collateralized loan obligations (5)
|
|
119
|
|
|
559.2
|
|
|
614.8
|
|
|
(55.6
|
)
|
|||
Asset-backed securities
|
|
109
|
|
|
365.0
|
|
|
404.8
|
|
|
(39.8
|
)
|
|||
Total fixed maturity securities
|
|
2,130
|
|
|
$
|
5,843.2
|
|
|
$
|
5,653.5
|
|
|
$
|
189.7
|
|
|
|
|
|
|
|
|
|
|
|||||||
Equity securities
|
|
|
|
|
|
|
|
|
|||||||
Non-redeemable preferred stocks
|
|
14
|
|
|
$
|
52.3
|
|
|
|
|
|
||||
Common stocks
|
|
98
|
|
|
14.8
|
|
|
|
|
|
|||||
Closed-end fund
|
|
1
|
|
|
19.9
|
|
|
|
|
|
|||||
Total equity securities
|
|
113
|
|
|
$
|
87.0
|
|
|
|
|
|
||||
|
|
|
|
|
|
|
|
|
|||||||
Total
|
|
2,243
|
|
|
$
|
5,930.2
|
|
|
|
|
|
(1)
|
At March 31, 2020, the fair value amount included $8.8 million which were non-investment grade.
|
(2)
|
The All other corporates category contains 19 additional industry sectors. Telecom, Retail, Consumer Products, Metal & Mining and Misc. represented $206.2 million of fair value at March 31, 2020, with the remaining 14 sectors each representing less than $30.0 million.
|
(3)
|
At March 31, 2020, 100% were investment grade, with an overall credit rating of AA+, and the positions were well diversified by property type, geography and sponsor.
|
(4)
|
Holdings are geographically diversified, 51.6% are tax-exempt and 77.5% are revenue bonds tied to essential services, such as mass transit, water and sewer. The overall credit quality of the municipal bond portfolio was AA- at March 31, 2020.
|
(5)
|
Based on fair value, 95.3% of the collateralized loan obligation securities were rated investment grade by Standard and Poor's Global Inc. (S&P), Moody's Investors Service, Inc. (Moody's) and/or Fitch Ratings, Inc. (Fitch) at March 31, 2020.
|
Horace Mann Educators Corporation
|
43
|
Quarterly Report on Form 10-Q
|
($ in millions)
|
|
March 31, 2020
|
|||||||||||||||
|
|
Number of Issuers
|
|
Fair Value
|
|
Amortized
Cost or
Cost
|
|
Pretax Net Unrealized
Investment
Gains (Losses)
|
|
Credit
Quality
|
|||||||
Fixed maturity securities (1)
|
|
|
|
|
|
|
|
|
|
|
|||||||
Travel and leisure
|
|
46
|
|
|
$
|
79.2
|
|
|
$
|
82.5
|
|
|
$
|
(3.3
|
)
|
|
BBB
|
Energy-related
|
|
77
|
|
|
137.3
|
|
|
134.4
|
|
|
2.9
|
|
|
BBB+
|
|||
Retail
|
|
21
|
|
|
54.0
|
|
|
54.2
|
|
|
(0.2
|
)
|
|
A-
|
|||
Aircraft
|
|
55
|
|
|
150.5
|
|
|
183.4
|
|
|
(32.9
|
)
|
|
A
|
|||
Total fixed maturity securities
|
|
199
|
|
|
$
|
421.0
|
|
|
$
|
454.5
|
|
|
$
|
(33.5
|
)
|
|
A-
|
(1)
|
Below investment grade securities included in this population account for $34.5 million of amortized cost, $26.6 million of market value, and $7.9 million of net unrealized investment losses. There are 83 issuers with an average rating of BB-. The majority of these securities are concentrated in the energy sector.
|
Horace Mann Educators Corporation
|
44
|
Quarterly Report on Form 10-Q
|
($ in millions)
|
|
Percent of Portfolio
|
|
|
|
|
||||||||
|
|
Fair Value
|
|
March 31, 2020
|
||||||||||
|
|
December 31, 2019
|
|
March 31, 2020
|
|
Fair
Value
|
|
Amortized
Cost
|
||||||
Fixed maturity securities
|
|
|
|
|
|
|
|
|
||||||
AAA
|
|
11.5
|
%
|
|
11.6
|
%
|
|
$
|
676.4
|
|
|
$
|
695.2
|
|
AA (2)
|
|
42.7
|
|
|
43.3
|
|
|
2,531.2
|
|
|
2,343.4
|
|
||
A
|
|
23.3
|
|
|
21.8
|
|
|
1,276.5
|
|
|
1,239.2
|
|
||
BBB
|
|
18.9
|
|
|
18.6
|
|
|
1,084.2
|
|
|
1,084.9
|
|
||
BB
|
|
1.7
|
|
|
1.8
|
|
|
104.8
|
|
|
110.8
|
|
||
B
|
|
0.4
|
|
|
0.9
|
|
|
49.7
|
|
|
55.0
|
|
||
CCC or lower
|
|
—
|
|
|
—
|
|
|
1.4
|
|
|
2.3
|
|
||
Not rated (3)
|
|
1.5
|
|
|
2.0
|
|
|
119.0
|
|
|
122.7
|
|
||
Total fixed maturity securities
|
|
100.0
|
%
|
|
100.0
|
%
|
|
$
|
5,843.2
|
|
|
$
|
5,653.5
|
|
Equity securities
|
|
|
|
|
|
|
|
|
||||||
AAA
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|||
AA
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|||
A
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|||
BBB
|
|
59.3
|
%
|
|
60.1
|
%
|
|
$
|
52.3
|
|
|
|
||
BB
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|||
B
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|||
CCC or lower
|
|
—
|
|
|
—
|
|
|
—
|
|
|
|
|||
Not rated
|
|
40.7
|
|
|
39.9
|
|
|
34.7
|
|
|
|
|||
Total equity securities
|
|
100.0
|
%
|
|
100.0
|
%
|
|
$
|
87.0
|
|
|
|
||
|
|
|
|
|
|
|
|
|
||||||
Total
|
|
|
|
|
|
$
|
5,930.2
|
|
|
|
(1)
|
Ratings are as assigned primarily by S&P when available, with remaining ratings as assigned on an equivalent basis by Moody's or Fitch. Ratings for publicly traded securities are determined when the securities are acquired and are updated monthly to reflect any changes in ratings.
|
(2)
|
At March 31, 2020, the AA rated fair value amount included $468.2 million of U.S. Government and federally sponsored agency securities and $736.4 million of mortgage-backed and asset-backed securities issued by U.S. Government and federally sponsored agencies.
|
(3)
|
This category primarily represents private placement and municipal securities not rated by either S&P, Moody's or Fitch.
|
Horace Mann Educators Corporation
|
45
|
Quarterly Report on Form 10-Q
|
($ in millions)
|
|
Three Months Ended
March 31, |
|
2020-2019
|
|||||||
|
|
2020
|
|
2019
|
|
Change %
|
|||||
Net cash provided by operating activities
|
|
$
|
87.4
|
|
|
$
|
124.8
|
|
|
-30.0
|
%
|
Net cash used in investing activities
|
|
(140.0
|
)
|
|
(146.2
|
)
|
|
4.2
|
%
|
||
Net cash provided by financing activities
|
|
68.3
|
|
|
16.8
|
|
|
N.M.
|
|
||
Net increase (decrease) in cash
|
|
15.7
|
|
|
(4.6
|
)
|
|
N.M.
|
|
||
Cash at beginning of period
|
|
25.5
|
|
|
11.9
|
|
|
114.3
|
%
|
||
Cash at end of period
|
|
$
|
41.2
|
|
|
$
|
7.3
|
|
|
N.M.
|
|
Horace Mann Educators Corporation
|
46
|
Quarterly Report on Form 10-Q
|
Horace Mann Educators Corporation
|
47
|
Quarterly Report on Form 10-Q
|
($ in millions)
|
|
Effective
Interest
Rates
|
|
Final
Maturity
|
|
|
|
|
||||
|
|
|
|
March 31, 2020
|
|
December 31, 2019
|
||||||
Short-term debt
|
|
|
|
|
|
|
|
|
||||
Bank Credit Facility
|
|
Variable
|
|
2024
|
|
$
|
135.0
|
|
|
$
|
135.0
|
|
Long-term debt (1)
|
|
|
|
|
|
|
|
|
||||
4.50% Senior Notes, Aggregate principal
amount of $250,000 less unaccrued discount of $411 and $426 and unamortized debt issuance costs of $1,491 and $1,549 |
|
4.50%
|
|
2025
|
|
248.1
|
|
|
248.0
|
|
||
Federal Home Loan Bank borrowing
|
|
1.99%
|
|
2022
|
|
50.0
|
|
|
50.0
|
|
||
Total
|
|
|
|
|
|
$
|
433.1
|
|
|
$
|
433.0
|
|
Horace Mann Educators Corporation
|
48
|
Quarterly Report on Form 10-Q
|
|
|
Insurance Financial
|
|
|
||||
|
|
Strength Ratings (Outlook)
|
|
Debt Ratings (Outlook)
|
||||
S&P
|
|
A
|
|
(stable)
|
|
BBB
|
|
(stable)
|
Moody’s
|
|
A2
|
|
(stable)
|
|
Baa2
|
|
(stable)
|
A.M. Best
|
|
|
|
|
|
|
|
|
HMEC (parent company)
|
|
N.A.
|
|
|
|
bbb
|
|
(stable)
|
HMEC's Life
|
|
A
|
|
(stable)
|
|
N.A.
|
|
|
HMEC's Property and Casualty subsidiaries
|
|
A
|
|
(stable)
|
|
N.A.
|
|
|
HMEC's Supplemental subsidiaries
|
|
A-
|
|
(stable)
|
|
N.A.
|
|
|
Fitch
|
|
A
|
|
(stable)
|
|
BBB
|
|
(stable)
|
Horace Mann Educators Corporation
|
49
|
Quarterly Report on Form 10-Q
|
Horace Mann Educators Corporation
|
50
|
Quarterly Report on Form 10-Q
|
•
|
employees contracting COVID-19;
|
•
|
reductions in our operating effectiveness as our employees work from home;
|
•
|
sustained lack of access to schools and teachers that could materially impact our sales and premium volumes;
|
•
|
unprecedented volatility in financial markets that could materially affect our investment portfolio valuations and returns as well as our ability to generate targeted spreads on the indexed products;
|
•
|
regulatory mandates and/or legislative changes, including premium grace periods and premium credits;
|
•
|
changes in frequency and/or severity of claims;
|
•
|
increased credit risk;
|
•
|
business disruption for insurance agents who market and sell our insurance products; and
|
•
|
business disruptions to third parties at which we outsource certain business functions to or on which we rely for technology.
|
Horace Mann Educators Corporation
|
51
|
Quarterly Report on Form 10-Q
|
Period
|
|
Total Number
of Shares
Purchased
|
|
Average Price
Paid Per Share
|
|
Total Number of
Shares Purchased
as Part of Publicly
Announced Plans
or Programs
|
|
Maximum Number
(or Approximate Dollar
Value) of Shares
That May Yet Be
Purchased Under The
Plans or Programs
|
|||
January 1 - 31
|
|
—
|
|
|
—
|
|
|
—
|
|
|
$22.8 million
|
February 1 - 29
|
|
52,095
|
|
|
$41.17
|
|
52,095
|
|
|
$20.6 million
|
|
March 1 - 30
|
|
—
|
|
|
—
|
|
|
—
|
|
|
$20.6 million
|
Total
|
|
52,095
|
|
|
$41.17
|
|
52,095
|
|
|
$20.6 million
|
Horace Mann Educators Corporation
|
52
|
Quarterly Report on Form 10-Q
|
Horace Mann Educators Corporation
|
53
|
Quarterly Report on Form 10-Q
|
|
|
|
10.3(c)*
|
|
|
|
|
|
10.3(d)*
|
|
|
|
|
|
10.3(e)*
|
|
|
|
|
|
10.3(f)*
|
|
|
|
|
|
10.3(g)*
|
|
|
|
|
|
10.4*
|
|
|
|
|
|
10.5*
|
|
|
|
|
|
10.6*
|
|
|
|
|
|
10.7*
|
|
|
|
|
|
10.8*
|
|
|
|
|
|
10.9*
|
|
|
|
|
|
10.10*
|
|
|
|
|
|
10.10(a)*
|
|
|
|
|
|
10.11*
|
|
|
|
|
|
10.11(a)*
|
|
|
|
|
|
Horace Mann Educators Corporation
|
54
|
Quarterly Report on Form 10-Q
|
Horace Mann Educators Corporation
|
55
|
Quarterly Report on Form 10-Q
|
|
|
|
HORACE MANN EDUCATORS CORPORATION
|
|
|
|
(Registrant)
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Date
|
May 8, 2020
|
|
/s/ Marita Zuraitis
|
|
|
|
|
|
|
|
Marita Zuraitis
|
|
|
|
President and Chief Executive Officer
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Date
|
May 8, 2020
|
|
/s/ Bret A. Conklin
|
|
|
|
|
|
|
|
Bret A. Conklin
|
|
|
|
Executive Vice President and
|
|
|
|
Chief Financial Officer
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
|
Date
|
May 8, 2020
|
|
/s/ Kimberly A. Johnson
|
|
|
|
|
|
|
|
Kimberly A. Johnson
|
|
|
|
Senior Vice President, Controller and
|
|
|
|
Principal Accounting Officer
|
Horace Mann Educators Corporation
|
56
|
Quarterly Report on Form 10-Q
|
1 Year Horace Mann Educators Chart |
1 Month Horace Mann Educators Chart |
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