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61ASSURANT, INC. – 2014 Form 10-K
PART II
ITEM 7 Management’s Discussion and Analysis of Financial Condition and Results of Operations
operating activities was primarily due to changes in the
timing of payments and by amounts yet to be recovered
under the 3 R’s program, partially offset by increased net
written premiums in Assurant Solutions, Assurant Health and
Assurant Employee Benefi ts. For more information on the 3
R’s, please refer to Assurant Health’s Results of Operations
section in this Item 7.
Net cash provided by operating activities was $1,003,819 and
$673,215 for the years ended December 31, 2013 and 2012,
respectively. The increase in cash provided by operating
activities was primarily due to decreased catastrophe loss
payments, decreased tax payments and increased net written
premiums in our Assurant Solutions and Assurant Specialty
Property segments. These items were partially offset by a
$14,000 settlement payment with the NYDFS in our Assurant
Specialty Property segment during Twelve Months 2013.
Investing Activities:
Net cash provided by (used in) investing activities was $63,889
and $(392,738) for the years ended December 31, 2014
and 2013, respectively. The change in investing activities
is primarily due to decreased purchases of fi xed maturity
securities and less cash spent on acquisitions and equity
interests, partially offset by a decrease in sales of fi xed
maturity securities. For more information on acquisitions,
please see Note 3 to the Consolidated Financial Statements
contained elsewhere in the report.
Net cash used in investing activities was $392,738 and
$449,883 for the years ended December 31, 2013 and 2012,
respectively. The decrease in cash used in investing activities
is primarily due to increased sales of fi xed maturity securities
and decreased purchases of fi xed maturity securities, partially
offset by the acquisitions of FAS and LSG, and an equity
investment in Iké, all during Twelve Months 2013, and changes
in our short term investments.
Financing Activities:
Net cash (used in) provided by fi nancing activities was
$(776,199) and $196,699 for the years ended December 31,
2014 and 2013, respectively. The cash used in fi nancing
activities during Twelve Months 2014 was primarily due to
repayment of $467,330 of 2004 Senior Notes, which represents
$500,000 in principal less amounts repurchased in 2013,
and the payment of a contingent liability related to the
acquisition of LSG. The cash provided by activities during
Twelve Months 2013 was due to the issuance of two series
of senior notes during Twelve Months 2013. The company
received proceeds of $698,093 from this transaction, which
represents the principal amount less the discount before
offering expenses.
Net cash provided by (used in) fi nancing activities was $196,699
and $(480,641) for the years ended December 31, 2013 and
2012, respectively. The increase in fi nancing activities was
primarily due to the issuance of two series of senior notes
during Twelve Months 2013. The company received proceeds
of $698,093 from this transaction, which represents the
principal amount less the discount before offering expenses.
The table below shows our cash outfl ows for taxes, interest and dividends for the periods indicated:
For the Years Ended December 31,
2014 2013 2012
Income taxes paid $ 247,771 $ 132,487 $ 289,850
Interest paid on debt 68,875 70,741 60,188
Common stock dividends 77,495 74,128 69,393
TOTAL $ 394,141 $ 277,356 $ 419,431
Commitments and Contingencies
We have obligations and commitments to third parties as a result of our operations. These obligations and commitments,
as of December 31, 2014, are detailed in the table below by maturity date as of the dates indicated:
As of December 31, 2014
Total Less than 1 Year 1-3 Years 3-5 Years More than 5 Years
Contractual obligations:
Insurance liabilities(1) $ 22,217,185 $ 1,975,701 $ 1,812,682 $ 1,712,555 $ 16,716,247
Debt and related interest 1,949,844 54,813 109,625 446,500 1,338,906
Operating leases 126,251 30,587 44,422 27,970 23,272
Pension obligations and postretirement benefi t 720,115 68,933 116,751 127,459 406,972
Commitments:
Investment purchases outstanding:
Commercial mortgage loans on real estate 26,959 26,959 — — —
Capital contributions to real estate joint ventures 5,320 5,320 — — —
Liability for unrecognized tax benefi t 7,631 — 2,804 855 3,972
TOTAL OBLIGATIONS AND COMMITMENTS $ 25,053,305 $ 2,162,313 $ 2,086,284 $ 2,315,339 $ 18,489,369
(1) Insurance liabilities reflect estimated cash payments to be made to policyholders.