CEO: Unitrin Weighs Broader Use of Kemper Brand

Unitrin Inc., which last year acquired all rights to the Kemper name, is considering broader use of the moniker.

"We are even considering whether we should change the name of the parent company," Unitrin Chairman, President and Chief Executive Officer Donald G. Southwell told the audience at the annual New York Society of Security Analysts insurance conference.

Southwell said the Kemper name has a lot of meaning to many generations, and has "tremendous value" with independent agents.

"Our independent agents that work with us in our Kemper business tell us that it's got very strong name recognition and value with their customers," Southwell said. "They've encouraged us over the years to use this name more broadly."

Southwell said that if and when the company markets Kemper more broadly, "we'll probably have to invest some more in the name."

Chicago-based Unitrin acquired the Kemper personal lines business in 2002, and last June purchased all rights to the Kemper name from Lumbermens Mutual Casualty Co. and its affiliates (BestWire, June 30, 2010). Kemper, based in Jacksonville, Fla., gets 61% of its sales from personal automobile, and 39% of sales from homeowners.

Even though Kemper is based in Florida, Southwell said the company doesn't sell in the Sunshine State.

"Florida is a very, very difficult state in which to do personal lines property and casualty, and Kemper -- our Kemper operation does not sell in Florida at all. We do sell nonstandard auto in Florida, and we sell direct-to-consumer auto in Florida," Southwell said.

Unitrin has more than 6 million policyholders. As of Dec. 31, personal auto accounted for 55% of the company's earned premiums, with $819 million from standard and preferred personal auto, and $431 million in nonstandard personal auto. Homeowners accounted for $299 million, or 13% of the company's earned premiums. Life insurance accounted for $397 million, or 17% of the company's earned premiums, according to the company's presentation to NYSSA.

In addition to Kemper, Unitrin's property/casualty insurance group includes Unitrin direct auto and home insurance and Dallas-based Unitrin Specialty, which sells nonstandard auto insurance through 8,000 agents in 21 states. Unitrin also sells life, accident and health insurance under the Unitrin and Reserve National names.

The Unitrin P&C Insurance Group currently has a Best's Financial Strength Rating of A- (Excellent).

In afternoon trading on Feb. 15, shares of Unitrin (NYSE: UTR) were trading at $29.16, up 0.65% from the previous close.

To see an interview with Southwell, visit http://www.ambest.com/media/media.asp?RC=183320.

(By Diana Rosenberg, senior associate editor, BestWeek)