Kemper (KMPR) Raymond James & Associates’ 46th Annual Institutional Investors Conference 2025 summary

Industry environment and regulatory impacts

• Auto insurance faced 30-45 points of inflation post-pandemic, with regulatory lags delaying rate adjustments.

• California, representing over half of auto premiums, delayed rate increases, but a 35% hike approved in August 2023 improved profitability in 2024.

• The current hard market allows for outsized growth and returns as competitors remain cautious.

Financial performance and capital position

• Strong margins and financial flexibility restored, with $450 million debt repaid in February 2025, reducing debt-to-capital ratio to low 20s.

• Capital and liquidity are robust, with over $1 billion in liquidity and regulatory capital well above minimums.

• High teens premium growth expected in 2025, with sufficient capital for growth and share repurchases.

Market segmentation and geographic focus

• Focused on the specialty auto segment, which is more fragmented and price-sensitive than standard/preferred segments.

• California is a hard market with limited competition, enabling growth; Florida is stable with recent tort reforms; Texas is highly competitive but offers long-term growth opportunities.