Assurant 2014 Annual Report Download - page 66

52 ASSURANT, INC. – 2014 Form 10-K
PART II
ITEM 7 Management’s Discussion and Analysis of Financial Condition and Results of Operations
expenses, including a $10,205 tax liability increase, and a
decrease in net earned premiums. In addition, Twelve Months
2012 results included an additional $14,337 (after-tax) of
investment income from real estate joint venture partnerships.
Total Revenues
Total revenues decreased $37,082, or 2%, to $1,647,203
for Twelve Months 2013 from $1,684,285 for Twelve Months
2012. Net earned premiums from our individual medical
business decreased $4,737, or less than 1%, due to a decline
in individual major medical premiums, partially offset by
growth in supplemental and affordable choice products and
premium rate increases. Net earned premiums from our small
employer group business decreased $3,315, or 1%, due to a
decline in renewal business, partially offset by new sales and
premium rate increases. Net investment income decreased
$27,644, primarily due to less investment income from real
estate joint venture partnerships.
Total Benefi ts, Losses and Expenses
Total benefi ts, losses and expenses increased $9,447, or
less than 1%, to $1,604,625 for Twelve Months 2013 from
$1,595,178 for Twelve Months 2012. Policyholder benefi ts
decreased $5,033, or less than 1%, while the benefi t loss
ratio stayed level at 73.9%.The decrease in policyholder
benefi ts was primarily attributable to a decline in renewal
business, partially offset by less favorable loss experience
and increasing fi rst year business. Selling, underwriting and
general expenses increased $14,480, or 3%, primarily due to
higher expenses associated with increased fi rst year sales of
individual and small employer group major medical policies.
Twelve Months 2013 also includes $4,589 of restructuring
costs primarily due to the elimination of the underwriting
functions for major medical products effective January 2014
as required by the Affordable Care Act.
Assurant Employee Benefi ts
Overview
The table below presents information regarding Assurant Employee Benefi ts’ segment results of operations:
For the Years Ended December 31,
2014
2013 2012
Revenues:
Net earned premiums $ 1,051,725 $ 1,014,587 $ 1,014,264
Net investment income 117,192 117,853 128,485
Fees and other income 24,204 23,434 28,468
Total revenues 1,193,121 1,155,874 1,171,217
Benefi ts, losses and expenses:
Policyholder benefi ts 716,892 715,656 693,067
Selling, underwriting and general expenses 399,548 388,159 390,042
Total benefi ts, losses and expenses 1,116,440 1,103,815 1,083,109
Segment income before provision for income taxes 76,681 52,059 88,108
Provision for income taxes 28,000 17,506 30,049
SEGMENT NET INCOME $ 48,681 $ 34,553 $ 58,059
Net earned premiums:
Group disability $ 409,028 $ 403,286 $ 409,757
Group dental 392,502 383,223 394,413
Group life 200,285 192,392 188,246
Group supplemental and vision products 49,910 35,686 21,848
TOTAL $ 1,051,725 $ 1,014,587 $ 1,014,264
Voluntary $ 441,479 $ 393,969 $ 368,576
Employer-paid and other 610,246 620,618 645,688
TOTAL $ 1,051,725 $ 1,014,587 $ 1,014,264
Ratios:
Loss ratio(1) 68.2% 70.5% 68.3%
Expense ratio(2) 37.1% 37.4% 37.4%
(1) The loss ratio is equal to policyholder benefits divided by net earned premiums.
(2) The expense ratio is equal to selling, underwriting and general expenses divided by net earned premiums and fees and other income.