Kemper Corporation

afternoon ladies and gentlemen and welcome to campers third quarter 2025 earnings conference call my name is constantine and i will be your conference coordinator for today at this time all participants are in listen only mode later we will conduct a question and answer session and instructions will follow at that time as a reminder this conference is being recorded for replay purposes I would now like to introduce your host for today's conference call, Michael Marinaccio, Kemper's Vice President of Corporate Development and Investor Relations. Mr. Marinaccio, you may begin.

Good afternoon, everyone, and welcome to Kemper's discussion of our third quarter 2025 results. This afternoon, you'll hear from Tom Evans, Kemper's interim CEO, Brad Camden, Kemper's Executive Vice President and Chief Financial Officer, Matt Hunton, Kemper's Executive Vice President and President of Kemper Auto, and Chris Flynn, Kemper's Executive Vice President and President of Kemper Life. We'll make a few opening remarks to provide context around our third quarter results, followed by a Q&A session. During the interactive portion of the call, our presenters will be joined by John Buscelli, Kemper's Executive Vice President and Chief Investment Officer. After the markets closed today, we issued our earnings release filed our Form 10-Q with the SEC, and published our earnings presentation and financial supplement. You can find these documents in the investor section of our website, Kemper.com. Our discussion today may contain forward-looking statements within the meaning of the safe harbor provisions of the Private Securities Delegation Reform Act of 1995. These statements include, but are not limited to, the company's outlook on its future results of operation and financial condition. Actual future results and financial condition may differ materially from these statements. For information on additional risks that may impact these forward-looking statements, please refer to our 2024 Form 10-K and our third quarter earnings release. This afternoon's discussion also includes non-GAAP financial measures we believe are meaningful to investors. In our financial supplement, earnings presentation, and earnings release, we've defined and reconciled all non-GAAP financial measures to GAAP where required in accordance with SEC rules. You can find each of these documents in the investor section of our website, Kemper.com. All comparative references will be to the corresponding 2024 period unless otherwise stated. I'll now turn the call over to Tom.

Thank you, Michael, and good afternoon, everyone. First, I'd like to begin by introducing myself. I'm Tom Evans, and as many of you know, three weeks ago, the Board of Directors asked me to step in as Kemper's interim CEO. Over the past 33 years, I've had the privilege of serving in a variety of roles at Kemper, most recently as General Counsel. During this time, I've gained a deep understanding of our business and, just as importantly, our people. I believe strongly in this organization, its purpose, its potential, and the exceptional talent of our team. We are united by a commitment to serving markets that are often overlooked by other carriers, and I'm proud to be part of a company that embraces that responsibility with integrity and focus. As you know, our board has commenced a search to identify our next CEO, and I'm confident they'll find the right person to lead us through the next chapter of our story. We'll provide an update on the search when we have more information to share. Let's begin the substantive portion of this call with a straightforward comment. Our results this quarter were disappointing. Today we'll address what happened, why it happened, and, above all, what we're doing about it. Without question, we continue to believe strongly in both our strategy and our opportunities, but it's clear our execution has fallen short at times. Some of the challenges we faced were driven by external conditions, but others were within our control. We know that we need to be better operators to deliver the consistent results that investors expect and that we know we're capable of. To that end, the board and leadership team have taken significant steps, including recent changes in leadership and a restructuring initiative, to improve execution and accountability and ensure that we deliver on our strategic priorities. This isn't about changing our direction, it's about reinforcing the disciplines that drive performance. If we do those things, we can better leverage our scale and our capabilities to improve efficiency, broaden our reach across markets, and deliver more stable, sustainable results. With that, I'll now provide some context around the key drivers of our performance, and then Brad and Matt will provide more detail and commentary on each. We'll also get a quick update from Chris, who leads Kemper Life, about what's going on in that business. I'd like to start by discussing the broader specialty auto environment, which in 2025 has rapidly evolved. Historically, it's always been a more sensitive, fast-moving segment, with shifts often appearing there before becoming visible in the broader auto insurance space. And that dynamic certainly held true this year. One of the most notable developments year has been a sharp increase in competition, particularly over the spring and summer. In several of our key markets, we've seen other carriers aggressively pursue market share through pricing tactics. While we're responding to these pressures, we won't abandon our underwriting standards and we remain committed to disciplined underwriting and driving profitable growth. In addition to competitive pressure, we're seeing elevated severity trends due to medical cost inflation and higher attorney involvement in claims. The impact of bodily injury severity has been especially pronounced in our largest market, California, where the January 1st changes to minimum financial responsibility limits are showing up in our results more significantly than initially anticipated. We had expected adjustments to be needed once real claims experience began to emerge, and we're actively making those adjustments. Matt will provide further detail later. As for the litigation environment, whether you call it social inflation or legal system abuse, the effect is the same. Upward pressure on lost costs and overall claims inflation. Ultimately, this leads to increased customer premiums and prolonged claims resolution processes. As I stated earlier, we believe in our strategy and we remain committed to it. We know what we have to do. We're taking actions to enhance our competitive advantages, improve profitability, and achieve consistent TIF growth. We're in a solid financial position and are confident these actions will help us succeed. With that, I'll turn it over to Brad.