Horace Mann Educators (HMN) Q4 2025 earnings summary

Executive summary

• Achieved record 2025 core EPS of $4.71 and 12.4% ROE, with all segments meeting or exceeding profitability targets; full-year net income was $162 million ($3.90 per share).

• Total revenues and net premiums/contract deposits rose nearly 7% year-over-year, with strong sales momentum and growth across all business lines.

• Individual Supplemental sales increased nearly 40%, Group Benefits up 33%, and Life sales up 21% in Q4 year-over-year.

• Brand awareness in the educator market rose to 35%, aided by partnerships and expanded distribution.

• Introduced the Horace Mann Club and donated $5 million to the Horace Mann Educators Foundation.

Financial highlights

• Core earnings reached $196 million, up 39% over prior year; normalized core EPS was $3.95, in line with guidance.

• Book value per share at year-end was $36.47, up 15.7% year-over-year; adjusted book value per share was $40.21, up 7.1%.

• Property & Casualty core earnings doubled to $112 million; combined ratio improved over 8 points to 89.7.

• Net investment income on managed portfolio increased over 6% year-over-year; new money yield at 5.51%.

• Core ROE (LTM) improved to 12.4%, up 3.0pts year-over-year.

Outlook and guidance

• 2026 core EPS guidance of $4.20-$4.50, nearly 10% growth from normalized 2025 baseline.

• Targeting 10% average compound annual growth in core EPS and sustainable 12%-13% ROE over three years.

• Management targets sustained, profitable growth in 2026 and beyond, supported by strong segment performance and lower catastrophe losses.

• Expecting $485M-$495M total net investment income in 2026; $90M catastrophe loss assumption based on historical and modeled data.

• Majority of targeted 100-150 bps expense ratio improvement to be realized in later years of three-year plan.