Business Segments

9 Months Ended

Sep. 30, 2019

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 three operating segments: Preferred Property & Casualty Insurance, Specialty Property & Casualty Insurance and Life & Health Insurance.

The Preferred Property & Casualty Insurance segment’s principal products are preferred automobile insurance, homeowners insurance, other personal insurance. The Specialty Property & Casualty Insurance segment’s principal products are specialty automobile insurance and commercial automobile insurance. These products are distributed primarily through independent agents and brokers. The Life & Health Insurance segment’s principal products are individual life, accident, supplemental health and property insurance. These products are distributed by career agents employed by the Company and independent agents and brokers.

Earned Premiums by product line for the nine and three months ended September 30, 2019 and 2018 were:



	Nine Months Ended				Three Months Ended
(Dollars in Millions)	Sep 30, 2019		Sep 30, 2018		Sep 30, 2019		Sep 30, 2018
Preferred Property & Casualty Insurance:
Personal Automobile	$	353.0	$	325.0	$	119.7	$	111.4
Homeowners	182.6		186.5		61.5		62.5
Other Personal Lines	29.5		30.4		9.8		10.1
Specialty Property & Casualty Insurance:
Specialty Automobile	2,092.5		1,229.0		719.2		655.3
Commercial Automobile	186.2		80.6		64.2		55.9
Life & Health Insurance:
Life	289.0		284.3		96.2		95.2
Accident and Health	142.4		132.0		47.6		44.9
Property	51.4		53.0		17.0		17.6
Total Earned Premiums	$	3,326.6	$	2,320.8	$	1,135.2	$	1,052.9

Note 12 - Business Segments (continued)

Segment Revenues, including a reconciliation to Total Revenues, for the nine and three months ended September 30, 2019 and 2018 were:



	Nine Months Ended						Three Months Ended
(Dollars in Millions)	Sep 30, 2019			Sep 30, 2018			Sep 30, 2019			Sep 30, 2018
Segment Revenues:
Preferred Property & Casualty Insurance:
Earned Premiums	$	565.1		$	541.9		$	191.0		$	184.0
Net Investment Income	32.6			47.8			12.0			20.1
Total Preferred Property & Casualty Insurance	597.7			589.7			203.0			204.1
Specialty Property & Casualty Insurance:
Earned Premiums	2,278.7			1,309.6			783.4			711.2
Net Investment Income	79.2			40.8			28.8			20.7
Other Income	6.2			1.6			4.4			0.9
Total Specialty Property & Casualty Insurance	2,364.1			1,352.0			816.6			732.8
Life & Health Insurance:
Earned Premiums	482.8			469.3			160.8			157.7
Net Investment Income	154.4			159.2			49.7			51.0
Other Income	5.6			2.9			2.9			1.2
Total Life & Health Insurance	642.8			631.4			213.4			209.9
Total Segment Revenues	3,604.6			2,573.1			1,233.0			1,146.8
Income from Change in Fair Value of Equity and Convertible Securities	99.7			12.1			9.8			11.0
Net Realized Gains on Sales of Investments	39.1			10.0			1.7			3.6
Net Impairment Losses Recognized in Earnings	(12.1		)	(2.3		)	(1.8		)	(1.8		)
Other	24.2			37.5			1.1			35.9
Total Revenues	$	3,755.5		$	2,630.4		$	1,243.8		$	1,195.5

Note 12 - Business Segments (continued)

Segment Operating Profit, including a reconciliation to Income from Continuing Operations before Income Taxes, for the nine and three months ended September 30, 2019 and 2018 was:



	Nine Months Ended						Three Months Ended
(Dollars in Millions)	Sep 30, 2019			Sep 30, 2018			Sep 30, 2019			Sep 30, 2018
Segment Operating Profit:
Preferred Property & Casualty Insurance	$	36.2		$	22.0		$	26.5		$	14.1
Specialty Property & Casualty Insurance	277.4			84.1			98.6			26.9
Life & Health Insurance	86.4			97.6			41.0			33.5
Total Segment Operating Profit	400.0			203.7			166.1			74.5
Corporate and Other Operating Profit (Loss) From:
Partial Satisfaction of Judgment	20.1			35.7			—			35.7
Other	(24.1		)	(28.2		)	(3.1		)	(14.3		)
Corporate and Other Operating Profit (Loss)	(4.0		)	7.5			(3.1		)	21.4
Adjusted Consolidated Operating Profit	396.0			211.2			163.0			95.9
Income from Change in Fair Value of Equity and Convertible Securities	99.7			12.1			9.8			11.0
Net Realized Gains on Sales of Investments	39.1			10.0			1.7			3.6
Net Impairment Losses Recognized in Earnings	(12.1		)	(2.3		)	(1.8		)	(1.8		)
Acquisition Related Transaction, Integration and Other Costs	(12.2		)	(38.0		)	(5.4		)	(28.2		)
Loss from Early Extinguishment of Debt	(5.8		)	—			(5.8		)	—
Income from Continuing Operations before Income Taxes	$	504.7		$	193.0		$	161.5		$	80.5

Segment Net Operating Income, including a reconciliation to Income from Continuing Operations, for the nine and three months ended September 30, 2019 and 2018 was:



	Nine Months Ended						Three Months Ended
(Dollars in Millions and Net of Income Taxes)	Sep 30, 2019			Sep 30, 2018			Sep 30, 2019			Sep 30, 2018
Segment Net Operating Income (Loss):
Preferred Property & Casualty Insurance	$	29.1		$	19.7		$	21.1		$	12.2
Specialty Property & Casualty Insurance	220.8			67.3			78.5			21.5
Life & Health Insurance	69.8			77.9			33.4			27.1
Total Segment Net Operating Income	319.7			164.9			133.0			60.8
Corporate and Other Net Operating Income (Loss) From:
Total Corporate and Other Net Operating Income (Loss)	0.7			33.6			(3.0		)	43.7
Adjusted Consolidated Net Operating Income	320.4			198.5			130.0			104.5
Net Income (Loss) From:
Change in Fair Value of Equity and Convertible Securities	78.8			9.6			7.8			8.7
Net Realized Gains on Sales of Investments	30.9			7.9			1.4			2.8
Net Impairment Losses Recognized in Earnings	(9.6		)	(1.8		)	(1.5		)	(1.4		)
Acquisition Related Transaction, Integration and Other Costs	(9.5		)	(30.8		)	(4.1		)	(22.3		)
Loss from Early Extinguishment of Debt	(4.6		)	—			(4.6		)	—
Income from Continuing Operations	$	406.4		$	183.4		$	129.0		$	92.3