Kemper exits preferred home and auto insurance

Move comes as big-name insurers have been taking personal insurance action

By Jen Frost

Aug 08, 2023 Share

Insurer Kemper Corporation (Kemper) has exited preferred home and auto insurance, having moved to “actively reduce” the business immediately.

Policies sold through its Kemper Personal Insurance brand will be non-renewed or cancelled in accordance with state regulations, Kemper said in a press release.

Kemper Life and its specialty auto business, Kemper Auto, are not affected by changes, the insurer confirmed.

Kemper’s preferred business has been under review since November 2022. Its preferred property and casualty (P&C) business is comprised of eight underwriting companies, accounting for around $500 million in premium.

“The decision to exit the business was made after thoughtful evaluation of our options and considered the most effective and efficient way to support our stakeholders,” said Joseph P. Lacher, Jr., Kemper’s President, CEO and Chairman. “It enables us to release capital and increase the resources available to support our core specialty auto and life businesses.”

Kemper has previously announced a $45.5 million after-tax goodwill impairment charge related to its preferred business strategic review.

Kemper’s preferred auto and home insurance exit comes as some insurance companies have been reducing their personal lines exposure, with certain states feeling the brunt of changes. In July, Farmers Insurance confirmed it would end sales of its own-brand policies in Florida, in addition to cutting down on new business in California. State Farm and Allstate have both ceased sales of new policies in California. Nationwide Insurance has also confirmed corrective action across its personal and commercial portfolios.

Catastrophe exposure, the current state of the reinsurance market, and construction costs have all been cited as reasons behind insurers’ shrinking appetites.