Schedule II Condensed Financial Information of Registrant

12 Months Ended

Dec. 31, 2019

Condensed Financial Information Disclosure [Abstract]

Schedule II Condensed Financial Information of Registrant

HORACE MANN EDUCATORS CORPORATION

(Parent Company Only)

 CONDENSED FINANCIAL INFORMATION OF REGISTRANT BALANCE SHEETS

As of December 31, 2019 and 2018

($ in thousands, except share data)

	December 31,
	2019			2018
ASSETS
Investments and cash	$	1,453		$	5,255
Investment in subsidiaries	1,901,725			1,473,538
Other assets	62,442			66,138
Total assets	$	1,965,620		$	1,544,931
LIABILITIES AND SHAREHOLDERS' EQUITY
Short-term debt	$	135,000		$	—
Long-term debt	248,025			247,740
Other liabilities	15,310			6,641
Total liabilities	398,335			254,381
Preferred stock, $0.001 par value, authorized 1,000,000 shares; none issued	—			—
Common stock, $0.001 par value, authorized 75,000,000 shares; issued, 2019, 66,088,808; 2018, 65,820,369	66			66
Additional paid-in capital	480,962			475,109
Retained earnings	1,352,539			1,216,582
Accumulated other comprehensive income (loss), net of taxes:
Net unrealized investment gains on securities	230,448			96,941
Net funded status of benefit plans	(10,767		)	(12,185		)
Treasury stock, at cost, 2019, 24,850,484 shares; 2018, 24,850,484 shares	(485,963		)	(485,963		)
Total shareholders' equity	1,567,285			1,290,550
Total liabilities and shareholders' equity	$	1,965,620		$	1,544,931

See accompanying Note to Condensed Financial Statements.

See accompanying Report of Independent Registered Public Accounting Firm.

SCHEDULE II (continued)

HORACE MANN EDUCATORS CORPORATION

(Parent Company Only)

CONDENSED FINANCIAL INFORMATION OF REGISTRANT STATEMENTS OF OPERATIONS

 ($ in thousands)

	Year Ended December 31,
	2019			2018			2017
Revenues
Net investment income	$	(135	)	$	100		$	34
Realized investment gains	—			—			—
Total revenues	(135		)	100			34
Expenses
Interest expense	14,272			11,892			11,835
Other	12,632			10,898			5,101
Total expenses	26,904			22,790			16,936
Loss before income tax benefit and equity in net earnings of subsidiaries	(27,039		)	(22,690		)	(16,902		)
Income tax benefit	(6,029		)	(4,723		)	(6,667		)
Loss before equity in net earnings of subsidiaries	(21,010		)	(17,967		)	(10,235		)
Equity in net earnings of subsidiaries	205,453			36,310			179,694
Net income	$	184,443		$	18,343		$	169,459

See accompanying Note to Condensed Financial Statements.

See accompanying Report of Independent Registered Public Accounting Firm.

SCHEDULE II (continued)

HORACE MANN EDUCATORS CORPORATION

(Parent Company Only)

CONDENSED FINANCIAL INFORMATION OF REGISTRANT STATEMENTS OF CASH FLOWS

($ in thousands)

	Year Ended December 31,
	2019			2018			2017
Cash flows from operating activities
Net Income	$	184,443		$	18,343		$	169,459
Equity in net income of subsidiaries	(205,453		)	(36,310		)	(179,694		)
Dividends received from subsidiaries	363,250			61,000			56,900
Changes in:
Income taxes	3,369			(4,939		)	(7,041		)
Operating assets and liabilities	8,310			(1,792		)	(260		)
Other	686			13,804			9,861
Net cash provided by operating activities	354,605			50,106			49,225
Cash flows from investing activities
Net increase (decrease) in short-term investments	3,336			1,621			(2,338		)
Acquisition of businesses	(444,124		)	—			—
Net cash provided by (used in) investing activities	(440,788		)	1,621			(2,338		)
Cash flows from financing activities
Dividends paid to shareholders	(47,333		)	(46,689		)	(46,114		)
Principal borrowings on senior revolving credit facility	135,000			—			—
Acquisition of treasury stock	—			(5,088		)	(1,660		)
Proceeds from exercise of stock options	1,730			3,627			4,190
Withholding tax payments on RSUs tendered	(3,680		)	(3,165		)	(3,245		)
Net cash provided by (used in) financing activities	85,717			(51,315		)	(46,829		)
Net increase (decrease) in cash	(466		)	412			58
Cash at beginning of period	538			126			68
Cash at end of period	$	72		$	538		$	126

See accompanying Note to Condensed Financial Statements.

See accompanying Report of Independent Registered Public Accounting Firm.

SCHEDULE II (continued)

HORACE MANN EDUCATORS CORPORATION

(Parent Company Only)

 CONDENSED FINANCIAL INFORMATION OF REGISTRANT

 NOTE TO CONDENSED FINANCIAL STATEMENTS

The accompanying condensed financial statements should be read in conjunction with the Consolidated Financial Statements and the accompanying notes thereto.