Note 11 - Business Segments The Company is engaged, through its subsidiaries, in the property and casualty insurance and life and health insurance. The Company conducts its operations through four operating segments: Kemper Preferred, Unitrin Specialty, Unitrin Direct and Life and Health Insurance. The Kemper Preferred segment provides preferred and standard risk personal automobile insurance, homeowners insurance and other personal insurance through independent agents. The Unitrin Specialty segment provides automobile insurance to individuals and businesses in the non-standard and specialty market through independent agents. The non-standard automobile insurance market consists of individuals and companies that have difficulty obtaining standard or preferred risk insurance, usually because of their adverse driving records or claim or credit histories. Unitrin Direct markets personal automobile, homeowners and renters insurance through direct mail and the Internet through web insurance portals, click-thrus and its own website and through employer-sponsored voluntary benefit programs and other affinity relationships. The Life and Health Insurance segment provides individual life, accident, health and property insurance. Note 11 - Business Segments (continued)
Segment Revenues for the nine and three months ended September 30, 2011 and 2010 were: | | | | | | | | | | | | | | | | | | | | Nine Months Ended | | Three Months Ended | (Dollars in Millions) | | Sep 30,
2011 | | Sep 30,
2010 | | Sep 30,
2011 | | Sep 30,
2010 | Revenues: | | | | | | | | | Kemper Preferred: | | | | | | | | | Earned Premiums | | $ | 642.8 |
| | $ | 667.1 |
| | $ | 216.5 |
| | $ | 221.8 |
| Net Investment Income | | 38.1 |
| | 38.6 |
| | 8.4 |
| | 12.3 |
| Other Income | | 0.2 |
| | 0.3 |
| | 0.1 |
| | 0.1 |
| Total Kemper Preferred | | 681.1 |
| | 706.0 |
| | 225.0 |
| | 234.2 |
| Unitrin Specialty: | | | | | | | | | Earned Premiums | | 336.7 |
| | 359.9 |
| | 111.0 |
| | 117.0 |
| Net Investment Income | | 16.4 |
| | 18.5 |
| | 3.3 |
| | 5.7 |
| Other Income | | 0.4 |
| | 0.5 |
| | 0.2 |
| | 0.2 |
| Total Unitrin Specialty | | 353.5 |
| | 378.9 |
| | 114.5 |
| | 122.9 |
| Unitrin Direct: | | | | | | | | | Earned Premiums | | 171.8 |
| | 217.6 |
| | 54.4 |
| | 68.6 |
| Net Investment Income | | 13.9 |
| | 16.0 |
| | 2.9 |
| | 4.8 |
| Other Income | | 0.1 |
| | 0.1 |
| | 0.1 |
| | — |
| Total Unitrin Direct | | 185.8 |
| | 233.7 |
| | 57.4 |
| | 73.4 |
| Life and Health Insurance: | | | | | | | | | Earned Premiums | | 485.8 |
| | 483.2 |
| | 161.1 |
| | 160.8 |
| Net Investment Income | | 148.3 |
| | 158.4 |
| | 42.9 |
| | 53.8 |
| Other Income | | 0.1 |
| | 0.1 |
| | — |
| | 0.1 |
| Total Life and Health Insurance | | 634.2 |
| | 641.7 |
| | 204.0 |
| | 214.7 |
| Total Segment Revenues | | 1,854.6 |
| | 1,960.3 |
| | 600.9 |
| | 645.2 |
| Net Realized Gains (Losses) on Sales of Investments | | 27.8 |
| | 14.6 |
| | (4.2 | ) | | 7.2 |
| Net Impairment Losses Recognized in Earnings | | (6.7 | ) | | (12.7 | ) | | (5.0 | ) | | (4.6 | ) | Other | | 6.0 |
| | 9.5 |
| | 1.1 |
| | 2.8 |
| Total Revenues | | $ | 1,881.7 |
| | $ | 1,971.7 |
| | $ | 592.8 |
| | $ | 650.6 |
|
Note 11 - Business Segments (continued)
Segment Operating Profit (Loss) for the nine and three months ended September 30, 2011 and 2010 was: | | | | | | | | | | | | | | | | | | | | Nine Months Ended | | Three Months Ended | (Dollars in Millions) | | Sep 30,
2011 | | Sep 30,
2010 | | Sep 30,
2011 | | Sep 30,
2010 | Segment Operating Profit (Loss): | | | | | | | | | Kemper Preferred | | $ | (55.7 | ) | | $ | 54.0 |
| | $ | (15.7 | ) | | $ | 17.1 |
| Unitrin Specialty | | 17.8 |
| | 23.0 |
| | 6.7 |
| | 8.0 |
| Unitrin Direct | | (19.3 | ) | | (1.7 | ) | | (3.7 | ) | | (1.5 | ) | Life and Health Insurance | | 117.8 |
| | 100.9 |
| | 34.3 |
| | 26.9 |
| Total Segment Operating Profit | | 60.6 |
| | 176.2 |
| | 21.6 |
| | 50.5 |
| Unallocated Operating Loss | | (31.8 | ) | | (18.0 | ) | | (13.2 | ) | | (6.2 | ) | Total Operating Profit | | 28.8 |
| | 158.2 |
| | 8.4 |
| | 44.3 |
| Net Realized Gains (Losses) on Sales of Investments | | 27.8 |
| | 14.6 |
| | (4.2 | ) | | 7.2 |
| Net Impairment Losses Recognized in Earnings | | (6.7 | ) | | (12.7 | ) | | (5.0 | ) | | (4.6 | ) | Income (Loss) from Continuing Operations before Income Taxes and Equity in Net Loss of Investee | | $ | 49.9 |
| | $ | 160.1 |
| | $ | (0.8 | ) | | $ | 46.9 |
|
Segment Net Operating Income (Loss) for the nine and three months ended September 30, 2011 and 2010 was: | | | | | | | | | | | | | | | | | | | | Nine Months Ended | | Three Months Ended | (Dollars in Millions) | | Sep 30,
2011 | | Sep 30,
2010 | | Sep 30,
2011 | | Sep 30,
2010 | Segment Net Operating Income (Loss): | | | | | | | | | Kemper Preferred | | $ | (29.7 | ) | | $ | 41.6 |
| | $ | (8.0 | ) | | $ | 13.5 |
| Unitrin Specialty | | 14.4 |
| | 18.0 |
| | 5.3 |
| | 6.2 |
| Unitrin Direct | | (10.1 | ) | | 0.8 |
| | (1.6 | ) | | 0.3 |
| Life and Health Insurance | | 76.0 |
| | 60.3 |
| | 22.4 |
| | 12.4 |
| Total Segment Net Operating Income | | 50.6 |
| | 120.7 |
| | 18.1 |
| | 32.4 |
| Unallocated Net Operating Loss | | (19.5 | ) | | (8.5 | ) | | (8.3 | ) | | (1.8 | ) | Net Operating Income | | 31.1 |
| | 112.2 |
| | 9.8 |
| | 30.6 |
| Unallocated Net Income (Loss) From: | | | | | | | | | Net Realized Gains (Losses) on Sales of Investments | | 18.0 |
| | 9.5 |
| | (2.7 | ) | | 4.7 |
| Net Impairment Losses Recognized in Earnings | | (4.3 | ) | | (8.3 | ) | | (3.3 | ) | | (3.0 | ) | Income from Continuing Operations | | $ | 44.8 |
| | $ | 113.4 |
| | $ | 3.8 |
| | $ | 32.3 |
|
Note 11 - Business Segments (continued)
Earned Premiums by product line for the nine and three months ended September 30, 2011 and 2010 were: | | | | | | | | | | | | | | | | | | | | Nine Months Ended | | Three Months Ended | (Dollars in Millions) | | Sep 30,
2011 | | Sep 30,
2010 | | Sep 30,
2011 | | Sep 30,
2010 | Life | | $ | 297.1 |
| | $ | 298.3 |
| | $ | 98.0 |
| | $ | 98.8 |
| Accident and Health | | 124.6 |
| | 120.5 |
| | 41.9 |
| | 40.5 |
| Property and Casualty: | | | | | | | | | Personal Lines: | | | | | | | | | Automobile | | 854.7 |
| | 947.4 |
| | 281.4 |
| | 308.3 |
| Homeowners | | 226.4 |
| | 223.7 |
| | 76.6 |
| | 75.1 |
| Other Personal | | 104.5 |
| | 104.6 |
| | 35.0 |
| | 34.8 |
| Total Personal Lines | | 1,185.6 |
| | 1,275.7 |
| | 393.0 |
| | 418.2 |
| Commercial Automobile | | 29.8 |
| | 33.3 |
| | 10.1 |
| | 10.7 |
| Total Earned Premiums | | $ | 1,637.1 |
| | $ | 1,727.8 |
| | $ | 543.0 |
| | $ | 568.2 |
|
|