Kemper Corporation — Third Quarter 2026 Earnings Summary

Financial Performance:

• Reported Net Income of $52.4 million ($0.88 per diluted share) for Q3 2026, compared to a Net Loss of $21.0 million ($(0.34) per share) in Q3 2025.
• Adjusted Consolidated Net Operating Income was $59.9 million ($1.01 per diluted share) for Q3 2026, up from $20.4 million ($0.33 per share) in Q3 2025.
• Total Revenues decreased $149.1 million to $1,090.6 million in Q3 2026 from $1,239.7 million in Q3 2025, driven by lower Specialty Personal Automobile volumes partially offset by higher Specialty Commercial Automobile volumes.
• Nine-month Net Income (Loss) was $(414.1) million ($(7.04) per share) for 2026 compared to $151.3 million ($2.37 per share) for 2025.
• Nine-month Adjusted Consolidated Net Operating Income was $98.7 million ($1.68 per share) for 2026 compared to $210.9 million ($3.31 per share) for 2025.
• Impact of catastrophe losses and related LAE on Net Income was $(2.3) million for Q3 2026 versus $(0.6) million for Q3 2025.
• Kemper Corporation Shareholders' Equity was $2,133.3 million as of September 30, 2026, a 20% decrease from year-end 2025.
• Book value per share was $36.20 at quarter-end 2026, down 21% from $45.71 at year-end 2025.
• Adjusted book value per share was $28.13 at quarter-end 2026, compared to $28.06 at year-end 2025.
• Return on Adjusted Shareholders' Equity was 12.8% for Q3 2026, compared to (4.6)% for Q3 2025.

Guidance and Future Outlook:

• Management stated that actions taken to improve profitability are taking hold, though more work remains to restore profitability and build capabilities for durable, growth.
• The Company will continue to evaluate additional efficiency opportunities through 2027.
• The Preferred Insurance business is expected to be fully exited.

Business Segments and Product Lines:

• Specialty Property & Casualty Insurance: Reported Adjusted Net Operating Income of $54.4 million in Q3 2026, up from $7.6 million in Q3 2025.
  • Specialty Personal Automobile income increased $24.6 million, primarily driven by favorable prior year development.
  • Specialty Commercial Automobile income increased $22.2 million, driven by lower adverse prior year development, partially offset by higher underlying losses from increased claim severity.
  • California Personal Auto Combined Ratio improved 12 points and Underlying Combined Ratio improved 7 points since Q1 2026.
  • Specialty Property & Casualty Insurance Combined Ratio was 99.2% for Q3 2026, down from 104.8% in Q3 2025.
  • Specialty Property & Casualty Insurance Underlying Combined Ratio was 101.7% for Q3 2026, up from 99.6% in Q3 2025.
• Life Insurance: Reported Adjusted Net Operating Income of $19.8 million in Q3 2026, up from $18.6 million in Q3 2025.
  • Improvement was driven by higher Earned Premiums, partially offset by higher Policyholders' Benefits from life insurance products.
  • Life Insurance Earned Premiums were $115.7 million for Q3 2026, up from $99.8 million in Q3 2025.

Market and Competitive Landscape:

• The Company serves approximately 4.3 million policies through approximately 24,000 agents and brokers.
• Management noted heightened competition as a risk factor in forward-looking statements.
• The Company completed the sale of Newins in the second quarter of 2026, recording a gain.

Risks and Challenges:

• Risks include changes in claim frequency and severity, claim development estimation, inflation impacts, interest rate environment changes, supply chain disruptions, product demand, legislative/regulatory actions, litigation outcomes, investment risks, cybersecurity incidents, and catastrophe impacts.
• The Specialty Property & Casualty segment faced higher underlying losses in Commercial Automobile due to increased claim severity.
• Shareholders' Equity decreased 20% in the first nine months of 2026 primarily due to comprehensive losses.
• Goodwill impairment of $460.0 million was recorded in the first nine months of 2025, impacting prior year comparisons.

Management Commentary and Tone:

• Stephen J. McAnena, President and CEO, stated: "Our third-quarter results demonstrate continued progress as the actions we've taken to improve profitability are taking hold."
• Management expressed confidence in moving in the right direction while focusing on restoring profitability and building capabilities for durable, profitable growth.
• A restructuring program was launched in Q3 2025 to achieve operational and organizational efficiencies.

Other Key Points:

• On August 5, 2026, the Board declared a quarterly dividend of $0.32 per share ($18.9 million total), paid on September 4, 2026.
• The Company ended the quarter with cash and investments of $90.8 million and $350.0 million of available borrowing capacity under its revolving credit agreement.
• Total Investments were $8,270.1 million as of September 30, 2026, down from $8,669.6 million as of December 31, 2025.
• Long-term debt was $945.0 million as of September 30, 2026, compared to $943.5 million as of December 31, 2025.
• A conference call to discuss results was scheduled for November 10, 2026, at 8:00 a.m. Eastern Time.
• Non-GAAP measures used include Adjusted Consolidated Net Operating Income, Underlying Combined Ratio, Adjusted Book Value Per Share, and Return on Adjusted Shareholders' Equity.