ケンパーの四半期報告

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UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

WASHINGTON, D.C. 20549

______________________________________________________

FORM 10-Q

______________________________________________________


☒			Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the Quarterly Period Ended 9/30/2025


☐			Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the Transition Period from to

Commission file number 001-18298

______________________________________________________

Kemper Corporation

(Exact name of registrant as specified in its charter)

______________________________________________________


DE		95-4255452
(State or other jurisdiction of incorporation or organization)		(I.R.S. Employer Identification No.)

200 E. Randolph Street
Suite 3300
Chicago	IL	60601
(Address of principal executive offices)		(Zip Code)

(312) 661-4600

(Registrant’s telephone number, including area code)

(Former name, former address and former fiscal year, if changed since last report)

Securities registered pursuant to Section 12(b) of the Act:


Title of each class	Trading Symbol(s)	Name of each exchange on which registered
Common Stock, par value $0.10 per share	KMPR	NYSE
5.875% Fixed-Rate Reset Junior Subordinated Debentures due 2062	KMPB	NYSE

______________________________________________________

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. Yes x No ¨

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (§232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files). Yes x No ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, non-accelerated filer, smaller reporting company, or an emerging growth company. See definition of “large accelerated filer,” “ accelerated filer,” “smaller reporting company” and “emerging growth company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer

☒

Accelerated filer

☐

Non-accelerated filer

☐

Smaller reporting company

☐

Emerging growth company

☐

If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act. ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). Yes ☐ No x

58,546,860 shares of common stock, $0.10 par value, were outstanding as of November 3, 2025.

KEMPER CORPORATION

INDEX


		Page
Caution Regarding Forward-Looking Statements		1

PART I.	FINANCIAL INFORMATION

Item 1.	Financial Statements

	Condensed Consolidated Statements of (Loss) Income for the Three and Nine Months Ended September 30, 2025 and 2024 (Unaudited)	4

	Condensed Consolidated Statements of Comprehensive Income for the Three and Nine Months Ended September 30, 2025 and 2024 (Unaudited)	5

	Condensed Consolidated Balance Sheets as of September 30, 2025 and December 31, 2024 (Unaudited)	6

	Condensed Consolidated Statements of Cash Flows for the Nine Months Ended September 30, 2025 and 2024 (Unaudited)	8

	Condensed Consolidated Statements of Shareholders’ Equity for the Three and Nine Months Ended September 30, 2025 and 2024 (Unaudited)	10

	Notes to the Condensed Consolidated Financial Statements (Unaudited)	12

Item 2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	49

Item 3.	Quantitative and Qualitative Disclosures About Market Risk	73

Item 4.	Controls and Procedures	73

PART II.	OTHER INFORMATION

Item 1.	Legal Proceedings	73

Item 1A.	Risk Factors	73

Item 2.	Unregistered Sales of Equity Securities and Use of Proceeds and Issuer Repurchases of Equity Securities	73

Item 5	Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities	74

Item 6.	Exhibits	75

Exhibit Index		75

Signatures		76

Caution Regarding Forward-Looking Statements

This Quarterly Report on Form 10-Q, including, but not limited to, Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”), Risk Factors and the accompanying unaudited Condensed Consolidated Financial Statements (including the notes thereto) of Kemper Corporation (“Kemper”) and its subsidiaries (individually and collectively referred to herein as the “Company”), as well as a variable interest entity (“VIE”) in which the Company is considered the primary beneficiary, may contain or incorporate by reference information that includes or is based on forward-looking statements within the meaning of the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995.

Forward-looking statements give expectations or forecasts of future events. The reader can identify these statements by the fact that they do not relate strictly to historical or current facts. They use words such as “believe(s),” “goal(s),” “target(s),” “estimate(s),” “anticipate(s),” “forecast(s),” “project(s),” “plan(s),” “intend(s),” “expect(s),” “might,” “may,” “could” and other terms of similar meaning. Forward-looking statements, in particular, include statements relating to future actions, prospective services or products, future performance or results of current and anticipated services or products, sales efforts, expenses, the outcome of contingencies such as legal proceedings, trends in operations and financial results.

Any or all forward-looking statements may turn out to be wrong, and, accordingly, Kemper cautions readers not to place undue reliance on such statements. Kemper bases these statements on current expectations and the current economic environment as of the date of this Quarterly Report on Form 10-Q. They involve a number of risks and uncertainties that are difficult to predict. These statements are not guarantees of future performance, and actual results could differ materially from those expressed or implied in the forward-looking statements. Forward-looking statements can be affected by inaccurate assumptions or by known or unknown risks and uncertainties that may be important in determining the Company’s actual future results and financial condition.

In addition to the factors discussed under Item 1A., “Risk Factors,” of Part I of Kemper’s Annual Report on Form 10-K, filed with the U.S. Securities and Exchange Commission (the “SEC”), for the year ended December 31, 2024 (the “2024 Annual Report”), the reader should consider the following list of factors that, among others, could cause the Company’s actual results and financial condition to differ materially from estimated results and financial condition.

Factors related to the legal and regulatory environment in which Kemper and its subsidiaries operate

•Evolving policies, practices and interpretations by regulators and courts that increase operating costs and potential liabilities, particularly any that involve retroactive application of new requirements;

•Adverse outcomes in litigation, investigations or other legal or regulatory proceedings involving Kemper or its subsidiaries or affiliates, including proceedings related to its business practices or business practices in the insurance industry;

•Governmental actions, including, but not limited to, implementation of new laws and regulations, and court decisions interpreting existing and future laws and regulations or policy provisions;

•Uncertainties related to regulatory approval of insurance rates, policy forms, insurance products, license applications, business withdrawals, dividends from insurance subsidiaries, reinsurance arrangements, acquisitions of businesses or strategic initiatives and other matters within the purview of insurance regulators;

•Increased costs required to address new legal and regulatory requirements; liabilities, costs and other impacts arising from investigations or developments related to cybersecurity, privacy and data governance, including, without limitation, cyber incidents that have occurred or may occur;

Factors relating to insurance claims and related reserves in the Company’s insurance businesses

•The incidence, frequency and severity of catastrophes occurring in any particular reporting period or geographic area, including natural disasters, pandemics and terrorist attacks or other man-made events;

•The frequency and severity of insurance claims (including those associated with catastrophe losses and pandemics);

•The interest rate environment, including recently enacted and proposed rate changes by the U.S. Federal Reserve, which may cause material fluctuations in our life policyholder benefit reserves;

•Changes in facts and circumstances affecting assumptions used in determining loss and loss adjustment expenses (“LAE”) reserves, including, but not limited to, the frequency and severity of insurance claims, changes in claims handling procedures and closure patterns, development patterns and the impacts of technological and other environmental conditions;

•The impact of inflation on insurance claims, including, but not limited to, the effects on material costs, the effects on personal injury claims of increasing medical costs and the effects on severity of claims resulting from a catastrophe;

•The effects on property claims attributed to supply chain disruption, in part potentially as a result of the impact of tariffs and scarcity of resources available to rebuild damaged structures and repair damaged property, including labor and materials and the amount of salvage value recovered for damaged property;

•The rising costs of insurance claims from increased and more targeted litigation, higher jury awards, broader definitions of liability, and other effects of legal and societal trends referred to as legal system abuse or social inflation;

•Developments related to insurance policy claims and coverage issues, including, but not limited to, interpretations, pronouncements or decisions by courts or regulators that may govern or influence losses incurred in connection with hurricanes and other catastrophes;

•Orders, interpretations or other actions by regulators that impact the reporting, adjustment and payment of claims;

•Changes in the pricing or availability of reinsurance, or in the financial condition of reinsurers and amounts recoverable therefrom;

Factors related to the Company’s ability to compete

•Changes in the ratings of Kemper and/or its insurance company subsidiaries by rating agencies with regard to credit, financial strength, claims paying ability and other areas on which the Company is rated;

•The level of success and costs incurred in realizing or maintaining economies of scale, integrating acquired businesses and implementing significant business initiatives and the timing of the occurrence or completion of such events, including, but not limited to, those related to expense and claims savings, the operation of Kemper Reciprocal, consolidations, reorganizations and technology;

•Absolute and relative performance of the Company’s products and services, including, but not limited to, the level of success achieved in designing and introducing new insurance products and services;

•Difficulties with technology, data and network security (including as a result of cyber attacks that have occurred or may occur), outsourcing relationships or cloud-based technology that could negatively impact the Company’s ability to conduct business;

•The ability of the Company and its third-party service providers to maintain the availability and required performance of critical systems and manage technology initiatives cost-effectively to address insurance industry developments and regulatory requirements;

•Heightened competition, including, with respect to pricing, consolidations of existing competitors or entry of new competitors and alternate distribution channels, introduction of new technologies, use and enhancements of telematics, refinements of existing products and development of new products by current or future competitors;

•Expected benefits and synergies from mergers, acquisitions, divestitures and/or strategic initiatives that may not be realized to the extent anticipated, within expected time frames or at all, due to a number of factors including, but not limited to, the loss of key agents/brokers, customers or employees, increased costs, fees, expenses and related charges and delays caused by unanticipated developments or factors outside of the Company’s control;

•The successful formulation and execution of the Company’s plan with regard to corporate strategy and significant operational changes;

•Increase in competition as a result of new competitors to the property and casualty insurance industry or existence of competitors that receive substantial infusion of capital or access to third-party capital;

Factors related to the business environment in which Kemper and its subsidiaries operate

•Changes in general economic conditions, including those related to, without limitation, performance of financial markets, increased volatilities in market conditions, interest rates, inflation, unemployment rates, significant global catastrophes and/or pandemics, tariffs and international trade policies, such as the implementation of tariffs recently imposed by the US government pursuant to the International Emergency Economic Powers Act, and fluctuating values of particular investments held by the Company;

•Absolute and relative performance of investments made by the Company;

•Changes in insurance industry trends and significant industry developments;

•Changes in consumer trends, including changes in number of miles driven by automobile insurance policyholders, and significant consumer or product developments;

•Changes in capital requirements, including the calculations thereof, used by regulators and rating agencies;

•Regulatory, accounting or tax changes that may affect the Company’s earnings, the cost of, or demand for, the Company’s products or services or after-tax returns from the Company’s investments;

•The impact of required participation in state windpools and joint underwriting associations, residual market assessments and assessments for insurance industry insolvencies;

•Changes in distribution channels, methods or costs resulting from changes in laws or regulations, legal proceedings or market forces;

•Increasing competition and higher costs for executive talent and employees with necessary skills and industry experience;

•Increased costs and risks related to cybersecurity that could materially affect the Company’s operations including, but not limited to, data breaches, cyber attacks, virus or malware attacks, or other infiltrations or incidents affecting system integrity, availability and performance, and actions taken to minimize and remediate the risks of such events that have occurred or could occur;

Other risks and uncertainties described from time to time in Kemper’s filings with the U.S. Securities and Exchange Commission (“SEC”)

Kemper cannot provide any assurances that the results and outcomes contemplated in any forward-looking statements will be achieved or will be achieved in any particular timetable or that future events or developments will not cause such statements to be inaccurate. Kemper assumes no obligation to correct or update any forward-looking statements publicly for any changes in events or developments or in the Company’s expectations or results subsequent to the date of this Quarterly Report on Form 10-Q. Kemper advises the reader, however, to consult any further disclosures Kemper makes on related subjects in its filings with the SEC.

PART I. FINANCIAL INFORMATION

Item 1. Financial Statements

KEMPER CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF (LOSS) INCOME

(Dollars in millions, except per share amounts)

(Unaudited)


	Three Months Ended				Nine Months Ended
	Sep 30, 2025		Sep 30, 2024		Sep 30, 2025		Sep 30, 2024
Revenues:
Earned Premiums1	$	1,133.3	$	1,068.5	$	3,352.0	$	3,134.1
Net Investment Income	104.8		111.1		301.9		304.5
Other Income	2.9		2.7		8.6		7.9
Change in Fair Value of Equity and Convertible Securities	(2.1)		(2.3)		(2.5)		(0.1)
Net Realized Investment Gains	3.9		1.1		4.7		9.2
Impairment Losses	(3.1)		(2.2)		(6.4)		(3.8)
Total Revenues	1,239.7		1,178.9		3,658.3		3,451.8
Expenses:
Policyholders’ Benefits and Incurred Losses and Loss Adjustment Expenses2	924.6		769.3		2,521.0		2,269.7
Insurance and Other Expenses	339.1		304.5		933.6		870.6

Interest Expense	9.1		14.4		29.5		42.3

Total Expenses	1,272.8		1,088.2		3,484.1		3,182.6
(Loss) Income before Income Taxes	(33.1)		90.7		174.2		269.2
Income Tax (Benefit) Expense	(8.9)		18.5		31.6		52.4
Net (Loss) Income	(24.2)		72.2		142.6		216.8
Less: Net Loss attributable to Noncontrolling Interest	(3.2)		(1.5)		(8.7)		(3.6)
Net (Loss) Income attributable to Kemper Corporation	$	(21.0)	$	73.7	$	151.3	$	220.4

Net (Loss) Income attributable to Kemper Corporation per Unrestricted Share:
Basic	$	(0.34)	$	1.15	$	2.40	$	3.43
Diluted	$	(0.34)	$	1.14	$	2.37	$	3.40
1 Includes a remeasurement loss related to the deferred profit liability within the Life insurance business of $0.9 million and $0.5 million for the three months ended September 30, 2025 and 2024, respectively, and a remeasurement loss of $1.6 million and $1.2 million for the nine months ended September 30, 2025 and 2024, respectively.
2 Includes a remeasurement gain of $1.8 million and $1.2 million related to the liability for future policyholder benefits within the Life insurance business for the three months ended September 30, 2025 and 2024, respectively, and a remeasurement gain of $1.8 million and $2.7 million for the nine months ended September 30, 2025 and 2024, respectively.

The Notes to the Condensed Consolidated Financial Statements are an integral part of these financial statements.

KEMPER CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF COMPREHENSIVE INCOME

(Dollars in millions)

(Unaudited)


	Three Months Ended				Nine Months Ended
	Sep 30, 2025		Sep 30, 2024		Sep 30, 2025		Sep 30, 2024
Net (Loss) Income	$	(24.2)	$	72.2	$	142.6	$	216.8

Other Comprehensive Income Before Income Taxes
Changes in Unrealized Gains (Losses) on Investment Securities with:
No Credit Losses Recognized in Condensed Consolidated Statements of (Loss) Income	107.9		286.6		179.2		98.4
Credit Losses Recognized in Condensed Consolidated Statements of (Loss) Income	(1.0)		—		0.3		(1.7)
Change in Unrecognized Postretirement Benefit Costs	(0.5)		(0.7)		(1.6)		(2.4)
Gain on Cash Flow Hedges	0.7		4.9		1.1		1.3
Change in Discount Rate on Future Life Policyholder Benefits	(68.4)		(209.1)		(81.4)		40.8
Other Comprehensive Income Before Income Taxes	38.7		81.7		97.6		136.4
Other Comprehensive Income Tax Expense	8.0		16.9		19.9		28.1
Other Comprehensive Income, Net of Taxes	30.7		64.8		77.7		108.3
Total Comprehensive Income	6.5		137.0		220.3		325.1

Less: Net Loss attributable to Noncontrolling Interest	(3.2)		(1.5)		(8.7)		(3.6)
Less: Other Comprehensive Income attributable to Noncontrolling Interest	0.1		—		0.3		—
Less: Total Comprehensive Loss attributable to Noncontrolling Interest	(3.1)		(1.5)		(8.4)		(3.6)

Comprehensive Income attributable to Kemper Corporation	$	9.6	$	138.5	$	228.7	$	328.7

The Notes to the Condensed Consolidated Financial Statements are an integral part of these financial statements.

KEMPER CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS

(Dollars in millions, except per share amounts)

(Unaudited)


	Sep 30, 2025		Dec 31, 2024
Assets:
Investments:
Fixed Maturities at Fair Value (Amortized Cost: 2025 - $7,331.7; 2024 - $7,295.0 Allowance for Credit Losses: 2025 - $15.7; 2024 - $10.7)	$	6,620.3	$	6,409.6
Equity Securities at Fair Value (Cost: 2025 - $282.1; 2024 - $197.1)	302.0		218.5
Equity Method Limited Liability Investments	174.9		186.3
Short-term Investments at Cost which Approximates Fair Value	371.2		1,037.1
Company-Owned Life Insurance	567.9		539.2
Loans to Policyholders	279.3		280.7
Other Investments	287.0		217.1
Total Investments	8,602.6		8,888.5
Cash	107.4		64.4
Receivables from Policyholders (Allowance for Credit Losses: 2025 - $2.4; 2024 - $2.9)	1,022.9		977.9
Other Receivables	185.0		185.7
Deferred Policy Acquisition Costs	658.9		628.9
Goodwill	1,250.7		1,250.7
Current Income Tax Assets	57.4		63.4
Deferred Income Tax Assets	66.3		93.3
Other Assets	422.2		436.1
Assets of Consolidated Variable Interest Entity
Fixed Maturities at Fair Value (Amortized Cost: 2025 - $36.0; 2024 - $1.7)	36.3		1.7
Short-term Investments at Cost which Approximates Fair Value	17.5		28.0
Cash	—		1.0
Receivables from Policyholders	10.7		8.2
Other Receivables	0.4		—
Deferred Policy Acquisition Costs	1.4		1.1

Deferred Income Tax Assets	3.7		1.5

Total Assets	$	12,443.4	$	12,630.4

The Notes to the Condensed Consolidated Financial Statements are an integral part of these financial statements.

KEMPER CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED BALANCE SHEETS (Continued)

(Dollars in millions, except per share amounts)

(Unaudited)


	Sep 30, 2025		Dec 31, 2024
Liabilities and Shareholders’ Equity:
Insurance Reserves:
Life and Health	$	3,317.6	$	3,199.7
Property and Casualty	2,806.0		2,611.9
Total Insurance Reserves	6,123.6		5,811.6
Unearned Premiums	1,310.6		1,264.1

Policyholder Obligations	620.0		637.7
Deferred Income Tax Liabilities	13.5		14.8
Accrued Expenses and Other Liabilities	669.5		705.2
Long-term Debt, Current, at Amortized Cost	—		449.9
Long-term Debt, Non-Current, at Amortized Cost	943.1		941.7
Liabilities of Consolidated Variable Interest Entity
Insurance Reserves	26.3		9.4
Unearned Premiums	13.6		11.2
Accrued Expenses and Other Liabilities	1.6		0.5
Total Liabilities	9,721.8		9,846.1
Kemper Corporation Shareholders’ Equity:
Common Stock, $0.10 Par Value, 100,000,000 Shares Authorized; 60,201,675 Shares Issued and Outstanding at September 30, 2025 and 63,840,442 Shares Issued and Outstanding at December 31, 2024	6.0		6.4
Paid-in Capital	1,737.2		1,854.9
Retained Earnings	1,216.0		1,231.6
Accumulated Other Comprehensive Loss	(227.1)		(304.5)
Total Kemper Corporation Shareholders’ Equity	2,732.1		2,788.4
Noncontrolling Interest	(10.5)		(4.1)
Total Shareholders’ Equity	2,721.6		2,784.3
Total Liabilities and Shareholders’ Equity	$	12,443.4	$	12,630.4

The Notes to the Condensed Consolidated Financial Statements are an integral part of these financial statements.

KEMPER CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS

(Dollars in millions)

(Unaudited)


	Nine Months Ended
	Sep 30, 2025		Sep 30, 2024
Cash Flows from Operating Activities:
Net Income	$	142.6	$	216.8
Adjustments to Reconcile Net Income to Net Cash Provided by Operating Activities
Net Realized Investment Gains	(4.7)		(9.2)
Impairment Losses	6.4		3.8
Depreciation, Amortization, and Impairments of Property, Equipment, Software and Intangible Assets Acquired	61.2		40.8
Settlement Related to Defined Benefit Pension Plan	—		(2.6)
Change in Accumulated Undistributed Earnings of Equity Method Limited Liability Investments	6.0		24.7
Change in Fair Value of Equity and Convertible Securities	2.5		0.1

Changes in:
Receivables from Policyholders	(47.5)		(28.4)
Reinsurance Recoverables	2.6		4.6
Deferred Policy Acquisition Costs	(30.3)		(30.3)
Insurance Reserves	251.1		(43.1)
Unearned Premiums	48.9		(2.9)
Income Taxes	9.5		42.5
Other	(38.8)		(9.0)
Net Cash Provided by Operating Activities	409.5		207.8
Cash Flows from Investing Activities:
Proceeds from the Sales, Calls and Maturities of Fixed Maturities	902.3		929.2
Proceeds from the Sales or Paydowns of Investments:
Equity Securities	19.3		15.8
Real Estate Investments	5.5		—
Mortgage Loans	83.4		96.5
Other Investments	18.1		10.9
Purchases of Investments:
Fixed Maturities	(980.7)		(792.2)
Equity Securities	(104.3)		(12.1)
Real Estate Investments	(2.1)		(0.9)

Mortgage Loans	(156.2)		(87.8)
Other Investments	(42.6)		(40.7)
Net Sales (Purchases) of Short-term Investments	685.4		(184.1)

Acquisition of Software and Long-lived Assets	(21.8)		(43.5)
Settlement Proceeds from Company-Owned Life Insurance	2.9		6.2
Other	4.2		13.1
Net Cash Provided by (Used in) Investing Activities	413.4		(89.6)

The Notes to the Condensed Consolidated Financial Statements are an integral part of these financial statements.

KEMPER CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF CASH FLOWS (Continued)

(Dollars in millions)

(Unaudited)


	Nine Months Ended
	Sep 30, 2025		Sep 30, 2024
Net Cash Provided by (Used in) Investing Activities (Carryforward from page 8)	413.4		(89.6)
Cash Flows from Financing Activities:
Repayment of Long-term Debt	(450.0)		—
Proceeds from Policyholder Contract Obligations	30.3		62.8
Repayment of Policyholder Contract Obligations	(51.0)		(100.6)
Proceeds from Shares Issued under Employee Stock Purchase Plan	2.7		2.9
Common Stock Repurchases	(251.3)		(25.0)
Dividends Paid	(60.7)		(60.1)
Other	(0.9)		(5.4)
Net Cash Used in Financing Activities	(780.9)		(125.4)

Net increase (decrease) in cash1	42.0		(7.2)
Cash, Beginning of Year1	65.4		64.1
Cash, End of Period1	$	107.4	$	56.9
1Includes amounts attributable to Kemper Reciprocal reported as non-controlling interest.

The Notes to the Condensed Consolidated Financial Statements are an integral part of these financial statements.

SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION

(Dollars in millions)

(Unaudited)


	Nine Months Ended
	Sep 30, 2025		Sep 30, 2024
Cash (paid) received during the year for:
Interest	$	(41.9)	$	(52.0)
Taxes	(22.2)		(10.5)
Operating Leases	(14.2)		(16.4)

Non-Cash Activities:
Right-of-Use Assets Obtained in Exchange for New Operating Lease Liabilities	$	24.8	$	8.5

KEMPER CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY

(In millions, except per share amounts)

(Unaudited)


	Three Months Ended September 30, 2025
	Number of Shares	Common Stock		Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive (Loss) Income		Noncontrolling Interest		Total Shareholders’ Equity
Balance, June 30, 2025	63.6	$	6.4	$	1,859.3	$	1,345.4	$	(257.7)	$	(7.9)	$	2,945.5
Net Loss	—	—		—		(21.0)		—		(3.2)		(24.2)
Other Comprehensive Income, Net of Taxes (Note 12)	—	—		—		—		30.6		0.1		30.7
Cash Dividends and Dividend Equivalents to Shareholders ($0.32 per share)	—	—		—		(19.7)		—		—		(19.7)
Repurchases of Common Stock (Note 13)	(3.4)	(0.3)		(129.8)		(88.7)		—		—		(218.8)
Shares Issued Under Employee Stock Purchase Plan (Note 13)	—	(0.1)		0.9		—		—		—		0.8
Equity-based Compensation Cost	—	—		7.3		—		—		—		7.3
Equity-based Awards, Net of Shares Exchanged	—	—		(0.5)		—		—		—		(0.5)
Other Changes in Non-Controlling Interest	—	—		—		—		—		0.5		0.5
Balance, September 30, 2025	60.2	$	6.0	$	1,737.2	$	1,216.0	$	(227.1)	$	(10.5)	$	2,721.6


	Three Months Ended September 30, 2024
	Number of Shares	Common Stock		Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive (Loss) Income		Noncontrolling Interest		Total Shareholders’ Equity
Balance, June 30, 2024	64.4	$	6.4	$	1,860.9	$	1,121.2	$	(317.3)	$	(1.9)	$	2,669.3
Net Income	—	—		—		73.7		—		(1.5)		72.2
Other Comprehensive Income, Net of Taxes (Note 12)	—	—		—		—		64.8		—		64.8
Cash Dividends and Dividend Equivalents to Shareholders ($0.31 per share)	—	—		—		(20.3)		—		—		(20.3)
Repurchases of Common Stock (Note 13)	(0.4)	—		(11.8)		(13.2)		—		—		(25.0)
Shares Issued Under Employee Stock Purchase Plan (Note 13)	—	—		0.9		—		—		—		0.9
Equity-based Compensation Cost	—	—		7.6		—		—		—		7.6
Equity-based Awards, Net of Shares Exchanged	—	—		0.4		—		—		—		0.4
Other Changes in Non-Controlling Interest	—	—		—		—		—		0.5		0.5
Balance, September 30, 2024	64.0	$	6.4	$	1,858.0	$	1,161.4	$	(252.5)	$	(2.9)	$	2,770.4

The Notes to the Condensed Consolidated Financial Statements are an integral part of these financial statements.

KEMPER CORPORATION AND SUBSIDIARIES

CONDENSED CONSOLIDATED STATEMENTS OF SHAREHOLDERS’ EQUITY (Continued)

(In millions, except per share amounts)

(Unaudited)


	Nine Months Ended September 30, 2025
	Number of Shares	Common Stock		Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive (Loss) Income		Noncontrolling Interest		Total Shareholders’ Equity
Balance, December 31, 2024	63.9	$	6.4	$	1,854.9	$	1,231.6	$	(304.5)	$	(4.1)	$	2,784.3
Net Income	—	—		—		151.3		—		(8.7)		142.6
Other Comprehensive Income, Net of Taxes (Note 12)	—	—		—		—		77.4		0.3		77.7
Cash Dividends and Dividend Equivalents to Shareholders ($0.96 per share)	—	—		—		(60.7)		—		—		(60.7)
Repurchases of Common Stock (Note 13)	(3.9)	(0.4)		(144.7)		(106.2)		—		—		(251.3)
Shares Issued Under Employee Stock Purchase Plan (Note 13)	—	—		2.7		—		—		—		2.7
Equity-based Compensation Cost	—	—		27.2		—		—		—		27.2
Equity-based Awards, Net of Shares Exchanged	0.2	—		(2.9)		—		—		—		(2.9)
Other Changes in Non-Controlling Interest	—	—		—		—		—		2.0		2.0
Balance, September 30, 2025	60.2	$	6.0	$	1,737.2	$	1,216.0	$	(227.1)	$	(10.5)	$	2,721.6


	Nine Months Ended September 30, 2024
	Number of Shares	Common Stock		Paid-in Capital		Retained Earnings		Accumulated Other Comprehensive (Loss) Income		Noncontrolling Interest		Total Shareholders’ Equity
Balance, December 31, 2023	64.1	$	6.4	$	1,845.3	$	1,014.3	$	(360.8)	$	(0.2)	$	2,505.0
Net Income	—	—		—		220.4		—		(3.6)		216.8
Other Comprehensive Income, Net of Taxes (Note 12)	—	—		—		—		108.3		—		108.3
Cash Dividends and Dividend Equivalents to Shareholders ($0.93 per share)	—	—		—		(60.1)		—		—		(60.1)
Repurchases of Common Stock (Note 13)	(0.4)	—		(11.8)		(13.2)		—		—		(25.0)
Shares Issued Under Employee Stock Purchase Plan (Note 13)	—	—		2.9		—		—		—		2.9
Equity-based Compensation Cost	—	—		27.1		—		—		—		27.1
Equity-based Awards, Net of Shares Exchanged	0.3	—		(5.5)		—		—		—		(5.5)
Other Changes in Non-Controlling Interest	—	—		—		—		—		0.9		0.9
Balance, September 30, 2024	64.0	$	6.4	$	1,858.0	$	1,161.4	$	(252.5)	$	(2.9)	$	2,770.4

The Notes to the Condensed Consolidated Financial Statements are an integral part of these financial statements.

KEMPER CORPORATION AND SUBSIDIARIES

NOTES TO THE INTERIM CONDENSED CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

Note 1 - Basis of Presentation and Accounting Policies

The unaudited Condensed Consolidated Financial Statements include the accounts of Kemper Corporation (“Kemper”) and its subsidiaries which include property and casualty insurance subsidiaries, life insurance subsidiaries (collectively referred to herein as the “Company”), and a variable interest entity (“VIE”) in which the Company is considered the primary beneficiary.

The unaudited Condensed Consolidated Financial Statements included herein have been prepared in accordance with generally accepted accounting principles in the United States of America (“GAAP”) on a basis consistent with reporting interim financial information pursuant to the rules and regulations for Form 10-Q and Article 10 of Regulation S-X of the Securities and Exchange Commission (“SEC”) and include the accounts of Kemper Corporation, its subsidiaries, and a VIE in which the Company is considered the primary beneficiary. All intercompany accounts and transactions have been eliminated.

Certain financial information that is included in the annual financial statements, including certain financial statement footnote disclosures prepared in accordance with GAAP, is not required by the rules and regulations of the SEC for interim financial reporting and has been condensed or omitted. In the opinion of the Company’s management, the Condensed Consolidated Financial Statements include all adjustments necessary to fairly present the financial position, results of operations and cash flows for the periods presented. The preparation of financial statements requires significant management estimates. Due to this factor and other factors, such as the seasonal nature of some portions of the insurance business, annualizing the results of operations for the nine months ended September 30, 2025 would not necessarily be indicative of the results expected for the full fiscal year. The accompanying Condensed Consolidated Financial Statements should be read in conjunction with the Company’s Consolidated Financial Statements and related notes included in Kemper’s Annual Report for the year ended December 31, 2024.

Adoption of New Accounting Guidance

The Company has adopted all recently issued accounting pronouncements with effective dates prior to October 1, 2025. There were no adoptions of such accounting pronouncements during the nine months ended September 30, 2025 that had a material impact on the Company’s interim Condensed Consolidated Financial Statements.

Guidance Not Yet Adopted

In October 2023, the FASB issued ASU 2023-06 Disclosure Improvements: Codification Amendments in Response to the SEC’s Disclosure Update and Simplification Initiative. This ASU amends the disclosure or presentation requirements related to various subtopics in the FASB Accounting Standards Codification. For SEC registrants, the effective date for each amendment will be the date on which the SEC’s removal of that related disclosure requirement from Regulation S-X or Regulation S-K becomes effective, with early adoption prohibited. The Company will monitor the removal of various requirements from the current regulations in order to determine when to adopt the related amendments, but does not anticipate the adoption of the new guidance will have a material impact on the Company’s Condensed Consolidated Financial Statements. The Company will continue to evaluate the impact of this guidance on its consolidated financial statements.

In December 2023, the FASB issued ASU 2023-09 Improvements to Income Tax Disclosures, which improves the transparency of income tax disclosures by requiring companies to use consistent categories and greater disaggregation of information in the tax rate reconciliation as well as requiring disaggregation of income taxes paid by jurisdiction. ASU 2023-09 is effective for annual periods beginning after December 15, 2024. The Company is currently evaluating the impact of this guidance on its consolidated financial statements.

In November 2024, the FASB issued ASU 2024-03 Disaggregation of Income Statement Expenses, which requires companies to disclose, within the financial statement footnotes, the amount of inventory purchases, employee compensation, depreciation, intangible asset amortization, and depreciation, depletion, and amortization recognized as part of oil- and gas-producing activities that contribute to each income statement expense line item, as well as the amount of selling expenses incurred during each reporting period. ASU 2024-03 is effective for annual periods beginning after December 15, 2026 and interim periods within fiscal years beginning after December 15, 2027. The Company is currently evaluating the impact of this guidance on its consolidated financial statements.

In September 2025, the FASB issued ASU 2025-06 Targeted Improvements to the Accounting for Internal-Use Software, which replaces the existing project stage model with a principles-based approach. Software costs are capitalized when management commits funding, and it is probable the project will be completed and used as intended.

KEMPER CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 1 - Basis of Presentation and Accounting Policies (Continued)

ASU 2025-06 also aligns disclosure requirements with those for property, plant, and equipment, eliminates separate intangible asset disclosures, and supersedes guidance on website development costs. ASU 2025-06 is effective for annual periods beginning after December 15, 2027, and interim periods within those fiscal years. The Company is currently evaluating the impact of this guidance on its consolidated financial statements.

Note 2 - Net (Loss) Income Per Unrestricted Share

A reconciliation of the numerator and denominator used in the calculation of Basic Net (Loss) Income Per Unrestricted Share and Diluted Net (Loss) Income Per Unrestricted Share for the three and nine months ended September 30, 2025 and 2024 is presented below.


	Three Months Ended				Nine Months Ended
(Dollars in Millions, except per share amounts)	Sep 30, 2025		Sep 30, 2024		Sep 30, 2025		Sep 30, 2024
Net (Loss) Income attributable to Kemper Corporation	$	(21.0)	$	73.7	$	151.3	$	220.4
Shares in Thousands
Weighted-average Unrestricted Shares Outstanding	61,477.4		64,216.5		63,092.2		64,288.4
Equity-based Compensation Equivalent Shares	—		681.5		628.2		575.4
Weighted-average Unrestricted Shares and Equivalent Shares Outstanding Assuming Dilution	61,477.4		64,898.0		63,720.4		64,863.8

Net (Loss) Income attributable to Kemper Corporation per Unrestricted Share:
(Per Unrestricted Share in Whole Dollars)
Basic Net (Loss) Income Per Unrestricted Share	$	(0.34)	$	1.15	$	2.40	$	3.43
Diluted Net (Loss) Income Per Unrestricted Share	$	(0.34)	$	1.14	$	2.37	$	3.40

The number of shares of Kemper common stock that were excluded from the calculations of Equity-based Compensation Equivalent Shares and Weighted-average Unrestricted Shares and Equivalent Shares Outstanding Assuming Dilution because the effect of inclusion would be anti-dilutive was 2.0 million and 1.0 million for the three months ended September 30, 2025 and 2024, respectively.

The number of shares of Kemper common stock that were excluded from the calculations of Equity-based Compensation Equivalent Shares and Weighted-average Unrestricted Shares and Equivalent Shares Outstanding Assuming Dilution because the effect of inclusion would be anti-dilutive was 1.4 million and 1.5 million for the nine months ended September 30, 2025 and 2024, respectively.

KEMPER CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 3 - Business Segments

The Company is engaged, through its subsidiaries, in the property and casualty insurance and life and health insurance businesses. The Company conducts its operations through two operating segments: Specialty Property & Casualty Insurance and Life Insurance.

The Specialty Property & Casualty Insurance segment’s principal products are specialty personal automobile and commercial automobile insurance. These products are distributed primarily through independent agents and brokers. The Life Insurance segment’s principal products are individual life, accident, supplemental health and property insurance. Career agents employed by the Company distribute these products. Corporate and Other operations include interest expense, board of directors’ fees, and general corporate expenses incurred by the Company which are not allocated to other businesses. Non-Core Operations includes the results of the Preferred Insurance business which the Company expects to fully exit.

Segment Adjusted Net Operating Income

The Company analyzes the operating performance of each segment using segment adjusted net operating income. Segment adjusted net operating income does not equate to “net (loss) income” as determined in accordance with U.S. GAAP but is the measure of segment profit or loss used by the Company’s Chief Operating Decision Maker (“CODM”) to evaluate segment performance and allocate resources, and consistent with authoritative guidance, is the measure of segment performance presented below. Segment adjusted net operating income is calculated by adjusting each segment’s income after income taxes for the following items:

(i) Change in Fair Value of Equity and Convertible Securities;

(ii) Net Realized Investment Gains;

(iii) Impairment Losses;

(iv) Acquisition and Disposition Related Transaction, Integration, Restructuring and Other Costs;

(v) Debt Extinguishment, Pension Settlement and Other Charges;

(vi) Goodwill Impairment Charges;

(vii) Non-Core Operations; and

(viii) Significant non-recurring or infrequent items that may not be indicative of ongoing operations

These items are important to an understanding of overall results of operations. Segment adjusted net operating income is not a substitute for income determined in accordance with U.S. GAAP, and the Company’s definition of segment adjusted net operating income may differ from that used by other companies. The Company, however, believes that the presentation of segment adjusted net operating income, as measured for management purposes, enhances the understanding of results of operations by highlighting the underlying profitability factors of its businesses.

Total Segment, Non-Core Operations, and Corporate and Other assets at September 30, 2025 and December 31, 2024 were:


(Dollars in Millions)	Sep 30, 2025		Dec 31, 2024
Segment Assets:
Specialty Property & Casualty Insurance1	$	6,642.1	$	6,352.9
Life Insurance	4,879.0		4,731.7
Total Segment Assets	11,521.1		11,084.6
Corporate and Other	262.9		774.7
Non-Core Operations	659.4		771.1
Total Assets1	$	12,443.4	$	12,630.4
1Includes $70.0 million and $41.5 million attributable to Kemper Reciprocal as of September 30, 2025 and December 31, 2024, respectively, which is reported as a consolidated variable interest entity.

KEMPER CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 3 - Business Segments (Continued)

Earned Premiums by product line, including a reconciliation to Total Earned Premiums, for the three and nine months ended September 30, 2025 and 2024 were:


	Three Months Ended				Nine Months Ended
(Dollars in Millions)	Sep 30, 2025		Sep 30, 2024		Sep 30, 2025		Sep 30, 2024
Specialty Property & Casualty Insurance:
Personal Automobile	$	785.1	$	731.3	$	2,328.1	$	2,098.1
Commercial Automobile	232.2		187.7		662.2		523.5
Total Specialty Property & Casualty Insurance	1,017.3		919.0		2,990.3		2,621.6
Life Insurance:
Life	84.1		84.2		252.6		249.2
Accident and Health	5.5		5.6		16.4		16.8
Property	10.2		10.8		31.0		32.7
Total Life Insurance	99.8		100.6		300.0		298.7
Total Segment Earned Premiums	1,117.1		1,019.6		3,290.3		2,920.3
Non-Core Operations	16.2		48.9		61.7		213.8
Total Earned Premiums	$	1,133.3	$	1,068.5	$	3,352.0	$	3,134.1

Segment Revenues, including a reconciliation to Total Revenues, for the three and nine months ended September 30, 2025 and 2024 were:


	Three Months Ended				Nine Months Ended
(Dollars in Millions)	Sep 30, 2025		Sep 30, 2024		Sep 30, 2025		Sep 30, 2024
Segment Revenues:
Specialty Property & Casualty Insurance:
Earned Premiums	$	1,017.3	$	919.0	$	2,990.3	$	2,621.6
Net Investment Income	53.8		52.0		153.9		139.7
Other Income	2.5		1.6		6.5		4.6
Total Specialty Property & Casualty Insurance	1,073.6		972.6		3,150.7		2,765.9
Life Insurance:
Earned Premiums	99.8		100.6		300.0		298.7
Net Investment Income	48.0		50.3		141.1		125.1
Other Income	0.4		0.2		1.4		0.7
Total Life Insurance	148.2		151.1		442.5		424.5
Total Segment Revenues	1,221.8		1,123.7		3,593.2		3,190.4
Change in Fair Value of Equity and Convertible Securities	(2.1)		(2.3)		(2.5)		(0.1)
Net Realized Investment Gains	3.9		1.1		4.7		9.2
Impairment Losses	(3.1)		(2.2)		(6.4)		(3.8)
Non-Core Operations	18.2		54.8		67.4		244.8
Other	1.0		3.8		1.9		11.3
Total Revenues	$	1,239.7	$	1,178.9	$	3,658.3	$	3,451.8

KEMPER CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 3 - Business Segments (Continued)

Significant Segment Expenses that were regularly provided to the CODM for the three and nine months ended September 30, 2025 and 2024 were:


	Three Months Ended				Nine Months Ended
(Dollars in Millions)	Sep 30, 2025		Sep 30, 2024		Sep 30, 2025		Sep 30, 2024
Segment Expenses:
Specialty Property & Casualty Insurance:
Current Year
Non-catastrophe Losses and LAE	$	798.7	$	644.2	$	2,211.1	$	1,846.0
Catastrophe Losses and LAE	1.0		3.6		10.1		18.0
Prior Years
Non-catastrophe Losses and LAE	51.4		(0.1)		65.5		4.4
Catastrophe Losses and LAE	—		0.2		0.6		0.8
Total Incurred Losses and LAE	851.1		647.9		2,287.3		1,869.2
Policy Acquisition Costs1	137.0		119.6		409.4		349.0
Business Unit Operating Costs2	44.2		40.5		122.6		101.4
Corporate Overhead Costs3	33.4		34.8		102.5		102.1
Total Insurance Expenses	214.6		194.9		634.5		552.5
Income Tax Expense	0.3		26.2		44.4		69.1
Total Specialty Property & Casualty Insurance	1,066.0		869.0		2,966.2		2,490.8
Life Insurance:
Policyholders’ Benefits and Incurred Losses and LAE	60.5		64.1		186.2		191.0
Policy Acquisition Costs1	32.8		34.9		97.7		100.3
Business Unit Operating Costs2	24.6		24.1		76.1		71.6
Corporate Overhead Costs3	8.2		10.0		25.9		31.0
Total Insurance Expenses	65.6		69.0		199.7		202.9
Income Tax Expense	3.5		3.0		8.2		3.9
Total Life Insurance	129.6		136.1		394.1		397.8
Total Segment Expenses	$	1,195.6	$	1,005.1	$	3,360.3	$	2,888.6
1Policy acquisition costs primarily represents commissions and premium taxes that are incurred by the Company as a result of underwriting insurance policies and reflect the impacts of deferral and amortization of certain of these costs in accordance with the Company’s accounting policies.
2Business unit operating costs are general expenses incurred by the Company's segments as part of ongoing operations and includes employee, IT, and facilities expenses.
3Corporate overhead costs represents general expenses and other shared service expenses which are allocated across the Company.

KEMPER CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 3 - Business Segments (Continued)

Total Segment Adjusted Net Operating Income, including a reconciliation to Net (Loss) Income attributable to Kemper Corporation, for the three and nine months ended September 30, 2025 and 2024 was:


	Three Months Ended				Nine Months Ended
(Dollars in Millions)	Sep 30, 2025		Sep 30, 2024		Sep 30, 2025		Sep 30, 2024
Segment Adjusted Net Operating Income:
Specialty Property & Casualty Insurance
Revenues	$	1,073.6	$	972.6	$	3,150.7	$	2,765.9
Expenses	(1,066.0)		(869.0)		(2,966.2)		(2,490.8)
Specialty Property & Casualty Insurance Adjusted Net Operating Income	7.6		103.6		184.5		275.1
Life Insurance
Revenues	148.2		151.1		442.5		424.5
Expenses	(129.6)		(136.1)		(394.1)		(397.8)
Life Insurance Adjusted Net Operating Income	18.6		15.0		48.4		26.7
Total Segment Adjusted Net Operating Income	26.2		118.6		232.9		301.8
Corporate and Other Adjusted Net Operating Loss	(9.0)		(15.1)		(30.7)		(39.0)
Less: Net Loss attributable to Noncontrolling Interest	(3.2)		(1.5)		(8.7)		(3.6)
Net Income (Loss) From:
Change in Fair Value of Equity and Convertible Securities	(1.7)		(1.8)		(2.0)		(0.1)
Net Realized Investment Gains	3.1		0.9		3.7		7.3
Impairment Losses	(2.5)		(1.7)		(5.1)		(3.0)
Acquisition and Disposition Related Transaction, Integration, Restructuring and Other Costs	(19.6)		(9.1)		(27.6)		(24.3)
Debt Extinguishment, Pension Settlement and Other Charges	—		(2.2)		0.4		(0.1)
Non-Core Operations	(20.7)		(17.4)		(29.0)		(25.8)
Net (Loss) Income attributable to Kemper Corporation	$	(21.0)	$	73.7	$	151.3	$	220.4

KEMPER CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 4 - Property and Casualty Insurance Reserves

Property and Casualty Insurance Reserve activity for the nine months ended September 30, 2025 and 2024 was:


	Nine Months Ended
(Dollars in Millions)	Sep 30, 2025		Sep 30, 2024
Property and Casualty Insurance Reserves:
Gross of Reinsurance at Beginning of Year	$	2,611.9	$	2,680.5
Less: Reinsurance Recoverables at Beginning of Year	24.3		27.8
Property and Casualty Insurance Reserves, Net of Reinsurance at Beginning of Year	2,587.6		2,652.7
Incurred Losses and LAE related to:
Current Year	2,242.2		2,053.0
Prior Years	66.2		27.4
Total Incurred Losses and LAE	2,308.4		2,080.4
Paid Losses and LAE related to:
Current Year	945.0		945.0
Prior Years	1,167.7		1,227.6
Total Paid Losses and LAE	2,112.7		2,172.6
Property and Casualty Insurance Reserves, Net of Reinsurance at End of Period	2,783.3		2,560.5
Plus: Reinsurance Recoverables at End of Period	22.7		26.4
Property and Casualty Insurance Reserves, Gross of Reinsurance at End of Period	$	2,806.0	$	2,586.9

Property and Casualty Insurance Reserves are estimated based on historical experience patterns and current economic trends. Actual loss experience and loss trends may differ from these historical experience patterns and economic conditions. Loss experience and loss trends emerge over several years from the dates of loss inception. The Company monitors such emerging loss trends on a quarterly basis. Changes in such estimates are included in the Condensed Consolidated Statements of (Loss) Income in the period of change. Additionally, the Company reviews if any premium revisions are appropriate as a result of any incurred losses and loss adjustment expenses (“LAE”) related to prior years recorded in the current period. For the nine months ended September 30, 2025 and 2024, no additional premiums or return premiums were recorded.

For the nine months ended September 30, 2025, the net adverse prior year development of $66.2 million included $67.5 million of adverse development on prior accident years attributable to evolving loss patterns and higher defense costs associated with attorney-represented bodily injury coverages in the Commercial Automobile product line.

For the nine months ended September 30, 2024, the net adverse prior year development of $27.4 million included $22.1 million of adverse development within Non-Core Operations due primarily to higher than expected loss emergence related to homeowners, umbrella, and bodily injury coverages. In addition, the Company experienced adverse development of $5.1 million within the Specialty Personal Automobile product line, primarily driven by higher than expected settlements for extra-contractual demands related to prior year claims.

The Company cannot predict whether loss and LAE reserves will develop favorably or unfavorably from the amounts reported in the Condensed Consolidated Financial Statements. The Company believes that any such development will not have a material effect on the Company’s Shareholders’ Equity, but could have a material effect on the Company’s consolidated financial results for a given period.

Note 5 - Liability for Future Policyholder Benefits

The Company’s Life Insurance Reserves are reported using the Company’s estimate of its liability for future policyholder benefits. The liability for future policyholder benefits is grouped by contract type and issue year into cohorts consistent with the grouping used in estimating the associated liability. Significant assumption inputs to the calculation of the liability for future policyholder benefits include mortality, lapses, and discount rates (both accretion and current).

KEMPER CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 5 - Liability for Future Policyholder Benefits (Continued)

The liability is adjusted for differences between actual and expected experience.

The following tables summarize balances and changes in the present value of expected net premiums, present value of expected future policyholder benefits and net liability for future policyholder benefits as of and for the three and nine months ended September 30, 2025 and 2024:


		Three Months Ended				Nine Months Ended
(Dollars in Millions)		Sep 30, 2025		Sep 30, 2024		Sep 30, 2025		Sep 30, 2024
Present Value of Expected Net Premiums	Balance, Beginning of Period	$	683.1	$	692.6	$	646.1	$	675.4

	Beginning Balance at Original Discount Rate	$	705.6	$	733.2	$	681.0	$	694.7
	Effect of Changes in Cash Flow Assumptions	—		—		—		—
	Effect of Actual Variances from Expected Experience	1.1		(1.4)		17.8		4.3
	Adjusted Beginning of Period Balance	706.7		731.8		698.8		699.0
	Issuances	21.2		29.4		61.9		92.9
	Interest Accrual	7.6		8.0		22.4		23.5
	Net Premiums Collected	(24.2)		(24.0)		(71.8)		(70.2)
	Ending Balance at Original Discount Rate	711.3		745.2		711.3		745.2
	Effect of Changes in Discount Rate Assumptions	(14.4)		(12.0)		(14.4)		(12.0)
	Balance, End of Period	$	696.9	$	733.2	$	696.9	$	733.2
Present Value of Expected Future Policyholder Benefits	Balance, Beginning of Period	$	3,343.4	$	3,380.1	$	3,295.9	$	3,613.2

	Beginning Balance at Original Discount Rate	$	3,834.3	$	3,874.5	$	3,812.1	$	3,835.9
	Effect of Changes in Cash Flow Assumptions	—		—		—		—
	Effect of Actual Variances From Expected Experience	(0.7)		(2.6)		16.0		1.6
	Adjusted Beginning of Period Balance	3,833.6		3,871.9		3,828.1		3,837.5
	Issuances	21.3		29.5		62.4		92.9
	Interest Accrual	42.1		43.0		126.1		128.2
	Benefit Payments	(55.0)		(57.6)		(174.6)		(171.8)
	Ending Balance at Original Discount Rate	3,842.0		3,886.8		3,842.0		3,886.8
	Effect of Changes in Discount Rate Assumptions	(414.3)		(256.1)		(414.3)		(256.1)
	Balance, End of Period	$	3,427.7	$	3,630.7	$	3,427.7	$	3,630.7
	Net Liability for Future Policyholder Benefits, pre-flooring	$	2,730.8	$	2,897.5	$	2,730.8	$	2,897.5
	Cumulative impact of flooring the future Policyholder Benefits Reserve	—		—		—		—
	Net Liability for Future Policyholder Benefits, post-flooring	2,730.8		2,897.5		2,730.8		2,897.5
	Less: Reinsurance Recoverable	—		—		—		—
	Net Liability for Future Policyholder Benefits, After Reinsurance Recoverable	$	2,730.8	$	2,897.5	$	2,730.8	$	2,897.5

KEMPER CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 5 - Liability for Future Policyholder Benefits (Continued)

The weighted-average liability duration of the liability for future policyholder benefits as calculated under current rates is as follows:


	Sep 30, 2025	Sep 30, 2024
Weighted-Average Liability Duration of the Liability for Future Policyholder Benefits (Years)	14.0	14.8

The reconciliation of the net liability for future policyholder benefits to Life and Health Insurance Reserves in the Condensed Consolidated Balance Sheets is as follows:


(Dollars in Millions)	Sep 30, 2025		Sep 30, 2024



Net Liability for Future Policyholder Benefits, post-flooring	$	2,730.8	$	2,897.5
Deferred Profit Liability	460.4		390.6
Other1	126.4		137.7
Total Life and Health Insurance Reserves	$	3,317.6	$	3,425.8
1Other primarily consists of Accident and Health and Universal Life reserves

The amounts of expected undiscounted future benefit payments, expected undiscounted future gross premiums and expected discounted future gross premiums, are as follows:


(Dollars in Millions)	Sep 30, 2025		Sep 30, 2024
Expected Future Benefit Payments, undiscounted	$	10,167.1	$	10,274.0
Expected Future Gross Premiums, undiscounted	$	4,010.9	$	4,159.0
Expected Future Gross Premiums, discounted	$	2,718.2	$	2,853.8

The amount of revenue and interest recognized on life insurance products in the Condensed Consolidated Statements of (Loss) Income is as follows:


	Three Months Ended				Nine Months Ended
(Dollars in Millions)	Sep 30, 2025		Sep 30, 2024		Sep 30, 2025		Sep 30, 2024
Gross Premiums or Assessments	$	99.2	$	99.8	$	299.7	$	300.3
Interest Expense	$	34.6	$	35.0	$	103.7	$	104.7

The weighted-average interest rate is as follows:


	Sep 30, 2025		Sep 30, 2024
Interest Accretion Rate	4.53	%	4.54	%
Current Discount Rate	5.57	%	5.17	%

Significant assumption inputs to the calculation of the liability for future policyholder benefits include mortality, lapses, and discount rates (both accretion and current). The Company did not make any changes to mortality and lapse assumptions during the nine months ended September 30, 2025 and 2024. Market data that underlies current discount rates was updated as of September 30, 2025.

KEMPER CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 5 - Liability for Future Policyholder Benefits (Continued)

The balances of and changes in Deferred Profit Liability as of and for the periods indicated are as follows:


	Nine Months Ended
(Dollars in Millions)	Sep 30, 2025		Sep 30, 2024
Balance, Beginning of Year	$	412.1	$	337.8
Profits Deferred	118.4		121.1
Interest Accrual	14.9		12.5
Amortization	(86.6)		(82.0)
Effect of Actual Variances from Expected Experience and Other Changes	1.6		1.2
Balance, End of Period	$	460.4	$	390.6

Note 6 - Investments

Fixed Maturities

The amortized cost and fair values of the Company’s Investments in Fixed Maturities at September 30, 2025 were:


	Amortized Cost		Gross Unrealized				Allowance for Expected Credit Losses		Fair Value
(Dollars in Millions)			Gains		Losses
U.S. Government and Government Agencies and Authorities	$	673.4	$	3.2	$	(84.7)	$	—	$	591.9
States and Political Subdivisions	1,435.6		2.2		(194.5)		(0.1)		1,243.2
Foreign Governments	12.1		0.2		(0.3)		—		12.0
Corporate Securities:
Bonds and Notes	3,982.7		22.1		(417.2)		(13.4)		3,574.2
Redeemable Preferred Stocks	9.8		0.5		—		—		10.3
Collateralized Loan Obligations	823.8		2.8		(6.5)		(2.2)		817.9
Other Mortgage- and Asset-backed	394.3		1.3		(24.8)		—		370.8
Investments in Fixed Maturities	$	7,331.7	$	32.3	$	(728.0)	$	(15.7)	$	6,620.3

The amortized cost and fair values of the Company’s Investments in Fixed Maturities at December 31, 2024 were:


	Amortized Cost		Gross Unrealized				Allowance for Expected Credit Losses		Fair Value
(Dollars in Millions)			Gains		Losses
U.S. Government and Government Agencies and Authorities	$	588.6	$	0.6	$	(102.4)	$	—	$	486.8
States and Political Subdivisions	1,457.3		1.6		(225.4)		(0.3)		1,233.2
Foreign Governments	6.5		0.3		(0.2)		—		6.6
Corporate Securities:
Bonds and Notes	4,038.3		8.9		(518.8)		(8.8)		3,519.6
Redeemable Preferred Stocks	9.8		0.1		(1.0)		—		8.9
Collateralized Loan Obligations	747.8		2.5		(7.2)		(1.6)		741.5
Other Mortgage- and Asset-backed	446.7		0.8		(34.5)		—		413.0
Investments in Fixed Maturities	$	7,295.0	$	14.8	$	(889.5)	$	(10.7)	$	6,409.6

KEMPER CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 6 - Investments (Continued)

Other Receivables included $4.2 million and $1.8 million of unsettled sales of Investments in Fixed Maturities at September 30, 2025 and December 31, 2024, respectively. There were $7.8 million and $11.6 million of unsettled purchases of Investments in Fixed Maturities included in Accrued Expenses and Other Liabilities as of September 30, 2025 and December 31, 2024, respectively.

The amortized cost and estimated fair values of the Company’s Investments in Fixed Maturities at September 30, 2025 by contractual maturity were:


(Dollars in Millions)	Amortized Cost		Fair Value
Due in One Year or Less	$	228.2	$	225.8
Due after One Year to Five Years	925.2		894.4
Due after Five Years to Ten Years	920.7		839.7
Due after Ten Years	3,497.9		3,001.5
Mortgage- and Asset-backed Securities Not Due at a Single Maturity Date	1,759.7		1,658.9
Investments in Fixed Maturities	$	7,331.7	$	6,620.3

The expected maturities of the Company’s Investments in Fixed Maturities may differ from the contractual maturities because issuers may have the right to call or prepay obligations with or without call or prepayment penalties.

Investments in Mortgage- and Asset-backed Securities Not Due at a Single Maturity Date at September 30, 2025 consisted of securities issued by the Government National Mortgage Association with a fair value of $326.1 million, securities issued by the Federal National Mortgage Association with a fair value of $85.4 million, securities issued by the Federal Home Loan Mortgage Corporation with a fair value of $58.7 million and securities of other non-governmental issuers with a fair value of $1,188.7 million.

An aging of unrealized losses on the Company’s Investments in Fixed Maturities at September 30, 2025 is presented below.


	Less Than 12 Months				12 Months or Longer				Total
(Dollars in Millions)	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
Fixed Maturities:
U.S. Government and Government Agencies and Authorities	$	3.2	$	—	$	382.4	$	(84.7)	$	385.6	$	(84.7)
States and Political Subdivisions	178.5		(6.6)		971.5		(187.9)		1,150.0		(194.5)
Foreign Governments	3.7		(0.1)		0.4		(0.2)		4.1		(0.3)
Corporate Securities:
Bonds and Notes	538.0		(21.3)		2,472.6		(395.9)		3,010.6		(417.2)
Redeemable Preferred Stocks	—		—		2.0		—		2.0		—
Collateralized Loan Obligations	57.0		(0.5)		68.8		(6.0)		125.8		(6.5)
Other Mortgage- and Asset-backed	13.4		—		247.6		(24.8)		261.0		(24.8)
Total Fixed Maturities	$	793.8	$	(28.5)	$	4,145.3	$	(699.5)	$	4,939.1	$	(728.0)

Investment-grade fixed maturity investments comprised $708.0 million and below-investment-grade fixed maturity investments comprised $20.0 million of the unrealized losses on investments in fixed maturities at September 30, 2025. For below-investment-grade fixed maturity investments in an unrealized loss position, the unrealized loss amount, on average, was approximately 4.4% of the amortized cost basis of the investment.

KEMPER CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 6 - Investments (Continued)

An aging of unrealized losses on the Company’s Investments in Fixed Maturities at December 31, 2024 is presented below.


	Less Than 12 Months				12 Months or Longer				Total
(Dollars in Millions)	Fair Value		Unrealized Losses		Fair Value		Unrealized Losses		Fair Value		Unrealized Losses
Fixed Maturities:
U.S. Government and Government Agencies and Authorities	$	41.7	$	(0.5)	$	383.6	$	(101.9)	$	425.3	$	(102.4)
States and Political Subdivisions	242.7		(10.3)		933.4		(215.1)		1,176.1		(225.4)
Foreign Governments	—		—		1.4		(0.2)		1.4		(0.2)
Corporate Securities:
Bonds and Notes	674.3		(40.9)		2,605.7		(477.9)		3,280.0		(518.8)
Redeemable Preferred Stocks	2.0		—		6.6		(1.0)		8.6		(1.0)
Collateralized Loan Obligations	34.2		(0.1)		89.5		(7.1)		123.7		(7.2)
Other Mortgage- and Asset-backed	12.0		(0.1)		261.7		(34.4)		273.7		(34.5)
Total Fixed Maturities	$	1,006.9	$	(51.9)	$	4,281.9	$	(837.6)	$	5,288.8	$	(889.5)

Investment-grade fixed maturity investments comprised $875.3 million and below-investment-grade fixed maturity investments comprised $14.2 million of the unrealized losses on investments in fixed maturities at December 31, 2024. For below-investment-grade fixed maturity investments in an unrealized loss position, the unrealized loss amount, on average, was approximately 4.9% of the amortized cost basis of the investment.

Fixed Maturities - Expected Credit Losses

The following table sets forth the change in allowance for credit losses on fixed maturities available-for-sale by major security type for nine months ended September 30, 2025. Accrued interest excluded from the amortized cost of fixed maturities total $73.5 million and $70.9 million as of September 30, 2025 and December 31, 2024, respectively, and is reported within the Other Receivables line of the Condensed Consolidated Balance Sheets. The Company monitors accrued interest and writes off amounts when they are not expected to be received.


	States and Political Subdivisions		Corporate Bonds and Notes		Total
(Dollars in Millions)
Balance, Beginning of Year	$	0.3	$	10.4	$	10.7
Additions for Securities for which No Previous Expected Credit Losses were Recognized	—		2.1		2.1
Reductions Due to Sales	—		(0.4)		(0.4)
Net (Decrease) Increase in Allowance on Securities for which Expected Credit Losses were Previously Recognized	(0.2)		4.7		4.5
Write-Offs Charged Against Allowance	—		(1.2)		(1.2)
Balance, End of Period	$	0.1	$	15.6	$	15.7

KEMPER CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 6 - Investments (Continued)

The following table sets forth the change in allowance for credit losses on fixed maturities available-for-sale by major security type for the nine months ended September 30, 2024.


	States and Political Subdivisions		Corporate Bonds and Notes		Total
(Dollars in Millions)
Balance, Beginning of Year	$	0.5	$	7.7	$	8.2
Additions for Securities for which No Previous Expected Credit Losses were Recognized	—		2.0		2.0
Reductions Due to Sales	—		(0.8)		(0.8)
Net (Decrease) Increase in Allowance on Securities for which Expected Credit Losses were Previously Recognized	(0.3)		0.4		0.1

Balance, End of Period	$	0.2	$	9.3	$	9.5

Equity Securities

Investments in Equity Securities at Fair Value were $302.0 million and $218.5 million at September 30, 2025 and December 31, 2024, respectively. Net unrealized losses arising during the nine months ended September 30, 2025 and 2024 and recognized in earnings, related to such investments still held as of September 30, 2025 and September 30, 2024, were $2.3 million and $2.3 million, respectively.

There were no unsettled purchases or sales of Investments in Equity Securities at Fair Value at September 30, 2025. As of December 31, 2024, there were no unsettled purchases and $0.3 million in unsettled sales of Investments in Equity Securities at Fair Value.

Equity Method Limited Liability Investments

Equity Method Limited Liability Investments include investments in limited liability investment companies and limited partnerships in which the Company’s interests are not deemed minor and are accounted for under the equity method of accounting. The Company’s investments in Equity Method Limited Liability Investments are generally of a passive nature in that the Company does not take an active role in the management of the investment entity.

The Company’s maximum exposure to loss at September 30, 2025 is limited to the total carrying value of $174.9 million. In addition, the Company had outstanding commitments totaling approximately $102.6 million to fund Equity Method Limited Liability Investments at September 30, 2025. At September 30, 2025, 3.0% of Equity Method Limited Liability Investments were reported without a reporting lag, 2.0% of the total carrying value were reported with a one-month lag, and the remainder were reported with a greater than one-month but less than or equal to three-month lag.

There were no unsettled purchases or sales of Equity Method Limited Liability Investments as of September 30, 2025 or December 31, 2024. Unsettled purchases and sales of Equity Method Limited Liability Investments are carried within Accrued Expenses and Other Liabilities and Other Receivables, respectively, on the Condensed Consolidated Balance Sheets.

Loans to Policyholders

Loans to Policyholders represents funds loaned to policyholders up to the cash surrender value of the associated insurance policies and are carried at the unpaid principal balances due to the Company from the policyholders. Interest income on policy loans is recognized in Net Investment Income at the contract interest rate when earned. Policy loans are fully collateralized by the cash surrender value of the associated insurance policies.

The carrying values of the Company’s Loans to Policyholders at Unpaid Principal investment at September 30, 2025 and December 31, 2024 were $279.3 million and $280.7 million, respectively.

KEMPER CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 6 - Investments (Continued)

Other Investments

The carrying values of the Company’s Other Investments at September 30, 2025 and December 31, 2024 were:


(Dollars in Millions)	Sep 30, 2025		Dec 31, 2024
Equity Securities at Modified Cost	$	22.2	$	22.5
Real Estate at Depreciated Cost	93.3		99.5
Mortgage Loans	148.2		75.3
Alternative Energy Partnership Investments	17.4		17.6
Other	5.9		2.2
Total Other Investments	$	287.0	$	217.1

Investments in Equity Securities at Modified Cost were $22.2 million and $22.5 million at September 30, 2025 and December 31, 2024, respectively. The Company performs a qualitative impairment analysis on a quarterly basis consisting of various factors such as earnings performance, current market conditions, changes in credit ratings, changes in the regulatory environment and other factors. If the qualitative analysis identifies the presence of impairment indicators, the Company estimates the fair value of the investment. If the estimated fair value is below the carrying value, the Company records an impairment in the Condensed Consolidated Statements of (Loss) Income to reduce the carrying value to the estimated fair value. When the Company identifies observable transactions of the same or similar securities to those held by the Company, the Company increases or decreases the carrying value to the observable transaction price. The Company did not recognize any changes in carrying value due to observable transactions for the nine months ended September 30, 2025 and 2024. The Company did not recognize any impairment on Equity Securities at Modified Cost for the nine months ended September 30, 2025 as a result of the Company’s impairment analysis. The Company recognized an impairment of $0.4 million on Equity Securities at Modified Cost for nine months ended September 30, 2024 as a result of the Company’s impairment analysis. As of September 30, 2025 and December 31, 2024, the Company recognized no cumulative increases or decreases in the carrying value due to observable transactions and $3.2 million of cumulative impairments on Equity Securities at Modified Cost.

Alternative Energy Partnership Investments include partnerships formed to invest in newly installed residential solar leases and power purchase agreements. As a result of this investment, the Company has the right to certain investment tax credits and tax depreciation benefits, and to a lesser extent, cash flows generated from the installed solar systems leased to individual consumers for a fixed period of time. The Hypothetical Liquidation Book Value (“HLBV”) equity method of accounting is used for the Company’s investments in Alternative Energy Partnership Investments. The Company’s maximum exposure to loss at September 30, 2025 is limited to the total carrying value of $17.4 million. The Company has no outstanding commitments to fund Alternative Energy Partnership Investments as of September 30, 2025. Alternative Energy Partnership Investments are reported on a three-month lag.

KEMPER CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 6 - Investments (Continued)

Net Investment Income

Net Investment Income for the three and nine months ended September 30, 2025 and 2024 was:


	Three Months Ended				Nine Months Ended
(Dollars in Millions)	Sep 30, 2025		Sep 30, 2024		Sep 30, 2025		Sep 30, 2024
Investment Income:
Interest on Fixed Maturities1	$	79.1	$	79.0	$	232.4	$	239.0
Dividends on Equity Securities Excluding Alternative Investments	2.1		0.9		3.6		4.6
Alternative Investments:
Equity Method Limited Liability Investments	—		0.9		(6.0)		(15.9)
Limited Liability Investments Included in Equity Securities	4.0		9.1		10.8		18.7
Total Alternative Investments	4.0		10.0		4.8		2.8
Short-term Investments	4.2		8.4		18.8		23.0
Loans to Policyholders	5.2		5.5		15.6		15.8
Real Estate	2.5		2.2		7.0		6.7
Company-Owned Life Insurance	10.8		9.7		31.5		25.7
Other	3.1		2.2		8.4		7.3
Total Investment Income	111.0		117.9		322.1		324.9
Investment Expenses:
Real Estate	2.0		1.8		6.3		6.1
Other Investment Expenses	4.2		5.0		13.9		14.3
Total Investment Expenses	6.2		6.8		20.2		20.4
Net Investment Income	$	104.8	$	111.1	$	301.9	$	304.5

1Reduced by interest expense incurred on FHLB borrowings used for spread lending purposes of $4.7 million and $4.8 million for the three months ended September 30, 2025 and 2024, respectively, and $14.3 million and $15.4 million for the nine months ended September 30, 2025 and 2024, respectively.

The components of Net Realized Investment Gains for the three and nine months ended September 30, 2025 and 2024 are presented below:


	Three Months Ended				Nine Months Ended
(Dollars in Millions)	Sep 30, 2025		Sep 30, 2024		Sep 30, 2025		Sep 30, 2024
Fixed Maturities:
Gains on Sales	$	3.7	$	0.9	$	5.4	$	15.9
Losses on Sales	(0.5)		—		(1.5)		(2.6)
Losses on Hedging Activity1	—		—		—		(7.9)
Equity Securities:
Gains on Sales	0.5		—		0.5		4.1
Losses on Sales	—		—		—		(0.1)
Other Investments:
Gains on Sales	0.2		1.8		0.3		3.3
Losses on Sales	—		(1.6)		—		(3.5)
Net Realized Investment Gains	$	3.9	$	1.1	$	4.7	$	9.2
1 Includes Ultra-Long Treasury Future derivative securities which do not qualify for hedge accounting treatment.

KEMPER CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 7 - Derivatives

The Company’s earnings, cash flows, and financial position are subject to fluctuations due to changes in prevailing interest rates.

The Company entered into derivative agreements with maturity dates throughout 2025. Derivative instruments are carried at fair value on the Condensed Consolidated Balance Sheets. Derivative instruments in a gain position are presented within Other Investments and those in a loss position are included in Accrued Expenses and Other Liabilities. Changes in the fair values of derivatives which do not qualify for hedge accounting treatment are recorded on the Condensed Consolidated Statements of (Loss) Income within Net Realized Investment Gains. Changes in the fair values of derivatives which qualify for hedge accounting treatment are recorded within Accumulated Other Comprehensive Loss along with the corresponding change in the designated hedge assets.

Interest Rate Risk

The Company’s debt securities valuations utilize the Treasury designated benchmark rate, exposing the Company to variability due to changes in interest rates.

Ultra-Long Treasury Futures

The Company enters into exchange-traded ultra-long Treasury futures (“Treasury Futures”) in order to manage exposure to upcoming changes in the benchmark (Treasury) interest rate of forecasted transactions. These derivatives expire quarterly. As of September 30, 2025, all Treasury Futures held by the Company qualified for hedge accounting as a cash flow hedge. The Company utilizes a rollover hedging strategy that involves continuously establishing short-term derivatives in consecutive contract months to hedge the underlying risk exposure. Under this strategy, the complete set of derivatives are not acquired at hedge inception; rather, short-term derivatives are acquired throughout the hedging period such that maturing derivatives are replaced with new short-term derivatives.

The following table presents the Company’s Ultra-Long Treasury Futures derivatives, primary underlying risk exposure, gross notional amount, and estimated fair value of these derivatives:


		September 30, 2025						December 31, 2024
(Dollars in Millions)				Estimated Fair Value						Estimated Fair Value
Derivative Instrument	Primary Underlying Risk Exposure	Gross Notional Amount		Assets		Liabilities		Gross Notional Amount		Assets		Liabilities

Derivatives Designated as Hedging Instruments:
Treasury Futures	Interest Rate Risk	$	75.0	$	2.7	$	—	$	75.0	$	—	$	(3.7)

The below table reflects the amounts of Gains (Losses) deferred into AOCI before taxes, net changes in amounts in AOCI associated with current hedging transactions, and amounts subsequently reclassified into Net (Loss) Income through Net Investment Income for Ultra-Long Treasury Futures qualifying as cash flow hedges for the three and nine months ended September 30, 2025 and 2024.


	Three Months Ended				Nine Months Ended
(Dollars in Millions)	Sep 30, 2025		Sep 30, 2024		Sep 30, 2025		Sep 30, 2024
Beginning of Period	$	(5.7)	$	(3.6)	$	(6.3)	$	—
Gains (Losses) Deferred in AOCI	0.2		—		(1.7)		(4.0)
Net Change in AOCI with Current Period Hedging Transactions	0.6		3.9		2.9		4.3
Losses Reclassified into Income	—		0.5		0.2		0.5
Net Comprehensive (Losses) Gains from Cash Flow Hedges	$	(4.9)	$	0.8	$	(4.9)	$	0.8

KEMPER CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 7 - Derivatives (Continued)

Treasury Locks

During the fourth quarter of 2016 and the first quarter of 2022, in anticipation of debt issuances shortly thereafter and for risk management purposes, the Company entered into derivative transactions (the “2016 Treasury Lock” and “2022 Treasury Lock,” together the “Treasury Locks”) to hedge the risk of changes in the debt cash flows attributable to changes in the benchmark U.S. Treasury interest rate during the period leading up to the debt issuance.

The Treasury Locks have no remaining gross notional amount or fair value as the hedging relationships have been previously discontinued with the issuance of the associated debt (Senior Notes due February 15, 2025 for the 2016 Treasury Lock and Senior Notes due February 23, 2032 for the 2022 Treasury Lock). The effective portion of the gain or loss before taxes on the derivative instruments upon discontinuance was a $4.5 million loss for the 2016 Treasury Lock and a $5.9 million gain on the 2022 Treasury Lock. The gain or loss upon discontinuance is reported as a component of Accumulated Other Comprehensive Loss. Beginning with the issuance of the associated debt, such gain or loss is amortized into earnings and reported in Interest Expense in the same periods that the hedged items affect earnings.

During the first quarter of 2025, in conjunction with the redemption of the Senior Notes due February 15, 2025, the Company amortized the remaining $0.1 million of pre-tax derivative loss on the 2016 Treasury Lock into earnings. Pre-tax amortization on the 2022 Treasury Lock was $0.1 million and $0.4 million for the three and nine months ended September 30, 2025 and 2024, respectively. As of September 30, 2025, the remaining amount of pre-tax derivative gain on the 2022 Treasury Lock within AOCI to be amortized into earnings was $3.8 million.

KEMPER CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 8 - Fair Value Measurements

The Company classifies its Investments in Fixed Maturities as available-for-sale and reports these investments at fair value. The Company reports equity investments with readily determinable fair values as Equity Securities at Fair Value. Certain investments that are measured at fair value using the net asset value (“NAV”) practical expedient are not required to be classified using the fair value hierarchy, but are presented in the following two tables to permit reconciliation of the fair value hierarchy to the amounts presented in the Condensed Consolidated Balance Sheets.

The valuation of assets and liabilities measured at fair value in Company’s Condensed Consolidated Balance Sheets at September 30, 2025 is summarized below. The Company had no material liabilities that are measured and reported at fair values.


	Fair Value Measurements
(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		Total Fair Value
Assets:
Fixed Maturities:
U.S. Government and Government Agencies and Authorities	$	103.9	$	488.0	$	—	$	—	$	591.9
States and Political Subdivisions	—		1,241.4		1.8		—		1,243.2
Foreign Governments	—		9.5		2.5		—		12.0
Corporate Securities:
Bonds and Notes	—		3,293.5		280.7		—		3,574.2
Redeemable Preferred Stock	—		5.9		4.4		—		10.3
Collateralized Loan Obligations	—		812.2		5.7		—		817.9
Other Mortgage and Asset-backed	—		335.9		34.9		—		370.8
Total Investments in Fixed Maturities	103.9		6,186.4		330.0		—		6,620.3
Equity Securities at Fair Value:
Preferred Stocks:
Finance, Insurance and Real Estate	—		11.6		2.6		—		14.2
Other Industries	—		5.6		—		—		5.6
Common Stocks:
Finance, Insurance and Real Estate	—		—		—		—		—
Other Industries	0.2		—		1.4		—		1.6
Other Equity Interests:
Exchange Traded Funds	76.6		—		—		—		76.6
Limited Liability Companies and Limited Partnerships	—		—		—		204.0		204.0
Total Investments in Equity Securities at Fair Value	76.8		17.2		4.0		204.0		302.0
Other Investments:

Derivative Instrument Classified as Cash Flow Hedge	—		2.7		—		—		2.7
Total Assets	$	180.7	$	6,206.3	$	334.0	$	204.0	$	6,925.0

KEMPER CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 8 - Fair Value Measurements (Continued)

The valuation of assets and liabilities measured at fair value in the Company’s Consolidated Balance Sheets at December 31, 2024 is summarized below.


	Fair Value Measurements
(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		Total Fair Value
Assets:
Fixed Maturities:
U.S. Government and Government Agencies and Authorities	$	86.8	$	400.0	$	—	$	—	$	486.8
States and Political Subdivisions	—		1,231.4		1.8		—		1,233.2
Foreign Governments	—		6.6		—		—		6.6
Corporate Securities:
Bonds and Notes	—		3,325.4		194.2		—		3,519.6
Redeemable Preferred Stocks	—		4.7		4.2		—		8.9
Collateralized Loan Obligations	—		741.5		—		—		741.5
Other Mortgage and Asset-backed	—		408.0		5.0		—		413.0
Total Investments in Fixed Maturities	86.8		6,117.6		205.2		—		6,409.6
Equity Securities at Fair Value:
Preferred Stocks:
Finance, Insurance and Real Estate	—		13.1		—		—		13.1
Other Industries	—		6.7		2.8		—		9.5
Common Stocks:
Finance, Insurance and Real Estate	0.3		—		—		—		0.3
Other Industries	0.1		—		1.0		—		1.1
Other Equity Interests:
Exchange Traded Funds	10.9		—		—		—		10.9
Limited Liability Companies and Limited Partnerships	—		—		—		183.6		183.6
Total Investments in Equity Securities at Fair Value	11.3		19.8		3.8		183.6		218.5
Total Assets	$	98.1	$	6,137.4	$	209.0	$	183.6	$	6,628.1
Liabilities:
Accrued Expenses and Other Liabilities:
Derivative Instruments Designated as Cash Flow Hedges	$	—	$	(3.7)	$	—	$	—	$	(3.7)
Total Liabilities	$	—	$	(3.7)	$	—	$	—	$	(3.7)

The Company’s investments in Fixed Maturities that are classified as Level 1 primarily consist of U.S. Treasury Bonds and Notes. The Company’s investments in Equity Securities at Fair Value that are classified as Level 1 consist of either investments in mutual funds or exchange traded funds. The Company’s investments in Fixed Maturities that are classified as Level 2 primarily consist of investments in corporate bonds, obligations of states and political subdivisions, collateralized loan obligations, and mortgage-backed securities of U.S. government agencies. The Company’s investments in Equity Securities at Fair Value that are classified as Level 2 primarily consist of investments in preferred stocks.

KEMPER CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 8 - Fair Value Measurements (Continued)

The Company’s Derivative Instruments Designated as Cash Flow Hedges that are classified as Level 2 primarily consist of hedges to manage exposure to upcoming changes in the benchmark (Treasury) interest rate of forecasted transactions. The Company uses a leading, nationally recognized provider of market data and analytics to price the vast majority of the Company’s Level 2 measurements. The provider utilizes evaluated pricing models that vary by asset class and incorporate available trade, bid and other market information. Because many fixed maturity securities do not trade on a daily basis, the provider’s evaluated pricing applications apply available information through processes such as benchmark curves, benchmarking of like securities, sector groupings and matrix pricing to prepare evaluations. In addition, the provider uses model processes to develop prepayment and interest rate scenarios. The pricing provider’s models and processes also take into account market convention. For each asset class, teams of its evaluators gather information from market sources and integrate relevant credit information, perceived market movements and sector news into the evaluated pricing applications and models. The Company generally validates the measurements obtained from its primary pricing provider by comparing them with measurements obtained from one additional pricing provider that provides either prices from recent market transactions, quotes in inactive markets or evaluations based on its own proprietary models.

The Company investigates significant differences related to the values provided. On completion of its investigation, management exercises judgment to determine the price selected and whether adjustments, if any, to the price obtained from the Company’s primary pricing provider would warrant classification of the price as Level 3. In instances where a measurement cannot be obtained from either pricing provider, the Company generally will evaluate bid prices from one or more binding quotes obtained from market makers to value investments in inactive markets and classified by the Company as Level 2. The Company generally classifies securities when it receives non-binding quotes or indications as Level 3 securities unless the Company can validate the quote or indication against recent transactions in the market.

The table below presents quantitative information about the significant unobservable inputs utilized by the Company in determining fair values for fixed maturity investments classified as Level 3 at September 30, 2025. Valuations for assets presented in the tables below are primarily based on broker/dealer quotes for which there is a lack of transparency as to inputs used to develop the valuations. The quantitative detail of these unobservable inputs is neither provided nor reasonably available to the Company. The weighted average yield is calculated based on fair value.


(Dollars in Millions)	Unobservable Input	Total Fair Value		Range of Unobservable Inputs					Weighted-average Yield
Investment-grade	Market Yield	$	91.6	1.6	%	-	10.5	%	7.3	%
Non-investment-grade:
Senior Debt	Market Yield	116.7		6.6		-	26.1		10.1
Junior Debt	Market Yield	27.1		8.5		-	26.0		13.0
Other	Various	94.6
Total Level 3 Fixed Maturity Investments		$	330.0

KEMPER CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 8 - Fair Value Measurements (Continued)

The table below presents quantitative information about the significant unobservable inputs utilized by the Company in determining fair values for fixed maturity investments classified as Level 3 at December 31, 2024. Valuations for assets presented in the tables below are primarily based on broker/dealer quotes for which there is a lack of transparency as to inputs used to develop the valuations. The quantitative detail of these unobservable inputs is neither provided nor reasonably available to the Company. The weighted average yield is calculated based on fair value.


(Dollars in Millions)	Unobservable Input	Total Fair Value		Range of Unobservable Inputs					Weighted-average Yield
Investment-grade	Market Yield	$	59.9	3.4	%	-	11.6	%	7.9	%
Non-investment-grade:
Senior Debt	Market Yield	42.7		7.0		-	24.1		10.0
Junior Debt	Market Yield	35.7		9.5		-	31.0		13.2
Other	Various	66.9
Total Level 3 Fixed Maturity Investments		$	205.2

For an investment in a fixed maturity security, an increase in the yield used to determine the fair value of the security will decrease the fair value of the security. A decrease in the yield used to determine fair value will increase the fair value of the security, but for callable securities the fair value increase is generally limited to par, unless security is currently callable at a premium.

Information by security type pertaining to the changes in the fair value of the Company’s investments classified as Level 3 for the three months ended September 30, 2025 is presented below.


	Fixed Maturities												Equity Securities
(Dollars in Millions)	Corporate Bonds and Notes		Foreign Governments		States and Political Sub- divisions		Redeemable Preferred Stocks		Collateralized Loan Obligations		Other Mortgage- and Asset- backed		Preferred and Common Stocks		Total
Balance, Beginning of Period	$	261.6	$	—	$	0.2	$	4.3	$	52.8	$	22.5	$	4.8	$	346.2
Total Gains (Losses):
Included in Condensed Consolidated Statements of (Loss) Income	0.4		—		—		—		—		—		(1.9)		(1.5)
Included in Other Comprehensive Income	(4.8)		—		(0.1)		0.1		—		0.8		0.4		(3.6)
Purchases	87.6		5.0		—		—		5.7		13.1		(0.5)		110.9
Sales	(64.1)		(2.5)		—		—		—		—		1.2		(65.4)
Transfers into Level 3	—		—		1.7		—		—		—		—		1.7
Transfers out of Level 3	—		—		—		—		(52.8)		(1.5)		—		(54.3)
Balance, End of Period	$	280.7	$	2.5	$	1.8	$	4.4	$	5.7	$	34.9	$	4.0	$	334.0

The transfers into and out of Level 3 were due to changes in the availability of market observable inputs.

KEMPER CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 8 - Fair Value Measurements (Continued)

Information by security type pertaining to the changes in the fair value of the Company’s investments classified as Level 3 for the three months ended September 30, 2024 is presented below.


	Fixed Maturities										Equity Securities
(Dollars in Millions)	Corporate Bonds and Notes		States and Political Sub- divisions		Redeemable Preferred Stocks		Collateralized Loan Obligations		Other Mortgage- and Asset- backed		Preferred and Common Stocks		Total
Balance, Beginning of Period	$	227.3	$	0.1	$	4.1	$	6.8	$	5.0	$	3.4	$	246.7
Total Gains (Losses):
Included in Condensed Consolidated Statements of (Loss) Income	0.3		—		—		—		—		(0.2)		0.1
Included in Other Comprehensive Income	1.7		(0.2)		0.2		—		0.3		—		2.0
Purchases	30.9		—		—		—		—		—		30.9
Sales	(31.8)		—		—		—		—		—		(31.8)
Transfers into Level 3	3.9		1.8		—		—		—		—		5.7
Transfers out of Level 3	(1.9)		—		—		(6.8)		—		—		(8.7)
Balance, End of Period	$	230.4	$	1.7	$	4.3	$	—	$	5.3	$	3.2	$	244.9

The transfers into and out of Level 3 were due to changes in the availability of market observable inputs.

Information by security type pertaining to the changes in the fair value of the Company’s investments classified as Level 3 for the nine months ended September 30, 2025 is presented below.


	Fixed Maturities												Equity Securities
(Dollars in Millions)	Corporate Bonds and Notes		Foreign Governments		States and Political Sub- divisions		Redeemable Preferred Stocks		Collateralized Loan Obligations		Other Mortgage- and Asset- backed		Preferred and Common Stocks		Total
Balance, Beginning of Year	$	194.2	$	—	$	1.8	$	4.2	$	—	$	5.0	$	3.8	$	209.0
Total Gains (Losses):
Included in Condensed Consolidated Statements of (Loss) Income	1.9		—		—		—		—		—		—		1.9
Included in Other Comprehensive Income	(2.1)		—		(0.2)		0.2		—		0.7		0.4		(1.0)
Purchases	216.5		5.0		—		—		125.5		20.8		0.3		368.1
Sales	(134.6)		(2.5)		—		—		(10.0)		(0.1)		(0.5)		(147.7)
Transfers into Level 3	5.0		—		1.7		—		—		10.0		—		16.7
Transfers out of Level 3	(0.2)		—		(1.5)		—		(109.8)		(1.5)		—		(113.0)
Balance, End of Period	$	280.7	$	2.5	$	1.8	$	4.4	$	5.7	$	34.9	$	4.0	$	334.0

The transfers into and out of Level 3 were due primarily to changes in the availability of market observable inputs.

KEMPER CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 8 - Fair Value Measurements (Continued)

Information by security type pertaining to the changes in the fair value of the Company’s investments classified as Level 3 for the nine months ended September 30, 2024 is presented below.


	Fixed Maturities										Equity Securities
(Dollars in Millions)	Corporate Bonds and Notes		States and Political Sub- divisions		Redeemable Preferred Stocks		Collateralized Loan Obligations		Other Mortgage- and Asset- backed		Preferred and Common Stocks		Total
Balance, Beginning of Year	$	177.1	$	0.1	$	7.1	$	—	$	5.2	$	2.8	$	192.3
Total Gains (Losses):
Included in Condensed Consolidated Statements of (Loss) Income	0.2		—		—		—		—		1.6		1.8
Included in Other Comprehensive Income	2.3		(0.6)		0.2		—		0.1		—		2.0
Purchases	103.5		—		1.9		6.8		—		0.5		112.7
Sales	(48.1)		—		—		—		—		(1.7)		(49.8)
Transfers into Level 3	7.0		3.5		—		—		—		—		10.5
Transfers out of Level 3	(11.6)		(1.3)		(4.9)		(6.8)		—		—		(24.6)
Balance, End of Period	$	230.4	$	1.7	$	4.3	$	—	$	5.3	$	3.2	$	244.9

The transfers into and out of Level 3 were due primarily to changes in the availability of market observable inputs.

KEMPER CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 8 - Fair Value Measurements (Continued)

The table below shows investments reported at fair value using NAV and their unfunded commitments by asset class as of September 30, 2025 and December 31, 2024.


(Dollars in Millions)	September 30, 2025				December 31, 2024
Asset Class	Fair Value Using NAV		Unfunded Commitments		Fair Value Using NAV		Unfunded Commitments
Reported as Equity Method Limited Liability Investments:
Mezzanine Debt	$	115.2	$	36.2	$	116.7	$	40.8
Real Estate	24.3		0.1		27.3		—
Senior Debt	19.5		64.1		19.1		48.2
Leveraged Buyout	6.5		0.6		7.5		0.6
Secondary Transactions	2.7		1.6		5.5		1.6
Distressed Debt	1.4		—		4.4		—

Other	5.3		—		5.8		0.1
Total Equity Method Limited Liability Investments	174.9		102.6		186.3		91.3

Reported as Other Equity Interests at Fair Value:
Mezzanine Debt	115.9		69.8		116.9		67.0
Leveraged Buyout	34.5		42.7		19.2		30.4
Senior Debt	26.5		6.7		26.3		8.4
Distressed Debt	11.1		15.7		11.7		15.0
Growth Equity	10.4		5.8		7.0		8.0
Secondary Transactions	1.6		1.6		2.4		1.6
Real Estate	0.1		0.2		—		—
Other	3.9		0.2		0.1		0.2
Total Reported as Other Equity Interests at Fair Value	204.0		142.7		183.6		130.6

Reported as Equity Securities at Modified Cost:
Other	1.8		0.1		1.8		—
Total Reported as Equity Securities at Modified Cost	1.8		0.1		1.8		—
Total Investments Reported at Fair Value Using NAV	$	380.7	$	245.4	$	371.7	$	221.9

The fund investments included above (excluding Hedge Funds) are not redeemable, because distributions from the funds will be received when underlying investments of the funds are liquidated. The funds are generally expected to have approximately 10 year lives at their inception, but these lives may be extended at the fund manager’s discretion, typically in one or two-year increments.

The hedge fund investments included above, which are carried at fair value, are generally redeemable subject to the redemption notices period. The majority of the hedge fund investments are redeemable monthly or quarterly.

KEMPER CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 8 - Fair Value Measurements (Continued)

The following table includes information related to the Company’s investments in certain private equity funds or hedge funds that calculate a net asset value per share:


Asset Class						Investment Category Includes
Mezzanine Debt						Funds with investments in junior or subordinated debt and potentially minority equity securities issued by private companies.
Senior Debt						Funds with investments in senior or first lien debt and potentially minority equity securities typically issued by private companies.
Distressed Debt						Funds with debt or minority equity investments that are made opportunistically in companies that are in or near default or under financial strain with potential to have an active role in restructuring the company.
Secondary Transactions						Funds that focus on purchasing third party fund interests from investors seeking liquidity within their own portfolio.
Hedge Fund						Funds that focus primarily on investing in public securities with strategy of generating uncorrelated returns to the public markets.
Leveraged Buyout						Funds with control equity investments in more mature, positive cash flowing, private companies that are typically purchased with the use of financial leverage.
Growth Equity						Funds that invest in early or venture stage companies with high growth potential with view towards generating realizations through sale or initial public offering of company.
Real Estate						Funds with investments in multi-family housing properties.
Other						Consists of direct investments of preferred equity or minority common equity investments into private companies structured as limited partnerships or limited liability companies.

Presented below are the carrying values and fair value estimates of financial instruments not carried at fair value.


		September 30, 2025				December 31, 2024
(Dollars in Millions)	Level	Carrying Value		Fair Value		Carrying Value		Fair Value
Financial Assets:
Loans to Policyholders	Level 3	$	279.3	$	279.3	$	280.7	$	280.7
Short-term Investments	Level 1 or 2	371.2		371.2		1,037.1		1,037.1
Mortgage Loans	Level 3	148.2		148.2		75.3		75.3
Company-Owned Life Insurance	Level 2	567.9		567.9		539.2		539.2
Equity Securities at Modified Cost	Level 3	22.2		22.2		22.5		22.5
Financial Liabilities:
Long-term Debt	Level 2	$	943.1	$	864.6	$	1,391.6	$	1,278.4
Policyholder Obligations	Level 2	525.2		525.2		541.3		541.3

Loans to policyholders are carried at unpaid principal balance which approximates fair value and are categorized as Level 3 within the fair value hierarchy. The nature of policy loans is to have a negligible default risk as the loans are fully collateralized by the value of the policy. Policy loans do not have a stated maturity and the balances and accrued interest are repaid either by the policyholder or with proceeds from the policy. Due to the collateralized nature of policy loans and unpredictable timing of payments, the Company believes the carrying value of policy loans approximates fair value. The fair value measurement of Short-term Investments is estimated using inputs that are considered either Level 1 or Level 2 measurements. The Mortgage Loans fair value measurement is considered equal to amortized cost given the short-term nature of the investments. The fair value measurement of Equity Securities at Modified Cost is estimated using inputs that are considered Level 3 measurements. The cash surrender value of Company-Owned Life Insurance approximates fair value and is considered to be a Level 2 investment. The fair value of Long-term Debt is estimated using quoted prices for similar liabilities in markets that are not active. The inputs used in the valuation are considered Level 2 measurements. Policyholder Obligations presented in the preceding table consist of advances from the FHLB of Chicago, and the inputs used in the valuation are considered Level 2 measurements.

KEMPER CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 9 - Variable Interest Entities

A VIE is a legal entity that does not have sufficient equity at risk to finance its activities without additional subordinated financial support or is structured such that equity investors lack the ability to make significant decisions relating to the entity's operations through voting rights or do not substantively participate in the gains and losses of the entity. The Company consolidates VIEs in which the Company is deemed the primary beneficiary. The primary beneficiary is the entity that has both (1) the power to direct the activities of the VIE that most significantly affect that entity's economic performance and (2) the obligation to absorb losses or the right to receive benefits that could be potentially significant to the VIE.

Reciprocal Exchange

The Company has formed a management company that acts as attorney-in-fact (“AIF”) for Kemper Reciprocal (the “Reciprocal Exchange” or “Exchange”), an Illinois-domiciled reciprocal insurance exchange. The Exchange principally writes specialty personal automobile policies sold to subscribers of the Exchange. The establishment of Kemper Reciprocal was completed in the third quarter of 2023.

The Company consolidates the Exchange since (1) the AIF manages the business operations of the Exchange and therefore has the power to direct the activities that most significantly impact the economic performance of the Exchange and (2) the Company has provided capital to the Exchange and would absorb any expected losses that could potentially be significant to the Exchange. The Exchange’s anticipated economic performance is the product of its underwriting and investment results. The AIF receives a management fee for the services provided to the Reciprocal Exchange. The management fee revenues are based upon all premiums written or assumed by the Exchange. The AIF determines the management fee rate to be paid by the Exchange. The AIF can charge a management fee of up to 30% of the Exchange’s gross written and assumed premiums.

The assets of the Reciprocal Exchange can be used only to settle the obligations of the Reciprocal Exchange for which creditors and other beneficial owners have no recourse to the Company. The Company has no obligation related to any underwriting and/or investment losses experienced by the Exchange. As of December 31, 2024, the Company had contributed $22.0 million of surplus to the Reciprocal Exchange. During the first nine months of 2025, the Company contributed an additional $7.0 million of surplus to the Reciprocal Exchange, resulting in a total contributed surplus of $29.0 million as of September 30, 2025. The effects of the transactions between the Company and the Reciprocal Exchange are eliminated in consolidation to derive consolidated Net (Loss) Income. However, the management fee income earned by the AIF is reported in Net (Loss) Income attributable to Kemper Corporation and is included in basic and diluted earnings per share.

Noncontrolling interest is the portion of equity (net assets) not attributable, directly or indirectly, to a parent. Since the Company has no ownership interest in Kemper Reciprocal, the difference between the carrying value of the Exchange’s assets and liabilities represents noncontrolling interest and any income or loss generated by the net assets of the Exchange is presented as income or loss attributable to noncontrolling interest.

Alternative Energy Partnership

The Company invests in an Alternative Energy Partnership formed to provide sustainable energy projects that are designed to generate a return primarily through the realization of federal tax credits. This entity was formed to invest in newly installed residential solar leases and power purchase agreements. As a result of this investment, the Company has the right to certain investment tax credits and tax depreciation benefits, and to a lesser extent, cash flows generated from the installed solar systems leased to individual consumers.

The Company’s interest in the Alternative Energy Partnership Investment is considered an investment in a VIE. The Company has determined that it is not the primary beneficiary as it does not have the power to direct the activities that most significantly impact the economic performance of the entity and therefore is not required to consolidate the VIE. The project sponsor governs the entity, and the Company only has consent rights that have been deemed protective in nature and does not participate in key economic decisions of the entity.

The investment is accounted for using the equity method of accounting and included in Other Investments in the Condensed Consolidated Balance Sheets. The Company uses the HLBV equity method to account for earnings and losses. This method provides an earnings allocation that appropriately reflects the substantive economics of the investment. Earnings and losses on the investment are reported in Other Income and investment tax credits are recognized in Income Tax (Benefit) Expense on the Condensed Consolidated Statements of (Loss) Income.

KEMPER CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 9 - Variable Interest Entities (Continued)

The Company’s maximum loss exposure in the event that all of the assets in the Alternative Energy Partnership are deemed worthless is $17.4 million and $17.6 million, which is the carrying value of the investment at September 30, 2025 and December 31, 2024, respectively.

Note 10 - Deferred Policy Acquisition Costs

The following tables present the balances and changes in Deferred Policy Acquisition Costs for the Specialty Property and Casualty Insurance segment, Life Insurance segment, and Non-Core Operations business for the nine months ended September 30, 2025 and 2024:


(Dollars in Millions)	Specialty		Life		Segment Total		Non-Core Operations		Total
Balance, December 31, 20241	$	162.8	$	463.1	$	625.9	$	4.1	$	630.0
Capitalizations	411.0		48.4		459.4		4.9		464.3
Amortization Expense2	(404.4)		(21.7)		(426.1)		(7.9)		(434.0)
Balance, September 30, 20251	$	169.4	$	489.8	$	659.2	$	1.1	$	660.3
1 Includes $1.4 million and $1.1 million attributable to Kemper Reciprocal as of September 30, 2025 and December 31, 2024, respectively, which is reported as a consolidated variable interest entity.
2 Includes $2.0 million of impairment within Non-Core Operations related to a premium deficiency recognized during the period.


(Dollars in Millions)	Specialty		Life		Segment Total		Non-Core Operations		Total
Balance, December 31, 20231	$	142.7	$	427.0	$	569.7	$	22.0	$	591.7
Capitalizations	365.4		52.6		418.0		11.4		429.4
Amortization Expense	(346.7)		(24.0)		(370.7)		(28.4)		(399.1)
Balance, September 30, 20241	$	161.4	$	455.6	$	617.0	$	5.0	$	622.0
1 Includes $0.7 million and $0.1 million attributable to Kemper Reciprocal as of September 30, 2024 and December 31, 2023, respectively, which is reported as a consolidated variable interest entity.

Costs directly associated with the successful acquisition of business, principally commissions and certain premium taxes and policy issuance costs, are deferred. Costs deferred on property and casualty insurance contracts are amortized over the period in which premiums are earned. Costs deferred on traditional life insurance products and other long-duration insurance contracts are amortized on a constant level basis over the expected life of the contracts in accordance with the assumptions used to estimate the liability for future policyholder benefits for nonparticipating traditional and limited-payment contracts. The underlying assumptions for deferred policy acquisition costs and the liability for future policyholder benefits are updated concurrently.

The Company did not make any changes to future assumptions for the nine months ended September 30, 2025 and 2024.

KEMPER CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 11 - Receivables from Policyholders - Allowance for Expected Credit Losses

The following tables present the balances of Receivables from Policyholders, net of the allowance for expected credit losses, as of September 30, 2025 and 2024, and a roll forward of changes in the allowance for expected credit losses for the three and nine months ended September 30, 2025 and 2024.


	Three Months Ended September 30, 2025
(Dollars in Millions)	Specialty		Life		Total Segments		Non-Core Operations		Total Allowance for Expected Credit Losses
Balance, Beginning of Period	$	1.8	$	—	$	1.8	$	0.2	$	2.0
Provision for Expected Credit Losses	14.5		0.1		14.6		—		14.6
Write-offs of Uncollectible Receivables from Policyholders	(14.0)		(0.1)		(14.1)		(0.1)		(14.2)
Balance, End of Period	$	2.3	$	—	$	2.3	$	0.1	$	2.4

Receivable Balance, End of Period1	$	1,014.9	$	11.3	$	1,026.2	$	7.4	$	1,033.6
1Specialty, Total Segments, and Total Includes $10.7 million attributable to Kemper Reciprocal, which is reported as a consolidated variable interest entity.


	Three Months Ended September 30, 2024
(Dollars in Millions)	Specialty		Life		Total Segments		Non-Core Operations		Total Allowance for Expected Credit Losses
Balance, Beginning of Period	$	4.3	$	—	$	4.3	$	0.5	$	4.8
Provision for Expected Credit Losses	12.7		0.1		12.8		0.1		12.9
Write-offs of Uncollectible Receivables from Policyholders	(13.8)		(0.1)		(13.9)		(0.2)		(14.1)
Balance, End of Period	$	3.2	$	—	$	3.2	$	0.4	$	3.6

Receivable Balance, End of Period1	$	960.7	$	11.4	$	972.1	$	17.3	$	989.4
1Specialty, Total Segments, and Total Includes $6.6 million attributable to Kemper Reciprocal, which is reported as a consolidated variable interest entity.

KEMPER CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 11 - Receivables from Policyholders - Allowance for Expected Credit Losses (Continued)


	Nine Months Ended September 30, 2025
(Dollars in Millions)	Specialty		Life		Total Segments		Non-Core Operations		Total Allowance for Expected Credit Losses
Balance, Beginning of Year	$	2.6	$	—	$	2.6	$	0.3	$	2.9
Provision for Expected Credit Losses	41.1		0.2		41.3		0.2		41.5
Write-offs of Uncollectible Receivables from Policyholders	(41.4)		(0.2)		(41.6)		(0.4)		(42.0)
Balance, End of Period	$	2.3	$	—	$	2.3	$	0.1	$	2.4

Receivable Balance, End of Period1	$	1,014.9	$	11.3	$	1,026.2	$	7.4	$	1,033.6
1Specialty, Total Segments, and Total Includes $10.7 million attributable to Kemper Reciprocal, which is reported as a consolidated variable interest entity.


	Nine Months Ended September 30, 2024
(Dollars in Millions)	Specialty		Life		Total Segments		Non-Core Operations		Total Allowance for Expected Credit Losses
Balance, Beginning of Year	$	12.9	$	—	$	12.9	$	1.0	$	13.9
Provision for Expected Credit Losses	26.4		0.2		26.6		0.6		27.2
Write-offs of Uncollectible Receivables from Policyholders	(36.1)		(0.2)		(36.3)		(1.2)		(37.5)
Balance, End of Period	$	3.2	$	—	$	3.2	$	0.4	$	3.6

Receivable Balance, End of Period1	$	960.7	$	11.4	$	972.1	$	17.3	$	989.4
1Specialty, Total Segments, and Total Includes $6.6 million attributable to Kemper Reciprocal, which is reported as a consolidated variable interest entity.

KEMPER CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 12 - Other Comprehensive Income and Accumulated Other Comprehensive Loss

The tables below display the changes in Accumulated Other Comprehensive Loss by component for the three months ended September 30, 2025 and 2024.


(Dollars in Millions)	Net Unrealized Losses on Fixed Maturities		Net Unrealized Losses on Investments with an Allowance for Credit Losses		Net Unrecognized Postretirement Benefit Income		Net Loss on Cash Flow Hedges		Change in Discount Rate on Future Life Policyholder Benefits		Total
Balance as of June 30, 2025	$	(631.7)	$	(2.2)	$	7.6	$	(1.4)	$	370.0	$	(257.7)
Other Comprehensive Income (Loss) Before Reclassifications	84.7		(5.1)		—		0.6		(54.0)		26.2
Amounts Reclassified from Accumulated Other Comprehensive Loss Net of Tax Expense of $0.2, $1.2, $0.0, $0.0, $0.0 and $1.4	0.7		4.3		(0.5)		(0.1)		—		4.4
Other Comprehensive Income (Loss) Net of Tax Expense (Benefit) of $22.4, $(0.2), $0.0, $0.2, $(14.4), and $8.0	85.4		(0.8)		(0.5)		0.5		(54.0)		30.6
Balance as of September 30, 2025	$	(546.3)	$	(3.0)	$	7.1	$	(0.9)	$	316.0	$	(227.1)


(Dollars in Millions)	Net Unrealized Losses on Fixed Maturities		Net Unrealized Losses on Investments with an Allowance for Credit Losses		Net Unrecognized Postretirement Benefit Costs		Net (Loss) Gain on Cash Flow Hedges		Change in Discount Rate on Future Life Policyholder Benefits		Total
Balance as of June 30, 2024	$	(679.6)	$	(3.7)	$	8.3	$	(0.3)	$	358.0	$	(317.3)
Other Comprehensive Income (Loss) Before Reclassifications	226.4		0.2		—		3.5		(165.2)		64.9
Amounts Reclassified from Accumulated Other Comprehensive Loss Net of Tax (Benefit) Expense of $0.0, $0.0,$(0.1), $0.1, $0.0, and $0.0	0.1		—		(0.6)		0.4		—		(0.1)
Other Comprehensive Income (Loss) Net of Tax Expense (Benefit) of $60.1, $(0.2), $(0.1), $1.0 $(43.9) and $16.9	226.5		0.2		(0.6)		3.9		(165.2)		64.8
Balance as of September 30, 2024	$	(453.1)	$	(3.5)	$	7.7	$	3.6	$	192.8	$	(252.5)

KEMPER CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 12 - Other Comprehensive Income and Accumulated Other Comprehensive Loss (Continued)

The tables below display the changes in Accumulated Other Comprehensive Loss by component for the nine months ended September 30, 2025 and 2024.


(Dollars in Millions)	Net Unrealized Losses on Fixed Maturities		Net Unrealized Losses on Investments with an Allowance for Credit Losses		Net Unrecognized Postretirement Benefit Income		Net Loss on Cash Flow Hedges		Change in Discount Rate on Future Life Policyholder Benefits		Total
Balance as of January 1, 2025	$	(687.8)	$	(3.2)	$	8.4	$	(2.2)	$	380.3	(304.5)
Other Comprehensive Income (Loss) Before Reclassifications	140.7		(0.3)		—		1.4		(64.3)		77.5
Amounts Reclassified from Accumulated Other Comprehensive Loss Net of Tax Expense (Benefit) of $0.2, $0.2, $(0.3), $0.0, $0.0 and $0.1	0.8		0.5		(1.3)		(0.1)		—		(0.1)
Other Comprehensive Income (Loss) Net of Tax Expense (Benefit) of $37.3, $0.1, $(0.3), $(0.2), $(17.1), and $19.8	141.5		0.2		(1.3)		1.3		(64.3)		77.4
Balance as of September 30, 2025	$	(546.3)	$	(3.0)	$	7.1	$	(0.9)	$	316.0	$	(227.1)


(Dollars in Millions)	Net Unrealized Losses on Fixed Maturities		Net Unrealized Losses on Investments with an Allowance for Credit Losses		Net Unrecognized Postretirement Benefit Costs		Net Gain on Cash Flow Hedges		Change in Discount Rate on Future Life Policyholder Benefits		Total
Balance as of January 1, 2024	$	(530.9)	$	(2.5)	$	9.5	$	2.5	$	160.6	$	(360.8)
Other Comprehensive Income (Loss) Before Reclassifications	68.9		(0.5)		—		0.7		32.2		101.3
Amounts Reclassified from Accumulated Other Comprehensive Loss Net of Tax Expense (Benefit) of $2.3, $(0.2), $(0.6), $0.1, $0.0 and $1.6	8.9		(0.5)		(1.8)		0.4		—		7.0
Other Comprehensive Income (Loss) Net of Tax Expense (Benefit) of $20.6, $(0.7), $(0.6), $0.2, $8.6, and $28.1	77.8		(1.0)		(1.8)		1.1		32.2		108.3
Balance as of September 30, 2024	$	(453.1)	$	(3.5)	$	7.7	$	3.6	$	192.8	$	(252.5)

Amounts reclassified from Accumulated Other Comprehensive Loss shown above are reported in Net (Loss) Income as follows:


Components of AOCI			Condensed Consolidated Statements of (Loss) Income Line Item Affected by Reclassifications
Net Unrealized Losses on Fixed Maturities			Net Realized Investment Gains
Net Unrealized Losses on Investments with an Allowance for Credit Losses			Impairment Losses and Net Realized Investment Gains
Net Unrecognized Postretirement Benefit Costs			Policyholders’ Benefits and Incurred Losses and Loss Adjustment Expenses, Insurance and Other Expenses, and Interest Expense
Net (Loss) Gain on Cash Flow Hedges			Net Investment Income and Interest Expense

KEMPER CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 13 - Shareholders’ Equity

Common Stock Repurchases

On May 6, 2020, Kemper’s Board of Directors authorized the repurchase of up to an additional $200.0 million of Kemper’s common stock, in addition to $133.3 million remaining under a prior authorization in 2014, bringing the remaining share repurchase authorization to approximately $333.3 million (the “2014 Repurchase Program”). On August 5, 2025, Kemper’s Board of Directors approved a new share repurchase authorization, under which the Company can repurchase up to $500.0 million of its common stock (the “2025 Repurchase Program”).

As of September 30, 2025, the 2014 Repurchase Program has been completed, and the remaining share repurchase authorization under the 2025 Repurchase Program was $383.8 million.

On August 13, 2025, the Company entered into an accelerated share repurchase agreement (the “ASR Agreement”) with Goldman Sachs & Co. LLC (“Goldman Sachs”) to repurchase an aggregate of $150.0 million of shares of the Company’s common stock. Under the terms of the ASR Agreement, the Company made a payment of $150.0 million to Goldman Sachs, and on August 14, 2025, received initial deliveries of an aggregate of 2,279,000 shares of the Company’s common stock, or approximately 80% of the total shares that are expected to be repurchased under the ASR Agreement, based on the closing price on August 13, 2025 of $52.65 per share.

The initial delivery of shares resulted in an immediate reduction of the outstanding shares used to calculate the weighted-average common shares outstanding for basic and diluted earnings per share. The ASR Agreement was accounted for as a treasury stock transaction and forward stock purchase contract. The shares delivered were immediately retired, and the unsettled portion of the ASR Agreement was recorded in additional paid-in capital in the Company’s Condensed Consolidated Balance Sheet. The forward stock purchase contract is considered indexed to the Company’s own stock and is classified as an equity instrument.

On October 13, 2025, as final settlement of the share repurchase transaction under the ASR Agreement, the Company received from Goldman Sachs approximately 615,000 shares of the Company’s common stock. In total, the Company repurchased 2,894,000 shares of its Common Stock under the ASR Agreement at $51.84 per share, which represents the volume-weighted average market price of the Company’s common stock during the term of the ASR Agreement less a customary discount. The shares delivered were immediately retired.

In addition to the ASR Agreement repurchases, during the three months ended September 30, 2025, Kemper repurchased and retired approximately 1,126,000 shares of its common stock in open market transactions under its share repurchase authorizations for an aggregate cost of $66.5 million and an average cost per share of $59.00. In addition to the ASR Agreement repurchases, during the nine months ended September 30, 2025, Kemper repurchased and retired approximately 1,636,000 shares of its common stock in open market transactions under its share repurchase authorizations for an aggregate cost of $99.0 million and an average cost per share of $60.52.

During the three and nine months ended September 30, 2024, Kemper repurchased and retired approximately 400,000 shares of its common stock in open market transactions under its share repurchase authorizations for an aggregate cost of $25.0 million and an average cost per share of $61.21.

Employee Stock Purchase Plan

During the three months ended September 30, 2025 and 2024, the Company issued 17,000 and 14,000 shares under the Kemper Employee Stock Purchase Plan (“ESPP”) at a discounted price of $43.82 and $52.06 per share, respectively. Compensation costs charged against income were $0.1 million and $0.1 million during the three months ended September 30, 2025 and 2024, respectively.

During the nine months ended September 30, 2025 and 2024, the Company issued 45,000 and 47,000 shares under the Kemper ESPP, respectively, at an average discounted price of $51.17 and $51.61 per share. Compensation costs charged against income were $0.4 million and $0.4 million for the nine months ended September 30, 2025 and 2024.

KEMPER CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 14 - Amortization of Intangible Assets

The following table presents the amortization expense on definite life intangible assets incurred by the Company for the three and nine months ended September 30, 2025 and 2024:


	Three Months Ended				Nine Months Ended
(Dollars in Millions)	Sep 30, 2025		Sep 30, 2024		Sep 30, 2025		Sep 30, 2024
Specialty Property & Casualty Insurance	$	5.5	$	4.0	$	14.3	$	12.6
Life Insurance	1.8		1.6		5.1		4.2
Total Segment Amortization Expense	7.3		5.6		19.4		16.8
Corporate and Other	4.2		5.3		14.0		16.8
Non-Core Operations1	22.3		0.5		23.6		1.2
Total Amortization Expense	$	33.8	$	11.4	$	57.0	$	34.8
1 During the three and nine months ended September 30, 2025, the Company recognized a $21.7 million impairment of Internal-Use Software assets included in Non-Core Operations.

Note 15 - Policyholder Obligations

Policyholder Obligations at September 30, 2025 and December 31, 2024 were as follows:


(Dollars in Millions)	Sep 30, 2025		Dec 31, 2024
FHLB Funding Agreements	$	525.2	$	541.3
Universal Life-type Policyholder Account Balances	94.8		96.4
Total	$	620.0	$	637.7

FHLB Funding Agreements

Kemper’s subsidiary, United Insurance Company of America (“United Insurance”) has entered into funding agreements with the FHLB of Chicago in exchange for cash, which it uses for spread lending purposes. During the nine months ended September 30, 2025, United Insurance received advances of $30.0 million from the FHLB of Chicago and made repayments of $46.1 million under the spread lending program.

When a funding agreement is issued, United Insurance is required to post collateral in the form of eligible securities including mortgage-backed, government, and agency debt instruments for each of the advances that are entered. The fair value of the collateral pledged must be maintained at certain specified levels above the borrowed amount, which can vary depending on the assets pledged. If the fair value of the collateral declines below these specified levels of the amount borrowed, United Insurance would be required to pledge additional collateral or repay outstanding borrowings. Upon any event of default by United Insurance, the FHLB’s recovery on the collateral is limited to the amount of United Insurance’s liability under the funding agreements to the FHLB of Chicago.

United Insurance’s liability under the funding agreements with the FHLB of Chicago, the amount of collateral pledged under such agreements and FHLB of Chicago common stock owned by United Insurance at September 30, 2025 and December 31, 2024 is presented below.


(Dollars in Millions)	Sep 30, 2025		Dec 31, 2024
Liability under Funding Agreements	$	525.2	$	541.3
Fair Value of Collateral Pledged	658.6		619.3
FHLB of Chicago Common Stock Owned at Cost	17.7		16.9

Universal Life-type Policyholder Account Balances

The Company’s weighted-average crediting rate for Universal Life-type Policyholder Account Balances was 5.1% and 5.1% as of September 30, 2025 and 2024. Guaranteed minimum benefit amounts in excess of the current account balances for these contracts were $264.1 million and $276.6 million as of September 30, 2025 and December 31, 2024, respectively.

KEMPER CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 15 - Policyholder Obligations (Continued)

The cash surrender value of the Company’s policyholder obligations for these contracts was $94.8 million and $96.4 million as of September 30, 2025 and December 31, 2024, respectively.

Note 16 - Debt

Amended and Extended Credit Agreement

On March 15, 2022, the Company entered into an amended and extended credit agreement. The amended and extended credit agreement increased the borrowing capacity of the existing unsecured credit agreement to $600.0 million and extended the maturity date to March 15, 2027. Furthermore, the amended and extended credit agreement provides for an accordion feature whereby the Company can increase the revolving credit borrowing capacity by an additional $200.0 million for a total maximum capacity of $800.0 million. There were no outstanding borrowings under the credit agreement at either September 30, 2025 or December 31, 2024.

Long-term Debt

The Company designates debt obligations as either short-term or long-term based on maturity date at issuance. Total amortized cost of Long-term Debt, Current and Non-Current, outstanding at September 30, 2025 and December 31, 2024 was:


(Dollars in Millions)	Sep 30, 2025		Dec 31, 2024
Senior Notes:
Current:
4.350% Senior Notes due February 15, 2025	$	—	$	449.9
Non-Current:
2.400% Senior Notes due September 30, 2030	397.8		397.5
3.800% Senior Notes due February 23, 2032	396.8		396.5
5.875% Fixed-Rate Reset Junior Subordinated Debentures due 2062	148.5		147.7
Total Long-term Debt Outstanding	$	943.1	$	1,391.6

Redemption of 4.350% Senior Notes Due 2025

On January 15, 2025, Kemper issued a notice of redemption for the entire $450.0 million aggregate principal of 4.350% senior notes originally due February 15, 2025 (the “2025 Senior Notes”) at a redemption price equal to 100% of the principal amount of the Notes, plus accrued and unpaid interest on the redemption date. On February 11, 2025, Kemper completed the redemption and the 2025 Senior Notes were repaid in full.

2.400% Senior Notes Due 2030

Kemper has $400.0 million aggregate principal of 2.400% senior notes due September 30, 2030 (the “2030 Senior Notes”). The net proceeds of issuance were $395.8 million, net of discount and transaction costs for an effective yield of 2.52%. The 2030 Senior Notes are unsecured and may be redeemed in whole at any time or in part from time to time, at Kemper’s option, at specified redemption prices.

3.800% Senior Notes Due 2032

On February 15, 2022, Kemper offered and sold $400.0 million aggregate principal of 3.800% senior notes due February 23, 2032 (the “2032 Senior Notes”). The net proceeds of issuance were $395.1 million, net of discount and transaction costs, for an effective yield of 3.950%. The 2032 Senior Notes are unsecured and may be redeemed in whole at any time or in part from time to time, at Kemper’s option, at specified redemption prices.

5.875% Fixed-Rate Reset Junior Subordinated Debentures Due 2062

On March 10, 2022, Kemper issued $150.0 million aggregate principal amount of 5.875% Fixed-Rate Reset Junior Subordinated Debentures due March 15, 2062 (the “2062 Junior Debentures”). The net proceeds from issuance were $144.7 million, net of discount and transaction costs.

KEMPER CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 16 - Debt (Continued)

The 2062 Junior Debentures will bear interest from and including the date of original issue to, but excluding, March 15, 2027 (the “First Reset Date”) at the fixed rate of 5.875% per annum. The interest rate on the First Reset Date, and subsequent Reset Dates, will be equal to the Five-Year Treasury Rate as of the most recent Reset Date plus 4.140% to be reset on each Reset Date. Interest is due quarterly in arrears beginning on June 15, 2022. The Company has the option to defer interest payments for one or more optional deferral periods of up to five consecutive years, provided that no optional deferral period shall extend beyond March 15, 2062, or any earlier accelerated maturity date arising from an event of default or any earlier redemption of the 2062 Junior Debentures.

The 2062 Junior Debentures are unsecured and may be redeemed in whole or in part on the First Reset Date or any time thereafter, at a redemption price equal to the principal amount of the debentures being redeemed plus any accrued and unpaid interest.

Short-term Debt

Kemper’s subsidiaries, United Insurance, Trinity Universal Insurance Company (“Trinity”) and American Access Casualty Company (“AAC”), are members of the FHLBs of Chicago, Dallas and Chicago, respectively. The Company periodically uses short-term FHLB borrowings for cash management and risk management purposes, in addition to long-term FHLB borrowings for the spread lending program. The Company did not receive advances or make repayments of short-term debt during the three and nine months ended September 30, 2025 and 2024 for cash and risk management purposes. There were no short-term debt advances from the FHLBs of Chicago or Dallas outstanding at September 30, 2025 or December 31, 2024. For information on United Insurance’s funding agreement with the FHLB of Chicago in connection with the spread lending program, see Note 15, “Policyholder Obligations,” to the Condensed Consolidated Financial Statements.

Interest Expense and Interest Paid

Interest Expense, including facility fees, accretion of discount, amortization of premium and amortization of issuance costs, was $9.1 million and $29.5 million for the three and nine months ended September 30, 2025, respectively. Interest paid, including facility fees, was $14.8 million and $41.9 million for the three and nine months ended September 30, 2025, respectively. Interest Expense, including facility fees, accretion of discount, amortization of premium and amortization of issuance costs, was $14.4 million and $42.3 million for the three and nine months ended September 30, 2024, respectively. Interest paid, including facility fees, was $24.7 million and $52.0 million for the three and nine months ended September 30, 2024, respectively.

KEMPER CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 17 - Leases

The Company leases certain office space under non-cancelable operating leases, with initial terms typically ranging from one to fifteen years, along with options that permit renewals for additional periods. The Company also leases certain vehicles and equipment under non-cancelable operating leases, with initial terms typically ranging from one to five years. Minimum rent is expensed on a straight-line basis over the term of the lease.

The following table presents operating lease right-of-use assets and lease liabilities.


(Dollars in Millions)	Sep 30, 2025		Dec 31, 2024
Operating Lease Right-of-Use Assets	$	48.0	$	33.9
Operating Lease Liabilities	63.9		51.6

Lease expenses are included in Insurance and Other Expenses in the Condensed Consolidated Statements of (Loss) Income. Additional information regarding the Company’s operating leases is presented below.


	Three Months Ended				Nine Months Ended
(Dollars in Millions)	Sep 30, 2025		Sep 30, 2024		Sep 30, 2025		Sep 30, 2024
Lease Cost:
Operating Lease Cost	$	4.4	$	3.9	$	12.4	$	11.6
Variable Lease Cost	0.9		1.2		3.1		3.5
Short-Term Lease Cost1	0.2		0.1		0.4		0.3
Total Lease Cost	$	5.5	$	5.2	$	15.9	$	15.4
1 Leases with an initial term of twelve months or less are not recorded on the Condensed Consolidated Balance Sheets.

Other Information on Operating Leases

Significant judgments and assumptions for determining lease asset and liability at September 30, 2025 and 2024 are presented below.

Nine Months Ended

Sep 30,
2025

Sep 30,
2024

Weighted-average Remaining Lease Term - Operating Leases

5.2 years

5.4 years

Weighted-average Discount Rate - Operating Leases

4.8

4.5

Most of the Company’s leases do not provide an implicit rate. Accordingly, the Company uses its incremental borrowing rate based on the information available at the commencement date to determine its lease payments’ present value.

Future minimum lease payments under operating leases at September 30, 2025 are presented below.


(Dollars in Millions)	September 30, 2025
Remainder of 2025	$	4.8
2026	16.7
2027	13.5
2028	11.3
2029	9.1
2030 and Thereafter	16.9
Total Future Payments	$	72.3
Less: Discount	8.4
Present Value of Minimum Lease Payments	$	63.9

As of September 30, 2025 and December 31, 2024, the Company did not have any finance leases.

KEMPER CORPORATION AND SUBSIDIARIES

NOTES TO THE CONDENSED CONSOLIDATED FINANCIAL STATEMENTS (Continued)

(Unaudited)

Note 18 - Income Taxes

The statute of limitations related to Kemper and its eligible subsidiaries’ consolidated Federal income tax returns is closed for all tax years up to and including 2011 as well as 2018 and 2019. As a result of the Company filing amended federal income tax returns, tax years 2012 and 2013 are under limited examination with respect to carryback adjustments associated with the amended returns. Tax years 2020 and 2022 are currently under examination and will remain open until the examination is complete. The statute of limitations related to tax years 2014, 2015, 2016, and 2017 has been extended to December 31, 2026. Tax years 2021, 2022, and 2023 are subject to a statute of three years from the extended due dates of October 15, 2022, 2023, and 2024, respectively.

The expiration of the statute of limitations related to the various state income tax returns that Kemper and its subsidiaries file varies by state.

In July 2025, the One Big Beautiful Bill Act (“OBBBA”) was signed, enacting significant changes to federal tax law. The OBBBA includes, among other provisions, extension and modification of various provisions from the 2017 Tax Cuts and Jobs Act, immediate expensing of domestic research and experimental costs, accelerated depreciation, compensation-related items, and the repeal of certain clean energy tax credits. The Company has evaluated the impacts of the OBBBA, which were not material to the consolidated financial statements, and will continue to monitor developments as further information becomes available.

The interim period tax expense or benefit is the difference between the year-to-date income tax provision and the amounts reported for the previous interim periods of the fiscal year. For the three months ended September 30, 2025, the income tax benefit attributable to Kemper Corporation was $7.9 million, or 27.3% of income before income taxes, compared to an income tax expense of $18.9 million, or 20.4% of income before income taxes for the three months ended September 30, 2024. For the nine months ended September 30, 2025, the income tax expense attributable to Kemper Corporation was $34.0 million, or 18.3% of income before income taxes, compared to an income tax expense of $53.4 million, or 19.5% of income before income taxes for the nine months ended September 30, 2024.

There were no Unrecognized Tax Benefits at September 30, 2025, or December 31, 2024. The Company recognizes interest and penalties, if any, related to unrecognized tax benefits in Income Tax (Benefit) Expense. There were no liabilities for accrued interest and penalties for the nine months ended September 30, 2025 and 2024.

For the nine months ended September 30, 2025, federal income taxes paid, net of income tax refunds received, were $20.5 million. For the nine months ended September 30, 2024, federal income taxes paid, net of income tax refunds received, were $9.9 million.

For the nine months ended September 30, 2025 and 2024, state income taxes paid, net of refunds received, were $1.7 million and $0.6 million, respectively. No foreign income taxes were paid or refunded for the nine months ended September 30, 2025 and 2024.

Note 19 - Commitments and Contingencies

In the ordinary course of its businesses, the Company is involved in legal proceedings including lawsuits, arbitration, regulatory examinations, audits and inquiries. Based on currently available information, the Company does not believe that it is reasonably possible that any of its pending legal proceedings will have a material effect on the Company’s Condensed Consolidated Financial Statements and Notes to the Condensed Consolidated Financial Statements.

Item 2. Management’s Discussion and Analysis of Financial Condition and Results of Operations

Non-GAAP Financial Measures

In this report, the Company presents certain measures of its performance on a consolidated and segment basis that are not calculated in accordance with GAAP. We believe that these non-GAAP financial measures enhance the understanding for the Company and our investors of our performance by highlighting the results of operations and the underlying profitability drivers of our business. Segment-specific financial measures are calculated using only the portion of consolidated results attributable to that specific segment.

Adjusted Consolidated Net Operating Income

The Company believes that the non-GAAP financial measure of Adjusted Consolidated Net Operating Income provides investors with a valuable measure of its ongoing performance because it reveals underlying operational performance trends that otherwise might be less apparent if the items were not excluded. The most directly comparable GAAP financial measure is Net (Loss) Income attributable to Kemper Corporation.

Adjusted Consolidated Net Operating Income is an after-tax, non-GAAP financial measure and is computed by excluding from Net (Loss) Income attributable to Kemper Corporation the after-tax impact of:

(i) Change in Fair Value of Equity and Convertible Securities;

(ii) Net Realized Investment Gains;

(iii) Impairment Losses;

(iv) Acquisition and Disposition Related Transaction, Integration, Restructuring and Other Costs;

(v) Debt Extinguishment, Pension Settlement and Other Charges;

(vi) Goodwill Impairment Charges;

(vii) Non-Core Operations; and

(viii) Significant non-recurring or infrequent items that may not be indicative of ongoing operations

Significant non-recurring items are excluded when (a) the nature of the charge or gain is such that it is reasonably unlikely to recur within two years, and (b) there has been no similar charge or gain within the prior two years. There were no applicable significant non-recurring items that the Company excluded from the calculation of Adjusted Consolidated Net Operating Income for the three and nine months ended September 30, 2025 or 2024.

Change in Fair Value of Equity and Convertible Securities, Net Realized Investment Gains and Impairment Losses related to investments included in the Company’s results may vary significantly between periods and are generally driven by business decisions and external economic developments such as capital market conditions that impact the values of the Company’s investments, the timing of which is unrelated to the insurance underwriting process. Acquisition and Disposition Related Transaction Costs, Integration Costs, and Restructuring and Other Costs may vary significantly between periods and are generally driven by the timing of acquisitions and business decisions which are unrelated to the insurance underwriting process. In the third quarter of 2025, a restructuring program was launched to achieve operational and organizational efficiencies. The Company will continue to evaluate additional efficiency opportunities through 2027. Debt Extinguishment, Pension Settlement and Other Charges relate to (i) loss from early extinguishment of debt, which is driven by the Company’s financing and refinancing decisions and capital needs, as well as external economic developments such as debt market conditions, the timing of which is unrelated to the insurance underwriting process; (ii) settlement of pension plan obligations which are business decisions made by the Company, the timing of which is unrelated to the underwriting process; and (iii) other charges that are non-standard, not part of the ordinary course of business, and unrelated to the insurance underwriting process. Goodwill Impairment Charges are excluded because they are infrequent and non-recurring charges. Non-Core Operations includes the results of our Preferred Insurance business which we expect to fully exit. These results are excluded because they are irrelevant to our ongoing operations and do not qualify for Discontinued Operations under GAAP. Significant non-recurring items are excluded because, by their nature, they are not indicative of the Company’s business or economic trends.

Non-GAAP Financial Measures (Continued)

Underlying Losses and Loss Adjustment Expenses (“LAE”) and Underlying Combined Ratio

The following discussion uses the non-GAAP financial measures of (i) Underlying Losses and LAE and (ii) Underlying Combined Ratio. Underlying Losses and LAE (also referred to in the discussion as “Current Year Non-catastrophe Losses and LAE”) exclude the impact of catastrophe losses and loss and LAE reserve development from prior years from the Company’s Incurred Losses and LAE, which is the most directly comparable GAAP financial measure.

The Underlying Combined Ratio is computed by adding the Current Year Non-catastrophe Losses and LAE Ratio with the Insurance Expense Ratio. The most directly comparable GAAP financial measure is the Combined Ratio, which is computed by adding Total Incurred Losses and LAE Ratio, including the impact of catastrophe losses and loss and LAE reserve development from prior years, with the Insurance Expense Ratio.

The Company believes Underlying Losses and LAE and the Underlying Combined Ratio are useful to investors and uses these financial measures to reveal the trends in the Company’s Property & Casualty Insurance segment that may be obscured by catastrophe losses and prior-year reserve development. These catastrophe losses may cause the Company’s loss trends to vary significantly between periods as a result of their incidence of occurrence and magnitude and can have a significant impact on incurred losses and LAE and the Combined Ratio. Prior-year reserve developments are caused by unexpected loss development on historical reserves. Because reserve development relates to the re-estimation of losses from earlier periods, it has no bearing on the performance of the Company’s insurance products in the current period. The Company believes it is useful for investors to evaluate these components separately and in the aggregate when reviewing the Company’s underwriting performance.

The preceding non-GAAP financial measures should not be considered a substitute for the comparable GAAP financial measures, as they do not fully recognize the overall profitability of the Company’s businesses.

Summary of Results

Net Loss Attributable to Kemper Corporation was $21.0 million ($(0.34) per unrestricted common share) for the three months ended September 30, 2025, compared to Net Income Attributable to Kemper Corporation of $73.7 million ($1.15 per unrestricted common share) for the same period in 2024.

Net Income attributable to Kemper Corporation was $151.3 million ($2.40 per unrestricted common share) for the nine months ended September 30, 2025, compared to Net Income attributable to Kemper Corporation of $220.4 million ($3.43 per unrestricted common share) for the same period in 2024.

Summary of Results (Continued)

A reconciliation of Net (Loss) Income attributable to Kemper Corporation to Adjusted Consolidated Net Operating Income (a non-GAAP financial measure) for the three and nine months ended September 30, 2025 and 2024 is presented below.


	Three Months Ended						Nine Months Ended
(Dollars in Millions)	Sep 30, 2025		Sep 30, 2024		Change		Sep 30, 2025		Sep 30, 2024		Change
Net (Loss) Income attributable to Kemper Corporation	$	(21.0)	$	73.7	$	(94.7)	$	151.3	$	220.4	$	(69.1)
Less:
Change in Fair Value of Equity and Convertible Securities	(1.7)		(1.8)		0.1		(2.0)		(0.1)		(1.9)
Net Realized Investment Gains	3.1		0.9		2.2		3.7		7.3		(3.6)
Impairment Losses	(2.5)		(1.7)		(0.8)		(5.1)		(3.0)		(2.1)
Acquisition and Disposition Related Transaction, Integration, Restructuring and Other Costs	(19.6)		(9.1)		(10.5)		(27.6)		(24.3)		(3.3)
Debt Extinguishment, Pension Settlement, and Other Charges	—		(2.2)		2.2		0.4		(0.1)		0.5
Non-Core Operations	(20.7)		(17.4)		(3.3)		(29.0)		(25.8)		(3.2)
Adjusted Consolidated Net Operating Income	$	20.4	$	105.0	$	(84.6)	$	210.9	$	266.4	$	(55.5)

Components of Adjusted Consolidated Net Operating Income:
Segment Adjusted Net Operating Income:
Specialty Property & Casualty Insurance	$	7.6	$	103.6	$	(96.0)	$	184.5	$	275.1	$	(90.6)
Life Insurance	18.6		15.0		3.6		48.4		26.7		21.7
Total Segment Adjusted Net Operating Income	26.2		118.6		(92.4)		232.9		301.8		(68.9)
Corporate and Other Adjusted Net Operating Loss	(9.0)		(15.1)		6.1		(30.7)		(39.0)		8.3
Less: Net Loss attributable to Noncontrolling Interest	(3.2)		(1.5)		(1.7)		(8.7)		(3.6)		(5.1)
Adjusted Consolidated Net Operating Income	$	20.4	$	105.0	$	(84.6)	$	210.9	$	266.4	$	(55.5)

Net (Loss) Income attributable to Kemper Corporation

Net Income (Loss) attributable to Kemper Corporation decreased by $94.7 million for the three months ended September 30, 2025, compared to the same period in 2024, due primarily to lower Adjusted Consolidated Net Operating Income.

Adjusted Consolidated Net Operating Income decreased by $84.6 million for the three months ended September 30, 2025, compared to the same period in 2024, mostly driven by our Specialty Property & Casualty Insurance segment due primarily to a higher Underlying Combined Ratio and higher adverse prior year development on bodily injury coverages within commercial automobile insurance, partially offset by higher average earned premiums per exposure resulting from rate increases.

The loss from Non-Core Operations increased by $3.3 million for the three months ended September 30, 2025 compared to the same period in 2024 primarily due to $21.7 million of impairment losses recognized on Internal-Use Software assets reported as Other Assets on the Condensed Consolidated Balance Sheets as the business continues run-off, partially offset by lower catastrophe losses and lower adverse prior year development. Additionally, on August 1, 2025, certain Company subsidiaries entered into a renewal rights agreement with a third party and certain of its affiliates (collectively, the “Third Party”) whereby the Third Party will offer replacement policies for certain policies written by the Company’s subsidiaries in New York after the expiration of their current term. Execution of the terms of the agreement is contingent upon the granting of regulatory approvals by the New York Department of Financial Services.

Corporate and Other Adjusted Net Operating Loss decreased by $6.1 million for the three months ended September 30, 2025 compared to the same period in 2024, primarily driven by lower interest expense due to the redemption of $450 million of 4.350% senior notes.

Net Income (Loss) attributable to Kemper Corporation decreased by $69.1 million for the nine months ended September 30, 2025, compared to the same period in 2024, due primarily to lower Adjusted Consolidated Net Operating Income.

Adjusted Consolidated Net Operating Income decreased by $55.5 million for the nine months ended September 30, 2025, compared to the same period in 2024, due primarily to a deterioration in the Specialty Property & Casualty Insurance segment’s Underlying Combined Ratio and higher adverse prior year development on bodily injury coverages within commercial automobile insurance, partially offset by higher average earned premiums per exposure resulting from rate increases.

Summary of Results (Continued)

This was partially offset by increased Life Insurance segment earnings driven by higher net investment income and a reduction in policyholders’ benefits and insurance expenses. Life Insurance segment results for the nine months ended September 30, 2024 included an $11.9 million after-tax loss from an investment valuation adjustment on one real estate investment from our alternative investment portfolio.

The loss from Non-Core Operations increased by $3.2 million for the nine months ended September 30, 2025 compared to the same period in 2024 primarily due to $21.7 million of impairment losses on Internal-Use Software assets reported as Other Assets on the Condensed Consolidated Balance Sheets, partially offset by lower adverse prior year development as the business continues to run-off.

Corporate and Other Adjusted Net Operating Loss decreased by $8.3 million for the nine months ended September 30, 2025 compared to the same period in 2024, primarily driven by lower interest expense due to the redemption of $450 million of 4.350% senior notes.

Revenues

Total Revenues increased by $60.8 million to $1,239.7 million for the three months ended September 30, 2025, compared to $1,178.9 million for the same period in 2024. The increase was primarily driven by higher earned premiums.

Earned Premiums increased by $64.8 million to $1,133.3 million for the three months ended September 30, 2025 compared to $1,068.5 for the same period in 2024, primarily driven by a $98.3 million increase from the Specialty Property & Casualty Insurance segment due to higher average earned premiums per exposure resulting from rate increases. This was partially offset by a $32.7 million reduction in premiums from our Preferred Insurance business, reported as Non-Core Operations, due primarily to lower volumes resulting from the exit and run-off of the business.

Net Investment Income decreased by $6.3 million for the three months ended September 30, 2025, compared to the same period in 2024, mostly driven by decreased earnings on alternative investments and lower levels and yields from Short-term investments, partially offset by higher earnings on Company Owned Life Insurance.

Net Realized Investment Gains increased by $2.8 million for the three months ended September 30, 2025, compared to the same period in 2024, primarily due to increased gains on sales of fixed maturity investments.

Impairment losses increased by $0.9 million for the three months ended September 30, 2025, compared to the same period in 2024.

Total Revenues increased by $206.5 million to $3,658.3 million for the nine months ended September 30, 2025, compared to $3,451.8 million for the same period in 2024. The increase was primarily driven by higher earned premiums.

Earned Premiums increased by $217.9 million to $3,352.0 million for the nine months ended September 30, 2025 compared to $3,134.1 for the same period in 2024, primarily driven by a $368.7 million increase from the Specialty Property & Casualty Insurance segment due to higher average earned premiums per exposure resulting from rate increases, partially offset by a $152.1 million reduction in premiums from our Preferred Insurance business, reported as Non-Core Operations, due primarily to lower volumes resulting from the exit and run-off of the business.

Net Investment Income decreased by $2.6 million for the nine months ended September 30, 2025, compared to the same period in 2024, mostly driven by lower levels and yields from fixed maturity securities and lower yields from Short-term investments, partially offset by higher earnings on Company-Owned Life Insurance and increased earnings on alternative investments.

Net Realized Investment Gains decreased by $4.5 million for the nine months ended September 30, 2025, compared to the same period in 2024, due primarily to decreased gains on sales of fixed maturity and equity securities, partially offset by the absence of net realized losses on ultra-long treasury future derivatives transactions that did not qualify for hedge accounting.

Impairment losses increased by $2.6 million for the nine months ended September 30, 2025, compared to the same period in 2024, primarily driven by an increase in the allowance for credit losses on fixed maturity securities.

Specialty Property & Casualty Insurance

Selected financial information for the Specialty Property & Casualty Insurance segment is presented below.


	Three Months Ended						Nine Months Ended
(Dollars in Millions)	Sep 30, 2025			Sep 30, 2024			Sep 30, 2025			Sep 30, 2024
Net Premiums Written	$	982.2		$	938.0		$	3,052.5		$	2,736.5




Earned Premiums	$	1,017.3		$	919.0		$	2,990.3		$	2,621.6
Net Investment Income	53.8			52.0			153.9			139.7
Other Income	2.5			1.6			6.5			4.6
Total Revenues	1,073.6			972.6			3,150.7			2,765.9
Incurred Losses and LAE related to:
Current Year:
Non-catastrophe Losses and LAE	798.7			644.2			2,211.1			1,846.0
Catastrophe Losses and LAE	1.0			3.6			10.1			18.0
Prior Years:
Non-catastrophe Losses and LAE	51.4			(0.1)			65.5			4.4
Catastrophe Losses and LAE	—			0.2			0.6			0.8
Total Incurred Losses and LAE	851.1			647.9			2,287.3			1,869.2
Insurance Expenses	214.6			194.9			634.5			552.5


Segment Adjusted Operating Income	7.9			129.8			228.9			344.2
Income Tax Expense	0.3			26.2			44.4			69.1
Total Segment Adjusted Net Operating Income	$	7.6		$	103.6		$	184.5		$	275.1

Ratios Based On Earned Premiums
Current Year Non-catastrophe Losses and LAE Ratio	78.5		%	70.1		%	74.0		%	70.4		%
Current Year Catastrophe Losses and LAE Ratio	0.1			0.4			0.3			0.7
Prior Years Non-catastrophe Losses and LAE Ratio	5.1			—			2.2			0.2
Prior Years Catastrophe Losses and LAE Ratio	—			—			—			—
Total Incurred Loss and LAE Ratio	83.7			70.5			76.5			71.3
Insurance Expense Ratio	21.1			21.2			21.2			21.1

Combined Ratio	104.8		%	91.7		%	97.7		%	92.4		%
Underlying Combined Ratio
Current Year Non-catastrophe Losses and LAE Ratio	78.5		%	70.1		%	74.0		%	70.4		%
Insurance Expense Ratio	21.1			21.2			21.2			21.1

Underlying Combined Ratio	99.6		%	91.3		%	95.2		%	91.5		%
Non-GAAP Measure Reconciliation
Combined Ratio	104.8		%	91.7		%	97.7		%	92.4		%
Less:
Current Year Catastrophe Losses and LAE Ratio	0.1			0.4			0.3			0.7
Prior Years Non-catastrophe Losses and LAE Ratio	5.1			—			2.2			0.2
Prior Years Catastrophe Losses and LAE Ratio	—			—			—			—
Underlying Combined Ratio	99.6		%	91.3		%	95.2		%	91.5		%

Specialty Property & Casualty Insurance (Continued)

Insurance Reserves


(Dollars in Millions)	Sep 30, 2025		Dec 31, 2024
Insurance Reserves:
Personal Automobile	$	1,752.1	$	1,626.0
Commercial Automobile	894.2		721.9
Total Insurance Reserves	$	2,646.3	$	2,347.9

Insurance Reserves:
Loss and Allocated LAE Reserves:
Case and Allocated LAE	$	932.7	$	921.8
Incurred But Not Reported	1,518.7		1,250.6
Total Loss and LAE Reserves	2,451.4		2,172.4
Unallocated LAE Reserves	194.9		175.5
Total Insurance Reserves	$	2,646.3	$	2,347.9

See MD&A, “Critical Accounting Estimates,” of the 2024 Annual Report for additional information pertaining to the Company’s process of estimating property and casualty insurance reserves for losses and LAE, development of property and casualty insurance losses and LAE from prior accident years, also referred to as “reserve development” in the discussion of segment results, estimated variability of property and casualty insurance reserves for losses and LAE, and a discussion of some of the variables that may impact development of property and casualty insurance losses and LAE and the estimated variability of property and casualty insurance reserves for losses and LAE.

Overall

Three Months Ended September 30, 2025 Compared to the Same Period in 2024

The Specialty Property & Casualty Insurance segment reported Total Segment Adjusted Net Operating Income of $7.6 million for the three months ended September 30, 2025, compared to Total Segment Adjusted Net Operating Income of $103.6 million for the same period in 2024. Segment adjusted net operating results decreased by $96.0 million that included a $69.9 million and $26.1 million decrease from personal automobile and commercial automobile insurance, respectively, due primarily to an increase in the Underlying Combined Ratio for personal automobile insurance and higher adverse prior year development in commercial automobile insurance, partially offset by growth from rate increases.

Earned Premiums in the Specialty Property & Casualty Insurance segment increased by $98.3 million for the three months ended September 30, 2025, compared to the same period in 2024, due to higher average earned premiums per exposure resulting from rate increases and higher commercial automobile volumes.

Net Investment Income in the Specialty Property & Casualty Insurance segment increased by $1.8 million for the three months ended September 30, 2025, compared to the same period in 2024, due primarily to higher levels of invested assets resulting from growth.

Incurred Loss and LAE were $851.1 million or 83.7% of earned premiums for the three months ended September 30, 2025 compared to $647.9 million or 70.5% of earned premiums, for the same period in 2024. Incurred losses and LAE as a percentage of earned premiums increased primarily due to deterioration in the underlying loss and LAE ratio and increased adverse prior year development. Underlying losses and LAE as a percentage of earned premiums were 78.5% for the three months ended September 30, 2025, a deterioration of 8.4 percentage points, compared to the same period in 2024 driven by higher loss costs primarily resulting from higher claim severity and frequency in bodily injury and property damage coverages within personal automobile insurance, that were partially offset by higher average earned premiums per exposure (10.3% increase year over year). Underlying losses and LAE exclude the impact of catastrophes and prior year loss and LAE reserve development. Adverse prior year loss and LAE reserve development (including catastrophe reserve development) was $51.4 million for the three months ended September 30, 2025, compared to adverse development of $0.1 million for the same period in 2024, a deterioration of $51.3 million due primarily to evolving loss patterns within bodily injury coverages within our Commercial Automobile product line. Catastrophe losses and LAE (excluding reserve development) were $1.0 million for the three months ended September 30, 2025 compared to $3.6 million for the same period in 2024, an improvement of $2.6 million due to fewer catastrophe events and lower severity per event in the current period.

Specialty Property & Casualty Insurance (Continued)

Insurance Expenses were $214.6 million, or 21.1% of earned premiums, for the three months ended September 30, 2025, compared to $194.9 million, or 21.2% of earned premiums for the same period in 2024. Insurance Expenses increased $19.7 million primarily due to higher expenses associated with increased business volumes.

The Specialty Property & Casualty Insurance segment’s three months ended September 30, 2025 effective tax rate was 3.1% compared to 20.3% for the same period in 2024. The effective income tax rate for the third quarters of 2025 and 2024 differs from the federal statutory income tax rate due to investments in Company-Owned Life Insurance, tax-exempt investment income and nondeductible expenses. The change in the effective tax rate from the third quarter of 2024 is due to a decrease in pre-tax income while the net favorable tax adjustments have remained consistent.

Nine Months Ended September 30, 2025 Compared to the Same Period in 2024

The Specialty Property & Casualty Insurance segment reported Total Segment Adjusted Net Operating Income of $184.5 million for the nine months ended September 30, 2025, compared to Total Segment Adjusted Net Operating Income of $275.1 million for the same period in 2024. Segment adjusted net operating results decreased by $90.6 million which included a $58.3 million decrease from personal automobile insurance and a $32.3 million decrease from commercial automobile insurance. The decrease in personal automobile Adjusted Net Operating Income was primarily driven by higher underlying losses. The decrease in commercial automobile insurance Adjusted Net Operating Income was primarily driven by higher adverse prior year development.

Earned Premiums in the Specialty Property & Casualty Insurance segment increased by $368.7 million for the nine months ended September 30, 2025, compared to the same period in 2024, due to higher average earned premiums per exposure resulting from rate increases and higher commercial automobile volumes.

Net Investment Income in the Specialty Property & Casualty Insurance segment increased by $14.2 million for the nine months ended September 30, 2025, compared to the same period in 2024, due primarily to higher levels of invested assets resulting from growth.

Incurred Loss and LAE were $2,287.3 million or 76.5% of earned premiums for the nine months ended September 30, 2025 compared to $1,869.2 million or 71.3% of earned premiums, for the same period in 2024. Incurred losses and LAE as a percentage of earned premiums increased primarily due to a deterioration in the underlying loss and LAE ratio and adverse prior year development. Underlying losses and LAE as a percentage of earned premiums were 74.0% for the nine months ended September 30, 2025, a deterioration of 3.6 percentage point, compared to the same period in 2024 due to increased claim severity and frequency in personal automobile primarily related to bodily injury and property damage coverages, partially offset by higher average earned premiums per exposure (11.8% increase year over year). Underlying losses and LAE exclude the impact of catastrophes and loss and LAE reserve development. Adverse loss and LAE reserve development (including catastrophe reserve development) was $66.1 million for the nine months ended September 30, 2025, compared to adverse development of $5.2 million for the same period in 2024, an increase of $60.9 million due primarily to evolving loss patterns on bodily injury coverages in commercial automobile and higher than expected development on litigated matters. Catastrophe losses and LAE (excluding reserve development) were $10.1 million for the nine months ended September 30, 2025 compared to $18.0 million for the same period in 2024, a decrease of $7.9 million due to fewer catastrophe events and lower severity per event in the current period.

Insurance Expenses were $634.5 million, or 21.2% of earned premiums, for the nine months ended September 30, 2025, compared to $552.5 million, or 21.1% of earned premiums for the same period in 2024. Insurance Expenses increased $82.0 million due to higher expenses associated with increased business volumes.

The Specialty Property & Casualty Insurance segment’s nine months ended September 30, 2025 effective tax rate was 19.5% compared to 20.1% for the same period in 2024. The effective income tax rate for the nine months ended September 30, 2025 and 2024 differs from the federal statutory income tax rate due to investments in Company-Owned Life Insurance, tax-exempt investment income and nondeductible expenses.

Specialty Property & Casualty Insurance (Continued)

Specialty Personal Automobile Insurance

Selected financial information for the specialty personal automobile insurance product line is presented below.


	Three Months Ended						Nine Months Ended
(Dollars in Millions)	Sep 30, 2025			Sep 30, 2024			Sep 30, 2025			Sep 30, 2024
Net Premiums Written	$	727.6		$	735.1		$	2,318.5		$	2,147.1
Earned Premiums	$	785.1		$	731.3		$	2,328.1		$	2,098.1
Incurred Losses and LAE related to:
Current Year:
Non-catastrophe Losses and LAE	$	629.2		$	507.8		$	1,729.3		$	1,465.1
Catastrophe Losses and LAE	0.6			2.1			7.6			13.5
Prior Years:
Non-catastrophe Losses and LAE	8.0			(2.7)			(1.7)			4.4
Catastrophe Losses and LAE	(0.1)			0.1			0.3			0.7
Total Incurred Losses and LAE	$	637.7		$	507.3		$	1,735.5		$	1,483.7

Ratios Based On Earned Premiums
Current Year Non-catastrophe Losses and LAE Ratio	80.1		%	69.5		%	74.3		%	69.9		%
Current Year Catastrophe Losses and LAE Ratio	0.1			0.3			0.3			0.6
Prior Years Non-catastrophe Losses and LAE Ratio	1.0			(0.4)			(0.1)			0.2
Prior Years Catastrophe Losses and LAE Ratio	—			—			—			—
Total Incurred Loss and LAE Ratio	81.2			69.4			74.5			70.7
Insurance Expense Ratio	22.0			21.7			22.0			21.6
Combined Ratio	103.2		%	91.1		%	96.5		%	92.3		%
Underlying Combined Ratio
Current Year Non-catastrophe Losses and LAE Ratio	80.1		%	69.5		%	74.3		%	69.9		%
Insurance Expense Ratio	22.0			21.7			22.0			21.6
Underlying Combined Ratio	102.1		%	91.2		%	96.3		%	91.5		%
Non-GAAP Measure Reconciliation
Combined Ratio	103.2		%	91.1		%	96.5		%	92.3		%
Less:
Current Year Catastrophe Losses and LAE Ratio	0.1			0.3			0.3			0.6
Prior Years Non-catastrophe Losses and LAE Ratio	1.0			(0.4)			(0.1)			0.2
Prior Years Catastrophe Losses and LAE Ratio	—			—			—			—
Underlying Combined Ratio	102.1		%	91.2		%	96.3		%	91.5		%

Three Months Ended September 30, 2025 Compared to the Same Period in 2024

Earned Premiums in personal automobile insurance increased by $53.8 million for the three months ended September 30, 2025, compared to the same period in 2024, due to higher average earned premiums per exposure resulting from rate increases. Incurred losses and LAE were $637.7 million, or 81.2% of earned premiums for the three months ended September 30, 2025, compared to $507.3 million, or 69.4% of earned premiums, for the same period in 2024. Incurred losses and LAE as a percentage of earned premiums increased primarily due to a deterioration in the underlying loss and LAE ratio. Underlying losses and LAE as a percentage of related earned premiums were 80.1% for the three months ended September 30, 2025, compared to 69.5% for the same period in 2024, a deterioration of 10.6 percentage points driven by higher claim severity and frequency primarily related to bodily injury and property damage coverages that were partially offset by higher average earned premiums per exposure (9.9% increase year over year). Prior year adverse loss and LAE reserve development was $7.9 million for the three months ended September 30, 2025, compared to favorable development of $2.6 million for the same period in 2024, a deterioration of $10.5 million due primarily to less favorable development on property damage and personal injury protection coverages, partially offset by favorable development on bodily injury coverages.

Specialty Property & Casualty Insurance (Continued)

Catastrophe losses and LAE (excluding reserve development) were $0.6 million for the three months ended September 30, 2025, compared to $2.1 million for the same period in 2024, an improvement of $1.5 million due to fewer catastrophe events and lower severity per event in the current period.

Nine Months Ended September 30, 2025 Compared to the Same Period in 2024

Earned Premiums on personal automobile insurance increased by $230.0 million for the nine months ended September 30, 2025, compared to the same period in 2024, due to higher average earned premiums per exposure resulting from rate increases. Incurred losses and LAE were $1,735.5 million, or 74.5% of earned premiums for the nine months ended September 30, 2025, compared to $1,483.7 million, or 70.7% of earned premiums, for the same period in 2024. Incurred losses and LAE as a percentage of earned premiums increased primarily due to deterioration in the underlying loss and LAE ratio. Underlying losses and LAE as a percentage of related earned premiums were 74.3% for the nine months ended September 30, 2025, compared to 69.9% for the same period in 2024, a deterioration of 4.4 percentage points driven by higher claim severity and frequency primarily related to bodily injury and property damage coverages that were offset by higher average earned premiums per exposure (11.2% increase year over year). Favorable loss and LAE reserve development was $1.4 million for the nine months ended September 30, 2025, compared to adverse development of $5.1 million for the same period in 2024, an improvement of $6.5 million due primarily to the stabilization of loss patterns in bodily injury coverages and improving settlement patterns on policies with personal injury protection coverage, partially offset by higher losses associated with litigated matters. Catastrophe losses and LAE (excluding reserve development) were $7.6 million for the nine months ended September 30, 2025, compared to $13.5 million for the same period in 2024, an improvement of $5.9 million due to fewer catastrophe events and lower severity per event in the current period.

Specialty Property & Casualty Insurance (Continued)

Commercial Automobile Insurance

Selected financial information for the commercial automobile insurance product line is presented below.


	Three Months Ended						Nine Months Ended
(Dollars in Millions)	Sep 30, 2025			Sep 30, 2024			Sep 30, 2025			Sep 30, 2024
Net Premiums Written	$	254.6		$	202.9		$	734.0		$	589.4
Earned Premiums	$	232.2		$	187.7		$	662.2		$	523.5
Incurred Losses and LAE related to:
Current Year:
Non-catastrophe Losses and LAE	$	169.5		$	136.4		$	481.8		$	380.9
Catastrophe Losses and LAE	0.4			1.5			2.5			4.5
Prior Years:
Non-catastrophe Losses and LAE	43.4			2.6			67.2			—
Catastrophe Losses and LAE	0.1			0.1			0.3			0.1
Total Incurred Losses and LAE	$	213.4		$	140.6		$	551.8		$	385.5

Ratios Based On Earned Premiums
Current Year Non-catastrophe Losses and LAE Ratio	73.0		%	72.6		%	72.8		%	72.7		%
Current Year Catastrophe Losses and LAE Ratio	0.2			0.8			0.4			0.9
Prior Years Non-catastrophe Losses and LAE Ratio	18.7			1.4			10.1			—
Prior Years Catastrophe Losses and LAE Ratio	—			0.1			—			—
Total Incurred Loss and LAE Ratio	91.9			74.9			83.3			73.6
Insurance Expense Ratio	18.1			19.2			18.3			19.1
Combined Ratio	110.0		%	94.1		%	101.6		%	92.7		%
Underlying Combined Ratio
Current Year Non-catastrophe Losses and LAE Ratio	73.0		%	72.6		%	72.8		%	72.7		%
Insurance Expense Ratio	18.1			19.2			18.3			19.1
Underlying Combined Ratio	91.1		%	91.8		%	91.1		%	91.8		%
Non-GAAP Measure Reconciliation
Combined Ratio	110.0		%	94.1		%	101.6		%	92.7		%
Less:
Current Year Catastrophe Losses and LAE Ratio	0.2			0.8			0.4			0.9
Prior Years Non-catastrophe Losses and LAE Ratio	18.7			1.4			10.1			—
Prior Years Catastrophe Losses and LAE Ratio	—			0.1			—			—
Underlying Combined Ratio	91.1		%	91.8		%	91.1		%	91.8		%

Three Months Ended September 30, 2025 Compared to the Same Period in 2024

Earned Premiums in commercial automobile insurance increased by $44.5 million for the three months ended September 30, 2025, compared to the same period in 2024, due primarily to higher average earned premiums per exposure resulting from rate increases, targeted mix shifts, and higher business volumes. Incurred losses and LAE were $213.4 million, or 91.9% of earned premiums in 2025, compared to $140.6 million, or 74.9% of earned premiums in 2024. Incurred losses and LAE as a percentage of earned premiums increased primarily due to adverse prior year development. Underlying losses and LAE as a percentage of earned premiums were 73.0% in the three months ended September 30, 2025, compared to 72.6% during the same period in 2024, a deterioration of 0.4 percentage points driven by increased claim severity that was partially offset by higher average earned premiums per exposure (7.0% increase year over year). Adverse loss and LAE reserve development was $43.5 million for the three months ended September 30, 2025, compared to adverse development of $2.7 million for the same period in 2024, an increase of $40.8 million due to evolving loss patterns and higher defense costs associated with attorney-represented bodily injury coverages. Catastrophe losses and LAE (excluding reserve development) were $0.4 million for the three months ended September 30, 2025, compared to $1.5 million for the same period in 2024, an improvement of $1.1 million due to fewer catastrophe events and lower severity per event in the current period.

Specialty Property & Casualty Insurance (Continued)

Nine Months Ended September 30, 2025 Compared to the Same Period in 2024

Earned Premiums in commercial automobile insurance increased by $138.7 million for the nine months ended September 30, 2025, compared to the same period in 2024, due primarily to higher average earned premiums per exposure resulting from rate increases, targeted mix shifts, and higher business volumes. Incurred losses and LAE were $551.8 million, or 83.3% of earned premiums in 2025, compared to $385.5 million, or 73.6% of earned premiums in 2024. Incurred losses and LAE as a percentage of earned premiums increased primarily due to adverse prior year development. Underlying losses and LAE as a percentage of earned premiums were 72.8% for the nine months ended September 30, 2025, compared to 72.7% during the same period in 2024, a deterioration of 0.1 percentage points driven by increased claim severity that was partially offset by higher average earned premiums per exposure (9.7% increase year over year). Adverse loss and LAE reserve development was $67.5 million for the nine months ended September 30, 2025, compared to adverse development of $0.1 million for the same period in 2024, an increase of $67.4 million due primarily to evolving loss patterns and higher defense costs associated with attorney-represented bodily injury coverages. Catastrophe losses and LAE (excluding reserve development) were $2.5 million for the nine months ended September 30, 2025, compared to $4.5 million for the same period in 2024, an improvement of $2.0 million due to fewer catastrophe events and lower severity per event in the current period.

Life Insurance

Selected financial information for the Life Insurance segment is presented below.


	Three Months Ended				Nine Months Ended
(Dollars in Millions)	Sep 30, 2025		Sep 30, 2024		Sep 30, 2025		Sep 30, 2024
Earned Premiums	$	99.8	$	100.6	$	300.0	$	298.7
Net Investment Income	48.0		50.3		141.1		125.1
Other Income	0.4		0.2		1.4		0.7
Total Revenues	148.2		151.1		442.5		424.5
Policyholders’ Benefits and Incurred Losses and LAE	60.5		64.1		186.2		191.0
Insurance Expenses	65.6		69.0		199.7		202.9
Segment Adjusted Operating Income	22.1		18.0		56.6		30.6
Income Tax Expense	3.5		3.0		8.2		3.9
Total Segment Adjusted Net Operating Income	$	18.6	$	15.0	$	48.4	$	26.7

INSURANCE RESERVES


(Dollars in Millions)	Sep 30, 2025		Dec 31, 2024
Insurance Reserves:
Future Policyholder Benefits	$	3,282.2	$	3,154.3
Incurred Losses and LAE Reserves:
Life	31.1		40.8
Accident and Health	4.3		4.6
Property	2.0		2.7
Total Incurred Losses and LAE Reserves	37.4		48.1
Total Insurance Reserves	$	3,319.6	$	3,202.4

Overall

Three Months Ended September 30, 2025 Compared to the Same Period in 2024

The Life Insurance segment reported Total Segment Adjusted Net Operating Income of $18.6 million for the three months ended September 30, 2025, compared to Net Operating Income of $15.0 million for the same period in 2024. The increase in segment net operating results was primarily due to favorable changes in mortality experience from life insurance products, lower incurred losses and LAE on property insurance products, and lower insurance expenses, partially offset by a decrease in net investment income.

Earned Premiums decreased by $0.8 million for the three months ended September 30, 2025, compared to the same period in 2024.

Net investment income decreased by $2.3 million for the three months ended September 30, 2025, compared to the same period in 2024, due primarily to decreased earnings on alternative investments, partially offset by higher earnings on Company Owned Life Insurance.

The Life Insurance segment’s three months ended September 30, 2025 effective income tax rate was 15.3% compared to 16.5% for the same period in 2024. The effective income tax rate for the third quarter of 2025 and 2024 differs from the federal statutory income tax rate due to investments in Company-Owned Life Insurance and Tax-Exempt Investment Income. The change in the effective tax rate from the three months ended September 30, 2024 is due to increased investments in Company-Owned Life Insurance and Tax-Exempt Investment Income.

Life Insurance (Continued)

Nine Months Ended September 30, 2025 Compared to the Same Period in 2024

The Life Insurance segment reported Total Segment Adjusted Net Operating Income of $48.4 million for the nine months ended September 30, 2025, compared to $26.7 million for the same period in 2024. The increase in segment net operating results was primarily due to an increase in net investment income, favorable changes in mortality experience from life insurance products, and lower incurred losses and LAE on property insurance products.

Earned Premiums increased by $1.3 million for the nine months ended September 30, 2025, compared to the same period in 2024, due primarily to higher average premiums per policy on life insurance products.

Net investment income increased by $16.0 million for the nine months ended September 30, 2025, compared to the same period in 2024, due primarily to lower losses on alternative investments and higher earnings on Company-Owned Life Insurance. The nine months ended September 30, 2024 included a $15.1 million pre-tax loss from an investment valuation adjustment of a real estate investment in our alternative investment portfolio.

The Life Insurance segment’s nine months ended September 30, 2025 effective income tax rate was 14.5% compared to 12.8% for the same period in 2024. The effective income tax rate for the nine months ended September 30, 2025 and 2024 differs from the federal statutory income tax rate due to investments in Company-Owned Life Insurance and Tax-Exempt Investment Income. The increase in the effective tax rate from the nine months ended September 30, 2024 is driven by an increase in pre-tax income, partially offset by an increase in investments in Company-Owned Life Insurance and Tax-Exempt Investment Income.

Investment Results

Net Investment Income

Net Investment Income for the three and nine months ended September 30, 2025 and 2024 is presented below:


	Three Months Ended				Nine Months Ended
(Dollars in Millions)	Sep 30, 2025		Sep 30, 2024		Sep 30, 2025		Sep 30, 2024
Investment Income:
Interest on Fixed Maturities1	$	79.1	$	79.0	$	232.4	$	239.0
Dividends on Equity Securities Excluding Alternative Investments	2.1		0.9		3.6		4.6
Alternative Investments:
Equity Method Limited Liability Investments	—		0.9		(6.0)		(15.9)
Limited Liability Investments Included in Equity Securities	4.0		9.1		10.8		18.7
Total Alternative Investments	4.0		10.0		4.8		2.8
Short-term Investments	4.2		8.4		18.8		23.0
Loans to Policyholders	5.2		5.5		15.6		15.8
Real Estate	2.5		2.2		7.0		6.7
Company-Owned Life Insurance	10.8		9.7		31.5		25.7
Other	3.1		2.2		8.4		7.3
Total Investment Income	111.0		117.9		322.1		324.9
Investment Expenses:
Real Estate	2.0		1.8		6.3		6.1
Other Investment Expenses	4.2		5.0		13.9		14.3
Total Investment Expenses	6.2		6.8		20.2		20.4
Net Investment Income	$	104.8	$	111.1	$	301.9	$	304.5

1Reduced by interest expense incurred on FHLB borrowings used for spread lending purposes of $4.7 million and $4.8 million for the three months ended September 30, 2025 and 2024, respectively, and $14.3 million and $15.4 million for the nine months ended September 30, 2025 and 2024, respectively.

Investment Results (Continued)

Net Investment Income was $104.8 million and $111.1 million for the three months ended September 30, 2025 and 2024, respectively. Net Investment Income decreased by $6.3 million in 2025, mostly driven by decreased earnings on alternative investments and lower levels and yields from Short-term investments, partially offset by higher earnings on Company Owned Life Insurance.

Net Investment Income was $301.9 million and $304.5 million for the nine months ended September 30, 2025 and 2024, respectively. Net Investment Income decreased by $2.6 million in 2025, mostly driven by lower levels and yields from fixed maturity securities and lower yields from Short-term investments, partially offset by higher earnings on Company-Owned Life Insurance and increased earnings on alternative investments.

Change in Unrealized Gains and Losses on Investments

Unrealized losses on investments decreased $106.9 million and $179.5 million for the three and nine months ended September 30, 2025, respectively, primarily attributable to decreases in interest rates.

Change in Fair Value of Equity and Convertible Securities

The components of Change in Fair Value of Equity and Convertible Securities for the three and nine months ended September 30, 2025 and 2024 are presented below:


	Three Months Ended				Nine Months Ended
(Dollars in Millions)	Sep 30, 2025		Sep 30, 2024		Sep 30, 2025		Sep 30, 2024
Preferred Stocks	$	(0.5)	$	0.7	$	—	$	1.1
Common Stocks	(0.1)		(0.4)		0.6		1.2
Other Equity Interests:

Limited Liability Companies and Limited Partnerships	(1.5)		(2.6)		(3.1)		(2.4)
Total Other Equity Interests	(1.5)		(2.6)		(3.1)		(2.4)
Change in Fair Value of Equity Securities	(2.1)		(2.3)		(2.5)		(0.1)
Change in Fair Value of Convertible Securities	—		—		—		—
Change in Fair Value of Equity and Convertible Securities	$	(2.1)	$	(2.3)	$	(2.5)	$	(0.1)

Investment Results (Continued)

Net Realized Gains on Sales of Investments

The components of Net Realized Investment Gains for the three and nine months ended September 30, 2025 and 2024 are presented below:


	Three Months Ended				Nine Months Ended
(Dollars in Millions)	Sep 30, 2025		Sep 30, 2024		Sep 30, 2025		Sep 30, 2024
Fixed Maturities:
Gains on Sales	$	3.7	$	0.9	$	5.4	$	15.9
Losses on Sales	(0.5)		—		(1.5)		(2.6)
Losses on Hedging Activity1	—		—		—		(7.9)
Equity Securities:
Gains on Sales	0.5		—		0.5		4.1
Losses on Sales	—		—		—		(0.1)
Other Investments:
Gains on Sales	0.2		1.8		0.3		3.3
Losses on Sales	—		(1.6)		—		(3.5)
Net Realized Investment Gains	$	3.9	$	1.1	$	4.7	$	9.2

Gross Gains on Sales	$	4.4	$	2.7	$	6.2	$	23.3
Gross Losses on Sales	(0.5)		(1.6)		(1.5)		(6.2)
Gains (Losses) on Hedging Activity	—		—		—		(7.9)
Net Realized Investment Gains	$	3.9	$	1.1	$	4.7	$	9.2
1 Includes Ultra-Long Treasury Future derivative securities which do not qualify for hedge accounting treatment.

Impairment Losses

The Company regularly reviews its investment portfolio to determine whether a decline in the fair value of an investment has occurred from credit or other, non-credit related factors. If the decline in fair value is due to credit factors and the Company does not expect to receive cash flows sufficient to support the entire amortized cost basis, the credit loss is reported in the Condensed Consolidated Statements of (Loss) Income in the period that the declines are evaluated. Conversely, an increase in the fair value or disposal of an investment with a previously established credit allowance will result in the reversal of impairment losses reported in the Condensed Consolidated Statements of (Loss) Income in the period.

The components of Impairment Losses in the Condensed Consolidated Statements of (Loss) Income for the three and nine months ended September 30, 2025 and 2024 were:


	Three Months Ended						Nine Months Ended
	Sep 30, 2025			Sep 30, 2024			Sep 30, 2025			Sep 30, 2024
(Dollars in Millions)	Amount		Number of Issuers	Amount		Number of Issuers	Amount		Number of Issuers	Amount		Number of Issuers
Fixed Maturities	$	(2.9)	22	$	(2.0)	16	$	(6.2)	23	$	(2.8)	19
Equity Securities at Modified Cost	—		—	—		—	—		—	(0.4)		3
Real Estate	(0.1)		4	(0.2)		4	(0.1)		4	(0.3)		5
Other	(0.1)		5	—		—	(0.1)		5	(0.3)		1
Impairment Losses1	$	(3.1)		$	(2.2)		$	(6.4)		$	(3.8)

1 Includes losses from intent-to-sell securities and direct write-down securities of $0.1 million and $1.4 million for the three and nine months ended September 30, 2025, respectively, and $0.3 million and $2.0 million for the three and nine months ended September 30, 2024, respectively.

Investment Quality and Concentrations

The Company’s fixed maturity investment portfolio is comprised primarily of high-grade corporate, municipal and agency bonds. At September 30, 2025, approximately 94.1% of the Company’s fixed maturity investment portfolio was rated investment-grade, which the Company defines as a security issued by a high quality obligor with at least a relatively stable credit profile and where it is highly likely that all contractual payments of principal and interest will timely occur and carry a rating from the National Association of Insurance Commissioners (“NAIC”) of 1 or 2. Securities with a rating of 1 or 2 from the NAIC typically are rated by one or more Nationally Recognized Statistical Rating Organizations and either have a rating of AAA, AA, A or BBB from Standard & Poor’s (“S&P”); a rating of Aaa, Aa, A or Baa from Moody’s Investors Service (“Moody’s”); or a rating of AAA, AA, A or BBB from Fitch Ratings.

The following table summarizes the credit quality of the Company’s fixed maturity investment portfolio at September 30, 2025 and December 31, 2024:


(Dollars in Millions)		Sep 30, 2025						Dec 31, 2024
NAIC Rating	Rating	Amortized Cost		Fair Value		Percentage of Total		Amortized Cost		Fair Value		Percentage of Total
1	AAA, AA, A	$	5,244.5	$	4,685.2	70.8	%	$	5,253.1	$	4,576.4	71.4	%
2	BBB	1,674.4		1,542.6		23.3		1,749.3		1,557.6		24.3
3-4	BB, B	361.4		349.7		5.3		233.0		221.7		3.5
5-6	CCC or Lower	51.4		42.8		0.6		59.6		53.9		0.8
Total Investments in Fixed Maturities		$	7,331.7	$	6,620.3	100.0	%	$	7,295.0	$	6,409.6	100.0	%

Gross unrealized losses on the Company’s investments in below-investment-grade fixed maturities were $20.0 million and $14.2 million at September 30, 2025 and December 31, 2024, respectively.

The following table summarizes the fair value of the Company’s investments in governmental fixed maturities at September 30, 2025 and December 31, 2024:


	Sep 30, 2025				Dec 31, 2024
(Dollars in Millions)	Fair Value		Percentage of Total Investments		Fair Value		Percentage of Total Investments
U.S. Government and Government Agencies and Authorities	$	592.1	6.9	%	$	486.8	5.5	%
States and Political Subdivisions:
Revenue Bonds	1,092.6		12.7		1,105.7		12.4
States	94.9		1.1		72.4		0.8
Political Subdivisions	55.7		0.6		55.1		0.6
Foreign Governments	12.0		0.1		6.6		0.1
Total Investments in Governmental Fixed Maturities	$	1,847.3	21.4	%	$	1,726.6	19.4	%

Investment Quality and Concentrations (Continued)

The following table summarizes the fair value of the Company’s investments in non-governmental fixed maturities by industry at September 30, 2025 and December 31, 2024.


	Sep 30, 2025				Dec 31, 2024
(Dollars in Millions)	Fair Value		Percentage of Total Investments		Fair Value		Percentage of Total Investments
Finance, Insurance and Real Estate	$	2,040.4	23.7	%	$	1,969.1	22.2	%
Manufacturing	974.7		11.3		1,014.3		11.4
Transportation, Communication and Utilities	838.2		9.7		793.0		8.9
Services	610.5		7.1		582.9		6.6
Mining	164.7		1.9		153.3		1.7
Retail Trade	115.8		1.3		125.7		1.4

Construction	9.8		0.1		11.7		0.1
Other	36.9		0.4		33.0		0.4
Total Investments in Non-governmental Fixed Maturities	$	4,791.0	55.5	%	$	4,683.0	52.7	%

The following table summarizes the fair value of the Company’s investments in non-governmental fixed maturities by range of amounts invested at September 30, 2025.


(Dollars in Millions)	Number of Issuers	Aggregate Fair Value
Below $5	664	$	1,364.0
$5 -$10	196	1,414.6
$10 - $20	106	1,405.1
$20 - $30	17	394.1
Greater Than $30	6	213.2
Total	989	$	4,791.0

The Company’s short-term investments primarily consist of U.S. Treasury bills, short-term bonds and money market funds . At September 30, 2025, the Company had $98.8 million invested in U.S. Treasury bills and short-term bonds and $272.5 million invested in money market funds, which primarily invest in U.S. Treasury securities.

Investment Quality and Concentrations (Continued)

The following table summarizes the fair value of the Company’s ten largest investment exposures in a single issuer, excluding investments in U.S. Government and Government Agencies and Authorities and Short-term Investment, at September 30, 2025:


(Dollars in Millions)	Fair Value		Percentage of Total Investments
Fixed Maturities:
States including their Political Subdivisions:
California	$	134.8	1.6	%
Texas	103.9		1.2
Michigan	87.6		1.0
Georgia	68.5		0.8
New York	61.0		0.7
Florida	54.4		0.6
Pennsylvania	47.5		0.6
Virginia	36.2		0.4
Louisiana	35.6		0.4
Colorado	35.2		0.4
Total	$	664.7	7.7	%

Investments in Limited Liability Companies and Limited Partnerships

The Company owns investments in various limited liability investment companies and limited partnerships that primarily invest in mezzanine debt, senior debt, and leveraged buyouts. Investments in limited liability investment companies and limited partnerships are reported either as Equity Method Limited Liability Investments, Other Equity Interests included in Equity Securities at Fair Value, or Other Investments, depending on the accounting method used to report the investment. Additional information pertaining to these investments at September 30, 2025 and December 31, 2024 is presented below.


(Dollars in Millions)	Unfunded Commitment		Reported Value
Asset Class	Sep 30, 2025		Sep 30, 2025		Dec 31, 2024
Reported as Equity Method Limited Liability Investments:
Senior Debt	$	64.1	$	19.5	$	19.1
Mezzanine Debt	36.2		115.2		116.7
Secondary Transactions	1.6		2.7		5.5
Leveraged Buyout	0.6		6.5		7.5
Real Estate	0.1		24.3		27.3
Distressed Debt	—		1.4		4.4


Other	—		5.3		5.8
Total Equity Method Limited Liability Investments	102.6		174.9		186.3

Reported as Other Equity Interests at Fair Value:
Mezzanine Debt	69.8		115.9		116.9
Leveraged Buyout	42.7		34.5		19.2
Distressed Debt	15.7		11.1		11.7
Senior Debt	6.7		26.5		26.3
Growth Equity	5.8		10.4		7.0
Secondary Transactions	1.6		1.6		2.4
Real Estate	0.2		0.1		—

Other	0.2		3.9		0.1
Total Reported as Other Equity Interests at Fair Value	142.7		204.0		183.6

Reported as Other Investments:
Alternative Energy Partnership Investments	—		17.4		17.6
Equity Securities at Modified Cost	0.1		1.8		1.8
Total Reported as Other Investments	0.1		19.2		19.4

Total Investments in Limited Liability Companies and Limited Partnerships	$	245.4	$	398.1	$	389.3

The Company expects that it will be required to fund its commitments over the next several years. The Company expects that the proceeds from distributions from these investments will be the primary source of funding of such commitments.

Insurance, Interest, and Other Expenses

Expenses for the three and nine months ended September 30, 2025 and 2024 were:


	Three Months Ended				Nine Months Ended
(Dollars in Millions)	Sep 30, 2025		Sep 30, 2024		Sep 30, 2025		Sep 30, 2024
Insurance and Other Expenses:
Insurance Expenses:
Policy Acquisition Costs	$	173.8	$	161.4	$	515.2	$	475.4
Business Unit Operating Costs	94.2		72.8		240.7		201.1
Corporate Overhead Costs	43.7		49.2		135.0		147.4
Insurance Expenses	311.7		283.4		890.9		823.9
Other Expenses:
Acquisition and Disposition Related Transaction, Integration, Restructuring and Other Costs	22.9		11.5		33.0		30.8
Pension Settlement	—		0.1		—		(2.6)
Other Corporate Costs	4.5		9.4		9.7		18.4
Other Expenses	27.4		21.0		42.7		46.6
Insurance and Other Expenses	339.1		304.4		933.6		870.5
Interest Expense	9.1		14.4		29.5		42.3
Total Insurance, Interest, and Other Expenses	$	348.2	$	318.8	$	963.1	$	912.8

Insurance and Other Expenses

Insurance Expenses were $311.7 million and $890.9 million for the three and nine months ended September 30, 2025, compared to $283.4 million and $823.9 million for the same periods in 2024. Policy acquisition costs increased $12.4 million and $39.8 million compared to the same periods in 2024, primarily due to growth in the Specialty Property & Casualty Insurance segment from higher business volumes, partially offset by reductions due to lower volumes resulting from the exit and run-off of the Preferred Insurance business. Business unit operating costs increased $21.4 million and $39.6 million compared to the same periods in 2024, primarily due to impairment losses recognized on Internal-Use Software assets related to the run-off of Preferred Insurance business.

Other Expenses increased by $6.4 million for the three months ended September 30, 2025 compared to the same period in 2024, due primarily to higher Acquisition and Disposition Related Transaction, Integration, Restructuring and Other Costs, partially offset by lower Other Corporate Costs from a reduction in legal expenses. Acquisition and Disposition Related Transaction, Integration, Restructuring and Other Costs for the three months ended September 30, 2025 included $18.5 million of restructuring charges to achieve operational and organizational efficiencies. The Company will continue to evaluate additional efficiency opportunities through 2027. These expenses for three months ended September 30, 2024 included $7.8 million of integration expenses due to continued investments in information technology and $3.8 million of accrued severance.

Other Expenses decreased by $3.9 million for the nine months ended September 30, 2025 compared to the same period in 2024, due to lower Other Corporate Costs from a reduction in legal expenses partially offset by higher Acquisition and Disposition Related Transaction, Integration, Restructuring and Other Costs. These expenses for the nine months ended September 30, 2025 included $18.5 million of restructuring charges to achieve operational and organizational efficiencies and $14.5 million of integration expenses due to continued investments in information technology. These expenses for the nine months ended September 30, 2024 included $29.1 million of integration expenses due to continued investments in information technology.

Interest Expense

Interest expense decreased by $5.3 million and $12.8 million for the three and nine months ended September 30, 2025, respectively, compared to the same periods in 2024 primarily due to redemption of $450 million of 4.350% senior notes.

Income Taxes

The federal corporate statutory income tax rate was 21% for the nine months ended September 30, 2025 and September 30, 2024. The Company’s effective income tax rate, which was 27.3% and 20.4% for the three months ended September 30, 2025 and 2024, respectively, and 18.3% and 19.5% for the nine months ended September 30, 2025 and 2024, respectively, differs from the federal corporate income tax rate due primarily to (1) the effects of tax-exempt investment income, (2) nontaxable income associated with the change in cash surrender value on Company-Owned Life Insurance, (3) general business tax credits, (4) a permanent difference between the amount of long-term equity-based compensation expense recognized under GAAP and the amount deductible for Federal tax purposes, (5) a permanent difference associated with nondeductible executive compensation, (6) impact of deferred taxes in foreign jurisdictions, and (7) a change in valuation allowance related to foreign deferred tax assets.

Tax-exempt investment income and dividends received deductions were $3.6 million for the three months ended September 30, 2025, compared to $3.9 million for the same period in 2024. Tax-exempt investment income and dividends received deductions were $11.3 million for the nine months ended September 30, 2025, compared to $12.1 million for the same period in 2024.

The nontaxable increase in cash surrender value on Company-Owned Life Insurance was $10.8 million for the three months ended September 30, 2025, compared to $9.5 million for the same period in 2024. The nontaxable increase in cash surrender value on Company-Owned Life Insurance was $31.5 million for the nine months ended September 30, 2025, compared to $25.6 million for the same period in 2024.

The Company realized investment tax credits and other federal income tax credits of $0.3 million for the three months ended September 30, 2025, compared to realized investment tax credits and other federal income tax credits of $0.3 million for the same period in 2024. The Company realized investment tax credits and other federal income tax credits of $0.9 million for the nine months ended September 30, 2025, compared to realized investment tax credits and other federal income tax credits of $0.9 million for the same period in 2024.

The amount of expense recognized for long-term equity-based compensation expense was $0.1 million lower than the amount that would be deductible under the IRC for the three months ended September 30, 2025, compared to $0.9 million higher for the same period in 2024. The amount of expense recognized for long-term equity-based compensation expense was $2.3 million lower than the amount that would be deductible under the IRC for the nine months ended September 30, 2025, compared to $0.6 million lower for the same period in 2024.

The amount of nondeductible executive compensation was $12.7 million for the three months ended September 30, 2025, compared to $4.2 million for the same period in 2024. The amount of nondeductible executive compensation was $23.2 million for the nine months ended September 30, 2025, compared to $12.6 million for the same period in 2024.

Tax benefits of $9.9 million were recorded for the three months ended September 30, 2025, compared to a tax benefit of $6.6 million for the same period in 2024 related to income taxes imposed in the foreign jurisdiction in which the Company operates. Tax benefits of $5.5 million were recorded for the nine months ended September 30, 2025, compared to a tax benefit of $17.1 million for the same period in 2024 related to income taxes imposed in the foreign jurisdiction in which the Company operates..

The Company recorded a decrease in valuation allowance of $10.0 million for the three months ended September 30, 2025, compared to $6.6 million for the same period in 2024 for those foreign deferred tax assets it determined were not more-likely-than-not to be realized. The Company recorded a decrease in valuation allowance of $5.6 million for the nine months ended September 30, 2025, compared to $17.1 million for the same period in 2024 for those foreign deferred tax assets it determined were not more-likely-than-not to be realized.

Recently Issued Accounting Pronouncements

The Company has adopted all recently issued accounting pronouncements with effective dates prior to October 1, 2025.

There were no adoptions of such accounting pronouncements during the nine months ended September 30, 2025 that had a material impact on the Company’s Condensed Consolidated Financial Statements.

Liquidity and Capital Resources

Amended and Extended Credit Agreement

On March 15, 2022, the Company entered into an amended and extended credit agreement. The amended and extended credit agreement increased the borrowing capacity of the existing unsecured credit agreement to $600.0 million and extended the maturity date to March 15, 2027. Furthermore, the amended and extended credit agreement provides for an accordion feature whereby the Company can increase the revolving credit borrowing capacity by an additional $200.0 million for a total of maximum capacity of $800.0 million. There were no outstanding borrowings under the credit agreement on either September 30, 2025 or December 31, 2024.

Long-term Debt


(Dollars in Millions)	Sep 30, 2025		Dec 31, 2024
Senior Notes:
Current:
4.350% Senior Notes due February 15, 2025	$	—	$	449.9
Non-Current:
2.400% Senior Notes due September 30, 2030	397.8		397.5
3.800% Senior Notes due February 23, 2032	396.8		396.5
5.875% Fixed-Rate Reset Junior Subordinated Debentures due 2062	148.5		147.7
Total Long-term Debt Outstanding	$	943.1	$	1,391.6

See Note 16, “Debt,” to the Condensed Consolidated Financial Statements for more information regarding the Company’s long-term debt.

Federal Home Loan Bank Agreements

Kemper’s subsidiaries, United Insurance, Trinity, and AAC are members of the Federal Home Loan Banks (“FHLBs”) of Chicago, Dallas and Chicago, respectively. AAC became a member of the FHLB of Chicago in May 2022. United Insurance and Trinity became members of the FHLBs of Chicago and Dallas, respectively, in 2013. Under their memberships, United Insurance, Trinity and AAC may borrow through the advance program of their respective FHLB. The Company’s investments in FHLB common stock are reported at cost and included in Other Investments. The carrying value of FHLB of Chicago common stock was $17.7 million and $16.9 million at September 30, 2025 and December 31, 2024, respectively. The carrying value of FHLB of Dallas common stock was $2.6 million and $8.8 million at September 30, 2025 and December 31, 2024, respectively. The Company periodically uses short-term FHLB borrowings for a combination of cash management and risk management purposes, in addition to long-term FHLB borrowings for spread lending purposes.

During the first nine months of 2025, United Insurance received advances of $30.0 million from the FHLB of Chicago and made repayments of $46.1 million. United Insurance had outstanding advances from the FHLB of Chicago totaling $525.2 million at September 30, 2025. These advances were made in connection with the Company’s spread lending program. The proceeds related to these advances were used to purchase fixed maturity securities to earn incremental net investment income.

For these advances, United Insurance held pledged securities in a custodial account with the FHLB of Chicago with a fair value of $658.6 million at September 30, 2025. The fair value of the collateral pledged must be maintained at certain specified levels above the borrowed amount, which can vary depending on the assets pledged. If the fair value of the collateral declines below these specified levels of the amount borrowed, United Insurance would be required to pledge additional collateral or repay outstanding borrowings. See Note 15, “Policyholder Obligations,” to the Condensed Consolidated Financial Statements for additional information about the United Insurance advances and related funding agreements.

Common Stock Repurchases

On May 6, 2020, Kemper’s Board of Directors authorized the repurchase of up to an additional $200.0 million of Kemper common stock, in addition to the $133.3 million remaining under a previous authorization in 2014 (the “2014 Repurchase Program”). Additionally, on August 5, 2025, Kemper’s Board of Directors approved a new share repurchase authorization, under which the Company can repurchase up to $500.0 million of its common stock (the “2025 Repurchase Program”).

Liquidity and Capital Resources (Continued)

In the nine months ended September 30, 2025, the Company repurchased approximately $219.0 million of shares of its common stock. As of September 30, 2025, the 2014 Repurchase Program has been completed and the remaining share repurchase authorization under the 2025 Repurchase Program was $383.8 million. The amount and timing of any future share repurchases under the 2025 Repurchase Program will depend on various factors, including market conditions, the Company’s financial condition, results of operations, available liquidity, particular circumstances and other considerations.

On August 13, 2025, the Company entered into an accelerated share repurchase agreement (the “ASR Agreement”) with Goldman Sachs & Co. LLC (“Goldman Sachs”) to repurchase an aggregate of $150.0 million of shares of the Company’s common stock. Under the terms of the ASR Agreement, the Company made a payment of $150.0 million to Goldman Sachs, and on August 14, 2025, received and retired initial deliveries of 2,279,000 shares of the Company’s common stock, or approximately 80% of the total shares that are expected to be repurchased under the ASR Agreement, based on the closing price on August 13, 2025 of $52.65 per share.

During the three and nine months ended September 30, 2024, Kemper repurchased and retired approximately 400,000 shares of its common stock under its share repurchase authorization for an aggregate cost of $25.0 million and an average cost per share of $61.21.

Dividends to Shareholders

Kemper paid a quarterly dividend of $0.32 and $0.31 per common share in the third quarter of 2025 and 2024, respectively. Dividends and dividend equivalents paid were $60.7 million and $60.1 million for the nine months ended September 30, 2025 and 2024, respectively.

Subsidiary Dividends

Various insurance laws restrict the ability of Kemper’s insurance subsidiaries to pay dividends without regulatory approval. Such insurance laws applicable to the Company’s US based insurance subsidiaries generally restrict the amount of dividends paid in an annual period to the greater of statutory net income from the previous year or 10% of statutory capital and surplus. Kemper’s insurance subsidiaries paid $433.9 million of dividends to Kemper during the first nine months of 2025. As of the filing date, Kemper’s US based insurance subsidiaries do not have remaining capacity to pay dividends without prior regulatory approval.

Sources and Uses of Funds

The Company directly held cash and investments totaling $156.8 million at September 30, 2025, compared to $547.6 million at December 31, 2024.

The primary sources of funds available for repayment of Kemper’s indebtedness, repurchases of common stock, future shareholder dividend payments, and the payment of interest on Kemper’s senior notes, include cash and investments directly held by Kemper, receipt of dividends from Kemper’s insurance subsidiaries and borrowings under the credit agreement and from subsidiaries.

The primary sources of funds for Kemper’s insurance subsidiaries are premiums, investment income, proceeds from the sales and maturity of investments, advances from the FHLBs of Chicago and Dallas, and capital contributions from Kemper. The primary uses of funds are the payment of policyholder benefits under life insurance contracts, claims under property and casualty insurance contracts and accident and health insurance contracts, the payment of commissions and general expenses, the purchase of investments and repayments of advances from the FHLBs of Chicago and Dallas.

Liquidity and Capital Resources (Continued)

Generally, there is a time lag between when premiums are collected and when policyholder benefits and insurance claims are paid. During periods of growth, property and casualty insurance companies typically experience positive operating cash flows and can invest a portion of their operating cash flows to fund future policyholder benefits and claims. During periods in which premium revenues decline, insurance companies may experience negative cash flows from operations and may need to sell investments to fund payments to policyholders and claimants. In addition, if the Company’s property and casualty insurance subsidiaries experience several significant catastrophic events over a relatively short period of time, investments may be sold to fund payments, which could result in investment gains or losses. Management believes that its property and casualty insurance subsidiaries maintain adequate levels of liquidity in the event that they were to experience several future catastrophic events over a relatively short period of time.

Information about the Company’s cash flows for nine months ended September 30, 2025 and 2024 is presented below.


(Dollars in Millions)	Sep 30, 2025		Sep 30, 2024
Net Cash Provided by Operating Activities	$	409.5	$	207.8
Net Cash Provided by (Used in) Investing Activities	413.4		(89.6)
Net Cash Used in Financing Activities	(780.9)		(125.4)

Cash available for investment activities is dependent on cash flow from Operating Activities and Financing Activities and the level of cash the Company elects to maintain.

Net Cash Provided by Operating Activities

Net cash provided by Operating Activities was $409.5 million for the nine months ended September 30, 2025, compared to net cash provided of $207.8 million for the same period in 2024. The increase in cash provided by Operating Activities was primarily driven by growth from our Specialty Property & Casualty business due to higher average earned premiums per exposure resulting from rate increases and timing of claim payments. This was partially offset by lower business volumes and timing of claim payments within Non-Core Operations resulting from the exit and run-off of the Preferred Insurance business.

Net Cash Provided by (Used in) Investing Activities

Net cash provided by Investing Activities for the nine months ended September 30, 2025 was $413.4 million, compared to net cash used of $89.6 million for the same period in 2024. The increase in cash provided by Investing Activities was primarily due to proceeds from sales of short term investments that were primarily used to fund the redemption of the $450.0 million 4.350% Senior Notes due February 15, 2025 (the “2025 Senior Notes”). This was partially offset by an increase in net purchases of Fixed Maturity investments as a result of normal portfolio management.

Net Cash Used in Financing Activities

Net cash used in Financing Activities for the nine months ended September 30, 2025 was $780.9 million, compared to net cash used of $125.4 million for the same period in 2024. This increase in net cash used by Financing Activities was primarily due to the redemption of the 2025 Senior Notes in the first quarter of 2025 and common stock repurchases made during the second and third quarter of 2025.

Critical Accounting Estimates

Kemper’s subsidiaries conduct their operations in two industries: property and casualty insurance and life insurance. Accordingly, the Company is subject to several industry-specific accounting principles under GAAP. The preparation of financial statements in accordance with GAAP requires the use of estimates and assumptions that affect the reported amounts of assets and liabilities, the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. The process of estimation is inherently uncertain. Accordingly, actual results could ultimately differ materially from the estimated amounts reported in a company’s financial statements. Different assumptions are likely to result in different estimates of reported amounts.

Critical Accounting Estimates (Continued)

The Company’s critical accounting policies most sensitive to estimates include the valuation of investments, the valuation of life insurance reserves, the valuation of reserves for property and casualty insurance incurred losses and LAE, the assessment of recoverability of goodwill, and the recoverability of deferred tax assets. The Company’s critical accounting policies are described in the MD&A included in the 2024 Annual Report. There have been no material changes to the information disclosed in the 2024 Annual Report with respect to these critical accounting estimates and the Company’s significant accounting policies.

Item 3. Quantitative and Qualitative Disclosures About Market Risk

There have been no material changes to the Company’s disclosures about market risk in Item 7A, “Quantitative and Qualitative Disclosures About Market Risk” of Part II of the 2024 Annual Report. Accordingly, no disclosures about market risk have been made in Item 3 of this Form 10-Q.

Item 4. Controls and Procedures

(a) Evaluation of disclosure controls and procedures.

The Company’s management, with the participation of Kemper’s Interim Chief Executive Officer and Chief Financial Officer, has evaluated the effectiveness of the Company’s disclosure controls and procedures (as such term is defined in Rules 13a-15(e) and 15d-15(e) under the Securities Exchange Act of 1934, as amended (the “Exchange Act”)), as of the end of the period covered by this report. Based on such evaluation, Kemper’s Interim Chief Executive Officer and Chief Financial Officer have concluded that, as of the end of such period, the Company’s disclosure controls and procedures are effective in ensuring that information required to be disclosed by Kemper in reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported, within the time periods specified by the SEC’s rules and forms, and accumulated and communicated to the Company’s management, including Kemper’s Interim Chief Executive Officer and Chief Financial Officer, as appropriate to allow timely decisions regarding required disclosure.

(b) Changes in internal control over financial reporting.

There have not been any changes in the Company’s internal control over financial reporting (as such term is defined in Rules 13a-15(f) and 15d-15(f) under the Exchange Act) during the fiscal quarter to which this report relates that have materially affected, or are reasonably likely to materially affect, the Company’s internal control over financial reporting.

PART II - OTHER INFORMATION

Items not listed here have been omitted because they are inapplicable or the answer is negative.

Item 1. Legal Proceedings

Information concerning pending legal proceedings is incorporated herein by reference to Note 19, “Commitments and Contingencies,” to the Condensed Consolidated Financial Statements in Part I of this Form 10-Q.

Item 1A. Risk Factors

For a discussion of the Company’s significant risk factors, see Item 1A. of Part I of the 2024 Annual Report. Readers are also advised to consider other factors not presently known by, or considered material to, the Company that could materially affect the Company’s business, financial condition and results of operations, along with other information disclosed in the 2024 Annual Report and this Quarterly Report on Form 10-Q, including the factors set forth under the caption “Caution Regarding Forward-Looking Statements” beginning on page 1 of the 2024 Annual Report and on page 1 of this Quarterly Report on Form 10-Q, and to consult any further disclosures Kemper makes on related subjects in its filings with the SEC.

Item 2. Unregistered Sales of Equity Securities and Use of Proceeds and Issuer Repurchases of Equity Securities

On May 6, 2020, Kemper’s Board of Directors authorized the repurchase of up to an additional $200.0 million of Kemper common stock, in addition to the $133.3 million remaining under a prior authorization in 2014, bringing the remaining share repurchase authorization to approximately $333.3 million (the “2014 Repurchase Program”). On August 5, 2025, Kemper’s Board of Directors approved a new share repurchase authorization, under which the Company can repurchase up to $500.0 million of its common stock (the “2025 Repurchase Program”).

Under the terms of the ASR Agreement, the Company made a payment of $150.0 million to Goldman Sachs and, on August 14, 2025, received initial deliveries of an aggregate of 2,279,000 shares of the Company’s common stock, or approximately 80% of the total shares that are expected to be repurchased under the ASR Agreement, based on the closing price on August 13, 2025 of $52.65 per share.

As of September 30, 2025, the 2014 Repurchase Program has been completed, and the remaining share repurchase authorization under the 2025 Repurchase Program was $383.8 million.

Shares purchased during the three months ended September 30, 2025 were as follows:


				Total	Maximum
				Number of Shares	Dollar Value of Shares
		Average		Purchased as Part	that May Yet Be
	Total	Price		of Publicly	Purchased Under
	Number of Shares	Paid per		Announced Plans	the Plans or Programs
Period	Purchased	Share		or Programs	(Dollars in Millions)
July 2025	833,642	$	62.00	833,642	$	48.6
August 2025	2,572,008	$	52.40	2,572,008	$	383.8
September 2025	—	$	—	—	$	383.8

Apart from the ASR Agreement repurchases, all purchases were made by the Company in the open market in reliance on the safe harbors provided by Rule 10b-18 and Rule 10b5-1 of the Securities Exchange Act of 1934.

Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities

Securities Trading Plans of Executive Officers and Directors

The Company’s Insider Trading Policy permits executive officers and directors to enter into trading plans designed to comply with Rule 10b5-1 under the Exchange Act. During the three months ended September 30, 2025, none of the Company’s executive officers or directors adopted, modified or terminated a Rule 10b5-1 trading plan or adopted or terminated a non-Rule 10b5-1 trading arrangement (as defined in Item 408(c) of Regulation S-K).

Item 6. Exhibits

The Exhibit Index that follows has been filed as part of this report. Exhibit numbers correspond to the numbering system in Item 601 of Regulation S-K.

Exhibit Index

The following exhibits are either filed as a part hereof or are incorporated by reference. Exhibit numbers followed by an asterisk (*) indicate exhibits that are management contracts or compensatory plans or arrangements.

Incorporated by Reference

Exhibit Number

Exhibit Description

Form

File Number

Exhibit

Filing Date

Filed or Furnished Herewith

10.1

Master Confirm ation and Suppl emental Confirmation, dated as of August 13, 2025, between the Company and Goldman Sachs & Co. LLC.

31.1

Certification of Chief Executive Officer Pursuant to SEC Rule 13a-14(a)

31.2

Certification of Chief Financial Officer Pursuant to SEC Rule 13a-14(a)

32.1

Certification of Chief Executive Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

32.2

Certification of Chief Financial Officer Pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002

101.1

XBRL Instance Document

101.2

XBRL Taxonomy Extension Schema Document

101.3

XBRL Taxonomy Extension Calculation Linkbase Document

101.4

XBRL Taxonomy Extension Label Linkbase Document

101.5

XBRL Taxonomy Extension Presentation Linkbase Document

101.6

XBRL Taxonomy Extension Definition Linkbase Document

104

Cover Page Interactive Data File (formatted as Inline XBRL and contained in Exhibit 101)

Signatures

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


		Kemper Corporation

Date:	November 5, 2025	/s/ C. THOMAS EVANS, JR.
		C. Thomas Evans, Jr.
		Interim Chief Executive Officer, Secretary and General Counsel (Principal Executive Officer)

Date:	November 5, 2025	/s/ BRADLEY T. CAMDEN
		Bradley T. Camden
		Executive Vice President and Chief Financial Officer (Principal Financial Officer)

Date:	November 5, 2025	/s/ JAMES A. ALEXANDER
		James A. Alexander
		Senior Vice President and Chief Accounting Officer (Principal Accounting Officer)

EX-10.1 2 kmpr202509302025ex101-asr.htm EX-10.1 Document

GOLDMAN SACHS & CO. LLC | 200 WEST STREET | NEW YORK, NEW YORK 10282-2198 | TEL: 212-902-1000

Opening Transaction


To:			Kemper Corporation 200 East Randolph Street, Suite 3300 Chicago, Illinois 60601
A/C:
From:			Goldman Sachs & Co. LLC
Re:			Accelerated Stock Buyback
Ref. No:			As provided in the Supplemental Confirmation
Date:			August 13, 2025

_____________________________________________________________________________________________

This master confirmation (this “Master Confirmation”), dated as of August 13, 2025 is intended to set forth certain terms and provisions of certain Transactions (each, a “Transaction”) entered into from time to time between Goldman Sachs & Co. LLC (“Dealer”) and Kemper Corporation (“Counterparty”). This Master Confirmation, taken alone, is neither a commitment by either party to enter into any Transaction nor evidence of a Transaction. The additional terms of any particular Transaction shall be set forth in a Supplemental Confirmation in the form of Schedule A hereto (a “Supplemental Confirmation”), which shall reference this Master Confirmation and supplement, form a part of, and be subject to this Master Confirmation. This Master Confirmation and each Supplemental Confirmation together shall constitute a “Confirmation” as referred to in the Agreement specified below.

The definitions and provisions contained in the 2002 ISDA Equity Derivatives Definitions (the “Equity Definitions”), as published by the International Swaps and Derivatives Association, Inc., are incorporated into this Master Confirmation. This Master Confirmation and each Supplemental Confirmation evidence a complete binding agreement between Counterparty and Dealer as to the subject matter and terms of each Transaction to which this Master Confirmation and such Supplemental Confirmation relate and shall supersede all prior or contemporaneous written or oral communications with respect thereto.

This Master Confirmation and each Supplemental Confirmation supplement form a part of and are subject to an agreement in the form of the ISDA 2002 Master Agreement (the “Agreement”) as if Dealer and Counterparty had executed the Agreement on the date of this Master Confirmation (but without any Schedule except for (i) the election of New York law as the governing law (without reference to its choice of law provisions), (ii) the election that subparagraph (ii) of Section 2(c) of the Agreement will not apply to the Transactions, (iii) the election that the “Cross Default” provisions of Section 5(a)(vi) of the Agreement shall apply to Dealer with a “Threshold Amount” of 3% of the shareholders’ equity of The Goldman Sachs Group, Inc. (“Dealer Parent”) and as if “Specified Indebtedness” had the meaning specified in Section 14 of the Agreement (provided that (a) the text “, or becoming capable at such time of being declared,” shall be deleted from Section 5(a)(vi)(1) of the Agreement, (b) such term shall not include obligations in respect of deposits received in the ordinary course of Dealer’s banking business and (c) the following provision shall be added to the end of Section 5(a)(vi) of the Agreement: “but a default under clause (2) above shall not constitute an Event of Default if (x) the default was caused solely by error or omission of an administrative or operational nature, (y) funds were available to enable the party to make the payment when due and (z) the payment is made within two Local Business Days of such party’s receipt of written notice of its failure to pay”), and (iv) as otherwise provided herein or in a Supplemental Confirmation).

The Transactions shall be the sole Transactions under the Agreement. If there exists any ISDA Master Agreement between Dealer and Counterparty or any confirmation or other agreement between Dealer and Counterparty pursuant to which an ISDA Master Agreement is deemed to exist between Dealer and Counterparty, then notwithstanding anything to the contrary in such ISDA Master Agreement, such confirmation or agreement or any other agreement to which Dealer and Counterparty are parties, the Transactions shall not be considered Transactions under, or otherwise governed by, such existing or deemed ISDA Master Agreement.

All provisions contained or incorporated by reference in the Agreement shall govern this Master Confirmation and each Supplemental Confirmation except as expressly modified herein or in the related Supplemental Confirmation.

If, in relation to any Transaction to which this Master Confirmation and a Supplemental Confirmation relate, there is any inconsistency between the Agreement, this Master Confirmation, any Supplemental Confirmation and the Equity Definitions, the following will prevail for purposes of such Transaction in the order of precedence indicated: (i) such Supplemental Confirmation; (ii) this Master Confirmation; (iii) the Equity Definitions; and

(iv) the Agreement.

1.Each Transaction constitutes a Share Forward Transaction for the purposes of the Equity Definitions. Set forth below are the terms and conditions that, together with the terms and conditions set forth in the Supplemental Confirmation relating to any Transaction, shall govern such Transaction.

General Terms:

Trade Date: For each Transaction, as set forth in the related Supplemental Confirmation.

Buyer: Counterparty

Seller: Dealer

Shares: Common stock, par value $0.10 per share, of Counterparty (Ticker: KMPR)

Exchange: New York Stock Exchange

Related Exchange(s): All Exchanges.

Prepayment\Variable

Obligation: Applicable

Prepayment Amount: For each Transaction, as set forth in the related Supplemental Confirmation.

Prepayment Date: For each Transaction, as set forth in the related Supplemental Confirmation.

Valuation:

VWAP Price: For any Exchange Business Day, as determined by the New York 10b-18. Volume Weighted Average Price per Share for the regular trading session (including any extensions thereof) of the Exchange on such Exchange Business Day (without regard to pre-open or after hours trading outside of such regular trading session for such Exchange Business Day), as published by Bloomberg at 4:15 p.m. New York time (or 15 minutes following the end of any extension of the regular trading session) on such Exchange Business Day, on Bloomberg page “KMPR.N <Equity> AQR_SEC” (or any successor thereto), or if such price is not so reported on such Exchange Business Day for any reason or is, in the Calculation Agent’s reasonable determination, erroneous, such VWAP Price shall be as reasonably determined by the Calculation Agent. For purposes of calculating the VWAP Price, the Calculation Agent will include only those


2

trades that are reported during the period of time during which Counterparty could purchase its own shares under Rule 10b-18(b)(2) and are effected pursuant to the conditions of Rule 10b-18(b)(3), each under the Securities Exchange Act of 1934, as amended (the “Exchange Act”) (such trades, “Rule 10b-18 eligible transactions”).

Forward Price: The average of the VWAP Prices for the Exchange Business Days in the Calculation Period, subject to “Valuation Disruption” below

Forward Price

Adjustment Amount: For each Transaction, as set forth in the related Supplemental Confirmation.

Calculation Period: The period from and including the Calculation Period Start Date to and including the Termination Date.

Calculation Period Start Date: For each Transaction, as set forth in the related Supplemental Confirmation.

Termination Date: The Scheduled Termination Date, provided that Dealer shall have the right to designate any Exchange Business Day on or after the First Acceleration Date to be the Termination Date for all or a portion of the Transaction (the "Accelerated Termination Date") by delivering notice (the "Accelerated Termination Notice") to Counterparty of any designation prior to 6:00 p.m. New York City time on the Exchange Business Day immediately following the designated Acceleration Termination Date.

Scheduled Termination Date: For each Transaction, as set forth in the related Supplemental Confirmation, subject to postponement as provided in "Valuation Disruption" below.

First Acceleration Date: For each Transaction, as set forth in the related Supplemental Confirmation.

Valuation Disruption: The definition of "Market Disruption Event" in Section 6.3(a) of the Equity Definitions is hereby amended by deleting the words "at any time during the one-hour period that ends at the relevant Valuation Time, Latest Exercise Time, Knock-in Valuation Time or Knock-out Valuation Time, as the case may be" and inserting the words "at any time on any Scheduled Trading Day during the Calculation Period or Settlement Valuation Period" after the word "material" in the third line thereof.

Section 6.3(d) of the Equity Definitions is hereby amended by deleting the remainder of the provision following the term “Scheduled Closing Time” in the fourth line thereof.

Notwithstanding anything to the contrary in the Equity Definitions, to the extent that a Disrupted Day occurs (i) in the Calculation Period, the Calculation Agent may, in its good faith and commercially reasonable discretion, postpone the Scheduled Termination Date, or (ii) in the Settlement Valuation Period, the Calculation Agent may extend the Settlement Valuation Period. If any such Disrupted Day is a Disrupted Day because of a Market Disruption Event (or a deemed Market Disruption Event as provided herein), the Calculation Agent shall determine whether (i) such Disrupted Day is a Disrupted Day in full, in which case the VWAP Price for such Disrupted Day shall not be included for purposes of determining the Forward Price or the Settlement Price, as the case may be, or (ii) such Disrupted Day is a Disrupted Day only in part, in which case the VWAP Price for such Disrupted Day shall be determined by the Calculation Agent based on Rule 10b-18 eligible transactions in the Shares on such Disrupted Day taking into account the nature and duration of the relevant Market Disruption Event, and the weighting of the VWAP Price for the relevant


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Exchange Business Days during the Calculation Period or the Settlement Valuation Period, as the case may be, shall be adjusted in a commercially reasonable manner by the Calculations Agent for purposes of determining the Forward Price or the Settlement Price, as the case may be, with such adjustments based on, among other factors, the duration of any Market Disruption Event and the volume, historical trading patterns and the price of the Shares. Any Exchange Business Day on which, as of the date hereof, the Exchange is scheduled to close prior to its normal close of trading shall be deemed not to be an Exchange Business Day; if a closure of the Exchange prior to its normal close of trading on any Exchange Business Day is scheduled following the date hereof, then such Exchange Business Day shall be deemed to be a Disrupted Day in full.

If a Disrupted Day occurs during the Calculation Period or the Settlement Valuation Period, as the case may be, and each of the nine immediately following Scheduled Trading Days is a Disrupted Day, then the Calculation Agent, in its good faith and commercially reasonable discretion, may deem such ninth Scheduled Trading Day to be an Exchange Business Day that is not a Disrupted Day and determine the VWAP Price for such ninth Scheduled Trading Day using its good faith estimate of the value of the Shares on such ninth Scheduled Trading Day based on the volume, historical trading patterns and price of the Shares and such other factors as it deems appropriate.

Settlement Terms:

Settlement Procedures: If the Number of Shares to be Delivered is positive, Physical Settlement shall be applicable; provided that Dealer does not, and shall not, make the agreement or the representations set forth in Section 9.11 of the Equity Definitions related to the restrictions imposed by applicable securities laws with respect to any Shares delivered by Dealer to Counterparty under any Transaction. If the Number of Shares to be Delivered is negative, then the Counterparty Settlement Provisions in Annex A shall apply.

Number of Shares

to be Delivered: A number of Shares equal to (x)(a) the Prepayment Amount divided by (b) the Divisor Amount minus (y) the number of Initial Shares.

Divisor Amount: The greater of (i) the Forward Price minus the Forward Price Adjustment Amount and (ii) $1.00.

Excess Dividend Amount: For the avoidance of doubt, all references to the Excess Dividend Amount shall be deleted from Section 9.2(a)(iii) of the Equity Definitions.

Settlement Date: If the Number of Shares to be Delivered is positive, the earlier of (x) the date that is one Settlement Cycle immediately following the Scheduled Termination Date or (y) the date that is one Settlement Cycle immediately following the date on which Dealer delivers the Accelerated Termination Notice.

Settlement Currency: USD

Initial Share Delivery: Dealer shall deliver a number of shares equal to the Initial Shares to Counterparty on the Initial Share Delivery Date in accordance with Section 9.4 of the Equity Definitions, with the Initial Share Delivery Date deemed to be a "Settlement Date" for purposes of such Section 9.4.

Initial Share Delivery Date: For each Transaction, as set forth in the related Supplemental Confirmation.


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Initial Shares: For each Transaction, as set forth in the related Supplemental Confirmation.

Share Adjustments:

Potential Adjustment Event: Notwithstanding anything to the contrary in Section 11.2(e) of the Equity Definitions, none of (i) an Extraordinary Dividend, (ii) the issuance of additional stock options, restricted stock or restricted stock units in the ordinary course pursuant to an equity plan or dividend reinvestment plan or (iii) a Permitted Transaction (as defined below) shall constitute a Potential Adjustment Event.

It shall constitute an additional Potential Adjustment Event if the Scheduled Termination Date for any Transaction is postponed pursuant to “Valuation Disruption” above, in which case the Calculation Agent may, in its commercially reasonable discretion, adjust any relevant terms of any such Transaction as necessary to preserve as nearly as practicable the fair value of such Transaction to Dealer prior to such postponement.

Extraordinary Dividend: For any calendar quarter, any dividend or distribution on the Shares with an ex- dividend date occurring during such calendar quarter (other than any dividend or distribution of the type described in Section 11.2(e)(i) or Section 11.2(e)(ii)(A) of the Equity Definitions) (a “Dividend”) the amount or value of which (as determined by the Calculation Agent), when aggregated with the amount or value (as determined by the Calculation Agent) of any and all previous Dividends with ex-dividend dates occurring in the same calendar quarter, exceeds the Ordinary Dividend Amount.

Ordinary Dividend Amount: For each Transaction, as set forth in the related Supplemental Confirmation. Method of Adjustment: Calculation Agent Adjustment

Early Ordinary Dividend

Payment: If an ex-dividend date for any Dividend that is not an Extraordinary Dividend occurs during any calendar quarter occurring (in whole or in part) during the Relevant Dividend Period (as defined below) and is prior to the Scheduled Ex- Dividend Date for such calendar quarter, the Calculation Agent shall make such adjustment to the exercise, settlement, payment or any other terms of the relevant Transaction as the Calculation Agent determines appropriate to account for the economic effect on the Transaction of such event.

Scheduled Ex-Dividend

Dates: For each Transaction for each calendar quarter, as set forth in the related Supplemental Confirmation.

Extraordinary Events:

Consequences of Merger Events:

(a)Share-for-Share: Modified Calculation Agent Adjustment

(b)Share-for-Other: Cancellation and Payment

(c)Share-for-Combined: Component Adjustment

Tender Offer: Applicable; provided that (i) Section 12.1(l) of the Equity Definitions shall be amended (x) by deleting the parenthetical in the fifth line thereof, (y) by


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replacing “that” in the fifth line thereof with “whether or not such announcement” and (z) by adding immediately after the words “Tender Offer” in the fifth line thereof “, and any publicly announced change or amendment to such an announcement (including the announcement of an abandonment of such intention)”, (ii) Section 12.1(d) of the Equity Definitions shall be amended by replacing “10%” in the third line thereof with “20%”, and (iii) Sections 12.3(a) and 12.3(d) of the Equity Definitions shall each be amended by replacing each occurrence of the words “Tender Offer Date” by “Announcement Date.”

Consequences of Tender Offers:

(a)Share-for-Share: Modified Calculation Agent Adjustment

(b)Share-for-Other: Modified Calculation Agent Adjustment

(c)Share-for-Combined: Modified Calculation Agent Adjustment

Nationalization,

Insolvency or Delisting: Cancellation and Payment; provided that in addition to the provisions of Section 12.6(a)(iii) of the Equity Definitions, it shall also constitute a Delisting if the Exchange is located in the United States and the Shares are not immediately re- listed, re-traded or re-quoted on any of the New York Stock Exchange, The NASDAQ Global Select Market or The NASDAQ Global Market (or their respective successors); if the Shares are immediately re-listed, re-traded or re- quoted on any such exchange or quotation system, such exchange or quotation system shall be deemed to be the Exchange.

Additional Disruption Events:

(a)Change in Law: Applicable; provided that Section 12.9(a)(ii) of the Equity

Definitions is hereby amended by (i) replacing the phrase “the interpretation” in the third line thereof with the phrase “, or public announcement of, the formal or informal interpretation”, (ii) replacing the word “Shares” where it appears in clause (X) thereof with the words “Hedge Position” and (iii) immediately following the word “Transaction” in clause (X) thereof, adding the phrase “in the manner contemplated by the Hedging Party on the Trade Date”; provided further that (i) any determination as to whether (A) the adoption of or any change in any applicable law or regulation (including, for the avoidance of doubt and without limitation, (x) any tax law or (y) adoption or promulgation of new regulations authorized or mandated by existing statute) or

(B) the promulgation of or any change in the interpretation by any court, tribunal or regulatory authority with competent jurisdiction of any applicable law or regulation (including any action taken by a taxing authority), in each case, constitutes a “Change in Law” shall be made without regard to Section 739 of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 or any similar legal certainty provision in any legislation enacted, or rule or regulation promulgated, on or after the Trade Date, and (ii) Section 12.9(a)(ii) of the Equity Definitions is hereby amended by replacing the parenthetical beginning after the word “regulation” in the second line thereof with the words “(including, for the avoidance of doubt and without limitation, (x) any tax law or


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(y) adoption or promulgation of new regulations authorized or mandated by existing statute)”.

(b)Failure to Deliver: Applicable

(c)Insolvency Filing: Applicable

(d)Loss of Stock Borrow: Applicable, it being understood that the rate to borrow Shares

shall be determined by reference to the terms of a commercially reasonable share borrowing arrangement and without regard to the Hedging Party’s cost of funding in connection with such borrowings.

Maximum Stock Loan Rate: For each Transaction, as set forth in the Related Supplemental

Confirmation.

(e)Increased Cost of Stock Borrow: Applicable, it being understood that the rate to borrow Shares

shall be determined by reference to the terms of a commercially reasonable share borrowing arrangement and without regard to the Hedging Party’s cost of funding in connection with such borrowings.

Initial Stock Loan Rate: For each Transaction, as set forth in the related Supplemental

Confirmation.

Hedging Adjustments: For the avoidance of doubt, whenever the Calculation Agent,

Determining Party or Dealer is called upon to make an adjustment or determination pursuant to the terms of this Master Confirmation or the Equity Definitions to take into account the effect of an event, the Calculation Agent, Determining Party or Dealer (as the case may be) shall make such adjustment or determination by reference to the effect of such event on Dealer, assuming that Dealer maintains a commercially reasonable Hedge Position.

Hedging Party: For all applicable events, Dealer

Determining Party: For all applicable events, Dealer

Additional Termination Event(s): Notwithstanding anything to the contrary in the Equity Definitions, if, as a result

of an Extraordinary Event, any Transaction would be cancelled or terminated (whether in whole or in part) pursuant to Article 12 of the Equity Definitions, an Additional Termination Event (with such terminated Transaction(s) (or portions thereof) being the Affected Transaction(s) and Counterparty being the sole Affected Party) shall be deemed to occur, and, in lieu of Sections 12.7, 12.8 and

12.9 of the Equity Definitions, Section 6 of the Agreement shall apply to such Affected Transaction(s).

The declaration by the Issuer of any Extraordinary Dividend, the ex-dividend date for which occurs or is reasonably expected to occur, as determined by the Calculation Agent, during the Relevant Dividend Period, will constitute an Additional Termination Event, with Counterparty as the sole Affected Party and all Transactions hereunder as the Affected Transactions.

Relevant Dividend Period: The period from and including the Calculation Period Start Date to and

including the Relevant Dividend Period End Date.


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End Date: If the Number of Shares to be Delivered is negative, the last day of the Settlement Valuation Period; otherwise, the Termination Date.

Non-Reliance/Agreements and Acknowledgements Regarding Hedging Activities/Additional

Acknowledgements: Applicable

Transfer and Assignment: Without limiting any and all rights in Section 7 of the Agreement, Dealer may

not assign any of its rights or duties hereunder to any one or more of its Affiliates without the prior written consent of Counterparty. Notwithstanding any other provision in this Master Confirmation to the contrary requiring or allowing Dealer to purchase, sell, receive or deliver any Shares or other securities to or from Counterparty, Dealer may designate any of its Affiliates to purchase, sell, receive or deliver such Shares or other securities and otherwise to perform Dealer’s obligations in respect of any Transaction and any such designee may assume such obligations. Dealer may assign the right to receive Settlement Shares to any third party who may legally receive Settlement Shares. Dealer shall be discharged of its obligations to Counterparty only to the extent of any such performance. For the avoidance of doubt, Dealer hereby acknowledges that notwithstanding any such designation hereunder, to the extent any of Dealer’s obligations in respect of any Transaction are not completed by its designee, Dealer shall be obligated to continue to perform or to cause any other of its designees to perform in respect of such obligations.

Dealer Payment Instructions: To be provided by Dealer Counterparty’s Contact Details

for Purpose of Giving Notice: Kemper Corporation

200 East Randolph Street, Suite 3300

Chicago, Illinois 60601 Attention: Treasurer Tele: 312-661-4600

Email: treasuryoperations@kemper.com

Dealer’s Contact Details for

Purpose of Giving Notice: Goldman Sachs & Co. LLC

200 West Street

New York, NY 10282-2198

Attention: Michael Voris, Equity Capital Markets Telephone: 212-902-4895

Facsimile: 212-291-5027

Email: Michael.Voris@ny.ibd.email.gs.com

Attention: Henry Liu, Equity Capital Markets Telephone: 212-902-4841

Email: Hengrui.Liu@ny.ibd.email.gs.com

And email notification to the following address: Eq-derivs-notifications@am.ibd.gs.com

2.Calculation Agent. Dealer; provided that, following the occurrence and during the continuation of an Event of Default pursuant to Section 5(a)(vii) of the Agreement with respect to which Dealer is the Defaulting Party, Counterparty shall have the right to select a leading dealer in the market for U.S. corporate equity derivatives to


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replace Dealer as Calculation Agent, and the parties shall work promptly and in good faith to execute any appropriate documentation required by such replacement Calculation Agent.

3.(a) Additional Mutual Representations, Warranties and Covenants of Each Party. In addition to the representations, warranties and covenants in the Agreement, each party represents, warrants and covenants to the other party that:

(i)Eligible Contract Participant. It is an “eligible contract participant”, as defined in the U.S. Commodity Exchange Act (as amended), and is entering into each Transaction hereunder as principal (and not as agent or in any other capacity, fiduciary or otherwise) and not for the benefit of any third party.

(ii)Accredited Investor. Each party acknowledges that the offer and sale of each Transaction to it is intended to be exempt from registration under the Securities Act of 1933, as amended (the “Securities Act”), by virtue of Section 4(a)(2) thereof. Accordingly, each party represents and warrants to the other that (i) it has the financial ability to bear the economic risk of its investment in each Transaction and is able to bear a total loss of its investment, (ii) it is an “accredited investor” as that term is defined under Regulation D under the Securities Act and (iii) the disposition of each Transaction is restricted under this Master Confirmation, the Securities Act and state securities laws.

(b)Additional Representations, Warranties and Covenants of Dealer. In addition to the representations, warranties and covenants in the Agreement, Dealer represents, warrants and covenants to Counterparty that:

(i)Dealer shall use commercially reasonable efforts, during the Calculation Period and any Settlement Valuation Period for each Transaction, to make all purchases of Shares in connection with such Transaction in a manner that would comply with the limitations set forth in clauses (b)(1), (b)(2), (b)(3) and (b)(4) and (c) of Rule 10b-18, as if such rule were applicable to such purchases and taking into account any applicable Securities and Exchange Commission no-action letters as appropriate, and subject to any delays between the execution and reporting of a trade of the Shares on the Exchange and other circumstances beyond Dealer’s control; provided that, during a Calculation Period, the foregoing agreement shall not apply to purchases made to dynamically hedge for Dealer’s own account or the account of its affiliate(s) the optionality arising under a Transaction (including, for the avoidance of doubt, timing optionality).

(ii)Dealer has implemented policies and procedures, taking into consideration the nature of its business, reasonably designed to prevent individuals making investment decisions related to any Transaction from having access to material nonpublic information regarding the Issuer that may be in possession of other individuals at Dealer.

4.Additional Representations, Warranties and Covenants of Counterparty. In addition to the representations, warranties and covenants in the Agreement, Counterparty represents, warrants and covenants to Dealer that:

(a)The purchase or writing of each Transaction and the transactions contemplated hereby will not violate Rule 13e-1 or Rule 13e-4 under the Exchange Act.

(b)It is not entering into any Transaction (i) on the basis of, and is not aware of, any material non-

public information with respect to the Shares, (ii) in anticipation of, in connection with, or to facilitate, a distribution of its securities, a self tender offer or a third-party tender offer or (iii) to create actual or apparent trading activity in the Shares (or any security convertible into or exchangeable for the Shares) or to raise or depress or otherwise manipulate the price of the Shares (or any security convertible into or exchangeable for the Shares).

(c)Each Transaction is being entered into pursuant to a publicly disclosed Share buy-back program and its Board of Directors has approved the use of derivatives to effect the Share buy-back program.

(d)Without limiting the generality of Section 13.1 of the Equity Definitions, Counterparty acknowledges that neither Dealer nor any of its affiliates is making any representations or warranties or taking any position or expressing any view with respect to the treatment of any Transaction under any accounting standards including ASC Topic 260, Earnings Per Share, ASC Topic 815, Derivatives and Hedging, or ASC Topic 480, Distinguishing Liabilities from Equity and ASC 815-40, Derivatives and Hedging Contracts in Entity’s Own Equity.


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(e)As of (i) the date hereof and (ii) the Trade Date for each Transaction hereunder, Counterparty is in compliance with its reporting obligations under the Exchange Act.

(f)Counterparty shall report each Transaction as required under the Exchange Act and the rules and regulations thereunder.

(g)The Shares are not, and Counterparty will not cause the Shares to be, subject to a “restricted period” (as defined in Regulation M promulgated under the Exchange Act) at any time during any Regulation M Period (as defined below) for any Transaction unless Counterparty has provided written notice to Dealer of such restricted period not later than the Scheduled Trading Day immediately preceding the first day of such “restricted period”; Counterparty acknowledges that any such notice may cause a Disrupted Day to occur pursuant to Section 5 below; accordingly, Counterparty acknowledges that its delivery of such notice must comply with the standards set forth in Section 6 below; “Regulation M Period” means, for any Transaction, (i) the Calculation Period (as defined below) and (ii) the Settlement Valuation Period, if any, for such Transaction.

(h)As of the Trade Date, the Prepayment Date, the Initial Share Delivery Date and the Settlement Date for each Transaction, Counterparty is not “insolvent” (as such term is defined under Section 101(32) of the

U.S. Bankruptcy Code (Title 11 of the United States Code) (the “Bankruptcy Code”)) and Counterparty would be able to purchase a number of Shares with a value equal to the Prepayment Amount in compliance with the laws of the jurisdiction of Counterparty’s incorporation.

(i)Counterparty is not and, after giving effect to any Transaction, will not be, required to register as an “investment company” as such term is defined in the Investment Company Act of 1940, as amended.

(k)Counterparty has not entered into and will not enter into agreements similar to the Transactions described herein where any initial hedge period, calculation period or settlement valuation period (each however defined) in such other transaction will overlap at any time (including as a result of extensions in such initial hedge period, calculation period or settlement valuation period as provided in the relevant agreements) with any Calculation Period or, if applicable, any Settlement Valuation Period under this Master Confirmation. In the event that the initial hedge period, calculation period or settlement valuation period in any other similar transaction overlaps with any Calculation Period or, if applicable, Settlement Valuation Period under this Master Confirmation as a result of any postponement of the Scheduled Termination Date or extension of the Settlement Valuation Period pursuant to “Valuation Disruption” above, Counterparty shall promptly amend such transaction to avoid any such overlap.

(l)Neither Counterparty nor any of its subsidiaries has applied nor shall it, until after the first date on which no portion of the Transaction remains outstanding following any final exercise and settlement, cancellation or early termination of the Transaction, apply, for a loan, loan guarantee, direct loan (as that term is defined in the Coronavirus Aid, Relief and Economic Security Act (the “CARES Act”)) or other investment, or to receive any financial assistance or relief under any program or facility (collectively “Financial Assistance”) that (a) is established under applicable law (whether in existence as of the Trade Date or subsequently enacted, adopted or amended), including without limitation the CARES Act and the Federal Reserve Act, as amended, and (b) (i) requires under applicable law (or any regulation, guidance, interpretation or other pronouncement of a governmental authority with jurisdiction for such program or facility) as a condition of such Financial Assistance, that the Counterparty comply with any requirement not to, or otherwise agree, attest, certify or warrant that it has not, as of the date specified in such condition, repurchased, or will not repurchase, any equity security of Counterparty, and that Counterparty has not, as of the date specified in the condition, made a capital distribution or will not make a capital distribution, or (ii) where the terms of the Transaction would cause Counterparty to fail to satisfy any condition for application for or receipt or retention of the Financial Assistance (collectively “Restricted Financial Assistance”); provided, that Counterparty or any of its subsidiaries may apply for Restricted Financial Assistance if Counterparty either (a) determines based on the advice of outside counsel of national standing that the terms of the Transaction would not cause Counterparty or any of its subsidiaries to fail to satisfy any condition for application for or receipt or retention of such Financial Assistance based on the terms of the program or facility as of the date of such advice or (b) delivers to Dealer evidence or other guidance from a governmental authority with jurisdiction for such program or facility that the Transaction is permitted under such program or facility (either by specific reference


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to the Transaction or by general reference to transactions with the attributes of the Transaction in all relevant respects).

5.Regulatory Disruption. In the event that Dealer concludes, in its reasonable discretion and based on advice of counsel, that it is appropriate with respect to any legal, regulatory or self-regulatory requirements or related policies and procedures (whether or not such requirements, policies or procedures are imposed by law or have been voluntarily adopted by Dealer), for it to refrain from or decrease any market activity as it relates to establishing or maintaining a commercially reasonable hedge position on any Scheduled Trading Day or Days during the Calculation Period or, if applicable, the Settlement Valuation Period, Dealer may by written notice to Counterparty elect to deem that a Market Disruption Event has occurred and will be continuing on such Scheduled Trading Day or Days. Dealer shall subsequently notify Counterparty in writing on the day Dealer reasonably believes in good faith and upon the advice of counsel that it may resume its market activity. Dealer shall not be required to communicate to Counterparty the reason for Dealer’s exercise of its rights pursuant to this provision if Dealer reasonably determines in good faith and upon the advice of counsel that disclosing such reason may result in a violation of any legal, regulatory, or self-regulatory requirements or related policies and procedures (whether or not such requirements, policies or procedures are imposed by law or have been voluntarily adopted by Dealer).

6.10b5-1 Plan. Counterparty represents, warrants and covenants to Dealer that:

(a)Counterparty is entering into this Master Confirmation and each Transaction hereunder in good faith and not as part of a plan or scheme to evade the prohibitions of Rule 10b5-1 under the Exchange Act (“Rule 10b5-1”) or any other antifraud or anti-manipulation provisions of the federal or applicable state securities laws and that it has not entered into or altered and will not enter into or alter any corresponding or hedging transaction or position with respect to the Shares. Counterparty acknowledges that it is the intent of the parties that each Transaction entered into under this Master Confirmation comply with the requirements of paragraphs (c)(1)(i)(A) and (B) of Rule 10b5-1 and each Transaction entered into under this Master Confirmation shall be interpreted to comply with the requirements of Rule 10b5-1(c).

(b)Counterparty will not seek to control or influence Dealer’s decision to make any “purchases or sales” (within the meaning of Rule 10b5-1(c)(1)(i)(B)(3)) under any Transaction entered into under this Master Confirmation, including, without limitation, Dealer’s decision to enter into any hedging transactions. Counterparty has consulted with its own advisors as to the legal aspects of its adoption and implementation of this Master Confirmation and each Supplemental Confirmation under Rule 10b5-1.

(c)Any amendment, modification, waiver or termination of this Master Confirmation or the relevant Supplemental Confirmation must be effected in accordance with the requirements for the amendment or termination of a “plan” as defined in Rule 10b5-1(c). Without limiting the generality of the foregoing, any such amendment, modification, waiver or termination shall be made in good faith and not as part of a plan or scheme to evade the prohibitions of Rule 10b-5, and no such amendment, modification, waiver or termination shall be made at any time at which Counterparty or any officer, director, manager or similar person of Counterparty is aware of any material non-public information regarding Counterparty or the Shares. Counterparty further agrees to act in good faith with respect to this Master Confirmation, each Supplemental Confirmation and the Agreement.

7.Counterparty Purchases. Counterparty (or any “affiliated purchaser” as defined in Rule 10b-18 under the Exchange Act (“Rule 10b-18”)) shall not, without the prior written consent of Dealer, directly or indirectly purchase any Shares (including by means of a derivative instrument), listed contracts on the Shares or securities that are convertible into, or exchangeable or exercisable for Shares (including, without limitation, any Rule 10b-18 purchases of blocks (as defined in Rule 10b-18)) during any Calculation Period or, if applicable, Settlement Valuation Period, except through Dealer. However, the foregoing shall not (a) limit Counterparty’s ability to purchase Shares in connection with any company employee, officer or director equity plan or any dividend reinvestment plan, in each case, that are not expected to result in market transactions, (b) limit Counterparty’s ability to withhold Shares to cover tax liabilities associated with any such plan, (c) prohibit any purchases effected by or for an issuer “plan” by an “agent independent of the issuer” (each as defined in Rule 10b-18), (d) otherwise restrict Counterparty’s or any of its affiliates’ ability to repurchase Shares under privately negotiated, off exchange transactions with any of its employees, officers, directors, affiliates or any third party that are not expected to result in market transactions or (e) limit Counterparty’s ability to grant stock and options to “affiliated purchasers” (as


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defined in Rule 10b-18) or the ability of such affiliated purchasers to acquire such stock or options in connection with Counterparty’s compensation policies for directors, officers and employees or any agreements with respect to the compensation of directors, officers or employees of any entities that are acquisition targets of Counterparty; provided that the transactions described in (a)-(e) are not considered a “Rule 10b-18 purchase” (as defined in Rule 10b-18) (the transactions described in (a)-(e) of this sentence, the “Permitted Transactions”).

8.Special Provisions for Merger Transactions. Notwithstanding anything to the contrary herein or in the Equity Definitions:

(a)Counterparty agrees that it:

(i)will not during the period commencing on the Trade Date through the end of the Calculation Period or, if applicable, the Settlement Valuation Period for any Transaction make, or permit to be made (to the extent within Counterparty's control), any public announcement (as defined in Rule 165(f) under the Securities Act) of any Merger Transaction or potential Merger Transaction (a “Public Announcement”) unless such Public Announcement is made prior to the opening or after the close of the regular trading session on the Exchange for the Shares;

(ii)shall promptly (but in any event prior to the next opening of the regular trading session on the Exchange) notify Dealer following any such Public Announcement that such Public Announcement has been made; and

(iii)shall promptly (but in any event prior to the next opening of the regular trading session on the Exchange) provide Dealer with written notice specifying (i) Counterparty’s average daily Rule 10b- 18 Purchases (as defined in Rule 10b-18) during the three full calendar months immediately preceding the date of such Public Announcement that were not effected through Dealer or its affiliates and (ii) the number of Shares purchased pursuant to the proviso in Rule 10b-18(b)(4) under the Exchange Act for the three full calendar months preceding the date of such Public Announcement. Such written notice shall be deemed to be a certification by Counterparty to Dealer that such information is true and correct. In addition, Counterparty shall promptly notify Dealer of the earlier to occur of the completion of the relevant Merger Transaction and the completion of the vote by target shareholders.

(b)Counterparty acknowledges that a Public Announcement may cause the terms of any Transaction to be adjusted or such Transaction to be terminated; accordingly, Counterparty acknowledges that in making any Public Announcement, it must comply with the standards set forth in Section 6 above.

(c)Upon the occurrence of any Public Announcement, Dealer in its reasonable discretion may (i) make adjustments to the terms of any Transaction, including, without limitation, the Scheduled Termination Date or the Forward Price Adjustment Amount, and/or suspend the Calculation Period and/or any Settlement Valuation Period or (ii) treat the occurrence of such Public Announcement as an Additional Termination Event with Counterparty as the sole Affected Party and the Transactions hereunder as the Affected Transactions and with the amount under Section 6(e) of the Agreement determined taking into account the fact that the Calculation Period or Settlement Valuation Period, as the case may be, had fewer Scheduled Trading Days than originally anticipated.

“Merger Transaction” means any merger, acquisition or similar transaction involving a recapitalization as contemplated by Rule 10b-18(a)(13)(iv) under the Exchange Act.

9.Special Provisions for Acquisition Transaction Announcements. (a) If an Acquisition Transaction Announcement occurs on or prior to the Settlement Date for any Transaction, then the Calculation Agent shall make such adjustments (if any) to the exercise, settlement, payment or other terms of such Transaction as the Calculation Agent determines appropriate to account for the economic effect on such Transaction of such Acquisition Transaction Announcement. If an Acquisition Transaction Announcement occurs after the Trade Date, but prior to the First Acceleration Date of any Transaction, the First Acceleration Date shall be the date of such Acquisition Transaction Announcement.


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(b)“Acquisition Transaction Announcement” means (i) the announcement of an event that, if consummated, would result in an Acquisition Transaction, (ii) an announcement that Counterparty or any of its subsidiaries has entered into an agreement, a letter of intent or an understanding designed to result in an Acquisition Transaction, (iii) the announcement of the intention to solicit or enter into, or to explore strategic alternatives or other similar undertaking that may include, an Acquisition Transaction, (iv) any other announcement that in the reasonable judgment of the Calculation Agent may result in an Acquisition Transaction or (v) any announcement of any change or amendment to any previous Acquisition Transaction Announcement (including any announcement of the abandonment of any such previously announced Acquisition Transaction, agreement, letter of intent, understanding or intention). For the avoidance of doubt, announcements as used in the definition of Acquisition Transaction Announcement refer to any public announcement whether made by the Issuer or a third party.

(c)“Acquisition Transaction” means (i) any Merger Event (for purposes of this definition the definition of Merger Event shall be read with the references therein to “100%” being replaced by “30%” and to “50%” by “75%” and without reference to the clause beginning immediately following the definition of Reverse Merger therein to the end of such definition), Tender Offer or Merger Transaction or any other transaction involving the merger of Counterparty with or into any third party, (ii) the sale or transfer of all or substantially all of the assets of Counterparty, (iii) a recapitalization, reclassification, binding share exchange or other similar transaction, (iv) any acquisition, lease, exchange, transfer, disposition (including by way of spin-off or distribution) of assets (including any capital stock or other ownership interests in subsidiaries) or other similar event by Counterparty or any of its subsidiaries where the aggregate consideration transferable or receivable by or to Counterparty or its subsidiaries exceeds 30% of the market capitalization of Counterparty as of the date of such announcement and (v) any transaction in which Counterparty or its board of directors has a legal obligation to make a recommendation to its shareholders in respect of such transaction (whether pursuant to Rule 14e-2 under the Exchange Act or otherwise).

10.Acknowledgments. (a) The parties hereto intend for:

(i)each Transaction to be a “securities contract” as defined in Section 741(7) of the Bankruptcy Code, a “swap agreement” as defined in Section 101(53B) of the Bankruptcy Code and a “forward contract” as defined in Section 101(25) of the Bankruptcy Code, and the parties hereto to be entitled to the protections afforded by, among other Sections, Sections 362(b)(6), 362(b)(17), 362(b)(27), 362(o), 546(e), 546(g), 546(j), 555, 556, 560 and 561 of the Bankruptcy Code;

(ii)the Agreement to be a “master netting agreement” as defined in Section 101(38A) of the Bankruptcy Code;

(iii)a party’s right to liquidate, terminate or accelerate any Transaction, net out or offset termination values or payment amounts, and to exercise any other remedies upon the occurrence of any Event of Default or Termination Event under the Agreement with respect to the other party or any Extraordinary Event that results in the termination or cancellation of any Transaction to constitute a “contractual right” (as defined in the Bankruptcy Code); and

(iv)all payments for, under or in connection with each Transaction, all payments for the Shares (including, for the avoidance of doubt, payment of the Prepayment Amount) and the transfer of such Shares to constitute “settlement payments” and “transfers” (as defined in the Bankruptcy Code).

(b)Counterparty acknowledges that:

(i)during the term of any Transaction, Dealer and its affiliates may buy or sell Shares or other securities or buy or sell options or futures contracts or enter into swaps or other derivative securities in order to establish, adjust or unwind its hedge position with respect to such Transaction;

(ii)Dealer and its affiliates may also be active in the market for the Shares and derivatives linked to the Shares other than in connection with hedging activities in relation to any Transaction, including acting as agent or as principal and for its own account or on behalf of customers;


13

(iii)Dealer shall make its own determination as to whether, when or in what manner any hedging or market activities in Counterparty’s securities shall be conducted and shall do so in a manner that it deems appropriate to hedge its price and market risk with respect to the Forward Price and the VWAP Price;

(iv)any market activities of Dealer and its affiliates with respect to the Shares may affect the market price and volatility of the Shares, as well as the Forward Price and VWAP Price, each in a manner that may be adverse to Counterparty; and

(v)each Transaction is a derivatives transaction in which it has granted Dealer an option; Dealer may purchase shares for its own account at an average price that may be greater than, or less than, the price paid by Counterparty under the terms of the related Transaction.

(c)Counterparty:

(i)is an “institutional account” as defined in FINRA Rule 4512(c);

(ii)is capable of evaluating investment risks independently, both in general and with regard to all transactions and investment strategies involving a security or securities, and will exercise independent judgment in evaluating the recommendations of Dealer or its associated persons, unless it has otherwise notified Dealer in writing; and

(iii)will notify Dealer if any of the statements contained in clause (i) or (ii) of this Section 10(c) ceases to be true.

11.Credit Support Documents. The parties hereto acknowledge that no Transaction hereunder is secured by any collateral that would otherwise secure the obligations of Counterparty herein or pursuant to the Agreement.

12.Set-off. Notwithstanding anything to the contrary in the Agreement, Dealer agrees not to set off or net amounts due from Counterparty with respect to any Transaction against amounts due from Dealer to Counterparty with respect to contracts or instruments that are not Equity Contracts. “Equity Contract” means any transaction or instrument that does not convey to Dealer rights, or the ability to assert claims, that are senior to the rights and claims of common stockholders in the event of Counterparty’s bankruptcy.

13.Delivery of Shares. Notwithstanding anything to the contrary herein, Dealer may, by prior notice to Counterparty, satisfy its obligation to deliver any Shares or other securities on any date due (an “Original Delivery Date”) by making separate deliveries of Shares or such securities, as the case may be, at more than one time on or prior to such Original Delivery Date, so long as the aggregate number of Shares and other securities so delivered on or prior to such Original Delivery Date is equal to the number required to be delivered on such Original Delivery Date.

14.Early Termination. In the event that an Early Termination Date (whether as a result of an Event of Default or a Termination Event) occurs or is designated with respect to any Transaction (except as a result of a Merger Event in which the consideration or proceeds to be paid to holders of Shares consists solely of cash), if either party would owe any amount to the other party pursuant to Section 6(d)(ii) of the Agreement (any such amount, a “Payment Amount”), then, in lieu of any payment of such Payment Amount, Counterparty may, no later than the Early Termination Date or the date on which such Transaction is terminated, elect to deliver or for Dealer to deliver, as the case may be, to the other party a number of Shares (or, in the case of a Merger Event, a number of units, each comprising the number or amount of the securities or property that a hypothetical holder of one Share would receive in such Merger Event (each such unit, an “Alternative Delivery Unit” and, the securities or property comprising such unit, “Alternative Delivery Property”)) with a value equal to the Payment Amount, as determined by the Calculation Agent (and the parties agree that, in making such determination of value, the Calculation Agent may take into account a number of factors, including the market price of the Shares or Alternative Delivery Property on the date of early termination and, if such delivery is made by Dealer, the prices at which Dealer purchases Shares or Alternative Delivery Property to fulfill its delivery obligations under this Section 14 assuming such purchases are made in a commercially reasonable manner and any hedge positions that are unwound are commercially reasonable


14

hedge positions); provided that in determining the composition of any Alternative Delivery Unit, if the relevant Merger Event involves a choice of consideration to be received by holders, such holder shall be deemed to have elected to receive the maximum possible amount of cash; and provided further that Counterparty may make such election only if Counterparty represents and warrants to Dealer in writing on the date it notifies Dealer of such election that, as of such date, Counterparty is not aware of any material non-public information concerning the Shares and is making such election in good faith and not as part of a plan or scheme to evade compliance with the federal securities laws. If such delivery is made by Counterparty, paragraphs 2 through 7 of Annex A shall apply as if such delivery were a settlement of the Transaction to which Net Share Settlement applied, the Cash Settlement Payment Date were the Early Termination Date and the Forward Cash Settlement Amount were zero (0) minus the Payment Amount owed by Counterparty.

15.Calculations and Payment Date upon Early Termination. The parties acknowledge and agree that in calculating Close-Out Amount pursuant to Section 6 of the Agreement Dealer may (but need not) determine such amount based on expected gains and losses assuming a commercially reasonable (including without limitation with regard to reasonable legal and regulatory guidelines) risk bid was used to determine gains and losses to avoid awaiting the delay associated with closing out any hedge or related trading position in a commercially reasonable manner prior to or promptly following the designation of an Early Termination Date. Notwithstanding anything to the contrary herein or in Section 6(d)(ii) of the Agreement or in the Equity Definitions, all amounts calculated as being due in respect of an Early Termination Date under Section 6(e) of the Agreement or other termination or cancellation of a Transaction hereunder will be payable on the day that notice of the amount payable is effective; provided that if Counterparty elects to receive Shares or Alternative Delivery Property in accordance with Section 14, such Shares or Alternative Delivery Property shall be delivered on a date selected by Dealer as promptly as practicable.

16.Automatic Termination Provisions. Notwithstanding anything to the contrary in Section 6 of the Agreement, if a Termination Price is specified in any Supplemental Confirmation, then an Additional Termination Event with Counterparty as the sole Affected Party and the Transaction to which such Supplemental Confirmation relates as the Affected Transaction will automatically occur without any notice or action by Dealer or Counterparty if the price of the Shares on the Exchange at any time falls below such Termination Price, and the Exchange Business Day that the price of the Shares on the Exchange at any time falls below the Termination Price will be the “Early Termination Date” for purposes of the Agreement.

17.Delivery of Cash. For the avoidance of doubt, nothing in this Master Confirmation shall be interpreted as requiring Counterparty to deliver cash in respect of the settlement of the Transactions contemplated by this Master Confirmation following payment by Counterparty of the relevant Prepayment Amount, except in circumstances where the required cash settlement thereof is permitted for classification of the contract as equity by ASC 815-40, Derivatives and Hedging – Contracts in Entity’s Own Equity, as in effect on the relevant Trade Date (including, without limitation, where Counterparty so elects to deliver cash or fails timely to elect to deliver Shares or Alternative Delivery Property in respect of the settlement of such Transactions).

18.Claim in Bankruptcy. Dealer acknowledges and agrees that this Confirmation is not intended to convey to it rights with respect to the Transactions that are senior to the claims of common stockholders in the event of Counterparty’s bankruptcy; provided that nothing herein shall limit or shall be deemed to limit Dealer’s right to pursue remedies in the event of a breach by Counterparty of its obligations and agreements with respect to the Transaction; provided further that nothing herein shall limit or shall be deemed to limit Dealer’s rights in respect of any transaction other than the Transactions.

19.Amendments to the Equity Definitions.

(a)Section 11.2(a) of the Equity Definitions is hereby amended by (i) replacing the words “a diluting or concentrative” with the word “an” and (ii) adding the phrase “or such Transaction” at the end thereof;

(b)Section 11.2(c) of the Equity Definitions is hereby amended by (i) replacing the words “a diluting or concentrative” with the word “an” in the fifth line thereof, (ii) adding the phrase “or such Transaction” immediately following the word “Shares” in the sixth line thereof, (iii) deleting the words “dilutive or concentrative” in the sixth to last line thereof and (iv) replacing the phrase “(provided that no adjustments will be made to account


15

solely for changes in volatility, expected dividends, stock loan rate or liquidity relative to the relevant Share)” with the phrase “(and, for the avoidance of doubt, adjustments may be made to account for changes in volatility, expected dividends, stock loan rate or liquidity relative to the relevant Share)”; and

(c)Section 11.2(e)(vii) of the Equity Definitions is hereby amended by (i) replacing the words “a diluting or concentrative” with the word “an” and (ii) adding the phrase “or the relevant Transaction” at the end thereof.

20.Calculations, Adjustments and Determinations. All calculations, adjustments and determinations made by Dealer hereunder, whether as Calculation Agent, as Determining Party or following the occurrence of an Early Termination Date, shall be made in good faith and in a commercially reasonable manner. Following any calculation, adjustment or determination by Dealer hereunder (including, without limitation, in its capacity as Calculation Agent), Dealer shall promptly deliver to Counterparty a report in a commonly used file format for the storage and manipulation of financial data (including the methodology, interest rates, quotations and market data (including volatility) but without disclosing any proprietary or confidential models or other proprietary or confidential information) displaying in reasonable detail the basis for such determination, adjustment or calculation, as the case may be.

21.Governing Law. The Agreement, this Master Confirmation, each Supplemental Confirmation and all matters arising in connection with the Agreement, this Master Confirmation and each Supplemental Confirmation shall be governed by, and construed and enforced in accordance with, the laws of the State of New York (without reference to its choice of laws doctrine other than Title 14 of Article 5 of the New York General Obligations Law).

22.Illegality. The parties agree that, for the avoidance of doubt, for purposes of Section 5(b)(i) of the Agreement, “any applicable law” shall include the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010, any rules and regulations promulgated thereunder and any similar law or regulation, without regard to Section 739 of the Dodd-Frank Wall Street Reform and Consumer Protection Act of 2010 or any similar legal certainty provision in any legislation enacted, or rule or regulation promulgated, on or after the Trade Date, and the consequences specified in the Agreement, including without limitation, the consequences specified in Section 6 of the Agreement, shall apply to any Illegality arising from any such act, rule or regulation.

23.Offices.

(a)The Office of Dealer for each Transaction is: 200 West Street, New York, New York 10282-

2198.

(b) The Office of Counterparty for each Transaction is 200 East Randolph Street, Suite 3300, Chicago, Illinois 60601.

24.Submission to Jurisdiction. Section 13(b) of the Agreement is deleted in its entirety and replaced by the following: “Each party hereby irrevocably and unconditionally submits for itself and its property in any suit, legal action or proceeding relating to this Agreement and/or any Transaction, or for recognition and enforcement of any judgment in respect thereof, (each, “Proceedings”) to the exclusive jurisdiction of

the Supreme Court of the State of New York, sitting in New York County, the courts of the United States of America for the Southern District of New York and appellate courts from any thereof. Nothing in this Agreement, the Master Confirmation or any Supplemental Confirmation precludes either party from bringing Proceedings in any other jurisdiction if (A) the courts of the State of New York or the United States of America for the Southern District of New York lack jurisdiction over the parties or the subject matter of the Proceedings or declines to accept the Proceedings on the grounds of lacking such jurisdiction; (B) the Proceedings are commenced by a party for the purpose of enforcing against the other party’s property, assets or estate any decision or judgment rendered by any court in which Proceedings may be brought as provided hereunder; (C) the Proceedings are commenced to appeal any such court’s decision or judgment to any higher court with competent appellate jurisdiction over that court’s decisions or judgments if that higher court is located outside the State of New York or Borough of Manhattan, such as a federal court of appeals or the U.S. Supreme Court; or (D) any suit, action or proceeding has been commenced in another jurisdiction by


16

or against the other party or against its property, assets or estate and, to exercise or protect its rights, interests or remedies under this Agreement, the Master Confirmation or any Supplemental Confirmation, the party (1) joins, files a claim, or takes any other action, in any such suit, action or proceeding, or (2) otherwise commences any Proceeding in that other jurisdiction as the result of that other suit, action or proceeding having commenced in that other jurisdiction.”

25.Tax.

(a)For the purposes of Section 3(f) of the Agreement:

(i)Dealer represents that it is a “U.S. person” (as that term is used in section 1.1441- 4(a)(3)(ii) of the United States Treasury Regulations), or a disregarded entity of such a U.S. person for U.S. federal income tax purposes.

(ii)Counterparty represents to Dealer that it is (i) a domestic corporation for U.S. federal income tax purposes and (ii) a “U.S. person” (as that term is used in section 1.1441-4(a)(3)(ii) of the United States Treasury Regulations).

(b) Dealer agrees to deliver to Counterparty a valid, accurate and complete U.S. Internal Revenue Service Form W-9 (or any successor form) (A) upon execution of this Master Confirmation, (B) promptly upon reasonable demand by Counterparty and (C) promptly upon learning that any Form W-9 (or any successor thereto) previously provided by Dealer has become obsolete, invalid or incorrect.

(c) Counterparty agrees to deliver to Dealer a valid, accurate and complete U.S. Internal Revenue Service Form W-9 (or any successor form) (A) upon execution of this Master Confirmation, (B) promptly upon reasonable demand by Dealer and (C) promptly upon learning that any Form W-9 (or any successor thereto) previously provided by Counterparty has become obsolete, invalid or incorrect.

(d)“Tax” as used in Paragraph 25(a) and “Indemnifiable Tax” as defined in Section 14 of the Agreement shall not include any U.S. federal withholding tax imposed or collected pursuant to Sections 1471 through 1474 of the Internal Revenue Code of 1986, as amended (the “Code”), any current or future regulations or official interpretations thereof, any agreement entered into pursuant to Section 1471(b) of the Code, or any fiscal or regulatory legislation, rules or practices adopted pursuant to any intergovernmental agreement entered into in connection with the implementation of such Sections of the Code (a “FATCA Withholding Tax). For the avoidance of doubt, a FATCA Withholding Tax is a Tax the deduction or withholding of which is required by applicable law for the purposes of Section 2(d) of the Agreement. To the extent that either party is not an adhering party to the ISDA 2015 Section 871(m) Protocol published by ISDA on November 2, 2015 and available at www.isda.org, as may be amended, supplemented, replaced or superseded from time to time (the “871(m) Protocol”), the parties agree that the provisions and amendments contained in the Attachment to the 871(m) Protocol are incorporated into and apply to the Agreement with respect to each Transaction as if set forth in full herein. The parties further agree that, solely for purposes of applying such provisions and amendments to the Agreement with respect to any Transaction, references to “each Covered Master Agreement” in the 871(m) Protocol will be deemed to be references to the Agreement with respect to such Transaction, and references to the “Implementation Date” in the 871(m) Protocol will be deemed to be references to the Trade Date of such Transaction.

26.Non-confidentiality. Notwithstanding any provision in this Master Confirmation, any Supplemental Confirmation or the Agreement to the contrary, in connection with Section 1.6011-4 of the Treasury Regulations, the parties hereby agree that each party (and each employee, representative, or other agent of such party) may disclose to any and all persons, without limitation of any kind, the U.S. tax treatment and U.S. tax structure of any Transaction and all materials of any kind (including opinions or other tax analyses) that are provided to such party relating to such U.S. tax treatment and U.S. tax structure, other than any information for which nondisclosure is reasonably necessary to comply with applicable securities laws.

27.U.S. Resolution Stay Provisions.


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(a)Recognition of the U.S. Special Resolution Regimes

i.In the event that Dealer becomes subject to a proceeding under (i) the Federal Deposit Insurance Act and the regulations promulgated thereunder or (ii) Title II of the Dodd-Frank Wall Street Reform and Consumer Protection Act and the regulations promulgated thereunder (a “U.S. Special Resolution Regime”) the transfer from Dealer of this Master Confirmation, and any interest and obligation in or under, and any property securing, this Master Confirmation, will be effective to the same extent as the transfer would be effective under the

U.S. Special Resolution Regime if this Master Confirmation, and any interest and obligation in or under, and any property securing, this Master Confirmation were governed by the laws of the United States or a state of the United States.

ii.In the event that Dealer or an Affiliate becomes subject to a proceeding under a U.S. Special Resolution Regime, any Default Rights (as defined in 12 C.F.R. §§ 252.81, 47.2 or 382.1, as applicable (“Default Right”)) under this Master Confirmation that may be exercised against Dealer are permitted to be exercised to no greater extent than such Default Rights could be exercised under the U.S. Special Resolution Regime if this Master Confirmation were governed by the laws of the United States or a state of the United States.

(b)Limitation on Exercise of Certain Default Rights Related to an Affiliate’s Entry Into Insolvency Proceedings. Notwithstanding anything to the contrary in this Master Confirmation, the parties expressly acknowledge and agree that:

i.Counterparty shall not be permitted to exercise any Default Right with respect to this Master Confirmation or any Affiliate Credit Enhancement that is related, directly or indirectly, to an Affiliate of the Dealer becoming subject to receivership, insolvency, liquidation, resolution, or similar proceeding (an “Insolvency Proceeding”), except to the extent that the exercise of such Default Right would be permitted under the provisions of 12 C.F.R. 252.84, 12 C.F.R. 47.5 or 12 C.F.R. 382.4, as applicable; and

ii.Nothing in this Master Confirmation shall prohibit the transfer of any Affiliate Credit Enhancement, any interest or obligation in or under such Affiliate Credit Enhancement, or any property securing such Affiliate Credit Enhancement, to a transferee upon or following an Affiliate of Dealer becoming subject to an Insolvency Proceeding, unless the transfer would result in the Counterparty being the beneficiary of such Affiliate Credit Enhancement in violation of any law applicable to the Counterparty.

iii.For the purpose of this paragraph:

I.Affiliate” is defined in, and shall be interpreted in accordance with, 12 U.S.C. § 1841(k).

II. “Credit Enhancement” means any credit enhancement or credit support arrangement in support of the obligations of Dealer under or with respect to this Master Confirmation, including any guarantee, collateral arrangement (including any pledge, charge, mortgage or other security interest in collateral or title transfer arrangement), trust or similar arrangement, letter of credit, transfer of margin or any similar arrangement.

(c)U.S. Protocol. If Counterparty has previously adhered to, or subsequently adheres to, the ISDA 2018

U.S. Resolution Stay Protocol as published by the International Swaps and Derivatives Association, Inc. as of July 31, 2018 (the “ISDA U.S. Protocol”), the terms of such protocol shall be incorporated into and form a part of this Master Confirmation and the terms of the ISDA U.S. Protocol shall supersede and replace the terms of this section. For purposes of incorporating the ISDA U.S. Protocol, Dealer shall be deemed to be a Regulated Entity, Counterparty shall be deemed to be an Adhering Party, and this Master Confirmation shall be deemed to be a Protocol Covered Agreement. Capitalized terms used but not defined in this paragraph shall have the meanings given to them in the ISDA U.S. Protocol.

(d)Pre-existing In-Scope Agreements. Dealer and Counterparty agree that to the extent there are any outstanding “in-scope QFCs,” as defined in 12 C.F.R. § 252.82(d), that are not excluded under 12 C.F.R. § 252.88, between Dealer and Counterparty that do not otherwise comply with the requirements of 12 C.F.R. § 252.2, 252.81– 8 (each such agreement, a “Preexisting In-Scope Agreement”), then each such Preexisting In-Scope Agreement is


18

hereby amended to include the foregoing provisions in this section, with references to “this Master Confirmation” being understood to be references to the applicable Preexisting In-Scope Agreement.

28.Counterparts. This Master Confirmation may be executed in any number of counterparts, all of which shall constitute one and the same instrument, and any party hereto may execute this Master Confirmation by signing and delivering one or more counterparts. Counterparts may be delivered via facsimile, electronic mail (including any electronic signature covered by the U.S. federal ESIGN Act of 2000, Uniform Electronic Transactions Act, the Electronic Signatures and Records Act or other applicable law, e.g., DocuSign (any such signature, an “Electronic Signature”)) or other transmission method and any counterpart so delivered shall be deemed to have been duly and validly delivered and be valid and effective for all purposes. The words “execution,” “signed,” “signature” and words of like import in this Master Confirmation or in any other certificate, agreement or document related to this Master Confirmation shall include any Electronic Signature, except to the extent electronic notices are expressly prohibited under this Master Confirmation or the Agreement.


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Counterparty hereby agrees (a) to check this Master Confirmation carefully and immediately upon receipt so that errors or discrepancies can be promptly identified and rectified and (b) to confirm that the foregoing (in the exact form provided by Dealer) correctly sets forth the terms of the agreement between Dealer and Counterparty with respect to any particular Transaction to which this Master Confirmation relates, by manually signing this Master Confirmation or this page hereof as evidence of agreement to such terms and providing the other information requested herein and immediately returning an executed copy to Equity Derivatives Documentation Department, Facsimile No. 212-428-1980/83.

Yours faithfully,

GOLDMAN SACHS & CO. LLC

By:

/s/ GOLDMAN SACHS & CO. LLC

Authorized Signatory

Agreed and Accepted By:

KEMPER CORPORATION

By:

/s/ MAXWELL T. MINDAK

Name: Maxwell T. Mindak

Title: Treasurer

{Signature Page to Master Confirmation]

SCHEDULE A

SUPPLEMENTAL CONFIRMATION


To:			Kemper Corporation 200 East Randolph Street, Suite 3300 Chicago, Illinois 60601
From:			Goldman Sachs & Co. LLC
Subject:			Accelerated Stock Buyback
Ref. No:
Date:			August 13, 2025

_______________________________________________________________________________________________

The purpose of this Supplemental Confirmation is to confirm the terms and conditions of the Transaction entered into between Goldman Sachs & Co. LLC (“Dealer”) and Kemper Corporation (“Counterparty”) (together, the “Contracting Parties”) on the Trade Date specified below. This Supplemental Confirmation is a binding contract between Dealer and Counterparty as of the relevant Trade Date for the Transaction referenced below.

1.This Supplemental Confirmation supplements, forms part of, and is subject to the Master Confirmation dated as of August 13, 2025 (the “Master Confirmation”) between the Contracting Parties, as amended and supplemented from time to time. All provisions contained in the Master Confirmation govern this Supplemental Confirmation except as expressly modified below.

2.The terms of the Transaction to which this Supplemental Confirmation relates are as follows:


Trade Date:			August 13, 2025
Forward Price Adjustment Amount:			USD 0.6845
Calculation Period Start Date:			August 14, 2025
Scheduled Termination Date:			November 26, 2025
First Acceleration Date:			September 15, 2025
Prepayment Amount:			USD 150,000,000.00
Prepayment Date:			August 14, 2025
Initial Shares:			2.279,2023 Shares; provided that if, in connection with the Transaction, Dealer is unable to borrow or otherwise acquire a number of Shares equal to the Initial Shares for delivery to Counterparty on the Initial Share Delivery Date, the Initial Shares delivered on the Initial Share Delivery Date shall be reduced to such number of Shares that Dealer is able to so borrow or otherwise acquire.
Initial Share Delivery Date:			August 14, 2025
Ordinary Dividend Amount:			For any calendar quarter, USD 0.32

A-1


Scheduled Ex-Dividend Dates:			August 18, 2025 November 17,2025
Maximum Stock Loan Rate: Initial Stock Loan Rate: Termination Price:			200 basis points per annum 25 basis points per annum USD 26.33 per Share

3.Counterparty represents and warrants to Dealer that neither it nor any “affiliated purchaser” (as defined in Rule 10b-18 under the Exchange Act) has made any purchases of blocks pursuant to the proviso in Rule 10b- 18(b)(4) under the Exchange Act during either (i) the four full calendar weeks immediately preceding the Trade Date or (ii) during the calendar week in which the Trade Date occurs.

4.This Supplemental Confirmation may be executed in any number of counterparts, all of which shall constitute one and the same instrument, and any party hereto may execute this Supplemental Confirmation by signing and delivering one or more counterparts.

A-2

Counterparty hereby agrees (a) to check this Supplemental Confirmation carefully and immediately upon receipt so that errors or discrepancies can be promptly identified and rectified and (b) to confirm that the foregoing (in the exact form provided by Dealer) correctly sets forth the terms of the agreement between Dealer and Counterparty with respect to the Transaction to which this Supplemental Confirmation relates, by manually signing this Supplemental Confirmation or this page hereof as evidence of agreement to such terms and providing the other information requested herein and immediately returning an executed copy to Equity Derivatives Documentation Department, facsimile No. 212-428-1980/83.

Yours sincerely,

GOLDMAN SACHS & CO. LLC

By:

/s/ GOLDMAN SACHS & CO. LLC

Authorized Signatory

Agreed and Accepted By:

KEMPER CORPORATION

By:

/s/ MAXWELL T. MINDAK

Name: Maxwell T. Mindak

Title: Treasurer

{Signature Page to Supplemental Confirmation}

ANNEX A COUNTERPARTY SETTLEMENT PROVISIONS

1.The following Counterparty Settlement Provisions shall apply to the extent indicated under the Master Confirmation:

Settlement Currency: USD

Settlement Method Election: Applicable; provided that (i) Section 7.1 of the Equity

Definitions is hereby amended by deleting the word “Physical” in the sixth line thereof and replacing it with the words “Net Share” and (ii) the Electing Party may make a settlement method election only if the Electing Party represents and warrants to Dealer in writing on the date it notifies Dealer of its election that, as of such date, the Electing Party is not aware of any material non-public information concerning Counterparty or the Shares and is electing the settlement method in good faith and not as part of a plan or scheme to evade compliance with the federal securities laws.

Electing Party: Counterparty

Settlement Method

Election Date: The earlier of (i) the Scheduled Termination Date and (ii) the

second Exchange Business Day immediately following the Accelerated Termination Date (in which case the election under Section 7.1 of the Equity Definitions shall be made no later than 10 minutes prior to the open of trading on the Exchange on such second Exchange Business Day), as the case may be

Default Settlement Method: Cash Settlement

Forward Cash Settlement

Amount: The Number of Shares to be Delivered multiplied by the Settlement Price

Settlement Price: The average of the VWAP Prices for the Exchange Business

Days in the Settlement Valuation Period, subject to Valuation Disruption as specified in the Master Confirmation

Settlement Valuation Period: A number of Scheduled Trading Days selected by Dealer in its

reasonable discretion, beginning on the Scheduled Trading Day immediately following the earlier of (i) the Scheduled Termination Date or (ii) the Exchange Business Day immediately following the Termination Date

Cash Settlement: If Cash Settlement is applicable, then Buyer shall pay to Seller

the absolute value of the Forward Cash Settlement Amount on the Cash Settlement Payment Date.

Cash Settlement


1

Payment Date: The date one Settlement Cycle following the last day of the Settlement Valuation Period.

Net Share Settlement

Procedures: If Net Share Settlement is applicable, Net Share Settlement shall be made in accordance with paragraphs 2 through 7 below.

2.Net Share Settlement shall be made by delivery on the Cash Settlement Payment Date of a number of Shares satisfying the conditions set forth in paragraph 3 below (the “Registered Settlement Shares”), or a number of Shares not satisfying such conditions (the “Unregistered Settlement Shares”), in either case with a value equal to the absolute value of the Forward Cash Settlement Amount, with such Shares’ value based on the value thereof to Dealer (which value shall, in the case of Unregistered Settlement Shares, take into account a commercially reasonable illiquidity discount), in each case as determined by the Calculation Agent.

3.Counterparty may only deliver Registered Settlement Shares pursuant to paragraph 2

above if:

(a)a registration statement covering public resale of the Registered Settlement Shares by Dealer (the “Registration Statement”) shall have been filed with the Securities and Exchange Commission under the Securities Act and been declared or otherwise become effective on or prior to the date of delivery, and no stop order shall be in effect with respect to the Registration Statement; a printed prospectus relating to the Registered Settlement Shares (including any prospectus supplement thereto, the “Prospectus”) shall have been delivered to Dealer, in such quantities as Dealer shall reasonably have requested, on or prior to the date of delivery;

(b)the form and content of the Registration Statement and the Prospectus (including, without limitation, any sections describing the plan of distribution) shall be satisfactory to Dealer;

(c)as of or prior to the date of delivery, Dealer and its agents shall have been afforded a reasonable opportunity to conduct a due diligence investigation with respect to Counterparty customary in scope for underwritten offerings of equity securities and the results of such investigation are satisfactory to Dealer, in its reasonable discretion; and

(d)as of the date of delivery, an agreement (the “Underwriting Agreement”) shall have been entered into with Dealer in connection with the public resale of the Registered Settlement Shares by Dealer substantially similar to underwriting agreements customary for underwritten offerings of equity securities, in form and substance satisfactory to Dealer, which Underwriting Agreement shall include, without limitation, provisions substantially similar to those contained in such underwriting agreements relating, without limitation, to the indemnification of, and contribution in connection with the liability of, Dealer and its affiliates and the provision of customary opinions, accountants’ comfort letters and lawyers’ negative assurance letters.

4.If Counterparty delivers Unregistered Settlement Shares pursuant to paragraph 2 above:

(a)all Unregistered Settlement Shares shall be delivered to Dealer (or any affiliate of Dealer designated by Dealer) pursuant to the exemption from the registration requirements of the Securities Act provided by Section 4(a)(2) thereof;

(b)as of or prior to the date of delivery, Dealer and any potential purchaser of any such shares from Dealer (or any affiliate of Dealer designated by Dealer) identified by Dealer shall be afforded a commercially reasonable opportunity to conduct a due diligence investigation with respect to Counterparty customary in scope for private placements of equity securities (including, without limitation, the right to have made available to them for inspection all financial and other records, pertinent corporate documents and other information reasonably requested by them);


2

(c)as of the date of delivery, Counterparty shall enter into an agreement (a “Private Placement Agreement”) with Dealer (or any affiliate of Dealer designated by Dealer) in connection with the private placement of such shares by Counterparty to Dealer (or any such affiliate) and the private resale of such shares by Dealer (or any such affiliate), substantially similar to private placement purchase agreements customary for private placements of equity securities, in form and substance commercially reasonably satisfactory to Dealer, which Private Placement Agreement shall include, without limitation, provisions substantially similar to those contained in such private placement purchase agreements relating, without limitation, to the indemnification of, and contribution in connection with the liability of, Dealer and its affiliates and the provision of customary opinions, accountants’ comfort letters and lawyers’ negative assurance letters, and shall provide for the payment by Counterparty of all fees and expenses in connection with such resale, including all fees and expenses of counsel for Dealer, and shall contain representations, warranties, covenants and agreements of Counterparty reasonably necessary or advisable to establish and maintain the availability of an exemption from the registration requirements of the Securities Act for such resales; and

(d)in connection with the private placement of such shares by Counterparty to Dealer (or any such affiliate) and the private resale of such shares by Dealer (or any such affiliate), Counterparty shall, if so requested by Dealer, prepare, in cooperation with Dealer, a private placement memorandum in form and substance reasonably satisfactory to Dealer

5.Dealer, itself or through an affiliate (the “Selling Agent”) or any underwriter(s), will sell all, or such lesser portion as may be required hereunder, of the Registered Settlement Shares or Unregistered Settlement Shares and any Makewhole Shares (as defined below) (together, the “Settlement Shares”) delivered by Counterparty to Dealer pursuant to paragraph 6 below commencing on the Cash Settlement Payment Date and continuing until the date on which the aggregate Net Proceeds (as such term is defined below) of such sales, as determined by Dealer, is equal to the absolute value of the Forward Cash Settlement Amount (such date, the “Final Resale Date”). If the proceeds of any sale(s) made by Dealer, the Selling Agent or any underwriter(s), net of any fees and commissions (including, without limitation, underwriting or placement fees) customary for similar transactions under the circumstances at the time of the offering, together with carrying charges and expenses incurred in connection with the offer and sale of the Shares (including, but without limitation to, the covering of any over-allotment or short position (syndicate or otherwise)) (the “Net Proceeds”) exceed the absolute value of the Forward Cash Settlement Amount, Dealer will refund, in USD, such excess to Counterparty on the date that is three

(3) Currency Business Days following the Final Resale Date, and, if any portion of the Settlement Shares remains unsold, Dealer shall return to Counterparty on that date such unsold Shares.

6.If the Calculation Agent determines that the Net Proceeds received from the sale of the Registered Settlement Shares or Unregistered Settlement Shares or any Makewhole Shares, if any, pursuant to this paragraph 6 are less than the absolute value of the Forward Cash Settlement Amount (the amount in USD by which the Net Proceeds are less than the absolute value of the Forward Cash Settlement Amount being the “Shortfall” and the date on which such determination is made, the “Deficiency Determination Date”), Counterparty shall on the Exchange Business Day next succeeding the Deficiency Determination Date (the “Makewhole Notice Date”) deliver to Dealer, through the Selling Agent, a notice of Counterparty’s election that Counterparty shall either (i) pay an amount in cash equal to the Shortfall on the day that is one (1) Currency Business Day after the Makewhole Notice Date, or (ii) deliver additional Shares. If Counterparty elects to deliver to Dealer additional Shares, then Counterparty shall deliver additional Shares in compliance with the terms and conditions of paragraph 3 or paragraph 4 above, as the case may be (the “Makewhole Shares”), on the first Clearance System Business Day which is also an Exchange Business Day following the Makewhole Notice Date in such number as the Calculation Agent reasonably believes would have a market value on that Exchange Business Day equal to the Shortfall. Such Makewhole Shares shall be sold by Dealer in accordance with the provisions above; provided that if the sum of the Net Proceeds from the sale of the originally delivered Shares and the Net Proceeds from the sale of any Makewhole Shares is less than the absolute value of the Forward Cash Settlement Amount then Counterparty shall, at its election, either make such cash payment or deliver to Dealer further Makewhole Shares until such Shortfall has been reduced to zero.

7.Notwithstanding the foregoing, in no event shall the aggregate number of Settlement Shares and Makewhole Shares be greater than the Reserved Shares minus the amount of any Shares actually


3

delivered by Counterparty under any other Transaction(s) under this Master Confirmation (the result of such calculation, the “Capped Number”). Counterparty represents and warrants (which shall be deemed to be repeated on each day that a Transaction is outstanding) that the Capped Number is equal to or less than the number of Shares determined according to the following formula:

A – B

Where A = the number of authorized but unissued shares of the Counterparty that are not reserved for future issuance on the date of the determination of the Capped Number; and

B = the maximum number of Shares required to be delivered to third parties if Counterparty elected Net Share Settlement of all transactions in the Shares (other than Transactions in the Shares under this Master Confirmation) with all third parties that are then currently outstanding and unexercised.

“Reserved Shares” means initially, 5,698,006 Shares.


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EX-31.1 3 kmpr202509302025ex311.htm EX-31.1 Document

Exhibit 31.1

CERTIFICATIONS

I, C. Thomas Evans, Jr., certify that:

1. I have reviewed this quarterly report on Form 10-Q of Kemper Corporation;

2. Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the registrant as of, and for, the periods presented in this report;

4. The registrant’s other certifying officer(s) and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) and internal control over financial reporting (as defined in Exchange Act Rules 13a-15(f) and 15d-15(f)) for the registrant and have:

(a) Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the registrant, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

(b) Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles;

(c) Evaluated the effectiveness of the registrant’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

(d) Disclosed in this report any change in the registrant’s internal control over financial reporting that occurred during the registrant’s most recent fiscal quarter (the registrant’s fourth fiscal quarter in the case of an annual report) that has materially affected, or is reasonably likely to materially affect, the registrant’s internal control over financial reporting; and

5. The registrant’s other certifying officer(s) and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the registrant’s auditors and the audit committee of the registrant’s board of directors (or persons performing the equivalent functions):

(a) All significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the registrant’s ability to record, process, summarize and report financial information; and

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 5, 2025



/s/ C. THOMAS EVANS, JR.
C. Thomas Evans, Jr.
Interim Chief Executive Officer, Secretary and General Counsel

EX-31.2 4 kmpr202509302025ex312.htm EX-31.2 Document

Exhibit 31.2

CERTIFICATIONS

I, Bradley T. Camden, certify that:

1. I have reviewed this quarterly report on Form 10-Q of Kemper Corporation;

(b) Any fraud, whether or not material, that involves management or other employees who have a significant role in the registrant’s internal control over financial reporting.

Date: November 5, 2025



/s/ BRADLEY T. CAMDEN
Bradley T. Camden
Executive Vice President and Chief Financial Officer

EX-32.1 5 kmpr202509302025ex321.htm EX-32.1 Document

Exhibit 32.1

Certification of CEO Pursuant to

18 U.S.C. Section 1350,

as Adopted Pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report on Form 10-Q of Kemper Corporation (the “Company”) for the quarterly period ended September 30, 2025 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), C. Thomas Evans, Jr., as Interim Chief Executive Officer of the Company, hereby certifies, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that, to the best of his knowledge:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.



						/s/ C. THOMAS EVANS, JR.
Name:						C. Thomas Evans, Jr.
Title:						Interim Chief Executive Officer, Secretary and General Counsel
Date:						November 5, 2025

EX-32.2 6 kmpr202509302025ex322.htm EX-32.2 Document

Exhibit 32.2

Certification of CFO Pursuant to

18 U.S.C. Section 1350,

as Adopted Pursuant to

Section 906 of the Sarbanes-Oxley Act of 2002

In connection with the Quarterly Report on Form 10-Q of Kemper Corporation (the “Company”) for the quarterly period ended September 30, 2025 as filed with the Securities and Exchange Commission on the date hereof (the “Report”), Bradley T. Camden, as Executive Vice President and Chief Financial Officer of the Company, hereby certifies, pursuant to 18 U.S.C. § 1350, as adopted pursuant to § 906 of the Sarbanes-Oxley Act of 2002, that, to the best of his knowledge:

(1) The Report fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

(2) The information contained in the Report fairly presents, in all material respects, the financial condition and results of operations of the Company.



						/s/ BRADLEY T. CAMDEN
Name:						Bradley T. Camden
Title:						Executive Vice President and Chief Financial Officer
Date:						November 5, 2025