XML 38 R28.htm IDEA: XBRL DOCUMENT v3.23.1
Basis of Presentation and Accounting Policies (Tables)
 3 Months Ended
Mar. 31, 2023
Organization, Consolidation and Presentation of Financial Statements [Abstract]  
Liability for Future Policy Benefit, Activity
The following tables summarize balances and changes in the present value of expected net premiums, present value of expected future policyholder benefits and net liability for future policyholder benefits as of and for the three months ended March 31, 2023 and March 31, 2022:
Present Value of Expected Net Premiums
Mar 31, 2023Mar 31, 2022
Balance, Beginning of Year$688.6 $669.0 
Beginning Balance at Original Discount Rate$728.9 $599.8 
        Effect of Changes in Cash Flow Assumptions— — 
        Effect of Actual Variances from Expected Experience0.7 12.5 
Adjusted Beginning of Year Balance729.6 612.3 
         Issuances31.8 41.6 
         Interest Accrual7.0 5.1 
         Net Premiums Collected(23.9)(21.1)
Ending Balance at Original Discount Rate744.5 637.9 
         Effect of Changes in Discount Rate Assumptions(22.1)23.1 
Balance, End of Period$722.4 $661.0 
Present Value of Expected Future Policyholder Benefits
Mar 31, 2023Mar 31, 2022
Balance, Beginning of Year$3,561.0 $4,933.1 
Beginning Balance at Original Discount Rate$3,906.2 $3,788.1 
        Effect of Changes in Cash Flow Assumptions— — 
        Effect of Actual Variances From Expected Experience0.3 12.7 
Adjusted Beginning of Year Balance3,906.5 3,800.8 
         Issuances 31.8 41.6 
         Interest Accrual42.4 40.8 
         Benefit Payments(63.8)(71.0)
Ending Balance at Original Discount Rate3,916.9 3,812.2 
         Effect of Changes in Discount Rate Assumptions(217.4)536.5 
Balance, End of Period$3,699.5 $4,348.7 
Net Liability for Future Policyholder Benefits
Mar 31, 2023Mar 31, 2022
Net Liability for Future Policyholder Benefits$2,977.1 $3,687.7 
Less: Reinsurance Recoverable— — 
Net Liability for Future Policyholder Benefits, After Reinsurance Recoverable$2,977.1 $3,687.7 
Weighted-Average Liability Duration
The weighted-average liability duration of the liability for future policyholder benefits as calculated under current rates is as follows:
Mar 31, 2023Mar 31, 2022
Weighted-Average Liability Duration of the Liability for Future Policyholder Benefits (Years)14.917.1
Reconciliation of Net Liability for Future Policyholder Benefits
The reconciliation of the net liability for future policyholder benefits to Life and Health Insurance Reserves in the Condensed Consolidated Balance Sheets is as follows:
Mar 31, 2023Mar 31, 2022
Present Value of Expected Future Policyholder benefits$3,699.5 $4,348.7 
Less: Present Value of Expected Net Premiums722.4 661.0 
Net Liability for Future Policyholder benefits2,977.1 3,687.7 
Deferred Profit Liability272.6 213.9 
Other1
149.9 202.6 
Total Life and Health Insurance Reserves$3,399.6 $4,104.2 
1Other primarily consists of Accident and Health and Universal Life reserves
Undiscounted Expected Gross Premiums and Expected Future Benefit Payments
The amounts of expected undiscounted future benefit payments, expected undiscounted future gross premiums and expected discounted future gross premiums, were as follows:
Mar 31, 2023Mar 31, 2022
Expected Future Benefit Payments, undiscounted$10,177.7 $9,536.9 
Expected Future Gross Premiums, undiscounted$4,464.2 $3,808.5 
Expected Future Gross Premiums, discounted$2,931.1 $2,912.1 
Weighted Average Interest Rate for Future Policyholder Benfits
The weighted-average interest rate is as follows:
Mar 31, 2023Mar 31, 2022
Interest Accretion Rate4.55 %4.55 %
Current Discount Rate5.05 %3.76 %
Accounting Standards Update and Change in Accounting Principle
The table below presents the transition adjustment for the adoption of ASU 2018-12:
Pre-Adoption Balance 12/31/2020Adjustments to AOCIAdjustments to Retained EarningsPost- Adoption Balance 1/1/2021
Retained Earnings $(2,071.2)— 25.1 $(2,046.1)
AOCI$(680.5)1,030.3 — $349.8 
Note 1 - Basis of Presentation and Accounting Policies (Continued)
For the liability for future policyholder benefits, the net transition adjustment is related to the difference in the historical discount rates used pre-transition and the discount rate at December 31, 2020. At transition, there were no adjustments related to premium deficiencies, as the balance is only applicable to Kemper’s universal life contracts which are stated at account value.
The effects of adoption of ASU 2018-12 on the Condensed Consolidated Statement of Loss for the three months ended March 31, 2022 were as follows:
Prior to AdoptionEffect of AdoptionPost- Adoption Balance
Earned Premiums $1,338.6 (18.6)$1,320.0 
Policyholders’ Benefits and Incurred Losses and Loss Adjustment Expenses$1,153.4 (30.2)$1,123.2 
Insurance Expenses$304.0 0.8 $304.8 
Income Tax Benefit$31.7 (2.3)$29.4 
Net Loss$(94.8)8.5 $(86.3)
Net Loss Per Unrestricted Share:
Basic$(1.49)$0.13 $(1.36)
Diluted$(1.49)$0.13 $(1.36)

The effects of adoption of ASU 2018-12 on the Condensed Consolidated Balance Sheet as of December 31, 2022 were as follows:
Prior to AdoptionEffect of AdoptionPost- Adoption Balance
Deferred Policy Acquisition Costs$625.6 10.0 $635.6 
Deferred Income Tax Assets$189.4 (60.4)$129.0 
Total Assets$13,364.0 (50.4)$13,313.6 
Life and Health Insurance Reserves$3,554.0 (277.8)$3,276.2 
Total Liabilities$10,920.8 (277.8)$10,643.0 
Retained Earnings$1,380.1 (13.7)$1,366.4 
Accumulated Other Comprehensive (Loss) Income$(756.0)241.1 $(514.9)
Total Shareholders’ Equity$2,443.2 227.4 $2,670.6 

The effects of adoption of ASU 2018-12 on the Condensed Consolidated Statement of Comprehensive Loss for the three months ended March 31, 2022 were as follows:
Prior to AdoptionEffect of AdoptionPost- Adoption Balance
Change in Discount Rate on Future Life Policyholder Benefits$— 562.3 $562.3 
Other Comprehensive Loss Before Income Taxes$(646.0)562.3 $(83.7)
Other Comprehensive Income Tax Benefit$135.6 (118.1)$17.5 
Other Comprehensive Loss, Net of Taxes$(510.4)444.2 $(66.2)
Total Comprehensive Loss$(605.2)452.7 $(152.5)
Note 1 - Basis of Presentation and Accounting Policies (Continued)
The effects of adoption of ASU 2018-12 on the Condensed Consolidated Statement of Cash Flows for the three months ended March 31, 2022 were as follows:
Prior to AdoptionEffect of AdoptionPost- Adoption Balance
Cash Flows from Operating Activities:
Net Loss$(94.8)8.5 $(86.3)
Change in Deferred Policy Acquisition Costs$(2.4)0.8 $(1.6)
Change in Insurance Reserves$2.9 (11.6)$(8.7)
Change in Income Taxes$(30.5)2.3 $(28.2)
Net Cash Used in Operating Activities$(18.2)— $(18.2)
Liability for Future Policy Benefits Interest Expense and Premiums
The amount of revenue and interest recognized in the Condensed Consolidated Statements of Loss is as follows:
Three Months Ended
Mar 31,
2023		Mar 31,
2022
Gross Premiums or Assessments $103.8 $101.4 
Interest Expense $35.4 $35.6