Kemper Corporation

Good afternoon, ladies and gentlemen, and welcome to Kemper's first quarter 2026 earnings conference call. My name is Mark, and I will be your coordinator today. At this time, all participants are in listen-only mode. Later, we will conduct a question-and-answer session, and instruction will follow at that time. As a reminder, this conference call is being recorded for replay purposes. I would now like to introduce your host to this conference call, Michael Marinaccio, Kemper's Vice President of Corporate Development and Investor Relations. Mr. Marinaccio, you may begin.

Thank you, operator. Good afternoon, everyone. Welcome to Kemper's discussion of our first quarter 2026 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 Flint, Kemper's executive vice president and president of Kemper Life. We'll make a few opening remarks to provide context around our first 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 Investors 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 Litigation 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. Our 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 2025 Form 10-K and our first 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 2025 period unless otherwise stated. I will now turn the call over to Tom.

Thank you, Michael. Good afternoon, everyone, and thank you for joining us. As I've done in previous quarters, I'll use my comments today to discuss how we look at the business provide some context on the quarter's results and, more importantly, update you on our primary focus, which is to improve profitability, reduce volatility, and deliver value to our shareholders. Turning to the business, I think it's worth a brief reminder of who we are. We are a specialty insurer operating in a multifaceted competitive industry. We concentrate on distinct customer segments and markets that are not the primary concern of larger carriers. Through our two core segments, auto and life, we provide affordable, easy to use, personalized solutions to individuals, families, and small businesses. We have a deep understanding of our customers and have developed products and services designed to meet their needs. We see meaningful near and long-term opportunities across both businesses. Before we discuss the quarterly results in detail, I want to note the main takeaways for the quarter. Overall, financial results were disappointing and did not meet our expectations. Notably, we continue to face significant headwinds in our California personal auto business. Results were also impacted by statutory profit limit refunds in Florida. What should not get lost in the narrative, however, is that we have several areas of the business that are performing well and we will discuss these shortly. First, let me spend a moment on Florida. The refunds are a function of state law that requires insurers if profits exceed certain thresholds over a three-year period to return a portion of profits to policyholders. Last quarter, we explained how tort reforms enacted in 2023 have reduced loss costs and made the Florida market more competitive. Brad will discuss the effect of these refunds on our financial results. Importantly, our current auto business in Florida is performing well. And the rate adjustments we've made are leading to profitable growth. Matt will share more on Florida in a bit. As for our personal auto business in California, the increases in minimum liability insurance limits that went into effect in January 2025 continue to complicate and exacerbate loss costs. We believe we have a good grasp of the issue and are taking targeted actions to respond, including rate changes that are coming into the market in the second quarter underwriting refinements, and claims process adjustments. The benefits of these changes will take time to be clearly visible in results. Matt will have more to share with you on California. While we clearly need to improve the California PPA results, there are bright spots in our business that should be noted. Among the items we are encouraged by are the continued strong growth and attractive results of our commercial auto business, which just finished its best production quarter ever. Kemper Life continues to deliver solid, consistent results and remains a source of diversified earnings. And while the specialty personal auto results as a whole were not where we wanted them to be, we did see positive developments with profitable PIF growth in Florida and Texas, rate approvals in California, and new product expansion that went live in Florida and was approved for rollout in Texas. On our earnings call in February, we outlined a number of enterprise priorities. We are making progress on our actions to improve results, enhance operational execution, and reduce earnings volatility through diversification. As I noted, we are focused on growing profitably and reducing earnings volatility. As we reposition our personal auto book, we expect California to represent a smaller percentage of our overall portfolio. It will remain our largest market for the foreseeable future and we continue to see value in our presence there, given the size of the market and our differentiated expertise in operating in the state. The restructuring program we launched last fall is well underway and to date we've identified cumulative run rate savings of more than 60 million, the majority of which has already been actioned. We continue to expand this program to further optimize operations and increase efficiency. We were also engaged in a comprehensive review of our end-to-end claims processes. We have identified and are executing on some early opportunities to reduce loss costs. Brad and Matt will provide more detail on the actions we are taking, which will protect and advance our competitive advantages, enhance profitability, enable growth, and ultimately create value for our shareholders. Brad, over to you.