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Schedule 2 - Parent Company Financial Statements
 12 Months Ended
Dec. 31, 2020
Condensed Financial Information Disclosure [Abstract]  
Parent Company Financial Statements
SCHEDULE II
KEMPER CORPORATION
PARENT COMPANY BALANCE SHEETS
(Dollars in Millions)
 
December 31,
20202019
ASSETS
Investments in Subsidiaries$4,896.0 $4,383.7 
Fixed Maturities at Fair Value (Amortized Cost: 2020 – $91.8)
99.8 — 
Equity Securities at Fair Value (Cost: 2020 - $73.4; 2019 - $53.4)
78.8 55.7 
Short-term Investments508.2 89.3 
Cash46.0 61.8 
Other Receivables1.1 21.9 
Right-of-Use Assets13.4 18.6 
Other Assets29.2 21.9 
Total Assets$5,672.5 $4,652.9 
LIABILITIES AND SHAREHOLDERS’ EQUITY
Term Loan due July 5, 2023 (Fair Value: 2020 – $50.0; 2019 – $50.0)
$49.9 $49.9 
Senior Notes Payable, 4.35% due 2025 (Fair Value: 2020 – $499.5; 2019 – $478.6)
448.8 448.6 
Senior Notes Payable, 2.40% due 2030 (Fair Value: 2020 – $405.6)
395.8 — 
Current Income Tax Liability41.5 55.3 
Deferred Income Tax Liability38.9 32.2 
Liabilities for Benefit Plans47.6 44.3 
Lease Liabilities26.9 31.3 
Accrued Expenses and Other Liabilities59.7 19.0 
Total Liabilities1,109.1 680.6 
Shareholders’ Equity:
Common Stock6.5 6.7 
Additional Paid-in Capital1,805.2 1,819.2 
Retained Earnings2,071.2 1,810.3 
Accumulated Other Comprehensive Income680.5 336.1 
Total Shareholders’ Equity4,563.4 3,972.3 
Total Liabilities and Shareholders’ Equity$5,672.5 $4,652.9 

See Accompanying Report of Independent Registered Public Accounting Firm.
 
KEMPER CORPORATION
PARENT COMPANY STATEMENTS OF INCOME
(Dollars in Millions)
 
 For the Year Ended December 31,
 202020192018
Net Investment Income$1.4 $2.1 $2.5 
Income from Change in Fair Value of Equity Securities4.3 1.6 1.4 
Net Realized Gains (Losses) on Sales of Investments0.1 0.3 (0.7)
Total Revenues5.8 4.0 3.2 
Interest Expense24.2 28.5 37.6 
Loss from Early Extinguishment of Debt— 5.8 — 
Pension Settlement Expense64.1 — — 
Other Operating (Benefits) Expenses(3.6)4.0 26.3 
Total Operating Expenses84.7 38.3 63.9 
Loss before Income Taxes and Equity in Net Income of Subsidiaries(78.9)(34.3)(60.7)
Income Tax Benefit13.4 9.4 12.2 
Loss before Equity in Net Income of Subsidiaries(65.5)(24.9)(48.5)
Equity in Net Income of Subsidiaries475.4 556.0 238.6 
Net Income$409.9 $531.1 $190.1 
See Accompanying Report of Independent Registered Public Accounting Firm.
KEMPER CORPORATION
PARENT COMPANY STATEMENTS OF COMPREHENSIVE INCOME
(Dollars in Millions)
 For the Year Ended December 31,
 202020192018
Net Income$409.9 $531.1 $190.1 
Other Comprehensive Income (Loss):
Changes in Net Unrealized Gains (Losses) on Investment Securities:
Having No Credit Losses Recognized in Consolidated Statements of Income
Securities Held by Subsidiaries378.7 433.2 (214.1)
Securities Held by Parent8.0 0.2 (0.1)
Having Credit Losses Recognized in Consolidated Statements of Income
Securities Held by Subsidiaries(2.6)— — 
Reclassification Adjustment for Amounts Included in Net Income:
Securities Held by Subsidiaries(16.6)(27.9)(21.9)
Securities Held by Parent(0.1)(0.2)— 
Changes in Net Unrecognized Postretirement Benefit Costs:
Securities Held by Subsidiaries— (0.6)— 
Securities Held by Parent3.6 (4.2)(8.0)
Reclassification Adjustments for Amounts Included in Net Income:
Pension Settlement Cost Recognized64.1 — — 
Amortization of Unrecognized Postretirement Benefits (Costs)2.5 (3.0)1.1 
Total Reclassification Adjustments for Amounts Included in Net Income66.6 (3.0)1.1 
Net Unrecognized Postretirement Benefit Costs70.2 (7.8)(6.9)
Changes in Foreign Currency Translation Adjustments on Investments Held by
Subsidiaries		— — 0.3 
Changes in Gain (Loss) on Cash Flow Hedges0.4 0.4 1.2 
Other Comprehensive Income (Loss) before Income Taxes438.0 397.9 (241.5)
Income Tax Benefit (Expense):
Changes in Net Unrealized Gains (Losses) on Investment Securities:
Having No Credit Losses Recognized in Consolidated Statements of Income
Securities Held by Subsidiaries(80.6)(91.0)45.0 
Securities Held by Parent(1.7)— — 
Having Credit Losses Recognized in Consolidated Statements of Income
Securities Held by Subsidiaries0.5 — — 
Reclassification Adjustment for Amounts Included in Net Income:
Securities Held by Subsidiaries3.5 5.8 4.6 
Unrecognized Postretirement Benefit Costs Arising During the Year(1.3)1.0 1.7 
Reclassification Adjustments for Amounts Included in Net Income:
Pension Settlement Cost Recognized(13.5)— — 
Amortization of Unrecognized Postretirement Benefit Costs(0.5)0.7 (0.2)
Total Reclassification Adjustments for Amounts Included in Net Income(14.0)0.7 (0.2)
Net Unrecognized Postretirement Benefit Costs(15.3)1.7 1.5 
Reclassification Adjustment for Amounts Included in Net Income— — (0.1)
Changes in Foreign Currency Translation Adjustments on Investments Held by
Subsidiaries		— — (0.1)
Changes in Gain (Loss) on Cash Flow Hedges— (0.1)(0.3)
Income Tax Benefit (Expense)(93.6)(83.6)50.7 
Other Comprehensive Income (Loss)344.4 314.3 (190.8)
Total Comprehensive Income (Loss)$754.3 $845.4 $(0.7)
See Accompanying Report of Independent Registered Public Accounting Firm.
KEMPER CORPORATION
PARENT COMPANY STATEMENTS OF CASH FLOWS
(Dollars in Millions)
 
 For the Year Ended December 31,
 202020192018
Operating Activities:
Net Income$409.9 $531.1 $190.1 
Adjustments to Reconcile Net Income to Net Cash Provided by Operations:
Equity in Net Income of Subsidiaries(475.4)(556.0)(238.6)
Cash Dividends from Subsidiaries216.2 239.0 130.4 
Net Realized Investment (Gains) Losses(0.1)(0.3)0.7 
Settlement Costs Related to Defined Benefit Pension Plan64.1 — — 
Contribution to Defined Benefit Pension Plan— (55.3)(5.0)
Loss from Early Extinguishment of Debt— 5.8 — 
Decrease (Increase) in Value of Equity and Convertible Securities at Fair Value(4.3)(1.6)(1.4)
Other, Net52.2 9.8 29.6 
Net Cash Provided by Operating Activities262.6 172.5 105.8 
Investing Activities:
Capital Contributed to Subsidiaries(62.0)(83.0)(20.0)
Capital Distributed from Subsidiaries— 85.0 176.0 
Proceeds from Sales, Calls and Maturities of Fixed Maturities2.0 12.7 (0.2)
Proceeds from the Sales or Paydowns of Investments:
Equity Securities2.2 15.3 67.5 
Purchases of Investments:
Equity Securities(21.0)(48.9)(2.3)
Net Sales (Purchases) of Short-term Investments(415.7)(23.3)253.4 
Acquisition of Business— — (564.6)
Net Cash Provided (Used In) by Investing Activities(494.5)(42.2)(90.2)
Financing Activities:
Net Proceeds from Issuance of Long-term Debt395.6 49.9 249.4 
Repayments of Long-term Debt— (185.0)(215.0)
Proceeds from Issuance of Common Stock, Net of Transaction Costs— 127.5 — 
Proceeds from Shares Issued under Employee Stock Purchase Plan4.4 1.6 — 
Common Stock Repurchases(110.4)— — 
Dividends and Dividend Equivalents Paid(78.9)(67.8)(56.4)
Other5.4 2.4 0.9 
Net Cash Provided (Used In) by Financing Activities216.1 (71.4)(21.1)
Increase (Decrease) in Cash(15.8)58.9 (5.5)
Cash, Beginning of Year61.8 2.9 8.4 
Cash, End of Year$46.0 $61.8 $2.9 

See Accompanying Report of Independent Registered Public Accounting Firm.
KEMPER CORPORATION
FINANCIAL INFORMATION OF KEMPER CORPORATION
NOTES TO FINANCIAL INFORMATION
(Dollars in Millions)

NOTE 1. SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES
The financial information of Kemper Corporation (“Kemper” or the “Parent Company”) should be read in conjunction with the Consolidated Financial Statements and Notes thereto included in Item 8 of this Form 10-K. Kemper’s subsidiaries are accounted for using the equity method of accounting. Equity in net income of these subsidiaries is presented on the Statements of Operations as Equity in Net Income of Subsidiaries.
NOTE 2. GUARANTEES
On November 30, 2018 Kemper executed a guarantee to fully and unconditionally guarantee the payment and performance obligations of the 5.0% Senior Notes due September 19, 2022 of Infinity Property and Casualty Corporation, a wholly owned subsidiary of Kemper.
NOTE 3. SUPPLEMENTAL DISCLOSURE OF CASH FLOW INFORMATION
Kemper received $106.0 million of securities in non-cash settlement of dividends from subsidiaries in 2020. Kemper did not receive any non-cash dividends from subsidiaries in 2019. Kemper did not make any non-cash capital contributions in 2020 or 2019.
NOTE 4. LEASES
Kemper leases certain office space for its current and former corporate headquarters under non-cancelable operating leases.
The following table presents operating lease ROU assets and lease liabilities at December 31, 2020 and 2019.
DOLLARS IN MILLIONS20202019
Operating Lease Right-of-Use Assets$13.4 $18.6 
Operating Lease Liabilities26.9 31.3 
Supplemental cash flow information related to Kemper’s operating leases for the year-ended December 31, 2020 and December 31, 2019 respectively are presented below.
DOLLARS IN MILLIONS20202019
Operating Cash Flows from Operating Leases (Fixed Payments)$(2.1)$1.2 
Operating Cash Flows from Operating Leases (Liability Reduction)0.3 1.0 
Right-of-Use Assets Obtained in Exchange for New Operating Lease Liabilities— 7.9 

Significant judgments and assumptions for determining lease asset and liability as December 31, 2020 and December 31, 2019 respectively are presented below.
20202019
Weighted-average Remaining Lease Term - Operating Leases13.0 years13.0 years
Weighted-average Discount Rate - Operating Leases4.0 %4.0 %
Kemper’s leases do not provide an implicit rate. Accordingly, Kemper uses its incremental borrowing rate based on the information available at the commencement date in determining the present value of its lease payments.
KEMPER CORPORATION
FINANCIAL INFORMATION OF KEMPER CORPORATION
NOTES TO FINANCIAL INFORMATION
(Dollars in Millions)
NOTE 4. LEASES (Continued)
Future minimum operating lease payments at December 31, 2020 were:
DOLLARS IN MILLIONSOperating
Leases
2021$2.2 
20222.4 
20232.4 
20242.5 
20252.6 
2026 and Thereafter22.9 
Total Future Payments35.0
Less Discount8.1 
Present Value of Minimum Lease Payments$26.9