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Acquisition of Business | 12 Months Ended
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Dec. 31, 2020
Business Combinations [Abstract] |
Acquisition of Business | ACQUISITION OF BUSINESS Acquisition of American Access Casualty Company On November 23, 2020, Kemper announced that it entered into a definitive agreement to acquire American Access Casualty Company and its related captive insurance agency, Newins Insurance Agency Holdings, LLC, and its subsidiaries (collectively “AAC”), in a cash transaction valued at $370.0 million. The transaction is expected to close in the first quarter of 2021, subject to regulatory approval and other customary closing conditions. AAC, headquartered in Downers Grove, Illinois, provides specialty private passenger auto insurance in Arizona, Illinois, Indiana, Nevada, and Texas. AAC wrote over $370.0 million of direct premiums in 2019 through a network of approximately 500 independent agents and over 110 captive agents. NOTE 3. ACQUISITION OF BUSINESS (Continued) Acquisition of Infinity Property and Casualty Corporation On July 2, 2018, Kemper acquired 100% of the outstanding common stock of Infinity Property and Casualty Corporation (“Infinity”), pursuant to the terms of the merger agreement dated February 13, 2018, with total cash, stock and equity-based compensation consideration paid to Infinity shareholders of approximately $1.5 billion. In conjunction with closing the acquisition, Kemper issued 13.2 million shares, with an aggregate fair value of $982.5 million based on Kemper’s July 2, 2018 stock price of $74.53 per share, and paid $564.6 million in cash consideration to Infinity’s shareholders. In addition, Kemper issued 44,010 restricted stock units under Kemper’s equity-based compensation plan to replace Infinity restricted shares that were outstanding immediately prior to the closing. The aggregate fair value of such Kemper restricted stock units granted was $3.3 million at July 2, 2018, of which $1.6 million is attributed to service provided prior to the closing and included in consideration paid. The remaining amount of $1.7 million is attributed to future service and will be recognized in compensation expense primarily over a period of two years. The cash consideration was funded by cash on hand as of July 2, 2018, inclusive of $250.0 million in borrowings under the Company’s delayed draw term loan facility and $110.0 million of Kemper subsidiary borrowings from the FHLB of Dallas and FHLB of Chicago. On July 13, 2018, Kemper subsidiaries repaid in full the $110.0 million of FHLB borrowings, plus accrued interest. On December 28, 2018, Kemper repaid $215.0 million of the delayed draw term loan facility. See Note 8, “Debt,” to the Consolidated Financial Statements for additional information. Infinity is a national provider of auto insurance focused on serving the specialty automobile market. In 2019, the Company completed the process of estimating the fair value of assets acquired and liabilities assumed. In accordance with ASC Topic 805, Business Combinations, changes to the preliminary estimates and allocation as a result of events or conditions as of the acquisition date, are reported in the Company’s financial statements as an adjustment to the assets acquired and liabilities assumed. The Company finalized its estimate of certain legal and tax accruals, increasing liabilities assumed by $1.8 million, increasing current income tax assets by $0.2 million and increasing goodwill by $1.6 million compared with balances as of December 31, 2018. The Company has allocated all of the goodwill associated with the Infinity acquisition to the Specialty Property & Casualty Insurance segment. The factors that contributed to the recognition of goodwill include synergies from economies of scale within the underwriting and claims operations, acquiring a talented workforce and cost savings opportunities. Based on the Company’s final allocation of the purchase price, the fair value of the assets acquired and liabilities assumed were:
DOLLARS IN MILLIONS |  |
Investments |  | $ | 1,569.3 |
Short-term Investments at Cost which Approximates Fair Value Investments |  | 98.8 |
Cash |  | 4.0 |
Receivables from Policyholders |  | 583.4 |
Other Receivables |  | 31.7 |
Value of Intangible Assets Acquired (Reported in Other Assets) |  | 262.7 |
Current Income Tax Assets |  | 1.0 |
Goodwill 1 |  | 791.0 |
Other Assets |  | 102.1 |
Property and Casualty Insurance Reserves |  | (717.2) |
Unearned Premiums |  | (715.6) |
Debt |  | (282.1) |
Deferred Income Tax Liabilities |  | (10.8) |
Accrued Expenses and Other Liabilities |  | (169.6) |
Total Purchase Price |  | $ | 1,548.7 |
1 Non-deductible for tax-purposes.

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- Definition The entire disclosure for a business combination (or series of individually immaterial business combinations) completed during the period, including background, timing, and recognized assets and liabilities. The disclosure may include leverage buyout transactions (as applicable). + References Reference 1: http://fasb.org/us-gaap/role/ref/legacyRef -Publisher FASB -Name Accounting Standards Codification -Topic 805 -URI http://asc.fasb.org/topic&trid=2303972 + Details
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