1Q 2023 Earnings Call Presentation

First Quarter 2023 Earnings

May 8, 2023

Earnings Call Presentation - 1Q 2023

Preliminary Matters

Cautionary Statements Regarding Forward-Looking Information

This presentation may contain or incorporate by reference information that includes or is based on forward-looking statements within the meaning of the safe-harbor provisions of the Private Securities Litigation Reform Act of 1995. We caution investors that these forward-looking statements are not guarantees of future performance, and actual results may differ materially. Such statements involve known and unknown risks, uncertainties, and other factors, including but not limited to:

• changes in the frequency and severity of insurance claims;
• claim development and the process of estimating claim reserves;
• the impacts of inflation;
• changes in interest rate environment;
• supply chain disruption;
• product demand and pricing;
• effects of governmental and regulatory actions;
• litigation outcomes;
• investment risks;
• cybersecurity risks;
• impact of catastrophes; and
• other risks and uncertainties detailed in Kemper's Annual Report on Form 10-K and subsequent filings with the Securities and Exchange Commission ("SEC").

Kemper assumes no obligation to publicly correct or update any forward-looking statements as a result of events or developments subsequent to the date of this presentation.

Non-GAAP Financial Measures

This presentation contains non-GAAP financial measures that the company believes are meaningful to investors. Non-GAAP financial measures have been reconciled to the most comparable GAAP financial measure.

Leading Insurer Empowering Specialty and Underserved Markets

Enabled by a dynamic, diverse, and innovative team who act like owners

Target top quartile value creation for customers, employees, and shareholders

First Quarter 2023 Summary

Financials impacted and actions taken to combat a continued dynamic operating environment

1st Quarter

Results

Weather, mix, and evolving development patterns pressure financial results

• Net loss of $80 million ($1.25/sh), as reported
• Adjusted consolidated net operating loss1 of $65 million ($1.02/sh), as reported
• (10)% ROAE1,2; (14)% ROAE1,2 excluding net unrealized (gains) losses on fixed maturities, changes in the discount rate on future life policyholder benefits, and goodwill1
• Total pre-tax catastrophe losses of $29 million
• Pre-taxnon-catastrophe results driven by:
• • Unfavorable prior year reserve development of $42 million (inclusive of $3M of catastrophe losses)
  • Elevated frequency driven by non-catastrophe weather and mix (state and coverage, new / renewal)

Actions Taken

Balance Sheet

Strength

Committed to profit restoration; aggressively pursuing improvement opportunities

• Rate actions:
• • Specialty P&C Private Passenger Auto - Filed an additional 24% increase on 41% of the book
  • Preferred P&C Personal Auto - Filed an additional 12% increase on 45% of the book
• Cumulative written rate benefits continue to eain at an accelerated rate
• • Specialty P&C Private Passenger Auto - 27 points of rate on 99% of the book since 2Q'21
  • Preferred P&C Personal Auto - 26 points of rate on 76% of the book since 2Q'21
• Further underwriting actions taken including suppressing new business growth until profitability is restored
• LAE, expense, and real estate initiatives in line with planned targets
• Enhancing tools and cost projection capabilities to minimize environmental uncertainties

Capital and liquidity positions enable the company to navigate current environment

• Holding company remains a source of strength for subsidiaries with approximately $1 billion of liquidity
• Insurance companies appropriately capitalized with significant sources of liquidity

1 Non-GAAP financial measure; please see reconciliation in appendix on pages 24-30

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Quarter and Post-Pandemic Reopening Themes1

Re-opening defined by evolving reporting patterns and continued severity inflation

23.6 pts Gap

35.9%

3.7%

12.3%

Long-Term Themes

• Loss costs continue to be pressured by rising:
• • Used car prices
  • Repairs cost (labor rates, car parts, etc.)
  • Medical care costs

(6.3)%

Short-Term Themes

• An atypical frequency pattewas experienced this quarter driven by:
• • Non-catastropheweather
  • Mix (state and coverage, new / renewal business)

Enhancing tools and cost projection capabilities to minimize environmental uncertainties

1 Themes and figures representative of Kemper Specialty Private Passenger Auto

Earnings Call Presentation - 1Q 2023

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