Research Update: Kemper Corp. And Core Subsidiaries Downgraded On Sustained Operating Performance Challenges; Outlook Stable

Private auto underwriting results across the industry have deteriorated materially over the past 24 months, and Kemper's geographic and product concentrations have exacerbated the impact and hindered the company's ability to restore profitability. Operating performance, as measured by return on revenue and combined ratio, has lagged that of 'A' rated peers. We lowered our financial strength ratings on Kemper Corp.'s core operating subsidiaries to 'A-' from 'A' and removed the ratings from CreditWatch negative. The outlook is stable, reflecting our view that Kemper's restructuring to a reciprocal exchange will have minimal impact on its credit fundamentals, especially in the near to medium term. On Feb. 9, 2023, S&P Global Ratings lowered its financial strength ratings on Kemper Corp.'s core operating

...- Private auto underwriting results across the industry have deteriorated materially over the past 24 months, and Kemper's geographic and product concentrations have exacerbated the impact and hindered the company's ability to restore profitability. - Operating performance, as measured by return on revenue and combined ratio, has lagged that of 'A' rated peers. - We lowered our financial strength ratings on Kemper Corp.'s core operating subsidiaries to 'A-' from 'A' and removed the ratings from CreditWatch negative. - The outlook is stable, reflecting our view that Kemper's restructuring to a reciprocal exchange will have minimal impact on its credit fundamentals, especially in the near to medium term....

Research Update