Business Wire | Nov 3, 2021 04:15PM EDT

Horace Mann reports third-quarter 2021 net income of $0.39 per share and core earnings* of $0.50 per share

Nov. 03, 2021

SPRINGFIELD, Ill.--(BUSINESS WIRE)--Nov. 03, 2021--Horace Mann Educators Corporation (NYSE:HMN) today reported financial results for the three months ended September 30, 2021:

($ inmillions, Three Months Ended Nine Months Endedexcept per share September 30, September 30,amounts)

2021 2020 % 2021 2020 % Change Change

Total $ 329.6 $ 337.1 -2.2 % $ 998.7 $ 958.1 4.2 %revenues

Net income 16.3 36.5 -55.3 % 102.3 85.5 19.6 %

Netinvestment(losses) (5.1 ) 1.9 N.M. (8.3 ) (10.1 ) N.M.gains aftertax

Core 21.4 34.6 -38.2 % 110.6 95.6 15.7 %earnings*

Per diluted share:

Net income 0.39 0.87 -55.2 % 2.43 2.03 19.7 %

Netinvestment(losses) (0.11 ) 0.05 N.M. (0.19 ) (0.24 ) N.M.gains aftertax

Coreearnings 0.50 0.82 -39.0 % 2.62 2.27 15.4 %per dilutedshare*

Book value 43.30 41.45 4.5 %per share

Book valueper shareexcludingnetunrealized 35.90 33.52 7.1 %investmentgains onfixedmaturitysecurities*

N.M. - Notmeaningful.

* These measures are not based on accounting principles generally accepted in the United States of America (non-GAAP). They are reconciled to the most directly comparable GAAP measures in the Appendix to the Investor Supplement. An explanation of these measures is contained in the Glossary of Selected Terms included as an exhibit in the Company's reports filed with the Securities and Exchange Commission.

"While all our business areas are showing some encouraging signs of momentum, the pace continues to vary by segment and geography compared to the pre-pandemic environment. Our Retirement line continued the strong performance it has delivered since the pandemic began, with its highest sales quarter in several years," said Horace Mann President and CEO Marita Zuraitis. "In addition, as educators returned to a 'more normal' school year, we have seen more opportunities to interact with them, introduce ourselves to new clients and engage in enrollment activities. This led to our highest sales quarter since the pandemic began for the Supplemental segment. Overall, it is clear that educators continue to find our financial solutions relevant for their needs. We also are seeing solid agent recruiting, typically a 'leading indicator' of future sales growth.

"Further, net investment income continued to outperform expectations in the third quarter, due to the strength of our alternatives investment strategy," Zuraitis continued. "The strong operating performance and net investment income increase were partially offset by the impact on our policyholders from Hurricane Ida and other catastrophe events, with $38.6 million in pretax catastrophe losses for the quarter, in line with our previous announcement. For the fourth quarter, we expect core EPS of $0.65 to $0.80 per diluted share with our full-year 2021 return on equity approaching 10%, a positive step toward our long-term sustainable double-digit ROE target.

"Our acquisition of Madison National Life remains on track for an early 2022 close, solidifying our approach of reaching educators wherever they get their protection and financial services solutions. In addition to providing individual products through local, trusted advisors, we will be able to reach substantially more educators through employer-sponsored group worksite solutions that also assist districts with attracting and retaining staff," Zuraitis said. "In its first year with Horace Mann, we expect Madison National to be accretive to EPS and ROE, and for the combined company to generate more than $50 million in excess capital each year. Over the past few years, we have developed a strong track record of prudent capital allocation that maximizes value for shareholders by prioritizing growth, as well as continued stock repurchases and maintaining our track record of annual increases in our cash dividend."

Property and Casualty segment loss due to catastrophe losses, auto loss costs returning to pre-pandemic levels(All comparisons vs. same period in 2020, unless noted otherwise)

The Property and Casualty insurance segment primarily markets private passenger automobile insurance and residential home insurance. Horace Mann offers standard automobile coverages, including liability, collision and comprehensive. Property coverage includes both homeowners and renters policies. For both automobile and property coverage, Horace Mann offers educators a discounted rate and the Educator Advantage(r) package of features. The Property and Casualty segment represented 53% of 2020 total revenues and contributed $76.5 million to 2020 core earnings.

($ in Three Months Ended Nine Months Endedmillions) September 30, September 30,

2021 2020 Change 2021 2020 Change

PropertyandCasualty $ 163.8 $ 172.8 -5.2 % $ 461.2 $ 482.5 -4.4 %premiumswritten*

PropertyandCasualty (4.7 ) 15.8 -129.7 % 42.5 53.7 -20.9 %net income/ coreearnings*

PropertyandCasualty 112.0 % 96.5 % 15.5 pts 99.1 % 93.5 % 5.6 ptscombinedratio

PropertyandCasualty 61.4 % 54.7 % 6.7 pts 60.0 % 53.6 % 6.4 ptsunderlyingloss ratio*

PropertyandCasualty 27.5 % 25.2 % 2.3 pts 26.2 % 25.8 % 0.4 ptsexpenseratio

PropertyandCasualty 25.1 % 20.9 % 4.2 pts 14.5 % 16.0 % -1.5 ptscatastrophelosses

PropertyandCasualty 88.9 % 79.9 % 9.0 pts 86.2 % 79.4 % 6.8 ptsunderlyingcombinedratio*

Autocombined 99.2 % 83.3 % 15.9 pts 92.1 % 85.3 % 6.8 ptsratio

Autounderlying 70.6 % 56.8 % 13.8 pts 65.7 % 58.1 % 7.6 ptsloss ratio*

Propertycombined 136.1 % 121.7 % 14.4 pts 112.4 % 109.6 % 2.8 ptsratio

Propertyunderlying 43.5 % 50.8 % -7.3 pts 49.0 % 44.9 % 4.1 ptsloss ratio*

The Property and Casualty segment core loss was due to catastrophe loss costs and auto loss costs continuing to move closer to pre-pandemic levels. Policyholder catastrophe losses were $38.6 million, which added 25.1 points to the combined ratio, compared to $34.8 million or 20.9 points in last year's third quarter. The largest event was Hurricane Ida, with $23.7 million in policyholder losses. The auto underlying loss ratio was 70.6%, compared to prior year auto underlying loss ratio of 56.8%, as driving patterns returned to a more normal level and severity continues to rise. In addition, last year's third quarter benefited from the $8.7 million Camp Fire subrogation recovery, reported as $5.2 million in favorable prior year reserve development and $3.5 million in return of reinsurance reinstatement premiums.

Property and Casualty premiums written of $163.8 million were below last year's third quarter with new business volume remaining below historical levels due to the impact of the pandemic on sales, as well as the impact of the Camp Fire subrogation recovery in third-quarter 2020. Auto average premiums were down slightly, driven in part by changes in miles driven during the pandemic. Property average premiums rose slightly as adjustments to coverage values continue to take effect. Rate increases are expected to play a greater role in the coming quarters.

Supplemental segment sees highest sales quarter since beginning of pandemic(All comparisons vs. same period in 2020, unless noted otherwise)

The Supplemental insurance segment specializes in marketing supplemental insurance products, including cancer, heart, hospital, supplemental disability and accident for the education market. The segment represented 12% of 2020 total revenues and contributed $43.1 million to 2020 core earnings.

Three Months Ended Nine Months Ended($ in millions) September 30, September 30,

2021 2020 Change 2021 2020 Change

Sales* $ 2.0 $ 1.4 42.9 % $ 4.2 $ 5.8 -27.6 %

Premiums earned 31.0 32.5 -4.6 % 94.3 98.8 -4.6 %

Supplemental net income / 11.4 10.6 7.5 % 34.8 30.6 13.7 %core earnings*

Pretax profit margin^(1) 37.6 % 36.3 % 1.3 38.8 % 34.7 % 4.1 pts pts

^(1) Measured to total revenues.

Supplemental segment sales were $2.0 million in the third quarter, a 42.9% increase over prior year and the highest quarter since the start of the pandemic. Persistency remained very strong at 92.2%.

Strong core earnings reflected higher net investment income as well as favorable business trends including some continued benefit from changes in policyholder behavior due to the pandemic. Segment expenses include the non-cash impact of amortization of intangible assets under purchase accounting that reduced core earnings by $2.9 million pretax. The pretax profit margin remains above management's longer-term expectations because of the pandemic-related changes in policyholder behavior.

Retirement segment benefits from strong net investment spread(All comparisons vs. same period in 2020, unless noted otherwise)

The Retirement segment primarily markets 403(b) tax-qualified fixed, fixed index and variable annuities; the Horace Mann Retirement Advantage(r) open architecture platform for 403(b)(7) and other defined contribution plans; and other retirement products to educators. Horace Mann is one of the largest participants in the K-12 educator portion of the 403(b) tax-qualified annuity market, measured by 403(b) net written premium on a statutory accounting basis. The Retirement segment represented 21% of 2020 total revenues and contributed $28.2 million to 2020 core earnings.

($ in Three Months Ended Nine Months Endedmillions) September 30, September 30,

2021 2020 Change 2021 2020 Change

Net annuitycontract $ 121.4 $ 118.7 2.3 % $ 344.6 $ 326.1 5.7 %deposits*

Annuity assetsunder 5,246.9 4,508.7 16.4 %management^(1)

Total assetsunder 9,352.7 8,032.6 16.4 %administration^(2)

Retirement netincome / core 14.1 7.8 80.8 % 36.2 16.6 118.1 %earnings*

Retirementcore earnings 13.5 7.3 84.9 % 34.8 15.6 123.1 %excluding DACunlocking*

^(1) Amount reported as of September 30, 2021 excludes $820.2 million of assetsunder management held under modified coinsurance reinsurance.

^(2) Includes Annuity AUM, Brokerage and Advisory AUA, and Recordkeeping AUA.

Net annuity contract deposits rose 2.3% over last year's third quarter. Horace Mann's relationship with educators often begins with 403(b) retirement savings products, including the company's attractive annuity products, which provide encouraging cross-sell opportunities. Total cash value persistency remained strong at 94.7% for both variable and fixed annuities.

Horace Mann currently has $5.2 billion in annuity assets under management, including $2.2 billion of fixed annuities, $2.5 billion of variable annuities and $0.5 billion of fixed indexed annuities. Assets under administration, which includes Retirement Advantage and other advisory and recordkeeping assets, was up 16.4% from a year ago, as assets under management continued to rise due to strong equity market performance over the past 12 months.

The net interest spread was 297 points, reflecting the strong returns from the alternatives portfolio. Core earnings excluding DAC unlocking was up 84.9%, primarily due to the strong net interest margin.

Life segment third-quarter core earnings increase on higher net investment income(All comparisons vs. same period in 2020, unless noted otherwise)

The Life insurance segment primarily markets traditional term and whole life insurance products to educators. The Life segment represented 14% of 2020 total revenues and contributed $10.4 million to 2020 core earnings.

Three Months Ended Nine Months Ended($ in millions) September 30, September 30,

2021 2020 Change 2021 2020 Change

Total sales* $ 3.5 $ 2.7 29.6 % $ 10.8 $ 9.6 12.5 %

Annualized sales* 2.0 2.0 - % 6.4 6.4 - %

Life mortality costs 10.3 9.0 14.4 % 33.4 28.3 18.0 %

Life net income / core 5.1 4.3 18.6 % 10.8 6.8 58.8 %earnings*

Life annualized sales were unchanged from last year on strong new sales of recurring premium policies and an increase in sales of single premium policies. Life core earnings for the quarter rose 18.6%, reflecting strong net investment income growth and mortality costs slightly above expectations. Full-year persistency for life products of 96.2% remains in line with prior periods.

Investment portfolio sees strong returns from alternatives portfolio(All comparisons vs. same period in 2020, unless noted otherwise)

Horace Mann's investment strategy is primarily focused on generating income to support product liabilities, and balances principal protection and risk. Total net investment income includes net investment income on the investment portfolio managed by Horace Mann, as well as accreted investment income on the deposit asset on reinsurance related to the company's reinsurance of policy liabilities related to legacy individual annuities written in 2002 or earlier.

Three Months Ended Nine Months Ended($ in millions) September 30, September 30,

2021 2020 Change 2021 2020 Change

Pretax netinvestmentincome - $ 78.1 $ 69.2 12.9 % $ 233.3 $ 184.3 26.6 %investmentportfolio

Pretaxinvestmentincome -deposit asset 25.6 24.5 4.5 % 75.1 72.1 4.2 %on

reinsurance

Total pretaxnet investment 103.7 93.7 10.7 % 308.4 256.4 20.3 %income

Pretax netinvestment (6.5) 2.5 N.M. (10.6) (12.8) N.M.(losses) gains

Pretax netunrealizedinvestmentgains on fixed 466.4 496.2 -6.0 %

maturitysecurities

Investmentyield,excludinglimited 0.18 -0.07partnership 4.36 % 4.18 % pts 4.29 % 4.36 % pts

interests,pretax -annualized

N.M. - Notmeaningful.

Total net investment income was up 10.7% or $10.0 million. Net investment income on the managed portfolio rose 12.9%, reflecting strong returns in the alternatives portfolio in the third quarter, largely due to private equity and venture capital limited partnership investments. The company's fixed maturity securities portfolio is in a net unrealized investment gain position of $466.4 million at September 30, 2021.

Book value excluding net unrealized investment gains up 7% year over year

At September 30, 2021, shareholders' equity was $1.80 billion, or $43.30 per share. Excluding net unrealized investment gains on fixed maturity securities, shareholders' equity was $1.49 billion, or $35.90 per share.* At September 30, 2021, total debt was $388.6 million, with $135.0 million outstanding on the company's line of credit. The ratio of debt-to-capital excluding net unrealized investment gains* was 20.7%.

As of September 30, 2021, $18.9 million remained authorized for future share repurchases under the share repurchase program.

Segment guidance

The company's current guidance for fourth quarter 2021 core EPS is 65 cents to 80 cents. Segment guidance includes fourth-quarter net investment income estimated to total approximately $95 million to $100 million.

* Property and Casualty segment fourth-quarter 2021 core earnings expected to be in the range of $10 million to $13 million. Underlying auto loss ratio expected to be above third quarter with frequency at or near pre-pandemic levels and higher severity. * Supplemental segment fourth-quarter 2021 core earnings expected to be in the range of $10 million to $11 million. * Life segment fourth-quarter 2021 core earnings expected to be in the range of $3 million to $4 million. * Retirement segment fourth-quarter 2021 core earnings expected to be in the range of $10 million to $11 million.

Quarterly webcast

Horace Mann's senior management will discuss the company's third-quarter financial results with investors on Nov. 4, 2021 at 11:00 a.m. Eastern Time. The conference call will be webcast live at investors.horacemann.com and archived later in the day for replay.

About Horace Mann

Horace Mann Educators Corporation (NYSE: HMN) is the largest financial services company focused on providing America's educators and school employees with insurance and retirement solutions. Founded by Educators for Educators(r) in 1945, the company is headquartered in Springfield, Illinois. For more information, visit horacemann.com.

Safe Harbor Statement and Non-GAAP Measures

Statements included in this news release that are not historical in nature are forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995 and are subject to certain risks and uncertainties. Horace Mann is not under any obligation to (and expressly disclaims any such obligation to) update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Please refer to the company's Quarterly Report on Form 10-Q for the quarterly period ended June 30, 2021 and the company's past and future filings and reports filed with the Securities and Exchange Commission (SEC) for information concerning important factors that could cause actual results to differ materially from those in forward-looking statements. Information contained in this news release include measures which are based on methodologies other than accounting principles generally accepted in the United States of America (GAAP). Reconciliations of non-GAAP measures to the closest GAAP measures are contained in the Appendix to the Investor Supplement and additional descriptions of the non-GAAP measures are contained in the Glossary of Selected Terms included as an exhibit to the company's SEC filings.

HORACE MANN EDUCATORS CORPORATION

Financial Highlights (Unaudited)



($ in Three Months Ended Nine Months Endedmillions, except per September 30, September 30,share data)

2021 2020 % 2021 2020 % Change Change

Earnings Summary

Net income $ 16.3 $ 36.5 -55.3 % $ 102.3 $ 85.5 19.6 %

Netinvestment(losses) (5.1 ) 1.9 N.M. (8.3 ) (10.1 ) N.M.gains, aftertax

Core 21.4 34.6 -38.2 % 110.6 95.6 15.7 %earnings*



Per diluted share:

Net income $ 0.39 $ 0.87 -55.2 % $ 2.43 $ 2.03 19.7 %

Netinvestment(losses) (0.11 ) 0.05 N.M. (0.19 ) (0.24 ) N.M.gains, aftertax

Core 0.50 0.82 -39.0 % 2.62 2.27 15.4 %earnings*

Weightedaveragenumber ofshares and 42.2 42.1 0.2 % 42.2 42.0 0.5 %equivalentshares (inmillions) -Diluted



Return on Equity

Net incomereturn on 8.5 % 7.4 % 8.5 % 7.4 % equity - LTM^(1)

Net incomereturn on 3.6 % 8.7 % 7.6 % 6.9 % equity -annualized

Core returnon equity - 10.9 % 9.4 % 10.9 % 9.4 % LTM*^(2)

Core returnon equity - 5.8 % 10.1 % 10.1 % 9.4 % annualized*



Financial Position

Per share:^ (3)

Book value $ 43.30 $ 41.45 4.5 %

Effect of netunrealizedinvestmentgains on $ 7.40 $ 7.93 -6.7 %fixedmaturitysecurities^(4)

Dividends $ 0.31 $ 0.30 3.3 % $ 0.93 $ 0.90 3.3 %paid

Ending numberof sharesoutstanding 41.5 41.4 0.2 %(in millions)^(3)

Total assets $ 14,266.0 $ 13,003.4 9.7 %

Short-term 135.0 135.0 - %debt

Long-term 253.6 302.2 -16.1 %debt

Totalshareholders' 1,796.4 1,715.7 4.7 %equity



Additional Information

Netinvestment (losses)gains

Before tax $ (6.5 ) $ 2.5 N.M. $ (10.6 ) $ (12.8 ) N.M.

After tax (5.1 ) 1.9 N.M. (8.3 ) (10.1 ) N.M.

Per share, $ (0.11 ) $ 0.05 N.M. $ (0.19 ) $ (0.24 ) N.M.diluted

N.M. - Not meaningful.(1)

Based on last twelve months net income and average quarter-end shareholders' equity.

(2)

Based on last twelve months core earnings and average quarter-end shareholders' equity which has been adjusted to exclude the fair value adjustment for investments, net of the related impact on deferred policy acquisition costs and applicable deferred taxes.

(3)

Ending shares outstanding were 41,487,287 at September 30, 2021 and 41,396,322 at September 30, 2020.

(4)

Net of the related impact on deferred policy acquisition costs and applicable deferred taxes.

N.M. - Not meaningful.^ Based on last twelve months net income and average quarter-end(1) shareholders' equity.

Based on last twelve months core earnings and average quarter-end^ shareholders' equity which has been adjusted to exclude the fair value(2) adjustment for investments, net of the related impact on deferred policy acquisition costs and applicable deferred taxes.

^ Ending shares outstanding were 41,487,287 at September 30, 2021 and(3) 41,396,322 at September 30, 2020.

^ Net of the related impact on deferred policy acquisition costs and(4) applicable deferred taxes.

HORACE MANN EDUCATORS CORPORATION

Statements of Operations and Consolidated Data (Unaudited)

($ in millions)

Three Months Ended

September 30,

Nine Months Ended

September 30,

2021

2020

% Change

2021

2020

% Change

Statements of Operations

Premiums and contract charges earned

$

225.4

$

235.3

-4.2

%

$

678.8

$

697.0

-2.6

%

Net investment income

103.7

93.7

10.7

%

308.4

256.4

20.3

%

Net investment (losses) gains

(6.5

)

2.5

N.M.

(10.6

)

(12.8

)

N.M.

Other income

7.0

5.6

25.0

%

22.1

17.5

26.3

%

Total revenues

329.6

337.1

-2.2

%

998.7

958.1

4.2

%

Benefits, claims and settlement expenses

164.8

151.4

8.9

%

446.2

433.1

3.0

%

Interest credited

51.9

51.1

1.6

%

153.7

153.3

0.3

%

Operating expenses

64.3

57.9

11.1

%

182.8

173.1

5.6

%

DAC unlocking and amortization expense

22.9

24.6

-6.9

%

70.5

75.0

-6.0

%

Intangible asset amortization expense

3.3

3.5

-5.7

%

9.8

10.9

-10.1

%

Interest expense

3.4

3.5

-2.9

%

10.4

11.7

-11.1

%

Total benefits, losses and expenses

310.6

292.0

6.4

%

873.4

857.1

1.9

%

Income before income taxes

19.0

45.1

-57.9

%

125.3

101.0

24.1

%

Income tax expense

2.7

8.6

-68.6

%

23.0

15.5

48.4

%

Net income

$

16.3

$

36.5

-55.3

%

$

102.3

$

85.5

19.6

%

Premiums Written and Contract Deposits*

Property and Casualty

$

163.8

$

172.8

-5.2

%

$

461.2

$

482.5

-4.4

%

Supplemental

30.9

32.0

-3.4

%

94.2

98.3

-4.2

%

Net annuity contract deposits

121.4

118.7

2.3

%

344.6

326.1

5.7

%

Life

30.1

26.9

11.9

%

84.8

79.3

6.9

%

Total

$

346.2

$

350.4

-1.2

%

$

984.8

$

986.2

-0.1

%

Segment Net Income (Loss)

Property and Casualty

$

(4.7

)

$

15.8

-129.7

%

$

42.5

$

53.7

-20.9

%

Supplemental

11.4

10.6

7.5

%

34.8

30.6

13.7

%

Retirement

14.1

7.8

80.8

%

36.2

16.6

118.1

%

Life

5.1

4.3

18.6

%

10.8

6.8

58.8

%

Corporate and Other(1)

(9.6

)

(2.0

)

N.M.

(22.0

)

(22.2

)

0.9

%

Net income

$

16.3

$

36.5

-55.3

%

$

102.3

$

85.5

19.6

%

HORACE MANN EDUCATORS CORPORATION

Statements of Operations and Consolidated Data (Unaudited)



($ in Three Months Ended Nine Months Endedmillions) September 30, September 30,

2021 2020 % Change 2021 2020 % Change

Statementsof Operations

Premiums andcontract $ 225.4 $ 235.3 -4.2 % $ 678.8 $ 697.0 -2.6 %chargesearned

Netinvestment 103.7 93.7 10.7 % 308.4 256.4 20.3 %income

Netinvestment (6.5 ) 2.5 N.M. (10.6 ) (12.8 ) N.M.(losses)gains

Other income 7.0 5.6 25.0 % 22.1 17.5 26.3 %

Total 329.6 337.1 -2.2 % 998.7 958.1 4.2 %revenues



Benefits,claims and 164.8 151.4 8.9 % 446.2 433.1 3.0 %settlementexpenses

Interest 51.9 51.1 1.6 % 153.7 153.3 0.3 %credited

Operating 64.3 57.9 11.1 % 182.8 173.1 5.6 %expenses

DACunlockingand 22.9 24.6 -6.9 % 70.5 75.0 -6.0 %amortizationexpense

Intangibleasset 3.3 3.5 -5.7 % 9.8 10.9 -10.1 %amortizationexpense

Interest 3.4 3.5 -2.9 % 10.4 11.7 -11.1 %expense

Totalbenefits, 310.6 292.0 6.4 % 873.4 857.1 1.9 %losses andexpenses



Incomebefore 19.0 45.1 -57.9 % 125.3 101.0 24.1 %income taxes

Income tax 2.7 8.6 -68.6 % 23.0 15.5 48.4 %expense

Net income $ 16.3 $ 36.5 -55.3 % $ 102.3 $ 85.5 19.6 %



PremiumsWritten and ContractDeposits*

Property and $ 163.8 $ 172.8 -5.2 % $ 461.2 $ 482.5 -4.4 %Casualty

Supplemental 30.9 32.0 -3.4 % 94.2 98.3 -4.2 %

Net annuitycontract 121.4 118.7 2.3 % 344.6 326.1 5.7 %deposits

Life 30.1 26.9 11.9 % 84.8 79.3 6.9 %

Total $ 346.2 $ 350.4 -1.2 % $ 984.8 $ 986.2 -0.1 %



Segment NetIncome (Loss)

Property and $ (4.7 ) $ 15.8 -129.7 % $ 42.5 $ 53.7 -20.9 %Casualty

Supplemental 11.4 10.6 7.5 % 34.8 30.6 13.7 %

Retirement 14.1 7.8 80.8 % 36.2 16.6 118.1 %

Life 5.1 4.3 18.6 % 10.8 6.8 58.8 %

Corporateand Other^ (9.6 ) (2.0 ) N.M. (22.0 ) (22.2 ) 0.9 %(1)

Net income $ 16.3 $ 36.5 -55.3 % $ 102.3 $ 85.5 19.6 %

N.M. - Not meaningful.(1)

Corporate and Other includes interest expense on debt and the impact of net investment gains and losses and other Corporate level items. The Company does not allocate the impact of corporate level transactions to the insurance segments consistent with how management evaluates the results of those segments. See detail for this segment on page 12.

N.M. - Not meaningful. Corporate and Other includes interest expense on debt and the impact of net^ investment gains and losses and other Corporate level items. The Company(1) does not allocate the impact of corporate level transactions to the insurance segments consistent with how management evaluates the results of those segments. See detail for this segment on page 12.

HORACE MANN EDUCATORS CORPORATION

Business Segment Overview (Unaudited)

($ in millions)

Three Months Ended

September 30,

Nine Months Ended

September 30,

2021

2020

Change

2021

2020

Change

Property and Casualty

Premiums written*

$

163.8

$

172.8

-5.2

%

$

461.2

$

482.5

-4.4

%

Premiums earned

153.3

166.0

-7.7

%

464.1

488.7

-5.0

%

Net investment income

11.3

13.7

-17.5

%

43.8

30.3

44.6

%

Other income

0.7

0.5

40.0

%

4.0

2.1

90.5

%

Losses and loss adjustment expenses (LAE)

129.5

118.4

9.4

%

338.2

331.0

2.2

%

Operating expenses (includes amortization expense)

42.1

41.9

0.5

%

121.5

126.0

-3.6

%

Interest expense

-

0.1

-100.0

%

0.1

0.4

-75.0

%

Income (loss) before income taxes

(6.3

)

19.8

-131.8

%

52.1

63.7

-18.2

%

Net income (loss) / core earnings (loss)*

(4.7

)

15.8

-129.7

%

42.5

53.7

-20.9

%

Net investment income, after tax

9.4

11.3

-16.8

%

36.1

25.5

41.6

%

Catastrophe losses

After tax

30.5

27.5

10.9

%

53.0

61.9

-14.4

%

Before tax

38.6

34.8

10.9

%

67.1

78.3

-14.3

%

Prior years' reserve development, before tax(1)

Automobile

(2.0

)

(1.0

)

100.0

%

(5.0

)

(2.0

)

150.0

%

Property and other

(1.0

)

(6.2

)

-83.9

%

(2.2

)

(7.2

)

-69.4

%

Total

(3.0

)

(7.2

)

-58.3

%

(7.2

)

(9.2

)

-21.7

%

Operating statistics:

Loss and loss adjustment expense ratio

84.5

%

71.3

%

13.2

pts

72.9

%

67.7

%

5.2

pts

Expense ratio

27.5

%

25.2

%

2.3

pts

26.2

%

25.8

%

0.4

pts

Combined ratio

112.0

%

96.5

%

15.5

pts

99.1

%

93.5

%

5.6

pts

Effect on the combined ratio of:

Catastrophe losses

25.1

%

20.9

%

4.2

pts

14.5

%

16.0

%

-1.5

pts

Prior years' reserve development(1)

-2.0

%

-4.3

%

2.3

pts

-1.6

%

-1.9

%

0.3

pts

Combined ratio excluding the effects of

catastrophe losses and prior years' reserve

development (underlying combined ratio)*

88.9

%

79.9

%

9.0

pts

86.2

%

79.4

%

6.8

pts

Risks in force (in thousands)

559

593

-5.7

%

Automobile(2)

381

406

-6.2

%

Property

178

187

-4.8

%

Policy renewal rate - 12 months

Automobile(3)

83.3

%

80.9

%

2.4

pts

Property(3)

88.0

%

86.7

%

1.3

pts

HORACE MANN EDUCATORS CORPORATION

Business Segment Overview (Unaudited)



($ in Three Months Ended Nine Months Endedmillions) September 30, September 30,

2021 2020 Change 2021 2020 Change

Property and Casualty

Premiums $ 163.8 $ 172.8 -5.2 % $ 461.2 $ 482.5 -4.4 %written*

Premiums 153.3 166.0 -7.7 % 464.1 488.7 -5.0 %earned

Netinvestment 11.3 13.7 -17.5 % 43.8 30.3 44.6 %income

Other income 0.7 0.5 40.0 % 4.0 2.1 90.5 %

Losses andlossadjustment 129.5 118.4 9.4 % 338.2 331.0 2.2 %expenses(LAE)

Operatingexpenses(includes 42.1 41.9 0.5 % 121.5 126.0 -3.6 %amortizationexpense)

Interest - 0.1 -100.0 % 0.1 0.4 -75.0 %expense

Income(loss) (6.3 ) 19.8 -131.8 % 52.1 63.7 -18.2 %beforeincome taxes

Net income(loss) /core (4.7 ) 15.8 -129.7 % 42.5 53.7 -20.9 %earnings(loss)*

Netinvestment 9.4 11.3 -16.8 % 36.1 25.5 41.6 %income,after tax



Catastrophe losses

After tax 30.5 27.5 10.9 % 53.0 61.9 -14.4 %

Before tax 38.6 34.8 10.9 % 67.1 78.3 -14.3 %

Prior years'reservedevelopment, before tax^(1)

Automobile (2.0 ) (1.0 ) 100.0 % (5.0 ) (2.0 ) 150.0 %

Property and (1.0 ) (6.2 ) -83.9 % (2.2 ) (7.2 ) -69.4 %other

Total (3.0 ) (7.2 ) -58.3 % (7.2 ) (9.2 ) -21.7 %



Operating statistics:

Loss andlossadjustment 84.5 % 71.3 % 13.2 pts 72.9 % 67.7 % 5.2 ptsexpenseratio

Expense 27.5 % 25.2 % 2.3 pts 26.2 % 25.8 % 0.4 ptsratio

Combined 112.0 % 96.5 % 15.5 pts 99.1 % 93.5 % 5.6 ptsratio

Effect onthe combined ratio of:

Catastrophe 25.1 % 20.9 % 4.2 pts 14.5 % 16.0 % -1.5 ptslosses

Prior years'reserve -2.0 % -4.3 % 2.3 pts -1.6 % -1.9 % 0.3 ptsdevelopment^(1)

Combinedratioexcludingthe effectsof

catastrophelosses and 88.9 % 79.9 % 9.0 pts 86.2 % 79.4 % 6.8 ptsprior years'reserve

development(underlyingcombinedratio)*



Risks inforce (in 559 593 -5.7 %thousands)

Automobile^ 381 406 -6.2 %(2)

Property 178 187 -4.8 %



Policyrenewal rate - 12 months

Automobile^ 83.3 % 80.9 % 2.4 pts(3)

Property^(3) 88.0 % 86.7 % 1.3 pts

N.M. - Not meaningful.(1)

(Favorable) unfavorable.

(2)

Includes assumed risks in force of 4.

(3)

For the nine months ended September 30, 2021, retention data is an estimate due to system conversion.

N.M. - Not meaningful.^ (Favorable) unfavorable.(1)

^ Includes assumed risks in force of 4.(2)

^ For the nine months ended September 30, 2021, retention data is an estimate(3) due to system conversion.

HORACE MANN EDUCATORS CORPORATION

Business Segment Overview (Unaudited)

($ in millions)

Three Months Ended

September 30,

Nine Months Ended

September 30,

2021

2020

Change

2021

2020

Change

Supplemental

Premiums and contract charges earned

$

31.0

$

32.5

-4.6

%

$

94.3

$

98.8

-4.6

%

Net investment income

7.1

4.3

65.1

%

18.7

11.8

58.5

%

Other income

0.5

0.7

-28.6

%

1.8

2.0

-10.0

%

Benefits

8.7

9.2

-5.4

%

27.0

28.6

-5.6

%

Change in reserves

1.7

1.3

30.8

%

3.0

4.9

-38.8

%

Interest credited

0.1

0.2

-50.0

%

0.2

0.2

-

%

Operating expenses (includes DAC unlocking and

amortization expense)

10.7

10.1

5.9

%

31.3

30.3

3.3

%

Intangible asset amortization expense

2.9

3.1

-6.5

%

8.8

9.5

-7.4

%

Income before income taxes

14.5

13.6

6.6

%

44.5

39.1

13.8

%

Net income / core earnings*

11.4

10.6

7.5

%

34.8

30.6

13.7

%

Benefits ratio(1)

33.5

%

32.3

%

1.2

pts

31.8

%

33.9

%

-2.1

pts

Operating expense ratio(2)

27.7

%

26.9

%

0.8

pts

27.3

%

26.9

%

0.4

pts

Pretax profit margin(3)

37.6

%

36.3

%

1.3

pts

38.8

%

34.7

%

4.1

pts

Premium persistency (rolling 12 months)

92.2

%

90.1

%

2.1

pts

92.2

%

90.1

%

2.1

pts

HORACE MANN EDUCATORS CORPORATION

Business Segment Overview (Unaudited)

($ in Three Months Ended Nine Months Endedmillions) September 30, September 30,

2021 2020 Change 2021 2020 Change

Supplemental

Premiums andcontract $ 31.0 $ 32.5 -4.6 % $ 94.3 $ 98.8 -4.6 %chargesearned

Netinvestment 7.1 4.3 65.1 % 18.7 11.8 58.5 %income

Other income 0.5 0.7 -28.6 % 1.8 2.0 -10.0 %

Benefits 8.7 9.2 -5.4 % 27.0 28.6 -5.6 %

Change in 1.7 1.3 30.8 % 3.0 4.9 -38.8 %reserves

Interest 0.1 0.2 -50.0 % 0.2 0.2 - %credited

Operatingexpenses(includesDACunlocking 10.7 10.1 5.9 % 31.3 30.3 3.3 %and

amortizationexpense)

Intangibleasset 2.9 3.1 -6.5 % 8.8 9.5 -7.4 %amortizationexpense

Incomebefore 14.5 13.6 6.6 % 44.5 39.1 13.8 %income taxes

Net income /core 11.4 10.6 7.5 % 34.8 30.6 13.7 %earnings*



Benefits 33.5 % 32.3 % 1.2 pts 31.8 % 33.9 % -2.1 ptsratio^(1)

Operatingexpense 27.7 % 26.9 % 0.8 pts 27.3 % 26.9 % 0.4 ptsratio^(2)

Pretaxprofit 37.6 % 36.3 % 1.3 pts 38.8 % 34.7 % 4.1 ptsmargin^(3)



Premiumpersistency 92.2 % 90.1 % 2.1 pts 92.2 % 90.1 % 2.1 pts(rolling 12months)

N.M. - Not meaningful.(1)

Ratio of benefits plus change in reserves to earned premium.

(2)

Ratio of operating expenses to total revenues.

(3)

Ratio of income before taxes to total revenues.

N.M. - Not meaningful.^(1) Ratio of benefits plus change in reserves to earned premium.

^(2) Ratio of operating expenses to total revenues.

^(3) Ratio of income before taxes to total revenues.

HORACE MANN EDUCATORS CORPORATION

Business Segment Overview (Unaudited)

($ in millions)

Three Months Ended

September 30,

Nine Months Ended

September 30,

2021

2020

Change

2021

2020

Change

Retirement

Net annuity contract deposits

$

121.4

$

118.7

2.3

%

$

344.6

$

326.1

5.7

%

Variable

71.0

58.5

21.4

%

200.2

168.6

18.7

%

Fixed

50.4

60.2

-16.3

%

144.4

157.5

-8.3

%

Contract charges earned

9.9

7.4

33.8

%

27.7

21.5

28.8

%

Net investment income

39.2

33.6

16.7

%

112.1

94.6

18.5

%

Interest credited

14.2

14.2

-

%

42.1

44.4

-5.2

%

Net interest margin

25.0

19.4

28.9

%

70.0

50.2

39.4

%

Investment income - deposit asset on reinsurance

25.6

24.5

4.5

%

75.1

72.1

4.2

%

Interest credited - Reinsured block

26.5

25.5

3.9

%

77.9

75.0

3.9

%

Net interest margin - Reinsured block

(0.9

)

(1.0

)

10.0

%

(2.8

)

(2.9

)

3.4

%

Other income

5.1

3.9

30.8

%

14.7

12.1

21.5

%

Mortality loss and other reserve changes

(0.9

)

(1.3

)

30.8

%

(3.6

)

(4.1

)

12.2

%

Operating expenses (includes DAC unlocking and

amortization expense)

21.0

19.1

9.9

%

61.6

56.4

9.2

%

Intangible asset amortization expense

0.4

0.4

-

%

1.0

1.4

-28.6

%

Income before income taxes

16.8

8.9

88.8

%

43.4

19.0

128.4

%

Net income / core earnings*

14.1

7.8

80.8

%

36.2

16.6

118.1

%

Pretax income increase (decrease) due to

evaluation of:

Deferred policy acquisition costs

$

0.8

$

0.7

14.3

%

$

1.8

$

1.3

38.5

%

Guaranteed minimum death benefit reserve

-

0.1

-100.0

%

-

-

N.M.

Annuity contracts in force (thousands)

229

230

-0.4

%

Retirement Advantage(r) contracts in force (thousands)

14

12

16.7

%

Annuity accumulated account value on deposit /

Assets under management

$

5,246.9

$

4,508.7

16.4

%

Variable(1)

2,506.7

1,828.4

37.1

%

Fixed

2,740.2

2,680.3

2.2

%

Annuity accumulated value retention - 12 months

Variable accumulations

94.7

%

94.8

%

-0.1

pts

Fixed accumulations

94.7

%

94.5

%

0.2

pts

Life

Premiums written and contract deposits*

$

30.1

$

26.9

11.9

%

$

84.8

$

79.3

6.9

%

Premiums and contract charges earned

31.2

29.4

6.1

%

92.7

88.0

5.3

%

Net investment income

21.1

18.2

15.9

%

60.5

49.4

22.5

%

Other income

0.1

0.1

-

%

0.3

0.1

N.M.

Death benefits/mortality cost/change in reserves

24.0

21.2

13.2

%

74.4

64.5

15.3

%

Interest credited

11.1

11.2

-0.9

%

33.5

33.7

-0.6

%

Operating expenses (includes DAC unlocking and

amortization expense)

11.2

10.1

10.9

%

32.5

31.1

4.5

%

Income before income taxes

6.1

5.2

17.3

%

13.1

8.2

59.8

%

Net income / core earnings*

5.1

4.3

18.6

%

10.8

6.8

58.8

%

Pretax income increase (decrease) due to

evaluation of:

Deferred policy acquisition costs

$

-

$

0.2

-100.0

%

$

-

$

0.5

-100.0

%

Life policies in force (in thousands)

199

201

-1.0

%

Life insurance in force

$

20,271

$

19,681

3.0

%

Lapse ratio - 12 months (Ordinary life insurance)

3.8

%

4.3

%

-0.5

pts



HORACE MANN EDUCATORS CORPORATION

Business Segment Overview (Unaudited)



($ in Three Months Ended Nine Months Endedmillions) September 30, September 30,

2021 2020 Change 2021 2020 Change

Retirement

Net annuitycontract $ 121.4 $ 118.7 2.3 % $ 344.6 $ 326.1 5.7 %deposits

Variable 71.0 58.5 21.4 % 200.2 168.6 18.7 %

Fixed 50.4 60.2 -16.3 % 144.4 157.5 -8.3 %

Contractcharges 9.9 7.4 33.8 % 27.7 21.5 28.8 %earned

Netinvestment 39.2 33.6 16.7 % 112.1 94.6 18.5 %income

Interest 14.2 14.2 - % 42.1 44.4 -5.2 %credited

Net interest 25.0 19.4 28.9 % 70.0 50.2 39.4 %margin

Investmentincome -deposit asset 25.6 24.5 4.5 % 75.1 72.1 4.2 %onreinsurance

Interestcredited - 26.5 25.5 3.9 % 77.9 75.0 3.9 %Reinsuredblock

Net interestmargin - (0.9 ) (1.0 ) 10.0 % (2.8 ) (2.9 ) 3.4 %Reinsuredblock

Other income 5.1 3.9 30.8 % 14.7 12.1 21.5 %

Mortalityloss and (0.9 ) (1.3 ) 30.8 % (3.6 ) (4.1 ) 12.2 %other reservechanges

Operatingexpenses(includes DACunlocking and 21.0 19.1 9.9 % 61.6 56.4 9.2 %

amortizationexpense)

Intangibleasset 0.4 0.4 - % 1.0 1.4 -28.6 %amortizationexpense

Income before 16.8 8.9 88.8 % 43.4 19.0 128.4 %income taxes

Net income /core 14.1 7.8 80.8 % 36.2 16.6 118.1 %earnings*

Pretax incomeincrease(decrease)due to

evaluationof:

Deferredpolicy $ 0.8 $ 0.7 14.3 % $ 1.8 $ 1.3 38.5 %acquisitioncosts

Guaranteedminimum death - 0.1 -100.0 % - - N.M.benefitreserve

Annuitycontracts in 229 230 -0.4 %force(thousands)

RetirementAdvantage^(r)contracts in 14 12 16.7 %force(thousands)

Annuityaccumulatedaccount valueon deposit / $ 5,246.9 $ 4,508.7 16.4 %

Assets undermanagement

Variable^(1) 2,506.7 1,828.4 37.1 %

Fixed 2,740.2 2,680.3 2.2 %

Annuityaccumulatedvalue retention -12 months

Variable 94.7 % 94.8 % -0.1 ptsaccumulations

Fixed 94.7 % 94.5 % 0.2 ptsaccumulations

Life

Premiumswritten and $ 30.1 $ 26.9 11.9 % $ 84.8 $ 79.3 6.9 %contractdeposits*

Premiums andcontract 31.2 29.4 6.1 % 92.7 88.0 5.3 %chargesearned

Netinvestment 21.1 18.2 15.9 % 60.5 49.4 22.5 %income

Other income 0.1 0.1 - % 0.3 0.1 N.M.

Deathbenefits/mortality 24.0 21.2 13.2 % 74.4 64.5 15.3 %cost/changein reserves

Interest 11.1 11.2 -0.9 % 33.5 33.7 -0.6 %credited

Operatingexpenses(includes DACunlocking and 11.2 10.1 10.9 % 32.5 31.1 4.5 %

amortizationexpense)

Income before 6.1 5.2 17.3 % 13.1 8.2 59.8 %income taxes

Net income /core 5.1 4.3 18.6 % 10.8 6.8 58.8 %earnings*

Pretax incomeincrease(decrease)due to

evaluationof:

Deferredpolicy $ - $ 0.2 -100.0 % $ - $ 0.5 -100.0 %acquisitioncosts

Life policiesin force (in 199 201 -1.0 %thousands)

Lifeinsurance in $ 20,271 $ 19,681 3.0 %force

Lapse ratio -12 months(Ordinary 3.8 % 4.3 % -0.5 ptslifeinsurance)

N.M. - Not meaningful.(1)

Amount reported as of September 30, 2021 excludes $820.2 million of assets under management held under modified coinsurance reinsurance.

N.M. - Not meaningful.^ Amount reported as of September 30, 2021 excludes $820.2 million of assets(1) under management held under modified coinsurance reinsurance.

HORACE MANN EDUCATORS CORPORATION

Business Segment Overview (Unaudited)

($ in millions)

Three Months Ended

September 30,

Nine Months Ended

September 30,

2021

2020

% Change

2021

2020

% Change

Corporate and Other(1)

Components of loss before tax:

Net investment (losses) gains

$

(6.5

)

$

2.5

N.M.

$

(10.6

)

$

(12.8

)

N.M.

Interest expense

(3.4

)

(3.4

)

-

%

(10.3

)

(11.3

)

8.8

%

Other operating expenses, net investment income

and other income

(2.2

)

(1.5

)

-46.7

%

(6.9

)

(4.9

)

-40.8

%

Loss before income taxes

(12.1

)

(2.4

)

N.M.

(27.8

)

(29.0

)

4.1

%

Net loss

(9.6

)

(2.0

)

N.M.

(22.0

)

(22.2

)

0.9

%

Investments

Retirement and Life

Fixed maturity securities, at fair value (amortized

cost, net 2021, $4,746,7; 2020, $4,326.6)

$

5,120.3

$

4,719.0

8.5

%

Equity securities, at fair value

112.2

68.9

62.8

%

Short-term investments

32.6

219.1

-85.1

%

Policy loans

143.1

150.6

-5.0

%

Limited partnership interests

404.5

263.8

53.3

%

Other investments

51.2

44.4

15.3

%

Total Retirement and Life investments

5,863.9

5,465.8

7.3

%

Property and Casualty

Fixed maturity securities, at fair value (amortized

cost, net 2021, $704.6; 2020, $804.1)

768.9

873.1

-11.9

%

Equity securities, at fair value

30.6

29.1

5.2

%

Short-term investments

13.5

21.1

-36.0

%

Limited partnership interests

171.2

118.6

44.4

%

Other investments

1.1

1.1

-

%

Total Property and Casualty investments

985.3

1,043.0

-5.5

%

Supplemental

Fixed maturity securities, at fair value (amortized

cost, net 2021, $594.3; 2020, $541.6)

622.8

576.5

8.0

%

Equity securities, at fair value

8.5

4.3

97.7

%

Short-term investments

5.7

13.8

-58.7

%

Policy loans

0.8

0.8

-

%

Limited partnership interests

39.7

35.8

10.9

%

Other investments

3.2

1.8

77.8

%

Total Supplemental investments

680.7

633.0

7.5

%

Corporate and Other

Equity securities, at fair value

1.0

-

N.M.

Short-term investments

0.4

0.3

33.3

%

Total Corporate and Other investments

1.4

0.3

N.M.

Total investments

$

7,531.3

$

7,142.1

5.4

%

Net investment income - investment portfolio

Before tax

$

78.1

$

69.2

12.9

%

$

233.3

$

184.3

26.6

%

After tax

62.2

55.1

12.9

%

185.8

147.1

26.3

%

Investment income - deposit asset on reinsurance

Before tax

$

25.6

24.5

4.5

%

$

75.1

72.1

4.2

%

After tax

20.2

19.4

4.1

%

59.3

57.0

4.0

%



HORACE MANN EDUCATORS CORPORATION

Business Segment Overview (Unaudited)



($ in Three Months Ended Nine Months Endedmillions) September 30, September 30,

2021 2020 % 2021 2020 % Change Change

Corporateand Other^ (1)

Componentsof loss before tax:

Netinvestment $ (6.5 ) $ 2.5 N.M. $ (10.6 ) $ (12.8 ) N.M.(losses)gains

Interest (3.4 ) (3.4 ) - % (10.3 ) (11.3 ) 8.8 %expense

Otheroperatingexpenses,netinvestment (2.2 ) (1.5 ) -46.7 % (6.9 ) (4.9 ) -40.8 %income

and otherincome

Loss before (12.1 ) (2.4 ) N.M. (27.8 ) (29.0 ) 4.1 %income taxes

Net loss (9.6 ) (2.0 ) N.M. (22.0 ) (22.2 ) 0.9 %



Investments

Retirement and Life

Fixedmaturitysecurities,at fairvalue(amortized $ 5,120.3 $ 4,719.0 8.5 %

cost, net2021,$4,746,7;2020,$4,326.6)

Equitysecurities, 112.2 68.9 62.8 %at fairvalue

Short-term 32.6 219.1 -85.1 %investments

Policy loans 143.1 150.6 -5.0 %

Limitedpartnership 404.5 263.8 53.3 %interests

Other 51.2 44.4 15.3 %investments

TotalRetirement 5,863.9 5,465.8 7.3 %and Lifeinvestments

Property and Casualty

Fixedmaturitysecurities,at fairvalue(amortized 768.9 873.1 -11.9 %

cost, net2021,$704.6;2020,$804.1)

Equitysecurities, 30.6 29.1 5.2 %at fairvalue

Short-term 13.5 21.1 -36.0 %investments

Limitedpartnership 171.2 118.6 44.4 %interests

Other 1.1 1.1 - %investments

TotalProperty and 985.3 1,043.0 -5.5 %Casualtyinvestments

Supplemental

Fixedmaturitysecurities,at fairvalue(amortized 622.8 576.5 8.0 %

cost, net2021,$594.3;2020,$541.6)

Equitysecurities, 8.5 4.3 97.7 %at fairvalue

Short-term 5.7 13.8 -58.7 %investments

Policy loans 0.8 0.8 - %

Limitedpartnership 39.7 35.8 10.9 %interests

Other 3.2 1.8 77.8 %investments

TotalSupplemental 680.7 633.0 7.5 %investments

Corporate and Other

Equitysecurities, 1.0 - N.M.at fairvalue

Short-term 0.4 0.3 33.3 %investments

TotalCorporate 1.4 0.3 N.M.and Otherinvestments

Total $ 7,531.3 $ 7,142.1 5.4 %investments

Netinvestmentincome - investmentportfolio

Before tax $ 78.1 $ 69.2 12.9 % $ 233.3 $ 184.3 26.6 %

After tax 62.2 55.1 12.9 % 185.8 147.1 26.3 %

Investmentincome -deposit asset onreinsurance

Before tax $ 25.6 24.5 4.5 % $ 75.1 72.1 4.2 %

After tax 20.2 19.4 4.1 % 59.3 57.0 4.0 %

N.M. - Not meaningful.(1)

The Corporate and Other segment includes interest expense on debt and the impact of investment gains and losses and other corporate level items. The Company does not allocate the impact of corporate level transactions to the insurance segments consistent with how management evaluates the results of those segments.

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CONTACT: Heather J. Wietzel, Vice President, Investor Relations 217-788-5144 | investorrelations@horacemann.com