Assurant (AIZ) 10-Q 6 Aug 09 2009 Q2 Quarterly report Financial data

Document and Entity Information

Document and Entity Information (USD $)
In Millions, except Share data	6 Months Ended Jun. 30, 2009	Aug. 03, 2009	Jun. 30, 2008
Document and entity information
Entity Registrant Name	Assurant, Inc.
Entity Central Index Key	0001267238
Current Fiscal Year End Date	--12-31
Document Type	10-Q
Document Period End Date	2009-06-30
Entity Current Reporting Status	Yes
Entity Filer Category	Large Accelerated Filer
Entity Well-known Seasoned Issuer	Yes
Amendment Flag	false
Entity Common Stock, Shares Outstanding		117,926,517
Entity Public Float			$7,778
Entity Voluntary Filers	No

Consolidated Balance Sheets (Un

Consolidated Balance Sheets (Unaudited) (USD $)
In Thousands	Jun. 30, 2009	Dec. 31, 2008
Assets
Fixed maturity securities available for sale, at fair value (amortized cost - $9,613,773 in 2009 and $9,218,644 in 2008)	$9,407,954	$8,631,687
Equity securities available for sale, at fair value (cost - $518,464 in 2009 and $562,940 in 2008)	446,173	434,452
Commercial mortgage loans on real estate, at amortized cost	1,470,121	1,506,694
Policy loans	56,548	58,096
Short-term investments	521,651	703,402
Collateral held under securities lending	210,703	234,027
Other investments	525,827	498,434
Total investments	12,638,977	12,066,792
Cash and cash equivalents	809,182	1,040,684
Premiums and accounts receivable, net	582,189	513,181
Reinsurance recoverables	4,073,703	4,010,170
Accrued investment income	149,475	144,679
Tax receivable		44,156
Deferred income taxes, net	358,729	449,372
Deferred acquisition costs	2,573,130	2,650,672
Property and equipment, at cost less accumulated depreciation	275,735	278,621
Goodwill	1,009,394	1,001,899
Value of business acquired	101,295	108,204
Other assets	486,396	427,347
Assets held in separate accounts	1,764,269	1,778,809
Total assets	24,822,474	24,514,586
Liabilities
Future policy benefits and expenses	7,203,830	7,095,645
Unearned premiums	5,203,442	5,407,859
Claims and benefits payable	3,331,280	3,302,731
Commissions payable	182,251	233,200
Reinsurance balances payable	56,776	88,393
Funds held under reinsurance	54,961	38,433
Deferred gain on disposal of businesses	173,808	187,360
Obligation under securities lending	224,774	256,506
Accounts payable and other liabilities	1,226,847	1,433,028
Tax payable	55,492
Debt	972,007	971,957
Mandatory redeemable preferred stock	8,160	11,160
Liabilities related to separate accounts	1,764,269	1,778,809
Total liabilities	20,457,897	20,805,081
Stockholders' Equity
Common stock, par value $0.01 per share, 800,000,000 shares authorized, 117,560,145 and 117,368,534 shares outstanding at June 30, 2009 and December 31, 2008, respectively	1,445	1,443
Additional paid-in capital	2,941,124	2,928,160
Retained earnings	2,933,131	2,650,371
Accumulated other comprehensive loss	(311,600)	(670,946)
Treasury stock, at cost, 26,997,943 shares at June 30, 2009 and December 31, 2008	(1,199,523)	(1,199,523)
Total stockholders' equity	4,364,577	3,709,505
Total liabilities and stockholders' equity	$24,822,474	$24,514,586

Consolidated Balance Sheets Par

Consolidated Balance Sheets Parenthetical (Unaudited) (USD $)
In Thousands, except Share data	Jun. 30, 2009	Dec. 31, 2008
Consolidated Balance Sheet
Fixed maturity securities available for sale, amortized cost	$9,613,773	$9,218,644
Equity securities available for sale, cost	$518,464	$562,940
Common stock, par value	0.01
Common stock, shares authorized	800,000,000
Common stock, shares outstanding	117,560,145	117,368,534
Treasury stock, shares	26,997,943

Consolidated Statement of Opera

Consolidated Statement of Operations (Unaudited) (USD $)
In Thousands, except Share data, unless otherwise specified	3 Months Ended Jun. 30, 2009		3 Months Ended Jun. 30, 2008		6 Months Ended Jun. 30, 2009		6 Months Ended Jun. 30, 2008
Revenues
Net earned premiums and other considerations	$1,875,866		$1,995,516		$3,750,445		$3,936,933
Net investment income	174,932		201,211		353,411		398,985
Net realized losses on investments, excluding other-than-temporary impairment losses	(1,828)		(7,001)		(32,078)		(6,735)
Total other-than-temporary impairment losses	(7,996)		(27,573)		(33,435)		(70,982)
Portion of loss recognized in other comprehensive loss, before taxes	3,682				3,682
Net other-than-temporary impairment losses recognized in earnings	(4,314)		(27,573)		(29,753)		(70,982)
Amortization of deferred gain on disposal of businesses	6,750		7,327		13,552		14,706
Fees and other income	222,203		79,280		305,909		153,178
Total revenues	2,273,609		2,248,760		4,361,486		4,426,085
Benefits, losses and expenses
Policyholder benefits	989,402		998,208		1,949,744		1,935,667
Amortization of deferred acquisition costs and value of business acquired	398,493		425,088		786,287		830,297
Underwriting, general and administrative expense	589,036		560,763		1,155,721		1,094,204
Interest expense	15,160		15,287		30,349		30,575
Total benefits, losses and expenses	1,992,091		1,999,346		3,922,101		3,890,743
Income before provision for income taxes	281,518		249,414		439,385		535,342
Provision for income taxes	88,196		59,460		165,482		158,558
Net income	$193,322		$189,954		$273,903		$376,784
Earnings Per Share
Basic	1.63		1.61		2.32		3.19
Diluted (1)	1.63	[1]	1.59	[1]	2.31	[1]	3.15	[1]
Dividends per share	0.15		0.14		0.29		0.26
Share Data
Weighted average shares outstanding used in basic per share calculations (1)	118,482,958	[1]	118,309,388	[1]	118,188,879	[1]	118,206,453	[1]
Plus: Dilutive securities (1)	245,346	[1]	1,331,495	[1]	246,152	[1]	1,344,852	[1]
Weighted average shares used in diluted per share calculations (1)	118,728,304	[1]	119,640,883	[1]	118,435,031	[1]	119,551,305	[1]
[1]Prior period amounts have been adjusted in accordance with FSP EITF 03-6-1. See notes 3 and 10.

Consolidated Statement of Stock

Consolidated Statement of Stockholders' Equity (Unaudited) (USD $)
In Thousands	Common Stock	Additional Paid-in Capital	Retained Earnings	Accumulated Other Comprehensive Loss	Treasury Stock	Total
Balance at Dec. 31, 2008	$1,443	$2,928,160	$2,650,371	($670,946)	($1,199,523)	$3,709,505
Stock plan exercises	2	2,552				2,554
Stock plan compensation expense		11,944				11,944
Change in tax benefit from share-based payment arrangements		(1,532)				(1,532)
Dividends			(34,260)			(34,260)
Acquisition of common stock					0
Cumulative effect of change in accounting principle, net of taxes of $23,124 (Note 3)			43,117	(43,117)
Comprehensive income:
Net Income			273,903			273,903
Other comprehensive income:
Net change in unrealized losses on securities, net of taxes of $(149,092)				353,121		353,121
Net change in other-than-temporary impairment gains recognized in other comprehensive income, net of taxes of $(3,420)				6,352		6,352
Net change in foreign currency translation, net of taxes of $(6,478)				41,787		41,787
Amortization of pension and postretirement unregonized net periodic benefit, net of taxes of $(648)				1,203		1,203
Balance at Jun. 30, 2009	$1,445	$2,941,124	$2,933,131	($311,600)	($1,199,523)	$4,364,577

1_Consolidated Statement of Sto

Consolidated Statement of Stockholders' Equity Parenthetical (Unaudited) (USD $)
In Thousands	1/1/2009 - 6/30/2009
Consolidated Statement of Shareholders' Equity
Cumulative effect of change in accounting principle, tax	$23,124
Net change in unrealized losses on securities, tax	(149,092)
Net change in other-than-temporary impairment gains recognized in other comprehensive income, tax	(3,420)
Net change in foreign currency translation, tax	(6,478)
Amortization of pension and postretirement unrecognized net periodic benefit, tax	($648)

Consolidated Statement of Cash

Consolidated Statement of Cash Flows (Unaudited) (USD $)
In Thousands	6 Months Ended Jun. 30, 2009	6 Months Ended Jun. 30, 2008
Operating Activities
Net cash (used in) provided by operating activities	($173,757)	$433,660
Investing Activities
Fixed maturity securities available for sale	442,656	1,086,904
Equity securities available for sale	25,636	169,352
Property and equipment and other	286	561
Subsidiary, net of cash transferred		31,853
Maturities, prepayments, and scheduled redeption of:
Fixed maturity securities available for sale	321,681	343,634
Purchases of:
Fixed maturity securities available for sale	(974,824)	(1,362,023)
Equity securities available for sale	(11,634)	(284,393)
Property and equipment and other	(28,062)	(28,798)
Change in commercial mortgage loans on real estate	32,553	(52,490)
Change in short-term investments	183,343	(87,728)
Change in other invested assets	(19,081)	(64,471)
Change in policy loans	1,644	822
Change in collateral held under securities lending	31,732	30,747
Net cash provided by (used in) investing activities	5,930	(216,030)
Financing Activities
Repayment of mandatorily redeemable preferred stock	(3,000)	(10,000)
Change in tax benefit from share-based payment arrangements	(1,532)	5,220
Dividends paid	(34,260)	(30,740)
Change in obligation under securities lending	(31,732)	(30,747)
Net cash used in financing activities	(70,524)	(66,267)
Effect of exchange rate changes on cash and cash equivalents	6,849	276
Change in cash and cash equivalents	(231,502)	151,639
Cash and cash equivalents at beginning of period	1,040,684	804,964
Cash and cash equivalents at end of period	$809,182	$956,603

Nature of Operations

Nature of Operations (Unaudited)
	6 Months Ended Jun. 30, 2009 USD / shares
Nature of Operations
Nature of Operations	1. Nature of Operations Assurant, Inc. (the Company) is a holding company whose subsidiaries provide specialized insurance products and related services in North America and selected other international markets. The Company is traded on the New York Stock Exchange under the symbol AIZ. Through its operating subsidiaries, the Company provides creditor-placed homeowners insurance, manufactured housing homeowners insurance, debt protection administration, credit-related insurance, warranties and service contracts, individual health and small employer group health insurance, group dental insurance, group disability insurance, group life insurance and pre-funded funeral insurance.

Basis of Presentation

Basis of Presentation (Unaudited)
	6 Months Ended Jun. 30, 2009 USD / shares
Basis of Presentation
Basis of Presentation	2. Basis of Presentation The accompanying unaudited interim consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (GAAP) for interim financial information. Accordingly, these statements do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements. The interim financial data as of June 30, 2009 and for the three and six months ended June 30, 2009 and June30, 2008 is unaudited; in the opinion of management, the interim data includes all adjustments, consisting only of normal recurring adjustments, necessary to a fair statement of the results for the interim periods. The unaudited interim consolidated financial statements include the accounts of the Company and all of its wholly owned subsidiaries. All inter-company transactions and balances are eliminated in consolidation. Certain prior period amounts have been reclassified to conform to the 2009 presentation. Effective January1, 2009, new preneed life insurance policies in which death benefit adjustments are determined at the discretion of the Company are accounted for as universal life contracts under Statement of Financial Accounting Standards (FAS) No.97, Accounting and Reporting by Insurance Enterprises for Certain Long-Duration Contracts and for Realized Gains and Losses from the Sale of Investments (FAS 97). For contracts sold prior to January1, 2009, these preneed life insurance policies were accounted for and will continue to be accounted for under FAS No. 60, Accounting and Reporting by Insurance Enterprises (FAS 60). The change from reporting certain preneed life insurance policies in accordance with FAS 97 versus FAS 60 is not material to the statement of operations or balance sheet. In accordance with FAS 97, income earned on new preneed life insurance policies is presented within policy fee income. Under FAS 60, the consideration received on preneed policies is presented separately as net earned premiums, with policyholder benefits expense being separately disclosed as incurred losses. As previously noted, the effects on net income for the three months and six months ended June 30, 2009 was not material. Operating results for the three and six months ended June 30, 2009 are not necessarily indicative of the results that may be expected for the year ending December31, 2009. The accompanying unaudited interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes included in the Companys Annual Report on Form 10-K for the year ended December31, 2008.

Recent Accounting Pronouncement

Recent Accounting Pronouncements (Unaudited)
	6 Months Ended Jun. 30, 2009 USD / shares
Recent Accounting Pronouncements
Recent Accounting Pronouncements	3. Recent Accounting Pronouncements Recent Accounting Pronouncements - Adopted On January1, 2009, the Company adopted FAS No.141R, Business Combinations (FAS 141R). FAS 141R replaces FAS No.141, Business Combinations (FAS 141). FAS 141R retains the fundamental requirements of FAS 141 in that the acquisition method of accounting be used for all business combinations, that an acquirer be identified for each business combination and for goodwill to be recognized and measured as a residual. FAS 141R expands the definition of transactions and events that qualify as business combinations to all transactions and other events in which one entity obtains control over one or more other businesses. FAS 141R broadens the fair value measurement and recognition of assets acquired, liabilities assumed and interests transferred as a result of business combinations. FAS 141R also increases the disclosure requirements for business combinations in the consolidated financial statements. The adoption of FAS 141R did not have an impact on the Companys financial position or results of operations. However, should the Company enter into any business combination in 2009 or beyond, our financial position or results of operations could incur a significantly different impact than had it recorded the acquisition under FAS 141. Earnings volatility could result, depending on the terms of the acquisition. On January1, 2009, the Company adopted FAS No.160, Noncontrolling Interest in Consolidated Financial Statementsan amendment of ARB No.51 (FAS 160). FAS 160 requires that a noncontrolling interest in a subsidiary be separately reported within equity and the amount of consolidated net income attributable to the noncontrolling interest be presented in the statement of operations. FAS 160 also calls for consistency in reporting changes in the parents ownership interest in a subsidiary and necessitates fair value measurement of any noncontrolling equity investment retained in a deconsolidation. The adoption of FAS 160 did not have an impact on the Companys financial position or results of operations. On January1, 2009, the Company applied FAS No.157, Fair Value Measurements (FAS 157), for all non-financial assets and liabilities measured at fair value on a non-recurring basis in accordance with Financial Accounting Standards Board (FASB) Staff Position (FSP) FAS 157-2, Effective Date of FAS 157 (FSP FAS 157-2). FSP FAS 157-2 postponed the effective date of FAS 157 for those assets and liabilities to fiscal years beginning after November15, 2008, which for the Company is January1, 2009. The application of FSP FAS 157-2 did not have an impact on the Companys financial position or results of operations. The Companys non-financial assets measured at fair value on a non-recurring basis include goodwill and intangible assets. In a business combination, the non-financial assets and liabilities of the acquired company would be measured at fair value in accordance with FAS 157. The requirements of FAS 157 include using an exit price based on an orderly transaction between market participants at the measurement date assuming the highest and best use of the asset by ma

Investments

Investments (Unaudited)
	6 Months Ended Jun. 30, 2009 USD / shares
Investments
Investments	4. Investments The following tables show the cost or amortized cost, gross unrealized gains and losses, fair value and OTTI in AOCI of our fixed maturity and equity securities as of the dates indicated: June 30, 2009 Cost or Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value OTTI in AOCI (1) Fixed maturity securities: United States Government and government agencies and authorities $ 118,911 $ 6,315 $ (31) $ 125,195 $ - States, municipalities and political subdivisions 866,104 27,238 (7,358) 885,984 - Foreign governments 570,562 16,526 (9,454) 577,634 - Asset-backed 51,188 974 (2,072) 50,090 (230) Commercial mortgage-backed 229,974 166 (26,822) 203,318 - Residential mortgage-backed 705,461 34,455 (4,873) 735,043 (2,561) Corporate 7,071,573 166,468 (407,351) 6,830,690 628 Total fixed maturity securities $ 9,613,773 $ 252,142 $ (457,961) $ 9,407,954 $ (2,163) Equity securities: Common stocks $ 5,534 $ 284 $ (1,660) $ 4,158 $ - Non-redeemable preferred stocks 512,930 12,666 (83,581) 442,015 - Total equity securities $ 518,464 $ 12,950 $ (85,241) $ 446,173 $ - (1) Represents the amount of other-than-temporary impairment losses in AOCI, which, from April 1, 2009, were not included in earnings under FSP FAS 115-2 and FAS 124-2 December 31, 2008 Cost or Amortized Cost Gross Unrealized Gains Gross Unrealized Losses Fair Value Fixed maturity securities: United States Government and government agencies and authorities $ 136,725 $ 13,784 $ (22) $ 150,487 States, municipalities and political subdivisions 874,134 14,122 (14,676) 873,580 Foreign governments 503,620 19,391 (9,693) 513,318 Asset-backed 62,184 157 (2,435) 59,906 Commercial mortgage-backed 241,458 60 (43,415) 198,103 Residential mortgage-backed 677,633 29,670 (1,027) 706,276 Corporate 6,722,890 107,270 (700,143) 6,130,017 Total fixed maturity securities $ 9,218,644 $ 184,454 $ (771,411) $ 8,631,687 Equity securities: Common stocks $ 5,384 $ 283 $ (1,618) $ 4,049 Non-redeemable preferred stocks 557,556 7,120 (134,273) 430,403 Total equity securities $ 562,940 $ 7,403 $ (135,891) $ 434,452 The cost or amortized cost and fair value of fixed maturity securities at June30, 2009 by contractual

Fair Value

Fair Value (Unaudited)
	6 Months Ended Jun. 30, 2009 USD / shares
Fair Value Disclosures
Fair Value Disclosures	5. Fair Value Disclosures FAS 157 Disclosures FAS 157 defines fair value, establishes a framework for measuring fair value, creates a fair value hierarchy based on the quality of inputs used to measure fair value and enhances disclosure requirements for fair value measurements. FAS 157 defines fair value as the price that would be received to sell an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. In accordance with FAS157, the Company has categorized its recurring basis financial assets and liabilities into a three-level fair value hierarchy based on the priority of the inputs to the valuation technique. The fair value hierarchy gives the highest priority to quoted prices in active markets for identical assets or liabilities (Level1)and the lowest priority to unobservable inputs (Level3). The inputs used to measure fair value may fall into differentlevels of the fair value hierarchy.In suchcases, the level in the fair value hierarchy within which the fair value measurement in its entirety falls has been determined based on the lowest level input that is significant to the fair value measurementin its entirety.The Companys assessment of the significance of a particular input to the fair value measurement in its entirety requires judgment, and considers factors specificto the asset or liability. The levels of the fair value hierarchy and its application to the Companys financial assets and liabilities are described below: Level 1 inputs utilize quoted prices (unadjusted) in active markets for identical assets or liabilities that the Company has the ability to access. Financial assets and liabilities utilizing Level 1 inputs include certain U.S. mutual funds, money market funds, common stock and certain foreign securities. Level 2 inputs utilize other than quoted prices included in Level 1 that are observable for the asset, either directly or indirectly, for substantially the full term of the asset. Level 2 inputs include quoted prices for similar assets in active markets, quoted prices for identical or similar assets in markets that are not active and inputs other than quoted prices that are observable in the marketplace for the asset. The observable inputs are used in valuation models to calculate the fair value for the asset. Financial assets utilizing Level 2 inputs include corporate, municipal, foreign government and private placement bonds, U.S. Government and agency securities, residential and commercial mortgage-backed securities, asset-backed securities, non-redeemable preferred stocks and certain U.S. and foreign mutual funds. Level 3 inputs are unobservable but are significant to the fair value measurement for the asset, and include situations where there is little, if any, market activity for the asset. These inputs reflect managements own assumptions about the assumptions a market participant would use in pricing the asset. Financial assets utilizing Level 3 inputs include certain non-redeemable preferred stocks, foreign government and corporate bonds, and commercial mortgage-backed and asset-backed securities that were quoted b

Income Taxes

Income Taxes (Unaudited)
	6 Months Ended Jun. 30, 2009 USD / shares
Income Taxes
Income Taxes	6. Income Taxes As of December31, 2008, the Company had a cumulative valuation allowance of $98,793 against deferred tax assets. During the six months ended June 30, 2009, the Company recognized income tax expense of $5,423, and other comprehensive income of $25,917. The overall impact to the valuation allowance was a net decrease of $20,494. The decrease in the valuation allowance was primarily related to additional unrealized gains in the Companys investment portfolio. It is managements assessment that it is more likely than not that $78,299 of deferred tax assets will not be realized. The Companys ability to realize deferred tax assets depends on its ability to generate sufficient taxable income of the same character within the carryback or carryforward periods. In assessing future GAAP taxable income, the Company has considered all sources of taxable income available to realize its deferred tax asset, including the future reversal of existing temporary differences, future taxable income exclusive of reversing temporary differences and carryforwards, taxable income in carryback years and tax-planning strategies. If changes occur in the assumptions underlying the Companys tax planning strategies or in the scheduling of the reversal of the Companys deferred tax assets, the valuation allowance may need to be adjusted in the future.

Debt

Debt (Unaudited)
	6 Months Ended Jun. 30, 2009 USD / shares
Debt
Debt	7. Debt In February 2004, the Company issued two series of senior notes with an aggregate principal amount of $975,000 (the Senior Notes). The Company received net proceeds of $971,537 from this transaction, which represents the principal amount less the discount. The discount of $3,463 is being amortized over the life of the Senior Notes and is included as part of interest expense on the statement of operations. The interest expense incurred related to the Senior Notes was $15,047 for the three months ended June 30, 2009 and 2008, respectively, and $30,094 for the six months ended June 30, 2009 and 2008, respectively. There was $22,570 of accrued interest at June 30, 2009 and 2008, respectively. The Company made interest payments of $30,094 on February15, 2009 and February 15, 2008. In March 2004, the Company established a $500,000 commercial paper program, which is available for working capital and other general corporate purposes. This program is backed up by a $500,000 senior revolving credit facility. There were no amounts relating to the commercial paper program outstanding at June 30, 2009. The Company did not use the revolving credit facility during the six months ended June 30, 2009 or the twelve months ended December31, 2008 and no amounts are currently outstanding. The $500,000 senior revolving credit facility contains a $30,000 commitment from Lehman Brothers Bank, FSB (Lehman). Based on the financial condition of Lehman, the Company is not relying on Lehmans commitment. The revolving credit facility contains restrictive covenants. The terms of the revolving credit facility also require that the Company maintain certain specified minimum ratios and thresholds. Among others, these covenants include maintaining a maximum debt to capitalization ratio and a minimum consolidated adjusted net worth. As of June 30, 2009 the Company was in compliance with all covenants, minimum ratios and thresholds.

Accumulated Other Comprehensive

Accumulated Other Comprehensive Loss (Unaudited)
	6 Months Ended Jun. 30, 2009 USD / shares
Accumulated Other Comprehensive Loss
Accumulated Other Comprehensive Loss	8. Accumulated Other Comprehensive Loss The components of accumulated other comprehensive loss, net of tax, at June30, 2009 are as follows: Foreign currency translation adjustment Unrealized losses on securities OTTI Pension under- funding Accumulated other comprehensive loss Balance at December 31, 2008 $ (45,944) $ (478,400) $ - $(146,602) $ (670,946) Cumulative effect of change in accounting principle (after-tax) (1) - (35,359) (7,758) - (43,117) Activity in 2009 41,787 353,121 6,352 1,203 402,463 Balance at June 30, 2009 $ (4,157) $ (160,638) $ (1,406) $(145,399) $ (311,600) (1) Related to adoption of FSP FAS 115-2 and FAS 124-2. See Notes 3 and 4 for further information. The amounts in the unrealized losses on securities column is net of reclassification adjustments of $(37,970), net of tax, for the six months ended June 30, 2009, for net realized gains (losses) on sales of securities included in net income.

Stock Based Compensation

Stock Based Compensation (Unaudited)
	6 Months Ended Jun. 30, 2009 USD / shares
Stock Based Compensation
Stock Based Compensation	9. Stock Based Compensation Long-Term Equity Incentive Plan In May 2008, the shareholders of the Company approved the Assurant, Inc. Long-Term Equity Incentive Plan (ALTEIP), which authorizes the granting of up to 3,400,000 shares of the Companys common stock to employees, officers and non-employee directors. Under the ALTEIP, the Company may grant awards based on shares of our Common Stock, including stock options, stock appreciation rights (SARs), restricted stock (including performance shares), unrestricted stock, restricted stock units (RSUs), performance share units (PSUs) and dividend equivalents. All future share-based grants will be issued under the ALTEIP. The Compensation Committee of the Board of Directors (the Compensation Committee) has decided to award PSUs and RSUs in 2009. RSUs and PSUs are promises to provide actual stock at the end of a vesting period or performance period. The RSUs granted to employees under the ALTEIP were based on salary grade and performance and will vest one-third each year over a three-year period. RSUs granted to non-employee directors also vest one-third each year over a three-year period. RSUs receive dividend equivalents in cash during the restricted period and they will not have voting rights during the restricted period. PSUs will accrue dividend equivalents during the performance period, which will be paid in cash at the end of the performance period. For the PSU portion of an award, the number of shares a participant will receive upon vesting is contingent upon the Company meeting certain pre-established performance goals, identified below, at the end of a three-year performance period. At the end of the three-year performance period, these performance goals will be measured to determine the number of shares a participant will receive. The payout levels can vary between 0% and 150% (maximum) of the target (100%)ALTEIP award amount based on the Companys level of performance against the pre-established performance goals. PSU Performance Goals. For 2009, the Compensation Committee has established earnings per share (EPS) growth, revenue growth and total stockholder return as the three performance measures for PSU awards. Earnings per share growth is defined as the year-over-year change in GAAP net income divided by average diluted shares outstanding. Revenue growth is defined as year-over-year change in GAAP total revenues as disclosed in the Companys annual statement of operations. Total stockholders return is defined as appreciation in Company stock plus dividend yield to stockholders. The particular performance goals were set based on the performance of each measure relative to the A.M. Best U.S. Insurance Index. Under the ALTEIP, the Companys CEO is authorized by the Board of Directors to grant common stock, restricted stock and RSUs to employees other than the executive officers of the Company (as defined in Section16 of the Securities Exchange Act of 1934, as amended (the Exchange Act). Restricted stock and RSUs granted under this program may have different vesting periods. Long-Term Incentive Plan Prior to the approval of the ALTEIP, share based awards

Earnings Per Common Share

Earnings Per Common Share (Unaudited)
	6 Months Ended Jun. 30, 2009 USD / shares
Earnings Per Common Share
Earnings Per Common Share	10. Earnings Per Common Share In accordance with FSP EITF 03-6-1 and as described in Note 3, restricted stock and RSUs which have non-forfeitable rights to dividends or dividend equivalents are included in calculating basic and diluted earnings per share under the two-class method. The two-class method is an earnings allocation formula that determines EPS for each class of common stock according to dividends declared and participation rights in undistributed earnings. All prior period EPS data presented has been adjusted retrospectively. The following table presents net income, the weighted average common shares used in calculating basic earnings per common share and those used in calculating diluted earnings per common share for each period presented below. Three months ended June 30, Six months ended June 30, 2009 2008 2009 2008 Numerator Net income $ 193,322 $ 189,954 $ 273,903 $ 376,784 Deduct dividends paid (17,771) (16,566) (34,260) (30,740) Undistributed earnings $ 175,551 $ 173,388 $ 239,643 $ 346,044 Denominator Weighted average shares outstanding used in basic earnings per share calculations 118,482,958 118,309,388 118,188,879 118,206,453 Incremental common shares from : SARs 58,368 1,265,602 59,174 1,278,959 ESPP 186,978 65,893 186,978 65,893 Weighted average shares used in diluted earnings per share calculations 118,728,304 119,640,883 118,435,031 119,551,305 Earnings per common share - Basic Distributed earnings $ 0.15 $ 0.14 $ 0.29 $ 0.26 Undistributed earnings 1.48 1.47 2.03 2.93 Net income $ 1.63 $ 1.61 $ 2.32 $ 3.19 Earnings per common share - Diluted Distributed earnings $ 0.15 $ 0.14 $ 0.29 $ 0.26 Undistributed earnings 1.48 1.45 2.02 2.89 Net income $ 1.63 $ 1.59 $ 2.31 $ 3.15 Average SARs totaling 4,460,151 and 1,471,068 for the three months ended June 30, 2009 and 2008, respectively, and 4,665,504 and 891,177 for the six months ended June 30, 2009 and 2008, respectively, were outstanding but were anti-dilutive and thus not included in the computation of diluted EPS under the treasury stock method.

Retirement and Other Employee B

Retirement and Other Employee Benefits (Unaudited)
	6 Months Ended Jun. 30, 2009 USD / shares
Retirement and Other Employee Benefits
Retirement and Other Employee Benefits	11. Retirement and Other Employee Benefits The components of net periodic benefit cost for the Companys qualified pension benefits plan, nonqualified pension benefits plan and retirement health benefits plan for the three and six months ended June 30, 2009 and 2008 were as follows: Qualified Pension Benefits Nonqualified Pension Benefits (1) Retirement Health Benefits For the Three Months Ended June 30, For the Three Months Ended June 30, For the Three Months Ended June 30, 2009 2008 2009 2008 2009 2008 Service cost $ 5,450 $ 5,300 $ 550 $ 475 $ 675 $ 775 Interest cost 7,350 6,575 1,600 1,475 1,050 950 Expected return on plan assets (8,800) (9,275) - - (475) (300) Amortization of prior service cost 100 725 150 200 325 325 Amortization of net loss (gain) 125 1,050 275 350 (50) - Special termination benefits - - - 1,748 - - Net periodic benefit cost $ 4,225 $ 4,375 $ 2,575 $ 4,248 $ 1,525 $ 1,750 Qualified Pension Benefits Nonqualified Pension Benefits (1) Retirement Health Benefits For the Six Months Ended June 30, For the Six Months Ended June 30, For the Six Months Ended June 30, 2009 2008 2009 2008 2009 2008 Service cost $ 10,900 $ 10,600 $ 1,100 $ 950 $ 1,350 $ 1,550 Interest cost 14,700 13,150 3,200 2,950 2,100 1,900 Expected return on plan assets (17,600) (18,550) - - (950) (600) Amortization of prior service cost 200 1,450 300 400 650 650 Amortization of net loss (gain) 250 2,100 550 700 (100) - (Curtailment credit)/special termination benefits - - (549) 1,748 - - Net periodic benefit cost $ 8,450 $ 8,750 $ 4,601 $ 6,748 $ 3,050 $ 3,500 (1) The Company's nonqualified plans are unfunded. During the first six months of 2009, $20,000 was contributed to the qualified pension benefits plan (Plan). An additional $20,000 is expected to be contributed to the Plan over the remainder of 2009. The Benefit Plans Investment Committee of the Company (Investment Committee) oversees the investment of the Plan assets and periodically conducts a review of the investment strategies and policies of the Plan. This includes a review of the strategic asset allocation, including the relationship of the Plan liabilities and portfolio structure. The current target asset allocation and their respective ranges are: Low Target High

Segment Information

Segment Information (Unaudited)
	6 Months Ended Jun. 30, 2009 USD / shares
Segment Information
Segment Information	12. Segment Information The Company has five reportable segments, which are defined based on the nature of the products and services offered: Assurant Solutions, Assurant Specialty Property, Assurant Health, Assurant Employee Benefits, and Corporate Other. Assurant Solutions provides credit-related insurance, including life, disability and unemployment, debt protection administration services, warranties and service contracts, life insurance policies and annuity products that provide benefits to fund pre-arranged funerals. Assurant Specialty Property provides creditor-placed homeowners insurance and manufactured housing homeowners insurance. Assurant Health provides individual, short-term and small group health insurance. Assurant Employee Benefits provides employee and employer paid dental, disability, and life insurance products and related services. Corporate Other includes activities of the holding company, financing and interest expenses, net realized gains (losses) on investments, interest income earned from short-term investments held and additional costs associated with excess of loss reinsurance programs reinsured and ceded to certain subsidiaries in the London market between 1995 and 1997. Corporate Other also includes the amortization of deferred gains associated with the sales of Fortis Financial Group and Long-Term Care through reinsurance agreements. The Company evaluates performance of the operating business segments based on after-tax segment income (loss) excluding realized gains (losses) on investments. The Company determines reportable segments in a manner consistent with the way the Company organizes for purposes of making operating decisions and assessing performance. The following tables summarize selected financial information by segment: Three Months Ended June 30, 2009 Solutions Specialty Property Health Employee Benefits Corporate Other Consolidated Revenues Net earned premiums and other considerations $ 666,935 $ 477,838 $ 468,895 $ 262,198 $ - $ 1,875,866 Net investment income 97,106 28,320 12,073 33,466 3,967 174,932 Net realized losses on investments - - - - (6,142) (6,142) Amortization of deferred gain on disposal of businesses - - - - 6,750 6,750 Fees and other income 51,960 13,642 9,847 7,540 139,214 222,203 Total revenues 816,001 519,800 490,815 303,204 143,789 2,273,609 Benefits, losses and expenses Policyholder benefits 261,325 178,167 357,644 186,770 5,496 989,402 Amortization of deferred acquisition costs and value of business acquired 293,559 93,147 2,357 9,430 - 398,493 Underwriting, general and administrative expenses 215,829 110,269 146,800 88,563 27,575 589,036 In

Commitments and Contingencies

Commitments and Contingencies (Unaudited)
	6 Months Ended Jun. 30, 2009 USD / shares
Commitments and Contingencies
Commitments and Contingencies	13. Commitments and Contingencies In the normal course of business, the Company issues letters of credit primarily to support reinsurance arrangements. These letters of credit are supported by commitments with financial institutions. The Company had $29,135 and $29,617 of letters of credit outstanding as of June 30, 2009 and December31, 2008, respectively. The Company is involved in litigation in the ordinary course of business, both as a defendant and as a plaintiff. The Company may from time to time be subject to a variety of legal and regulatory actions relating to the Companys current and past business operations. While the Company cannot predict the outcome of any pending or future litigation, examination or investigation, and although no assurances can be given, the Company does not believe that any pending matter will have a material adverse effect individually or in the aggregate, on the Companys financial condition, results of operations, or cash flows. One of the Companys subsidiaries, American Reliable Insurance Company (ARIC), participated in certain excess of loss reinsurance programs in the London market and, as a result, reinsured certain personal accident, ransom and kidnap insurance risks from 1995 to 1997. ARIC and a foreign affiliate ceded a portion of these risks to retrocessionaires. ARIC ceased reinsuring such business in 1997. However, certain risks continued beyond 1997 due to the nature of the reinsurance contracts written. ARIC and some of the other reinsurers involved in the programs are seeking to avoid certain treaties on various grounds, including material misrepresentation and non-disclosure by the ceding companies and intermediaries involved in the programs. Similarly, some of the retrocessionaires are seeking avoidance of certain treaties with ARIC and the other reinsurers and some reinsureds are seeking collection of disputed balances under some of the treaties. The disputes generally involve multiple layers of reinsurance, and allegations that the reinsurance programs involved interrelated claims spirals devised to disproportionately pass claims losses to higher-level reinsurance layers. Many of the companies involved in these programs, including ARIC, are currently involved in negotiations, arbitrations and/or litigation, in an effort to resolve these disputes. The disputes involving ARIC and an affiliate, Assurant General Insurance Limited (formerly Bankers Insurance Company Limited) (AGIL), for the 1995 and 1996 program years are subject to working group settlements negotiated with other market participants. Negotiations, arbitrations and litigation are still ongoing with respect to the 1997 program year or will be scheduled for the remaining disputes. As previously disclosed by the Company in a Current Report on Form 8-K, on June 9, 2009, ARIC and AGIL, wholly-owned subsidiaries of the Company, entered into a settlement agreement with Willis Limited, a subsidiary of Willis Group Holdings Limited (Willis Limited). The settlement agreement related to an action commenced in 2007 in the English Commercial Court pertaining to the placement of personal accident reinsurance. Under the

Subsequent Events

Subsequent Events (Unaudited)
	6 Months Ended Jun. 30, 2009 USD / shares
Subsequent Events
Subsequent Events	14. Subsequent Events The Company evaluated subsequent events through the date the accompanying consolidated financial statements were issued, which was August 5, 2009, and determined there were none.