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Postretirement Benefits Other Than Pensions | 12 Months Ended
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Dec. 31, 2024
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] |
Postretirement Benefits Other Than Pensions | PENSION BENEFITS The Company previously sponsored a qualified defined benefit pension plan (the “Pension Plan”). Effective January 1, 2006, the Pension Plan was closed to new hires and, effective June 30, 2016, benefit accruals were frozen for substantially all of the participants under the Pension Plan. The Pension Plan has since been fully terminated. In the third quarter of 2023, all plan liabilities were settled by either a lump-sum distribution or assumed by a third-party in exchange for a transfer of assets from the pension plan trust fund. After giving effect to these transactions, the Company recorded a $70.2 million noncash settlement charge ($55.5 million after-tax) for the unamortized net unrecognized postretirement benefit costs related to the settled obligations. As of December 31, 2023, $16.3 million of assets remained in the pension trust and was included within Other Assets in the accompanying Consolidated Balance Sheet. During the second quarter of 2024, the Company received $2.7 million as a post-settlement adjustment which was recorded in Insurance and Other Expenses in the accompanying Consolidated Statements of Income (Loss). As of September 30, 2024, $17.8 million of net assets remained in the pension trust after post-settlement adjustment, administrative, and investment activity. During the fourth quarter of 2024, the Company distributed $4.7 million to eligible participants in the Company’s defined contribution benefit plans and reverted the remaining $13.1 million of assets for general corporate use. As of December 31, 2024, no assets remained in the pension trust. The Company incurred $7.3 million of pre- and post-tax expenses related to the reversion of assets within the pension trust, which included $4.7 million distributed to eligible participants in the Company’s defined contribution benefit plans and $2.6 million of excise taxes paid by the Company on the remaining $13.1 million made available for general corporate use. NOTE 20. PENSION BENEFITS (Continued) Changes in Fair Value of Plan Assets and Changes in Projected Benefit Obligation for the Pension Plan for the years ended December 31, 2024 and 2023 is presented below.
DOLLARS IN MILLIONS |  | 2024 |  | 2023
Fair Value of Plan Assets at Beginning of Year |  | $ | 16.3 |  |  | $ | 315.8 |
Actual Return on Plan Assets |  | (1.1) |  |  | 7.1 |
Benefits Paid |  | — |  |  | (100.9) |
Settlement Benefits |  | 2.6 |  |  | (205.7) |
Assets contributed to 401(k) Plan |  | (4.7) |  |  | — |
Assets reverted to the Company |  | (13.1) |  |  | — |
Fair Value of Plan Assets at End of Year |  | — |  |  | 16.3 |
Projected Benefit Obligation at Beginning of Year |  | — |  |  | 292.2 |
Interest Cost |  | — |  |  | 8.4 |
Benefits Paid |  | — |  |  | (100.9) |
Settlement Benefits |  | — |  |  | (205.7) |
Actuarial Gains |  | — |  |  | 6.0 |
Projected Benefit Obligation at End of Year |  | — |  |  | — |
Funded Status—Plan Assets in Excess of Projected Benefit Obligation |  | $ | — |  |  | $ | 16.3 |
Unamortized Amount Reported in AOCI at End of Year |  | $ | — |  |  | $ | — |
Accumulated Benefit Obligation at End of Year |  | $ | — |  |  | $ | — |
The measurement dates of the assets and liabilities at end of year presented in the preceding table under the headings, “2024” and “2023” were December 31, 2024 and December 31, 2023, respectively. Asset allocations for the Pension Plan at December 31, 2024 and 2023 by asset category were:
ASSET CATEGORY |  | 2024 |  | 2023
Cash and Short-term Investments |  | — | % |  | 100 | %
Total |  | — | % |  | 100 | %
The fair values of pension plan assets are estimated using the same methodologies and inputs as those used to determine the fair values for the respective asset category of the Company. These methodologies and inputs are disclosed in Note 14, “Fair Value Measurements,” to the Consolidated Financial Statements. Fair value measurements for the Pension Plan’s assets at December 31, 2023 are summarized below.
DOLLARS IN MILLIONS |  | Quoted Prices in Active Markets for Identical Assets (Level 1) |  | Significant Other Observable Inputs (Level 2) |  | Significant Unobservable Inputs (Level 3) |  | Measured at Net Asset Value |  | Fair Value
Equity Securities: |  |  |  |  |  |  |  |  |  |
Other Equity Interests: |  |  |  |  |  |  |  |  |  |
Limited Liability Companies and Limited Partnerships |  | — |  |  | — |  |  | — |  |  | 0.1 |  |  | 0.1 |
Short-term Investments |  | 16.2 |  |  | — |  |  | — |  |  | — |  |  | 16.2 |
Total |  | $ | 16.2 |  |  | $ | — |  |  | $ | — |  |  | $ | 0.1 |  |  | $ | 16.3 |
NOTE 20. PENSION BENEFITS (Continued) The components of Comprehensive Pension (Income) Expense for the Pension Plan for the years ended December 31, 2024, 2023 and 2022 were:
DOLLARS IN MILLIONS |  | 2024 |  | 2023 |  | 2022
Service Cost Earned During the Year |  | $ | — |  |  | $ | — |  |  | $ | — |
Interest Cost on Projected Benefit Obligation |  | — |  |  | 8.4 |  |  | 8.7 |
Expected Return on Plan Assets |  | — |  |  | (7.9) |  |  | (7.4) |
Amortization of Prior Service Cost |  | — |  |  | 0.4 |  |  | 0.7 |
Amortization of Actuarial Loss |  | — |  |  | — |  |  | 1.8 |
Settlement (Income) Expense |  | (2.6) |  |  | 70.2 |  |  | — |
Pension (Income) Expense Recognized in Consolidated Statements of Income (Loss) |  | (2.6) |  |  | 71.1 |  |  | 3.8 |
Unrecognized Pension Loss Arising During the Year |  | — |  |  | — |  |  | (12.0) |
Prior Service Cost Arising During the Year |  | — |  |  | — |  |  | — |
Amortization of Prior Service Cost |  | — |  |  | — |  |  | (0.7) |
Amortization of Accumulated Unrecognized Pension Loss |  | — |  |  | — |  |  | (1.8) |
Comprehensive Pension (Income) Expense |  | $ | (2.6) |  |  | $ | 71.1 |  |  | $ | (10.7) |
The weighted-average discount rate, service cost discount rate, interest cost discount rate, rate of increase in future compensation levels and expected long-term rate of return on plan assets used to develop the components of Pension Expense for the Pension Plan for the years ended December 31, 2024, 2023 and 2022 were:
|  | 2024 |  | 2023 |  | 2022
Weighted-average Discount Rate |  | — | % |  | 5.05 | % |  | 2.89 | %
Interest Cost Discount Rate |  | — |  |  | 4.92 |  |  | 2.35 |
Rate of Increase in Future Compensation Levels |  | N/A |  | N/A |  | 3.40 |
Expected Long Term Rate of Return on Plan Assets |  | — |  |  | 3.79 |  |  | 2.08 |
The Company did not contribute to the Pension Plan in 2022, 2023 or 2024. The Company also sponsors a non-qualified supplemental defined benefit pension plan (the “Supplemental Plan”). Benefit accruals for all par ticipants in the Supplemental Plan were frozen effective June 30, 2016. The unfunded liability related to the Supplemental Plan was $20.1 million and $21.8 million at December 31, 2024 and 2023, respectively. Pension expense for the Supplemental Plan was $1.0 million, $1.0 million, and $0.8 million for the years ended December 31, 2024, 2023 and 2022, respectively. There was a pre-tax actuarial gain of $0.8 million, loss of $0.7 million, and gain of $4.8 million included in Other Comprehensive Income (Loss) for the years ended December 31, 2024, 2023 and 2022, respectively. The Company also sponsors several defined contribution benefit plans covering most of its employees. The Company made contributions to those plans of $24.3 million, $27.5 million and $30.6 million in 2024, 2023 and 2022, respectively, excluding the $4.7 million contributed during the fourth quarter of 2024 as part of the reversion of assets remaining in the pension trust.
Other Postretirement Benefit Plan, Defined Benefit |
Defined Benefit Plans and Other Postretirement Benefit Plans Table Text Block [Line Items] |
Postretirement Benefits Other Than Pensions | POSTRETIREMENT BENEFITS OTHER THAN PENSIONS Kemper and Infinity Property and Casualty Corporation (“Infinity”) sponsor other than pension postretirement employee benefit plans (“OPEB”) that together provide medical, dental and/or life insurance benefits to approximately 400 retired and 500 active employees. NOTE 21. POSTRETIREMENT BENEFITS OTHER THAN PENSIONS (Continued) Kemper has historically self-insured the benefits under the Kemper OPEB Plan. The Kemper medical plan generally provides for a limited number of years of medical insurance benefits at retirement based on the participant’s attained age at retirement and number of years of service until specified dates and generally has required participant contributions, with most contributions adjusted annually. On December 30, 2016, Kemper amended the Kemper OPEB Plan and, effective December 31, 2016, no longer offers coverage to post-65 Medicare-eligible retirees and Medicare-eligible spouses under the self-insured portion of its coverage. Rather, beginning on January 1, 2017, the Kemper OPEB Plan offers access to a private, third-party Medicare exchange and provides varying levels of a Company-determined subsidy via health reimbursement accounts to certain Medicare-eligible retirees and spouses in order to help fund a portion of the participants’ cost. Further, the amendment eliminates the requirement for such participants to contribute to the Kemper OPEB Plan. In conjunction with the amendment, the Company recorded a pre-tax reduction to its Accumulated Postretirement Benefit Obligation of $11.0 million through Other Comprehensive Income (Loss). This prior service credit is being amortized into income over the remaining average life of the Kemper OPEB Plan’s participants. Changes in Fair Value of Plans’ Assets and Changes in Accumulated Postretirement Benefit Obligation for the years ended December 31, 2024 and 2023 were:
DOLLARS IN MILLIONS |  |
2024 |  | 2023
Fair Value of Plans’ Assets at Beginning of Year |  | $ | — |  |  | $ | — |
Employer Contributions |  | 0.4 |  |  | 1.0 |
Plan Participants’ Contributions |  | 0.1 |  |  | 0.3 |
Benefits Paid |  | (0.5) |  |  | (1.3) |
Fair Value of Plan Assets at End of Year |  | — |  |  | — |
Accumulated Postretirement Benefit Obligation at Beginning of Year |  | 7.5 |  |  | 8.1 |
Service Cost |  | 0.1 |  |  | 0.1 |
Interest Cost |  | 0.3 |  |  | 0.4 |
Plan Participants’ Contributions |  | 0.1 |  |  | 0.3 |
Benefits Paid |  | (0.5) |  |  | (1.3) |
Actuarial Gain |  | (1.0) |  |  | (0.1) |
Accumulated Postretirement Benefit Obligation at End of Year |  | 6.5 |  |  | 7.5 |
Funded Status—Accumulated Postretirement Benefit Obligation in Excess of Plans’ Assets |  | $ | (6.5) |  |  | $ | (7.5) |
Unamortized Actuarial Gain Reported in AOCI at End of Year |  | $ | 12.0 |  |  | $ | 13.9 |
The measurement dates of the assets and liabilities at end of year in the preceding table under the headings “2024” and “2023” were December 31, 2024 and December 31, 2023, respectively. The weighted-average discount rate and rate of increase in future compensation levels used to develop the components of the Accumulated Postretirement Benefit Obligation at December 31, 2024 and 2023 were:
|  | 2024 |  | 2023
Discount Rate |  | 5.55 | % |  | 4.92 | %
Rate of Increase in Future Compensation Levels |  | 2.20 |  |  | 2.20 |
The assumed health care cost trend rate used in measuring the Accumulated Postretirement Benefit Obligation at December 31, 2024 was 8.3% for 2025, gradually declining to 4.7% in the year 2034 and remaining at that level thereafter for medical benefits and 12.3% for 2025, gradually declining to 4.5% in the year 2034 and remaining at that level thereafter for prescription drug benefits. The assumed health care cost trend rate used in measuring the Accumulated Postretirement Benefit Obligation at December 31, 2023 was 6.7% for 2024, gradually declining to 4.7% in the year 2029 and remaining at that level thereafter for medical benefits and 8.0% for 2024, gradually declining to 4.8% in the year 2030 and remaining at that level thereafter for prescription drug benefits. NOTE 21. POSTRETIREMENT BENEFITS OTHER THAN PENSIONS (Continued) The components of Comprehensive OPEB (Income) Expense for the years ended December 31, 2024, 2023 and 2022 were:
DOLLARS IN MILLIONS |  | 2024 |  | 2023 |  | 2022
Service Cost Earned During the Year |  | $ | 0.1 |  |  | $ | 0.1 |  |  | $ | 0.2 |
Interest Cost on Accumulated Postretirement Benefit Obligation |  | 0.3 |  |  | 0.4 |  |  | 0.2 |
Amortization of Prior Service Credit |  | (1.3) |  |  | (1.3) |  |  | (1.3) |
Amortization of Accumulated Unrecognized OPEB Gain |  | (1.5) |  |  | (1.8) |  |  | (1.8) |
OPEB Income Recognized in Consolidated Statements of Income (Loss) |  | (2.4) |  |  | (2.6) |  |  | (2.7) |
Unrecognized OPEB Gain Arising During the Year |  | (1.0) |  |  | (0.1) |  |  | (2.5) |
Amortization of Prior Service Credit |  | 1.3 |  |  | 1.3 |  |  | 1.3 |
Amortization of Accumulated Unrecognized OPEB Gain |  | 1.5 |  |  | 1.8 |  |  | 1.8 |
Comprehensive OPEB (Income) Expense |  | $ | (0.6) |  |  | $ | 0.4 |  |  | $ | (2.1) |
The Company estimates that OPEB Expense for the year ended December 31, 2025 will include income of $2.1 million resulting from the amortization of the related accumulated actuarial gain and prior service credit included in AOCI at December 31, 2024. The weighted-average discount rate and rate of increase in future compensation levels used to develop OPEB Expense for the years ended December 31, 2024, 2023 and 2022 were:
|  | 2024 |  | 2023 |  | 2022
Weighted-average Discount Rate |  | 4.92 | % |  | 5.11 | % |  | 2.56 | %
Service Cost Discount Rate |  | 4.94 |  |  | 5.12 |  |  | 2.79 |
Interest Cost Discount Rate |  | 4.85 |  |  | 5.03 |  |  | 1.97 |
Effective Rate for Interest on Service Cost |  | 4.85 |  |  | 5.04 |  |  | 2.54 |
Rate of Increase in Future Compensation Levels |  | 2.20 |  |  | 2.20 |  |  | 2.20 |
The Company expects to contribute $0.9 million, net of the expected Medicare Part D subsidy, to its OPEB Plan to fund benefit payments in 2025. The following benefit payments (net of participant contributions), which consider expected future service, as appropriate, are expected to be paid:
DOLLARS IN MILLIONS |  | Years Ending December 31,
2025 |  | 2026 |  | 2027 |  | 2028 |  | 2029 |  | 2030-2034
Estimated Benefit Payments: |  |  |  |  |  |  |  |  |  |  |  |
Excluding Medicare Part D Subsidy |  | $ | 0.9 |  |  | $ | 0.8 |  |  | $ | 0.8 |  |  | $ | 0.7 |  |  | $ | 0.6 |  |  | $ | 2.7 |
Expected Medicare Part D Subsidy |  | — |  |  | — |  |  | — |  |  | — |  |  | — |  |  | — |
Net Estimated Benefit Payments |  | $ | 0.9 |  |  | $ | 0.8 |  |  | $ | 0.8 |  |  | $ | 0.7 |  |  | $ | 0.6 |  |  | $ | 2.7 |

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