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Schedule 2 - Parent Company Financial Statements | 12 Months Ended
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Dec. 31, 2021
Condensed Financial Information Disclosure [Abstract] |
Parent Company Financial Statements | SCHEDULE II KEMPER CORPORATION PARENT COMPANY BALANCE SHEETS (Dollars in Millions)
|  | December 31,
|  | 2021 |  | 2020
ASSETS |  |  |  |
Investments in Subsidiaries |  | $ | 4,729.1 |  |  | $ | 4,896.0 |
Fixed Maturities at Fair Value (Amortized Cost: 2021 – $0.3; 2020 - $91.8) |  | 0.4 |  |  | 99.8 |
Equity Securities at Fair Value (Cost: 2021 - $106.8; 2020 - $73.4) |  | 107.4 |  |  | 78.8 |
Short-term Investments |  | 96.9 |  |  | 508.2 |
Cash |  | 27.7 |  |  | 46.0 |
Other Receivables |  | 2.3 |  |  | 1.1 |
Right-of-Use Assets |  | 12.8 |  |  | 13.4 |
Other Assets |  | 18.9 |  |  | 29.2 |
Total Assets |  | $ | 4,995.5 |  |  | $ | 5,672.5 |
LIABILITIES AND SHAREHOLDERS’ EQUITY |  |  |  |
Term Loan due July 5, 2023 (Fair Value: 2021 – $—; 2020 – $50.0) |  | $ | — |  |  | $ | 49.9 |
Senior Notes Payable, 4.35% due 2025 (Fair Value: 2021 – $481.4; 2020 – $499.5) |  | 449.0 |  |  | 448.8 |
Senior Notes Payable, 2.40% due 2030 (Fair Value: 2021 – $387.8, 2020 – $405.6) |  | 396.2 |  |  | 395.8 |
Current Income Tax Liability |  | 18.5 |  |  | 41.5 |
Deferred Income Tax Liability |  | 46.5 |  |  | 38.9 |
Liabilities for Benefit Plans |  | 42.3 |  |  | 47.6 |
Right-of-Use Liabilities |  | 25.8 |  |  | 26.9 |
Accrued Expenses and Other Liabilities |  | 9.5 |  |  | 59.7 |
Total Liabilities |  | 987.8 |  |  | 1,109.1 |
Shareholders’ Equity: |  |  |  |
Common Stock |  | 6.4 |  |  | 6.5 |
Additional Paid-in Capital |  | 1,790.7 |  |  | 1,805.2 |
Retained Earnings |  | 1,762.5 |  |  | 2,071.2 |
Accumulated Other Comprehensive Income |  | 448.1 |  |  | 680.5 |
Total Shareholders’ Equity |  | 4,007.7 |  |  | 4,563.4 |
Total Liabilities and Shareholders’ Equity |  | $ | 4,995.5 |  |  | $ | 5,672.5 |
See Accompanying Report of Independent Registered Public Accounting Firm. KEMPER CORPORATION PARENT COMPANY STATEMENTS OF INCOME (Dollars in Millions)
|  | For the Year Ended December 31,
|  | 2021 |  | 2020 |  | 2019
Net Investment Income |  | $ | 3.4 |  |  | $ | 1.4 |  |  | $ | 2.1 |
Income from Change in Fair Value of Equity Securities |  | 10.0 |  |  | 4.3 |  |  | 1.6 |
Net Realized Gains (Losses) on Sales of Investments |  | 10.6 |  |  | 0.1 |  |  | 0.3 |
Total Revenues |  | 24.0 |  |  | 5.8 |  |  | 4.0 |
Interest Expense |  | 32.0 |  |  | 24.2 |  |  | 28.5 |
Loss from Early Extinguishment of Debt |  | — |  |  | — |  |  | 5.8 |
Pension Settlement Expense |  | — |  |  | 64.1 |  |  | — |
Other Operating (Benefits) Expenses |  | 5.9 |  |  | (3.6) |  |  | 4.0 |
Total Operating Expenses |  | 37.9 |  |  | 84.7 |  |  | 38.3 |
Loss before Income Taxes and Equity in Net Income of Subsidiaries |  | (13.9) |  |  | (78.9) |  |  | (34.3) |
Income Tax Benefit (Expense) |  | (0.6) |  |  | 13.4 |  |  | 9.4 |
Loss before Equity in Net Income (Loss) of Subsidiaries |  | (14.5) |  |  | (65.5) |  |  | (24.9) |
Equity in Net Income (Loss) of Subsidiaries |  | (106.0) |  |  | 475.4 |  |  | 556.0 |
Net Income (Loss) |  | $ | (120.5) |  |  | $ | 409.9 |  |  | $ | 531.1 |
See Accompanying Report of Independent Registered Public Accounting Firm. KEMPER CORPORATION PARENT COMPANY STATEMENTS OF COMPREHENSIVE INCOME (Dollars in Millions)
|  | For the Year Ended December 31,
|  | 2021 |  | 2020 |  | 2019
Net Income (Loss) |  | $ | (120.5) |  |  | $ | 409.9 |  |  | $ | 531.1 |
Other Comprehensive Income (Loss): |  |  |  |  |  |
Changes in Net Unrealized Gains (Losses) on Investment Securities: |  |  |  |  |  |
Having No Credit Losses Recognized in Consolidated Statements of Income (Loss): |  |  |  |  |  |
Securities Held by Subsidiaries |  | (230.4) |  |  | 378.7 |  |  | 433.2 |
Securities Held by Parent |  | — |  |  | 8.0 |  |  | 0.2 |
Having Credit Losses Recognized in Consolidated Statements of Income (Loss): |  |  |  |  |  |
Securities Held by Subsidiaries |  | (2.0) |  |  | (2.6) |  |  | — |
Reclassification Adjustment for Amounts Included in Net Income (Loss): |  |  |  |  |  |
Securities Held by Subsidiaries |  | (43.5) |  |  | (16.6) |  |  | (27.9) |
Securities Held by Parent |  | (10.6) |  |  | (0.1) |  |  | (0.2) |
Unrecognized Postretirement Benefit Costs Arising During the Year: |  |  |  |  |  |
Securities Held by Subsidiaries |  | 0.6 |  |  | — |  |  | (0.6) |
Securities Held by Parent |  | (9.5) |  |  | 3.6 |  |  | (4.2) |
Reclassification Adjustments for Amounts Included in Net Income (Loss): |  |  |  |  |  |
Pension Settlement Cost Recognized |  | — |  |  | 64.1 |  |  | — |
Amortization of Unrecognized Postretirement Benefits (Costs) |  | 0.1 |  |  | 2.5 |  |  | (3.0) |
Gains (Losses) on Cash Flow Hedge |  | 0.5 |  |  | 0.4 |  |  | 0.4 |
Other Comprehensive Income (Loss) before Income Taxes |  | (294.8) |  |  | 438.0 |  |  | 397.9 |
Income Tax Benefit (Expense): |  |  |  |  |  |
Changes in Net Unrealized Gains (Losses) on Investment Securities: |  |  |  |  |  |
Having No Credit Losses Recognized in Consolidated Statements of Income (Loss): |  |  |  |  |  |
Securities Held by Subsidiaries |  | 48.4 |  |  | (80.6) |  |  | (91.0) |
Securities Held by Parent |  | — |  |  | (1.7) |  |  | — |
Having Credit Losses Recognized in Consolidated Statements of Income (Loss): |  |  |  |  |  |
Securities Held by Subsidiaries |  | 0.4 |  |  | 0.5 |  |  | — |
Reclassification Adjustment for Amounts Included in Net Income (Loss): |  |  |  |  |  |
Securities Held by Subsidiaries |  | 9.1 |  |  | 3.5 |  |  | 5.8 |
Securities Held by Parent |  | 2.2 |  |  | — |  |  | — |
Unrecognized Postretirement Benefit Costs Arising During the Year: |  |  |  |  |  |
Securities Held by Subsidiaries |  | (0.1) |  |  | — |  |  | — |
Securities Held by Parent |  | 2.5 |  |  | (1.3) |  |  | 1.0 |
Reclassification Adjustments for Amounts Included in Net Income (Loss): |  |  |  |  |  |
Pension Settlement Cost Recognized |  | — |  |  | (13.5) |  |  | — |
Amortization of Unrecognized Postretirement Benefit Costs |  | — |  |  | (0.5) |  |  | 0.7 |
Changes in Gain (Loss) on Cash Flow Hedges |  | (0.1) |  |  | — |  |  | (0.1) |
Income Tax Benefit (Expense) |  | 62.4 |  |  | (93.6) |  |  | (83.6) |
Other Comprehensive Income (Loss) |  | (232.4) |  |  | 344.4 |  |  | 314.3 |
Total Comprehensive Income (Loss) |  | $ | (352.9) |  |  | $ | 754.3 |  |  | $ | 845.4 |
See Accompanying Report of Independent Registered Public Accounting Firm. KEMPER CORPORATION PARENT COMPANY STATEMENTS OF CASH FLOWS (Dollars in Millions)
|  | For the Year Ended December 31,
|  | 2021 |  | 2020 |  | 2019
Operating Activities: |  |  |  |  |  |
Net Income (Loss) |  | $ | (120.5) |  |  | $ | 409.9 |  |  | $ | 531.1 |
Adjustment Required to Reconcile Net Income (Loss) to Net Cash Provided by Operations: |  |  |  |  |  |
Equity in Net Income (Loss) of Subsidiaries |  | 106.0 |  |  | (475.4) |  |  | (556.0) |
Cash Dividends from Subsidiaries |  | 170.3 |  |  | 216.2 |  |  | 239.0 |
Net Realized Investment (Gains) Losses |  | (10.6) |  |  | (0.1) |  |  | (0.3) |
Settlement Costs Related to Defined Benefit Pension Plan |  | — |  |  | 64.1 |  |  | — |
Contribution to Defined Benefit Pension Plan |  | — |  |  | — |  |  | (55.3) |
Loss from Early Extinguishment of Debt |  | — |  |  | — |  |  | 5.8 |
Decrease (Increase) in Value of Equity and Convertible Securities at Fair Value |  | (10.0) |  |  | (4.3) |  |  | (1.6) |
Other, Net |  | (35.3) |  |  | 52.2 |  |  | 9.8 |
Net Cash Provided by Operating Activities |  | 99.9 |  |  | 262.6 |  |  | 172.5 |
Investing Activities: |  |  |  |  |  |
Capital Contributed to Subsidiaries |  | (36.5) |  |  | (62.0) |  |  | (83.0) |
Capital Distribution from Subsidiaries |  | — |  |  | — |  |  | 85.0 |
Proceeds from Sales, Calls and Maturities of Fixed Maturities |  | 181.3 |  |  | 2.0 |  |  | 12.7 |
Proceeds from the Sales or Paydowns of Investments: |  |  |  |  |  |
Equity Securities |  | 28.5 |  |  | 2.2 |  |  | 15.3 |
Purchases of Investments: |  |  |  |  |  |
Equity Securities |  | (48.7) |  |  | (21.0) |  |  | (48.9) |
Net Sales (Purchases) of Short-term Investments |  | 411.3 |  |  | (415.7) |  |  | (23.3) |
Acquisition of Business |  | (370.9) |  |  | — |  |  | — |
Net Cash Provided (Used) by Investing Activities |  | 165.0 |  |  | (494.5) |  |  | (42.2) |
Financing Activities: |  |  |  |  |  |
Net Proceeds from Issuance of Long-term Debt |  | — |  |  | 395.6 |  |  | 49.9 |
Repayments of Long-term Debt |  | (50.0) |  |  | — |  |  | (185.0) |
Proceeds from Issuance of Common Stock, Net of Transaction Costs |  | — |  |  | — |  |  | 127.5 |
Proceeds from Shares Issued under Employee Stock Purchase Plan |  | 5.4 |  |  | 4.4 |  |  | 1.6 |
Common Stock Repurchases |  | (161.7) |  |  | (110.4) |  |  | — |
Dividends and Dividend Equivalents Paid |  | (80.6) |  |  | (78.9) |  |  | (67.8) |
Other |  | 3.7 |  |  | 5.4 |  |  | 2.4 |
Net Cash Provided (Used) by Financing Activities |  | (283.2) |  |  | 216.1 |  |  | (71.4) |
Increase (Decrease) in Cash |  | (18.3) |  |  | (15.8) |  |  | 58.9 |
Cash, Beginning of Year |  | 46.0 |  |  | 61.8 |  |  | 2.9 |
Cash, End of Year |  | $ | 27.7 |  |  | $ | 46.0 |  |  | $ | 61.8 |
See Accompanying Report of Independent Registered Public Accounting Firm. KEMPER CORPORATION FINANCIAL INFORMATION OF KEMPER CORPORATION NOTES TO FINANCIAL INFORMATION (Dollars in Millions) NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES The financial information of Kemper Corporation (“Kemper” or the “Parent Company”) should be read in conjunction with the Consolidated Financial Statements and Notes thereto included in Item 8 of this Form 10-K. Kemper’s subsidiaries are accounted for using the equity method of accounting. Equity in net income (loss) of these subsidiaries is presented on the Statements of Operations as Equity in Net Income (Loss) of Subsidiaries. NOTE 2. GUARANTEES On November 30, 2018 Kemper executed a guarantee to fully and unconditionally guarantee the payment and performance obligations of the 5.0% Senior Notes due September 19, 2022 of Infinity Property and Casualty Corporation, a wholly owned subsidiary of Kemper. NOTE 3. SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION Kemper received $189.0 million and $106.0 million of securities in non-cash settlement of dividends from subsidiaries in 2021 and 2020, respectively. Kemper made non-cash capital contributions of $103.3 million to subsidiaries in 2021. Kemper did not make any non-cash capital contributions in 2020. NOTE 4. LEASES Kemper leases certain office space for its current and former corporate headquarters under non-cancelable operating leases. The following table presents operating lease ROU assets and lease liabilities at December 31, 2021 and 2020.
DOLLARS IN MILLIONS |  | 2021 |  | 2020
Operating Lease Right-of-Use Assets |  | $ | 12.8 |  |  | $ | 13.4 |
Operating Lease Liabilities |  | 25.8 |  |  | 26.9 |
Supplemental cash flow information related to Kemper’s operating leases for the year-ended December 31, 2021 and December 31, 2020 respectively are presented follows.
DOLLARS IN MILLIONS |  | 2021 |  | 2020
Operating Cash Flows from Operating Leases (Fixed Payments) |  | $ | 2.2 |  |  | $ | (2.1) |
Operating Cash Flows from Operating Leases (Liability Reduction) |  | 1.1 |  |  | 0.3 |
Right-of-Use Assets Obtained in Exchange for New Operating Lease Liabilities |  | — |  |  | — |
Significant judgments and assumptions for determining lease asset and liability as December 31, 2021 and December 31, 2020 respectively are presented below.
DOLLARS IN MILLIONS |  | 2021 |  | 2020
Weighted-average Remaining Lease Term - Operating Leases |  | 11.9 years |  | 13.0 years
Weighted-average Discount Rate - Operating Leases |  | 4.0 | % |  | 4.0 | %
Kemper’s leases do not provide an implicit rate. Accordingly, Kemper uses its incremental borrowing rate based on the information available at the commencement date in determining the present value of its lease payments. KEMPER CORPORATION FINANCIAL INFORMATION OF KEMPER CORPORATION NOTES TO FINANCIAL INFORMATION (Dollars in Millions) NOTE 4. LEASES (Continued) Future minimum operating lease payments at December 31, 2021 were:
DOLLARS IN MILLIONS |  | Operating Leases
2022 |  | $ | 2.4 |
2023 |  | 2.4 |
2024 |  | 2.5 |
2025 |  | 2.6 |
2026 |  | 2.6 |
2027 and Thereafter |  | 20.4 |
Total Future Payments |  | $ | 32.9 |
Less Discount |  | 7.1 |
Present Value of Minimum Lease Payments |  | $ | 25.8 |

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- Definition The entire disclosure for condensed financial information, including the financial position, cash flows, and the results of operations of the registrant (parent company) as of the same dates or for the same periods for which audited consolidated financial statements are being presented. Alternatively, the details of this disclosure can be reported by the specific parent company taxonomy elements, indicating the appropriate date and period contexts in an instance document. + References Reference 1: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 205 -SubTopic 10 -Section S99 -Paragraph 6 -Subparagraph (SX 210.5-04(Schedule I)) -URI http://asc.fasb.org/extlink&oid=120391182&loc=d3e5864-122674 Reference 2: http://www.xbrl.org/2003/role/recommendedDisclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 810 -SubTopic 10 -Section 45 -Paragraph 11 -URI http://asc.fasb.org/extlink&oid=123454820&loc=d3e5283-111683 Reference 3: http://www.xbrl.org/2003/role/disclosureRef -Publisher FASB -Name Accounting Standards Codification -Topic 235 -SubTopic 10 -Section S99 -Paragraph 3 -Subparagraph (SX 210.12-04(a)) -URI http://asc.fasb.org/extlink&oid=120395691&loc=d3e24072-122690 + Details
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