EXHIBIT 99.2
[ASSURANT LOGO]
ASSURANT INC. (AIZ)
FINANCIAL SUPPLEMENT AS OF DECEMBER 31, 2004
.
.
.
[ASSURANT LOGO]
ASSURANT, INC. AND SUBSIDIARIES
EARNINGS RELEASE SUPPLEMENT
AS OF DECEMBER 31, 2004
INDEX TO SUPPLEMENT
Page:
-----
REGULATION G - NON GAAP MEASURES 1
SUMMARY FINANCIAL HIGHLIGHTS (unaudited) 2
CONSOLIDATED CONDENSED BALANCE SHEETS (unaudited) 4
RECONCILIATION OF NET OPERATING INCOME TO NET INCOME (unaudited) 5
CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS (unaudited) 6
CONDENSED SEGMENT STATEMENTS OF OPERATIONS (unaudited) 7
INVESTMENTS (unaudited) 12
INVESTMENT RESULTS BY ASSET CATEGORY
& ANNUALIZED YIELDS (unaudited) 13
ABOUT ASSURANT:
Assurant is a premier provider of specialized insurance products and related
services in North America and selected other markets. The four key business
segments - Assurant Employee Benefits; Assurant Health; Assurant Preneed; and
Assurant Solutions - have partnered with clients who are leaders in their
industries and have built leadership positions in a number of specialty
insurance markets in the U.S. and selected international markets. The Assurant
business segments provide creditor-placed homeowners insurance; manufactured
housing homeowners insurance; debt protection administration; credit insurance;
warranties and extended services contracts; individual health and small employer
group health insurance; group dental insurance; group disability insurance;
group life insurance; and pre-funded funeral insurance.
The company, which is traded on the New York Stock Exchange under the symbol
AIZ, has over $20 billion in assets and $7 billion in annual revenue. Assurant
has more than 12,000 employees and is headquartered in New York's financial
district.
SAFE HARBOR STATEMENT:
Some of the statements included in this statistical supplement, particularly
those anticipating future financial performance, business prospects, growth and
operating strategies and similar matters, are forward-looking statements that
involve a number of risks and uncertainties. For those statements, we claim the
protection of the safe harbor for forward-looking statements contained in the
Private Securities Litigation Reform Act of 1995. For a discussion of the
factors that could affect our actual results please refer to the risk factors
identified from time to time in our SEC reports, posted on the Assurant website
at www.assurant.com.
[ASSURANT LOGO]
REGULATION G - NON GAAP MEASURES
Assurant uses the following non-GAAP financial measures to analyze the company's
operating performance for the periods presented in the press release. Because
Assurant's calculation of these measures may differ from similar measures used
by other companies, investors should be careful when comparing Assurant's
non-GAAP financial measures to those of other companies.
(1) Assurant uses net operating income as an important measure of the company's
operating performance. Net operating income equals net income, excluding net
realized gains (losses) on investments and unusual and/or infrequent items. The
company believes net operating income provides investors a valuable measure of
the performance of the company's ongoing business, because it excludes both the
effect of realized gains (losses) on investments that tend to be highly variable
from period to period, and those events that are unusual and/or unlikely to
recur.
(2) Pro forma earnings per share has been included as a measure of operating
performance. In February 2004, Assurant completed a significant capital
restructuring in conjunction with its initial public offering of common stock.
Pro forma earnings per share reflects earnings per share adjusted as if this
capital restructuring had occurred on January 1, 2003. This restructuring
included: a stock split and conversion of Class B and C shares resulting in
total outstanding shares of 109,222,276; the issuance of 32,976,854 shares of
Assurant common stock to Fortis Insurance N.V. in exchange for a capital
contribution of $725.5 million, and the issuance of 68,976 restricted shares of
Assurant common stock to certain officers and directors of the company pursuant
to specific restricted stock grants. These transactions occurred subsequent to
the December 31, 2003 balance sheet, but management believes that this adjusted
measure provides a better indication of operating performance than the
corresponding GAAP measure, earnings per share.
(3) Book value per share excluding accumulated other comprehensive income (AOCI)
has been included as a measure of stockholder value. The company believes book
value per share excluding AOCI provides investors a better measure of
stockholder value than book value per share because it excludes the effect of
unrealized gains (losses) on investments and foreign currency translation, which
tend to be highly variable from period to period.
(4) Pro forma book value per share and Pro forma book value per share excluding
AOCI have been included as measures of stockholder value. In February 2004,
Assurant completed a significant capital restructuring in conjunction with its
initial public offering of common stock. These Pro forma book value per share
measures reflect book value per share adjusted as if this capital restructuring
had occurred on January 1, 2003. This restructuring included: a stock split and
conversion of Class B and C shares resulting in total outstanding shares of
109,222,276; the issuance of 32,976,854 shares of Assurant common stock to
Fortis Insurance N.V. in exchange for a capital contribution of $725.5 million,
and the issuance of 68,976 restricted shares of Assurant common stock to certain
officers and directors of the company pursuant to specific restricted stock
grants. These transactions occurred subsequent to the December 31, 2003 balance
sheet, but management believes that these adjusted measures provide a better
indication of stockholder value than the corresponding GAAP measures, book value
per share and book value per share excluding AOCI.
[ASSURANT LOGO]
ASSURANT, INC. AND SUBSIDIARIES
SUMMARY FINANCIAL HIGHLIGHTS
(UNAUDITED)
FOR THE THREE-MONTHS ENDED FOR THE YEAR ENDED
DECEMBER 31, DECEMBER 31,
($ IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) 2004 2003 2004 2003
- ----------------------------------------------------------- --------------- --------------- --------------- ---------------
NET OPERATING INCOME (1) $ 86,478 $ 74,799 $ 344,991 $ 329,159
Net realized gain/(loss) from investments 1,210 (8,411) 15,800 1,214
Loss on disposal of business - - (6,337) -
Expenses directly related to the initial and
secondary public offerings (1,560) (10,237) (3,894) (10,937)
Interest premium on redemption of mandatorily
redeemable preferred securities - (133,784) - (133,784)
--------------- --------------- --------------- ---------------
NET INCOME $ 86,128 $ (77,633) $ 350,560 $ 185,652
--------------- --------------- --------------- ---------------
TOTAL REVENUES $ 1,876,695 $ 1,836,295 $ 7,403,464 $ 7,066,213
PER SHARE AND SHARE DATA:
Basic earnings per share
Net operating income $ 0.62 $ 0.68 $ 2.49 $ 3.01
Net income $ 0.62 $ (0.71) $ 2.53 $ 1.70
Weighted average of common shares
outstanding - basic 139,968,130 109,222,276 138,358,767 109,222,276
Diluted earnings per share
Net operating income $ 0.62 $ 0.68 $ 2.49 $ 3.01
Net income $ 0.61 $ (0.71) $ 2.53 $ 1.70
Weighted average of common shares outstanding - diluted 140,054,287 109,222,276 138,467,564 109,222,276
Pro forma earnings per share (2)
Net operating income $ 0.62 $ 0.53 $ 2.44 $ 2.31
Net income (loss) $ 0.61 $ (0.55) $ 2.48 $ 1.31
Pro forma common shares outstanding 140,054,287 142,208,676 141,622,001 142,208,676
Page 2
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ASSURANT, INC. AND SUBSIDIARIES
SUMMARY FINANCIAL HIGHLIGHTS (CONTINUED)
(UNAUDITED)
AS OF AS OF
DECEMBER 31, DECEMBER 31,
-------------- -------------------------------
($ IN THOUSANDS, EXCEPT PER SHARE AMOUNTS) 2004 2003 2002
- --------------------------------------------------------------- -------------- -------------- --------------
TOTAL ASSETS $ 23,968,565 $ 23,707,977 $ 22,257,699
TOTAL STOCKHOLDERS' EQUITY $ 3,635,431 $ 2,632,103 $ 2,555,059
Capital contribution from Fortis - 725,500 725,500
PRO FORMA STOCKHOLDERS' EQUITY (3) $ 3,635,431 $ 3,357,603 $ 3,280,559
TOTAL STOCKHOLDERS' EQUITY (EXCLUDING AOCI) (4) $ 3,297,268 $ 2,313,576 $ 2,310,074
Capital contribution from Fortis - 725,500 725,500
PRO FORMA STOCKHOLDERS' EQUITY (EXCLUDING AOCI) (3) $ 3,297,268 $ 3,039,076 $ 3,035,574
Basic book value per share $ 26.01 $ 24.10 $ 23.39
Basic book value per share (excluding AOCI) (4) $ 23.59 $ 21.18 $ 21.15
Shares outstanding for basic book value per share calculation 139,766,177 109,222,276 109,222,276
Diluted book value per share $ 25.99 $ 24.10 $ 23.39
Diluted book value per share (excluding AOCI) (4) $ 23.57 $ 21.18 $ 21.15
Shares outstanding for diluted book value per share calculation 139,901,760 109,222,276 109,222,276
Pro forma book value per share (3) $ 25.99 $ 23.61 $ 23.07
Pro forma book value per share (excluding AOCI) (3) $ 23.57 $ 21.37 $ 21.35
Pro forma shares outstanding 139,901,760 142,208,676 142,208,676
Page 3
[ASSURANT LOGO]
ASSURANT, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED BALANCE SHEETS
(UNAUDITED)
AS OF AS OF
DECEMBER 31, DECEMBER 31,
------------- -------------------------
($ IN THOUSANDS) 2004 2003 2002
- ---------------------------------------------------------------------------- ------------ ------------ -----------
ASSETS
Investments and cash and cash equivalents $12,419,797 $11,881,802 $10,694,772
Reinsurance recoverables 4,133,660 4,445,265 4,649,909
Goodwill 823,054 828,523 834,138
Assets held in separate accounts 3,717,149 3,805,058 3,411,616
Other assets 2,874,905 2,747,329 2,667,264
----------- ----------- -----------
Total assets 23,968,565 23,707,977 22,257,699
=========== =========== ===========
LIABILITIES
Policyholder liability 13,381,936 12,881,796 12,388,623
Debt 971,611 1,750,000 -
Mandatorily redeemable preferred securities - 196,224 1,446,074
Mandatorily redeemable preferred stock 24,160 24,160 24,660
Liabilities related to separate accounts 3,717,149 3,805,058 3,411,616
Accounts payable and other liabilities 2,238,278 2,418,636 2,431,667
----------- ----------- -----------
Total liabilities 20,333,134 21,075,874 19,702,640
STOCKHOLDERS' EQUITY
Equity, excluding accumulated other
comprehensive income 3,297,268 2,313,576 2,310,074
Accumulated other comprehensive income 338,163 318,527 244,985
----------- ----------- -----------
Total stockholders' equity 3,635,431 2,632,103 2,555,059
----------- ----------- -----------
----------- ----------- -----------
Total liabilities and stockholders' equity $23,968,565 $23,707,977 $22,257,699
=========== =========== ===========
Page 4
[ASSURANT LOGO]
ASSURANT, INC. AND SUBSIDIARIES
RECONCILIATION OF NET OPERATING INCOME TO NET INCOME
(UNAUDITED)
FOR THE THREE MONTHS ENDED
-----------------------------------------------------------------
DECEMBER 31, SEPTEMBER 30, JUNE 30, MARCH 31, DECEMBER 31,
($ IN THOUSANDS, NET OF TAX) 2004 2004 2004 2004 2003
------------ ------------- ---------- ---------- ------------
Assurant Solutions $ 44,563 $ 2,974 $ 38,568 $ 40,053 $ 33,085
Assurant Health 33,744 47,900 39,935 36,708 28,421
Assurant Employee Benefits 19,967 14,967 14,026 13,250 12,938
Assurant Preneed 8,698 8,942 10,139 6,456 8,159
Corporate and Other (19,857) (1,195) (3,818) (10,412) (1,150)
Amortization of deferred gain on disposal of businesses
9,318 9,450 9,270 9,423 10,427
Interest expense and distributions on mandatorily redeemable
preferred securities (9,955) (9,819) (10,292) (8,012) (17,081)
--------- --------- --------- --------- ---------
Net operating income 86,478 73,219 97,828 87,466 74,799
Adjustments:
Net realized gains (losses) on investments 1,210 1,625 3,719 9,246 (8,411)
Loss on disposal of business - - (6,337) - -
Expenses directly related to the initial and secondary public
offerings (1,560) - - (2,334) (10,237)
Interest premium on redemption of mandatorily redeemable
preferred securities - - - - (133,784)
--------- --------- --------- --------- ---------
Net income (loss) $ 86,128 $ 74,844 $ 95,210 $ 94,378 $ (77,633)
========= ========= ========= ========= =========
FOR THE THREE MONTHS ENDED FOR THE YEAR ENDED
-------------------------------------- -------------------------
SEPTEMBER 30, JUNE 30, MARCH 31, DECEMBER 31, DECEMBER 31,
($ IN THOUSANDS, NET OF TAX) 2003 2003 2003 2004 2003
------------- ---------- ---------- ------------ ------------
Assurant Solutions $ 31,424 $ 34,067 $ 34,613 $ 126,158 $ 133,189
Assurant Health 30,626 30,424 31,542 158,287 121,013
Assurant Employee Benefits 22,091 18,400 8,138 62,210 61,567
Assurant Preneed 8,857 9,874 9,132 34,235 36,022
Corporate and Other 9,981 (1,414) (242) (35,282) 7,175
Amortization of deferred gain on disposal of businesses
11,389 10,013 12,550 37,461 44,379
Interest expense and distributions on mandatorily redeemable
preferred securities (19,037) (18,808) (19,260) (38,078) (74,186)
--------- --------- --------- --------- ---------
Net operating income 95,331 82,556 76,473 344,991 329,159
Adjustments:
Net realized gains (losses) on investments 4,767 8,094 (3,236) 15,800 1,214
Loss on disposal of business - - - (6,337) -
Expenses directly related to the initial and secondary public
offerings (700) - - (3,894) (10,937)
Interest premium on redemption of mandatorily redeemable
preferred securities - - - - (133,784)
--------- --------- --------- --------- ---------
Net income (loss) $ 99,398 $ 90,650 $ 73,237 $ 350,560 $ 185,652
========= ========= ========= ========= =========
Page 5
[ASSURANT LOGO]
ASSURANT, INC. AND SUBSIDIARIES
CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS
(UNAUDITED)
FOR THE THREE MONTHS ENDED
----------------------------------------------------------------------
DECEMBER 31, SEPTEMBER 30, JUNE 30, MARCH 31, DECEMBER 31,
($ IN THOUSANDS) 2004 2004 2004 2004 2003
------------ ------------- ------------ ----------- --------------
REVENUES:
Net earned premiums and other considerations $ 1,638,612 $ 1,603,548 $ 1,615,473 $ 1,625,238 $ 1,623,269
Net investment income 163,263 160,034 157,628 153,824 150,705
Net realized gains (losses) on investments 1,861 2,501 5,722 14,224 (12,940)
Loss on disposal of business - - (9,232) - -
Amortization of deferred gain on disposal of businesses 14,334 14,539 14,262 14,497 16,042
Fees and other income 58,625 51,238 53,496 49,777 59,219
----------- ----------- ----------- ----------- -----------
1,876,695 1,831,860 1,837,349 1,857,560 1,836,295
----------- ----------- ----------- ----------- -----------
BENEFITS, LOSSES AND EXPENSES:
Policyholder benefits 950,821 976,934 943,049 968,965 1,001,438
Selling, underwriting, general and administrative expenses 770,691 730,565 734,422 733,508 737,148
Interest expense and distributions on mandatorily redeemable
preferred securities 15,314 15,107 15,834 12,326 26,279
Interest premium on redemption of mandatorily redeemable
preferred securities - - - - 205,822
----------- ----------- ----------- ----------- -----------
1,736,826 1,722,606 1,693,305 1,714,799 1,970,687
----------- ----------- ----------- ----------- -----------
Income (loss) before income taxes 139,869 109,254 144,044 142,761 (134,392)
Income tax expense (benefit) 53,741 34,410 48,834 48,383 (56,759)
----------- ----------- ----------- ----------- -----------
Net income (loss) $ 86,128 $ 74,844 $ 95,210 $ 94,378 $ (77,633)
=========== =========== ============ =========== ===========
FOR THE THREE MONTHS ENDED FOR THE YEAR ENDED
---------------------------------------- --------------------------
SEPTEMBER 30, JUNE 30, MARCH 31, DECEMBER 31, DECEMBER 31,
($ IN THOUSANDS) 2003 2003 2003 2004 2003
------------- ----------- ------------ ------------ ------------
REVENUES:
Net earned premiums and other considerations $ 1,546,474 $ 1,484,066 $ 1,502,963 $ 6,482,871 $ 6,156,772
Net investment income 150,723 154,364 151,521 634,749 607,313
Net realized gains (losses) on investments 7,334 12,452 (4,978) 24,308 1,868
Loss on disposal of business - - - (9,232) -
Amortization of deferred gain on disposal of businesses 17,522 15,405 19,308 57,632 68,277
Fees and other income 53,524 56,314 62,926 213,136 231,983
----------- ----------- ----------- ----------- -----------
1,775,577 1,722,601 1,731,740 7,403,464 7,066,213
----------- ----------- ----------- ----------- -----------
BENEFITS, LOSSES AND EXPENSES:
Policyholder benefits 879,321 888,241 888,763 3,839,769 3,657,763
Selling, underwriting, general and administrative expenses 721,192 667,819 702,979 2,969,186 2,829,138
Interest expense and distributions on mandatorily redeemable
preferred securities 29,288 28,935 29,631 58,581 114,133
Interest premium on redemption of mandatorily redeemable
preferred securities - - - - 205,822
----------- ----------- ----------- ----------- -----------
1,629,801 1,584,995 1,621,373 6,867,536 6,806,856
----------- ----------- ----------- ----------- -----------
Income (loss) before income taxes 145,776 137,606 110,367 535,928 259,357
Income tax expense (benefit) 46,378 46,956 37,130 185,368 73,705
----------- ----------- ----------- ----------- -----------
Net income (loss) $ 99,398 $ 90,650 $ 73,237 $ 350,560 $ 185,652
=========== =========== =========== =========== ===========
Page 6
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ASSURANT SOLUTIONS
CONDENSED STATEMENT OF OPERATIONS
(UNAUDITED)
FOR THE THREE MONTHS ENDED
--------------------------------------------------------------------------
DECEMBER 31, SEPTEMBER 30, JUNE 30, MARCH 31, DECEMBER 31,
($ IN THOUSANDS) 2004 2004 2004 2004 2003
------------ ------------ ------------- ------------- -------------
REVENUES:
Net earned premiums and other considerations $ 612,226 $ 602,720 $ 610,630 $ 623,065 $ 624,999
Net investment income 47,123 48,201 44,868 44,759 44,658
Fees and other income 38,787 36,818 34,004 26,859 30,091
------------ ------------ ------------- ------------- -------------
698,136 687,739 689,502 694,683 699,748
------------ ------------ ------------- ------------- -------------
BENEFITS, LOSSES AND EXPENSES:
Policyholder benefits 211,552 272,088 220,215 231,576 267,081
Selling underwriting general and administrative
expenses 422,224 412,153 412,573 404,202 390,087
------------ ------------ ------------- ------------- -------------
633,776 684,241 632,788 635,778 657,168
------------ ------------ ------------- ------------- -------------
Income before income taxes 64,360 3,498 56,714 58,905 42,580
Income tax expense 19,797 524 18,146 18,852 9,495
------------ ------------ ------------- ------------- -------------
Net operating income $ 44,563 $ 2,974 $ 38,568 $ 40,053 $ 33,085
============ ============ ============= ============= =============
NET EARNED PREMIUMS AND OTHER CONSIDERATIONS BY MAJOR
PRODUCT GROUPINGS:
(amounts in millions)
Special Property Solutions $ 191 $ 202 $ 193 $ 183 $ 206
Consumer Protection Solutions 421 401 418 440 419
------------ ------------ ------------- ------------- -------------
Total $ 612 $ 603 $ 611 $ 623 $ 625
============ ============ ============= ============= =============
FOR THE THREE MONTHS ENDED FOR THE YEAR ENDED
------------------------------------------------------------------------
SEPTEMBER 30, JUNE 30, MARCH 31, DECEMBER 31, DECEMBER 31,
($ IN THOUSANDS) 2003 2003 2003 2004 2003
------------- ------------ ------------ ------------- --------------
REVENUES:
Net earned premiums and other considerations $ 612,882 $ 552,403 $ 571,531 $ 2,448,641 $ 2,361,815
Net investment income 46,315 45,387 50,490 184,951 186,850
Fees and other income 31,218 30,774 37,399 136,468 129,482
------------- ------------ ------------ ------------- --------------
690,415 628,564 659,420 2,770,060 2,678,147
------------- ------------ ------------ ------------- --------------
BENEFITS, LOSSES AND EXPENSES:
Policyholder benefits 221,755 213,280 197,113 935,431 899,229
Selling underwriting general and administrative
expenses 424,307 364,783 411,023 1,651,152 1,590,200
------------- ------------ ------------ ------------- --------------
646,062 578,063 608,136 2,586,583 2,489,429
------------- ------------ ------------ ------------- --------------
Income before income taxes 44,353 50,501 51,284 183,477 188,718
Income tax expense 12,929 16,434 16,671 57,319 55,529
------------- ------------ ------------ ------------- --------------
Net operating income $ 31,424 $ 34,067 $ 34,613 $ 126,158 $ 133,189
============= ============ ============ ============= ==============
NET EARNED PREMIUMS AND OTHER CONSIDERATIONS BY MAJOR
PRODUCT GROUPINGS:
(amounts in millions)
Special Property Solutions $ 183 $ 172 $ 172 $ 769 $ 733
Consumer Protection Solutions 430 380 400 1,680 1,629
------------- ------------ ------------ ------------- --------------
Total $ 613 $ 552 $ 572 $ 2,449 $ 2,362
============= ============ ============ ============= ==============
Page 7
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ASSURANT HEALTH
CONDENSED STATEMENT OF OPERATIONS
(UNAUDITED)
FOR THE THREE MONTHS ENDED
------------------------------------------------------------------------
DECEMBER 31, SEPTEMBER 30, JUNE 30, MARCH 31, DECEMBER 31,
($ IN THOUSANDS) 2004 2004 2004 2004 2003
------------- ------------- ----------- ------------- --------------
REVENUES:
Net earned premiums and other considerations $ 557,825 $ 563,165 $ 559,361 $ 550,947 $ 533,711
Net investment income 17,365 16,874 16,716 16,947 12,970
Fees and other income 9,882 8,436 11,035 9,355 8,524
------------ ------------ ----------- ------------- -------------
585,072 588,475 587,112 577,249 555,205
------------ ------------ ----------- ------------- -------------
BENEFITS, LOSSES AND EXPENSES:
Policyholder benefits 357,751 350,188 358,729 356,115 351,843
Selling, underwriting, general and administrative expenses 176,645 165,108 167,753 165,401 160,703
------------ ------------ ----------- ------------- -------------
534,396 515,296 526,482 521,516 512,546
------------ ------------ ----------- ------------- -------------
Income before income taxes 50,676 73,179 60,630 55,733 42,659
Income tax expense 16,932 25,279 20,695 19,025 14,238
------------- ------------- ----------- -------------- --------------
Net operating income $ 33,744 $ 47,900 $ 39,935 $ 36,708 $ 28,421
============ ============ =========== ============= =============
Loss ratio (a) 64.1% 62.2% 64.1% 64.6% 65.9%
Expense ratio (b) 31.1% 28.9% 29.4% 29.5% 29.6%
Combined ratio (c) 94.1% 90.1% 92.3% 93.1% 94.5%
MEMBERSHIP BY PRODUCT LINE:
Individual 782 807 810 782 761
Small employer group 333 348 367 333 376
------------ ------------ ----------- ------------- -------------
Total 1,115 1,155 1,177 1,115 1,137
============ ============ =========== ============= =============
NET EARNED PREMIUMS AND OTHER CONSIDERATIONS:
(amounts in millions)
Individual $ 311 $ 311 $ 301 $ 292 $ 281
Small employer group 247 252 258 259 253
------------ ------------ ----------- ------------- -------------
Total $ 558 $ 563 $ 559 $ 551 $ 534
============ ============ =========== ============= =============
FOR THE THREE MONTHS ENDED FOR THE YEAR ENDED
--------------------------------------------------------------------------
SEPTEMBER 30, JUNE 30, MARCH 31, DECEMBER 31, DECEMBER 31,
($ IN THOUSANDS) 2003 2003 2003 2004 2003
-------------- ------------ ------------- -------------- -------------
REVENUES:
Net earned premiums and other considerations $ 506,702 $ 491,690 $ 477,145 $ 2,231,298 $ 2,009,248
Net investment income 11,460 12,406 12,594 67,902 49,430
Fees and other income 8,590 7,904 7,237 38,708 32,255
------------ ------------ ------------ -------------- -------------
526,752 512,000 496,976 2,337,908 2,090,933
------------ ------------ ------------ -------------- -------------
BENEFITS, LOSSES AND EXPENSES:
Policyholder benefits 334,681 317,609 312,913 1,422,783 1,317,046
Selling, underwriting, general and administrative
expenses 145,677 146,848 136,055 674,907 589,283
------------ ------------ ------------ -------------- -------------
480,358 464,457 448,968 2,097,690 1,906,329
------------ ------------ ------------ -------------- -------------
Income before income taxes 46,394 47,543 48,008 240,218 184,604
Income tax expense 15,768 17,119 16,466 81,931 63,591
------------ ------------- ------------ -------------- -------------
Net operating income $ 30,626 $ 30,424 $ 31,542 $ 158,287 $ 121,013
============ ============ ============ ============== ==============
Loss ratio (a) 66.1% 64.6% 65.6% 63.8% 65.5%
Expense ratio (b) 28.3% 29.4% 28.1% 29.7% 28.9%
Combined ratio (c) 93.2% 93.0% 92.7% 92.4% 93.4%
MEMBERSHIP BY PRODUCT LINE:
Individual 755 715 685 782 761
Small employer group 365 360 355 333 376
------------ ------------ ------------ -------------- -------------
Total 1,120 1,075 1,040 1,115 1,137
============ ============ ============ ============== =============
NET EARNED PREMIUMS AND OTHER CONSIDERATIONS:
(amounts in millions)
Individual $ 262 $ 252 $ 242 $ 1,216 $ 1,037
Small employer group 245 240 235 1,015 973
------------ ------------ ------------ -------------- -------------
Total $ 507 $ 492 $ 477 $ 2,231 $ 2,010
============ ============ ============ ============== ==============
(a) The loss ratio is equal to policyholder benefits divided by net earned
premiums and other considerations.
(b) The expense ratio is equal to selling, underwriting and general expenses
divided by net earned premiums and other considerations and fees and other
income.
(c) The combined ratio is equal to total benefits, losses and expenses divided
by net earned premiums and other considerations and fees and other income.
Page 8
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ASSURANT EMPLOYEE BENEFITS
CONDENSED STATEMENT OF OPERATIONS
(UNAUDITED)
FOR THE THREE MONTHS ENDED
--------------------------------------------------------------------------
DECEMBER 31, SEPTEMBER 30, JUNE 30, MARCH 31, DECEMBER 31, SEPTEMBER 30,
2004 2004 2004 2004 2003 2003
($ in thousands) ---- ---- ---- ---- ---- ----
----------- ------------ --------- --------- ----------- ------------
REVENUES:
Net earned premiums and other considerations $ 343,782 $ 305,827 $ 309,159 $ 318,044 $ 336,134 $ 297,258
Net investment income 39,063 37,496 37,437 35,722 35,527 34,512
Fees and other income 6,777 5,411 6,734 10,384 16,898 3,832
----------- ------------ --------- --------- ----------- ------------
389,622 348,734 353,330 364,150 388,559 335,602
BENEFITS, LOSSES AND EXPENSES: ----------- ------------ --------- --------- ----------- ------------
Policyholder benefits 252,984 224,083 228,842 244,326 253,265 196,910
Selling, underwriting, general and administrative
expenses 106,037 101,618 102,737 99,345 114,069 104,707
----------- ------------ --------- --------- ----------- ------------
359,021 325,701 331,579 343,671 367,334 301,617
----------- ------------ --------- --------- ----------- ------------
Income before income taxes 30,601 23,033 21,751 20,479 21,225 33,985
Income tax expense 10,634 8,066 7,725 7,229 8,287 11,894
----------- ------------ --------- --------- ----------- ------------
Net operating income $ 19,967 $ 14,967 $ 14,026 $ 13,250 $ 12,938 $ 22,091
=========== ============ ========= ========= =========== ============
Loss ratio (a) 73.6% 73.3% 74.0% 76.8% 75.3% 66.2%
Expense ratio (b) 30.2% 32.6% 32.5% 30.2% 32.3% 34.8%
NET EARNED PREMIUMS AND OTHER CONSIDERATIONS BY
MAJOR PRODUCT GROUPINGS:
(amounts in millions)
Group dental $ 132 $ 128 $ 130 $ 131 $ 135 $ 133
Group disability 151 116 115 124 140 102
Group life 61 62 64 63 61 62
----------- ------------ --------- --------- ----------- ------------
Total $ 344 $ 306 $ 309 $ 318 $ 336 $ 297
=========== ============ ========= ========= =========== ============
ASSURANT
ASSURANT EMPLOYEE BENEFITS
CONDENSED STATEMENT OF OPERATIONS
(UNAUDITED)
FOR THE THREE MONTHS ENDED FOR THE YEAR ENDED
-------------------------- ------------------------
JUNE 30, MARCH 31, DECEMBER 31, DECEMBER 31,
2003 2003 2004 2003
($ in thousands) ---- ---- ---- ----
--------- --------- ----------- -----------
REVENUES:
Net earned premiums and other considerations $ 302,759 $ 320,279 $ 1,276,812 $ 1,256,430
Net investment income 35,397 34,520 149,718 139,956
Fees and other income 16,290 16,773 29,306 53,793
--------- --------- ----------- -----------
354,446 371,572 1,455,836 1,450,179
BENEFITS, LOSSES AND EXPENSES: --------- --------- ----------- -----------
Policyholder benefits 223,261 247,512 950,235 920,948
Selling, underwriting, general and administrative
expenses 102,877 111,539 409,737 433,192
--------- --------- ----------- -----------
326,138 359,051 1,359,972 1,354,140
--------- --------- ----------- -----------
Income before income taxes 28,308 12,521 95,864 96,039
Income tax expense 9,908 4,383 33,654 34,472
--------- --------- ----------- -----------
Net operating income $ 18,400 $ 8,138 $ 62,210 $ 61,567
========= ========= =========== ===========
Loss ratio (a) 73.7% 77.3% 74.4% 73.3%
Expense ratio (b) 32.2% 33.1% 31.4% 33.1%
NET EARNED PREMIUMS AND OTHER CONSIDERATIONS BY
MAJOR PRODUCT GROUPINGS:
(amounts in millions)
Group dental $ 134 $ 137 $ 521 $ 539
Group disability 101 118 506 461
Group life 68 65 250 256
--------- --------- ----------- -----------
Total $ 303 $ 320 $ 1,277 $ 1,256
========= ========= =========== ===========
(a) The loss ratio is equal to policyholder benefits divided by net earned
premiums and other considerations.
(b) The expense ratio is equal to selling, underwriting and general expenses
divided by net earned premiums and other considerations and fees and other
income.
Page 9
[ASSURANT LOGO]
ASSURANT PRENEED
CONDENSED STATEMENT OF OPERATIONS
(UNAUDITED)
FOR THE THREE MONTHS ENDED
--------------------------------------------------------------------------------------------------
DECEMBER 31, SEPTEMBER 30, JUNE 30, MARCH 31, DECEMBER 31, SEPTEMBER 30, JUNE 30, MARCH 31,
($ IN THOUSANDS) 2004 2004 2004 2004 2003 2003 2003 2003
- ------------------------------ ----------- ------------ ------- -------- ----------- ------------ ------- --------
REVENUES:
Net earned premiums and other
considerations $ 124,779 $ 131,836 $ 136,323 $ 133,182 $ 128,425 $ 129,632 $ 137,214 $ 134,008
Net investment income 52,672 50,982 52,469 50,177 48,363 46,371 48,380 45,110
Fees and other income 3,295 (20) 1,494 2,041 1,660 1,167 1,243 1,245
--------- --------- --------- --------- ----------- --------- --------- ---------
180,746 182,798 190,286 185,400 178,448 177,170 186,837 180,363
--------- --------- --------- --------- ----------- --------- --------- ---------
BENEFITS, LOSSES AND EXPENSES:
Policyholder benefits 128,534 130,575 135,263 136,948 129,249 125,975 134,091 131,225
Selling, underwriting, general
and administrative expenses 39,729 38,854 39,390 38,513 36,451 37,765 37,657 35,069
--------- --------- --------- --------- ----------- --------- --------- ---------
168,263 169,429 174,653 175,461 165,700 163,740 171,748 166,294
--------- --------- --------- --------- ----------- --------- --------- ---------
Income before income taxes 12,483 13,369 15,633 9,939 12,748 13,430 15,089 14,069
Income tax expense 3,785 4,427 5,494 3,483 4,589 4,573 5,215 4,937
--------- --------- --------- --------- ----------- --------- --------- ---------
Net operating income $ 8,698 $ 8,942 $ 10,139 $ 6,456 $ 8,159 $ 8,857 $ 9,874 $ 9,132
========= ========= ========= ========= =========== ========= ========= =========
NET EARNED PREMIUMS AND
OTHER CONSIDERATIONS
BY CHANNEL:
(amounts in millions)
AMLIC $ 62 $ 69 $ 70 $ 72 $ 67 $ 69 $ 75 $ 72
Independent 63 63 66 61 61 61 62 62
--------- --------- --------- --------- ----------- --------- --------- ---------
Total $ 125 $ 132 $ 136 $ 133 $ 128 $ 130 $ 137 $ 134
========= ========= ========= ========= =========== ========= ========= =========
FOR THE YEAR ENDED
---------------------
DECEMBER 31, DECEMBER 31,
($ IN THOUSANDS) 2004 2003
- ------------------------------ ----------- -----------
REVENUES:
Net earned premiums and other
considerations $ 526,120 $ 529,279
Net investment income 206,300 188,224
Fees and other income 6,810 5,315
--------- ---------
739,230 722,818
--------- ---------
BENEFITS, LOSSES AND EXPENSES:
Policyholder benefits 531,320 520,540
Selling, underwriting, general
and administrative expenses 156,486 146,942
--------- ---------
687,806 667,482
--------- ---------
Income before income taxes 51,424 55,336
Income tax expense 17,189 19,314
--------- ---------
Net operating income $ 34,235 $ 36,022
========= =========
NET EARNED PREMIUMS AND
OTHER CONSIDERATIONS
BY CHANNEL:
(amounts in millions)
AMLIC $ 273 $ 283
Independent 253 246
--------- ---------
Total $ 526 $ 529
========= =========
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[ASSURANT LOGO]
ASSURANT CORPORATE AND OTHER
CONDENSED STATEMENT OF OPERATIONS
(UNAUDITED)
FOR THE THREE MONTHS ENDED
---------------------------------------------------------------------------------------------
DECEMBER 31, SEPTEMBER 30, JUNE 30, MARCH 31, DECEMBER 31, SEPTEMBER 30, JUNE 30, MARCH 31,
($ IN THOUSANDS) 2004 2004 2004 2004 2003 2003 2003 2003
- ----------------------------------- ----------- ------------ -------- -------- ----------- ------------ -------- --------
REVENUES:
Net earned premiums and other
considerations $ - $ - $ - $ - $ - $ - $ - $ -
Net investment income 7,040 6,481 6,138 6,219 9,187 12,065 12,794 8,807
Net realized gains (losses) on
investments 1,861 2,501 5,722 14,224 (12,940) 7,334 12,452 (4,978)
Loss on disposal of business - - (9,232) - - - - -
Amortization of deferred gain on
disposal of businesses 14,334 14,539 14,262 14,497 16,042 17,522 15,405 19,308
Fees and other income (116) 593 229 1,138 2,046 8,717 103 272
----------- ------------ -------- -------- ----------- ------------ -------- --------
23,119 24,114 17,119 36,078 14,335 45,638 40,754 23,409
----------- ------------ -------- -------- ----------- ------------ -------- --------
BENEFITS, LOSSES AND EXPENSES:
Policyholder benefits - - - - - - - -
Selling, underwriting, general and
administrative expenses 26,056 12,832 11,969 26,047 35,838 8,736 15,654 9,293
Interest expense and distributions
on mandatorily redeemable
preferred securities 15,314 15,107 15,834 12,326 26,279 29,288 28,935 29,631
Interest premium on redemption of
mandatorily redeemable
preferred securities - - - - 205,822 - - -
----------- ------------ -------- -------- ----------- ------------ -------- --------
41,370 27,939 27,803 38,373 267,939 38,024 44,589 38,924
----------- ------------ -------- -------- ----------- ------------ -------- --------
Income (loss) before income taxes (18,251) (3,825) (10,684) (2,295) (253,604) 7,614 (3,835) (15,515)
Income tax expense (benefit) 2,593 (3,886) (3,226) (206) (93,368) 1,214 (1,720) (5,327)
----------- ------------ -------- -------- ----------- ------------ -------- --------
Net operating income (loss) $ (20,844) $ 61 $ (7,458) $ (2,089) $ (160,236) $ 6,400 $ (2,115) $(10,188)
=========== ============ ======== ======== =========== ============ ======== ========
FOR THE YEAR ENDED
-------------------------
DECEMBER 31, DECEMBER 31,
($ IN THOUSANDS) 2004 2003
- ----------------------------------- ----------- ----------
REVENUES:
Net earned premiums and other
considerations $ - $ -
Net investment income 25,878 42,853
Net realized gains (losses) on
investments 24,308 1,868
Loss on disposal of business (9,232) -
Amortization of deferred gain on
disposal of business 57,632 68,277
Fees and other income 1,844 11,138
----------- -----------
100,430 124,136
----------- -----------
BENEFITS, LOSSES AND EXPENSES:
Policyholder benefits - -
Selling, underwriting, general and
administrative expenses 76,904 69,521
Interest expense and distributions
on mandatorily redeemable
preferred securities 58,581 114,133
Interest premium on redemption of
mandatorily redeemable
preferred securities - 205,822
----------- -----------
135,485 389,476
----------- -----------
Income (loss) before income taxes (35,055) (265,340)
Income tax expense (benefit) (4,725) (99,201)
----------- -----------
Net operating income (loss) $ (30,330) $ (166,139)
=========== ===========
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[ASSURANT LOGO]
ASSURANT, INC. AND SUBSIDIARIES
INVESTMENTS
(UNAUDITED)
AS OF AS OF
DECEMBER 31, DECEMBER 31,
($ IN THOUSANDS) 2004 2003
- ------------------------------------------------------------ ------------ ------------
INVESTMENTS BY TYPE
Fixed maturities: available-for-sale, at fair value $ 9,177,938 $ 8,728,838
Equity Securities: available-for-sale
Preferred stocks 520,888 452,373
Common stocks 6,063 4,067
Commercial mortgage loans on real estate, at amortized cost 1,053,872 932,791
Policy loans 64,886 68,185
Cash and short-term investments 1,107,175 1,234,075
Other investments 488,975 461,473
------------ ------------
TOTAL $ 12,419,797 $ 11,881,802
============ ============
FIXED MATURITY SECURITIES BY CREDIT QUALITY (FAIR VALUE)
Aaa / Aa / A $ 6,331,737 67% $ 6,074,426 70%
Baa 2,301,855 27% 2,110,009 24%
Ba 406,412 5% 360,991 4%
B 100,460 1% 135,415 2%
Caa and lower 37,130 0% 39,884 0%
In or near default 344 0% 8,113 0%
------------ --- ------------ ---
TOTAL $ 9,177,938 100% $ 8,728,838 100%
============ === ============ ===
FIXED MATURITY SECURITIES BY ISSUER TYPE (FAIR VALUE)
U.S government and government agencies and authorities $ 1,232,396 13% $ 1,681,746 19%
State, municipalities and political subdivisions 211,576 2% 203,679 2%
Foreign government 520,646 6% 317,748 4%
Public utilities 1,082,725 12% 984,141 11%
All other corporate bonds 6,130,595 67% 5,541,524 64%
------------ --- ------------ ---
TOTAL $ 9,177,938 100% $ 8,728,838 100%
============ === ============ ===
Page 12
[ASSURANT LOGO]
ASSURANT, INC.
INVESTMENT RESULTS BY ASSET CATEGORY AND ANNUALIZED YIELDS
(UNAUDITED)
FOR THE THREE MONTHS ENDED DECEMBER 31, 2004 FOR THE THREE MONTHS ENDED DECEMBER 31, 2003
-------------------------------------------- --------------------------------------------
INVESTMENT INVESTMENT INVESTMENT INVESTMENT
($ IN THOUSANDS) YIELD INCOME GAIN (LOSS) YIELD INCOME GAIN (LOSS)
- ----------------------------------------- ---------- ---------- ---------- ------------ ---------- ----------
Fixed maturities: available-for-sale,
at fair value 5.97% $ 128,644 $ 11,987 6.04% $ 107,851 $ (12,630)
Equity Securities: available-for-sale 6.85% 9,014 803 7.43% 7,952 563
Commercial mortgage loans on real estate,
at amortised cost 7.75% 20,284 (747) 7.70% 17,729 (68)
Policy loans 5.16% 844 - 5.76% 987 -
Cash and short-term investments 1.48% 3,739 - 0.74% 1,847 (22)
Other investments 5.52% 6,881 (10,182) 6.90% 21,349 (783)
---------- ---------- ---------- ----------
Total 169,406 $ 1,861 157,715 $ (12,940)
Investment expenses (6,143) (7,010)
---------- ----------
Net investment income $ 163,263 $ 150,705
========== ==========
Gross investment gain $ 18,486 $ 5,072
Gross investment loss (16,625) (12,054)
Write-downs on available-for-sale
securities - (5,958)
---------- ---------
Net investment gain (loss) $ 1,861 $ (12,940)
========== =========
FOR THE YEAR ENDED DECEMBER 31, 2004 FOR THE YEAR ENDED DECEMBER 31, 2003
------------------------------------ ------------------------------------
INVESTMENT INVESTMENT INVESTMENT INVESTMENT
($ IN THOUSANDS) YIELD INCOME GAIN (LOSS) YIELD INCOME GAIN (LOSS)
- ----------------------------------------- ---------- ---------- ---------- ----------- ---------- ----------
Fixed maturities: available-for-sale,
at fair value 5.84% $ 494,152 $ 31,489 6.17% $ 472,717 $ 3,754
Equity Securities: available-for-sale 7.50% 35,596 1,098 7.70% 27,030 1,084
Commercial mortgage loans on real estate,
at amortised cost 7.99% 79,334 (1,197) 8.00% 70,988 -
Policy loans 5.76% 3,832 - 5.70% 3,920 -
Cash and short-term investments 0.86% 10,100 17 0.78% 9,916 -
Other investments 7.58% 36,003 (7,099) 9.61% 46,538 (2,970)
---------- ---------- ---------- ----------
Total 659,017 $ 24,308 631,109 $ 1,868
Investment expenses (24,268) (23,796)
---------- ----------
Net investment income $ 634,749 $ 607,313
========== ==========
Gross investment gain $ 58,640 $ 52,752
Gross investment loss (33,515) (28,288)
Write-downs on available-for-sale
securities (817) (22,596)
---------- ----------
Net investment gain (loss) $ 24,308 $ 1,868
========== ==========
Page 13