Kemper Swings to Loss as Goodwill Charge Hits Results
A $460.0 million noncash goodwill impairment weighed on the insurer’s second-quarter results.
Kemper Corporation (KMPR), the insurer, swung to a $464.8 million net loss, or $7.90 a share, from net income of $72.6 million, or $1.12 a share, a year earlier, primarily reflecting a new goodwill impairment. The company had lost $1.7 million, or $0.03 a share, in the first quarter.
The quarter paired a severe reported loss with a sequential improvement in Kemper’s adjusted operations. Adjusted consolidated net operating income rose to $26.3 million, or $0.45 a share, from $12.5 million, or $0.21 a share, in the first quarter. It remained 69% below the year-earlier period.
Revenue declined for a third consecutive quarter, falling about 11% from a year earlier to $1.0927 billion. The total had moved down from $1.2397 billion in the third quarter of 2025 to $1.1314 billion in the fourth quarter and $1.1072 billion in the first quarter of 2026. Earned premiums offered an early sequential improvement, rising 1.2% from the first quarter while remaining 10.5% lower than a year earlier.
The premium mix continued shifting toward commercial auto. Personal-auto earned premiums fell 18.0% from a year earlier to $647.4 million, while commercial-auto premiums increased 12.5% to $249.2 million. Commercial auto entered the quarter with policy growth of 10% and a 92.4% underlying combined ratio in the first quarter.
Specialty Property & Casualty adjusted net operating income recovered to $15.8 million from $0.1 million in the first quarter, though it remained 80% below the year-earlier result. The segment’s combined ratio deteriorated 8.6 percentage points to 104.0%, signaling an underwriting loss, as personal auto absorbed higher claim severity and frequency in California.
Life Insurance provided steadier support. Adjusted net operating income rose 45% from a year earlier to $18.3 million, aided by higher investment income and earned premiums. Segment revenue increased 4.7% to $152.4 million, while consolidated net investment income rose 9.9% to $105.4 million. Investment impairment losses climbed to $23.7 million from $3.6 million a year earlier.
Kemper completed the sale of Newins during the quarter and will continue evaluating efficiency opportunities through 2027. Acquisition, disposition, integration, restructuring and other after-tax costs increased to $11.6 million, while the goodwill charge reduced shareholders’ equity and lifted debt to 30.1% of total capitalization from 26.3% at the end of March.