Business Segments

12 Months Ended

Dec. 31, 2014

Segment Reporting [Abstract]

Business Segments

NOTE 17. 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: Property & Casualty Insurance and Life & Health Insurance.

The Property & Casualty Insurance segment’s principal products are personal automobile insurance, both standard and nonstandard risks, homeowners insurance, other personal insurance and commercial automobile insurance. These products are primarily distributed through independent agents, employer-sponsored voluntary benefit programs and other affinity relationships. The Life & Health Insurance segment’s principal products are individual life, accident, health and property insurance. These products are distributed by career agents employed by the Company as well as exclusive and non-exclusive independent agents and brokers.

The Company’s earned premiums are derived in the United States. The accounting policies of the segments are the same as those described in Note 2, “Summary of Accounting Policies and Accounting Changes,” to the Consolidated Financial Statements. Capital expenditures for long-lived assets by operating segment are immaterial.

It is the Company’s management practice to allocate certain corporate expenses, primarily compensation costs for corporate employees and related facility costs, included in Interest and Other Expenses in the Consolidated Statements of Income to its insurance operations. The amount of such allocated corporate expenses was $42.1 million, $39.7 million and $31.7 million for

NOTE 17. BUSINESS SEGMENTS (Continued)

the years ended December 31, 2014, 2013 and 2012, respectively. The Company does not allocate Net Realized Gains on Sales of Investments, Net Impairment Losses Recognized in Earnings, interest expense on debt or postretirement benefit plans, and actuarial gains and losses on its postretirement benefit plans to its operating segments.

Segment Assets at December 31, 2014 and 2013 were:

DOLLARS IN MILLIONS	2014		2013
Property & Casualty Insurance	$	2,486.1	$	2,648.6
Life & Health Insurance	4,810.6		4,545.6
Corporate and Other, Net	536.7		462.2
Total Assets	$	7,833.4	$	7,656.4

Earned Premiums by product line for the years ended December 31, 2014, 2013 and 2012 were:

DOLLARS IN MILLIONS	2014		2013		2012
Personal Automobile	$	831.4	$	959.1	$	1,050.1
Homeowners	312.4		326.2		318.0
Other Personal Property and Casualty Insurance	127.4		134.1		136.9
Commercial Automobile	54.8		52.3		43.5
Life	387.6		392.7		393.4
Accident and Health	148.6		161.4		165.2
Total Earned Premiums	$	1,862.2	$	2,025.8	$	2,107.1

Segment Revenues, including a reconciliation to Total Revenues, for the years ended December 31, 2014, 2013 and 2012 were:

DOLLARS IN MILLIONS	2014			2013			2012
Segment Revenues:
Property & Casualty Insurance:
Earned Premiums	$	1,249.5		$	1,392.9		$	1,467.2
Net Investment Income	72.7			90.9			77.9
Other Income	0.5			0.5			0.7
Total Property & Casualty Insurance	1,322.7			1,484.3			1,545.8
Life & Health Insurance:
Earned Premiums	612.7			632.9			639.9
Net Investment Income	218.7			209.9			204.3
Other Income	0.9			0.2			0.1
Total Life & Health Insurance	832.3			843.0			844.3
Total Segment Revenues	2,155.0			2,327.3			2,390.1
Net Realized Gains on the Sales of Investments	39.1			99.1			65.4
Net Impairment Losses Recognized in Earnings	(15.2		)	(13.9		)	(6.9		)
Other	17.7			14.0			13.7
Total Revenues	$	2,196.6		$	2,426.5		$	2,462.3

NOTE 17. BUSINESS SEGMENTS (Continued)

Segment Operating Profit (Loss), including a reconciliation to Income from Continuing Operations before Income Taxes, for the years ended December 31, 2014, 2013 and 2012 was:

DOLLARS IN MILLIONS	2014			2013			2012
Segment Operating Profit (Loss):
Property & Casualty Insurance	$	27.1		$	139.6		$	(35.6	)
Life & Health Insurance	141.9			136.9			140.4
Total Segment Operating Profit	169.0			276.5			104.8
Corporate and Other Operating Loss	(32.7		)	(47.3		)	(40.9		)
Total Operating Profit	136.3			229.2			63.9
Net Realized Gains on Sales of Investments	39.1			99.1			65.4
Net Impairment Losses Recognized in Earnings	(15.2		)	(13.9		)	(6.9		)
Income from Continuing Operations before Income Taxes	$	160.2		$	314.4		$	122.4

Segment Net Operating Income (Loss), including a reconciliation to Income from Continuing Operations, for the years ended December 31, 2014, 2013 and 2012 was:

DOLLARS IN MILLIONS	2014			2013			2012
Segment Net Operating Income (Loss):
Property & Casualty Insurance	$	24.9		$	100.6		$	(10.9	)
Life & Health Insurance	91.8			89.3			90.8
Total Segment Net Operating Income	116.7			189.9			79.9
Corporate and Other Net Operating Loss	(19.6		)	(30.7		)	(26.1		)
Consolidated Net Operating Income	97.1			159.2			53.8
Net Income (Loss) From:
Net Realized Gains on Sales of Investments	25.4			64.4			42.5
Net Impairment Losses Recognized in Earnings	(9.9		)	(9.1		)	(4.5		)
Income from Continuing Operations	$	112.6		$	214.5		$	91.8

Amortization of Deferred Policy Acquisition Costs by Operating Segment for the years ended December 31, 2014, 2013 and 2012 was:

DOLLARS IN MILLIONS	2014		2013		2012
Property & Casualty Insurance	$	187.5	$	207.2	$	212.6
Life & Health Insurance	47.9		46.7		44.4
Total Amortization	$	235.4	$	253.9	$	257.0