Policyholder Obligations

6 Months Ended

Jun. 30, 2025

Policyholder Obligations at June 30, 2025 and December 31, 2024 were as follows:


(Dollars in Millions)	Jun 30, 2025		Dec 31, 2024
FHLB Funding Agreements	$	546.2	$	541.3
Universal Life-type Policyholder Account Balances	95.1		96.4
Total	$	641.3	$	637.7

Note 15 - Policyholder Obligations (Continued)

FHLB Funding Agreements

Kemper’s subsidiary, United Insurance Company of America (“United Insurance”) has entered into funding agreements with the FHLB of Chicago in exchange for cash, which it uses for spread lending purposes. During the six months ended June 30, 2025, United Insurance received advances of $30.0 million from the FHLB of Chicago and made repayments of $25.1 million under the spread lending program.

When a funding agreement is issued, United Insurance is required to post collateral in the form of eligible securities including mortgage-backed, government, and agency debt instruments for each of the advances that are entered. The fair value of the collateral pledged must be maintained at certain specified levels above the borrowed amount, which can vary depending on the assets pledged. If the fair value of the collateral declines below these specified levels of the amount borrowed, United Insurance would be required to pledge additional collateral or repay outstanding borrowings. Upon any event of default by United Insurance, the FHLB’s recovery on the collateral is limited to the amount of United Insurance’s liability under the funding agreements to the FHLB of Chicago.

United Insurance’s liability under the funding agreements with the FHLB of Chicago, the amount of collateral pledged under such agreements and FHLB of Chicago common stock owned by United Insurance at June 30, 2025 and December 31, 2024 is presented below.


(Dollars in Millions)	Jun 30, 2025		Dec 31, 2024
Liability under Funding Agreements	$	546.2	$	541.3
Fair Value of Collateral Pledged	653.4		619.3
FHLB of Chicago Common Stock Owned at Cost	17.7		16.9

Universal Life-type Policyholder Account Balances

The Company’s weighted-average crediting rate for Universal Life-type Policyholder Account Balances was 5.1% as of June 30, 2025 and 2024. Guaranteed minimum benefit amounts in excess of the current account balances for these contracts were $268.2 million and $276.6 million as of June 30, 2025 and December 31, 2024, respectively. The cash surrender value of the Company’s policyholder obligations for these contracts was $95.1 million and $96.4 million as of June 30, 2025 and December 31, 2024, respectively.

- Definition

The entire disclosure for the types of coverages and products sold, and the assets, obligations, recorded liabilities, revenues and expenses arising therefrom, and the amounts of and methodologies and assumptions used in determining the amounts of such items.

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