Assurant 2012 Annual Report Download - page 4

ASSURANT - 2012 Annual Report2
A Message to O ur Shareholders
› Assurant Specialty Property
Revenue at Assurant Specialty Property increased in 2012,
refl ecting expanding lender-placed loan portfolios from
new and existing clients, and growth in our multifamily
housing offerings. Net operating income was up slightly for
the year despite increased catastrophe losses, especially
from Superstorm Sandy. This was the largest fl ood event our
company ever experienced, and it reaffi rmed the importance
of the investments we have made to serve homeowners and
clients when disaster strikes. Our employees deployed our
robust tools, processes and training to quickly pay claims and
bring relief to policyholders devastated by the monumental
storm.
In 2012, our multifamily housing business achieved double-
digit revenue growth. With the SureDeposit resident bond
products now fully integrated in our Assurant Specialty
Property multifamily product portfolio, we are creating new
opportunities to cross-sell our products to our clients and, in
turn, their residents.
While recovery in the housing market likely will lead to a
reduction in the returns at Assurant Specialty Property in
the future, our disciplined execution and unparalleled
capabilities will continue to provide attractive long-term
value for shareholders.
Assurant Health
Using its deep experience in the individual and small group
medical insurance markets, Assurant Health continued its
transformation by adapting to the changing U.S. health care
landscape. A signifi cant expansion of our provider network
and tight management of expenses helped position the
business for profi table growth. Results for 2012 also benefi ted
from $13.8 million of additional investment income from a
real estate joint venture partnership.
Our affordable choice and supplemental products helped
Assurant Health serve a broader spectrum of individual
and small group customers. In 2012, we increased the total
number of insured lives by six percent — growth we expect
will continue as more consumers seek out affordable access
to healthcare.
While the rollout of additional elements of the Affordable
Care Act will require further transformation that will
reduce earnings, we continue to believe that the changing
health insurance marketplace in the U.S. provides great
opportunities for Assurant Health.
Assurant Employee Benefi ts
The strategic shift launched a few years ago to focus on
employee-funded voluntary benefi ts delivered improved
and encouraging results at Assurant Employee Benefi ts.
With a diversifi ed product suite, improved distribution and
enhanced enrollment and administrative platforms for small
business customers, voluntary offerings drove nearly half of
sales and more than a third of premiums in 2012. Assurant
Employee Benefi ts also now offers the largest dental PPO
network in many markets thanks to the expansion of Dental
Health Alliance and a new agreement in 2012.
The U.S. economy still presents challenges for many small
businesses, tempering job expansion and enthusiasm for
additional employer-paid benefi ts coverage. We also expect
lower investment income and a planned reduction in the
reserve discount rate for new, long-term disability claims to
reduce earnings in the year ahead. These lingering macro-
economic concerns reinforce the importance of ongoing
operational excellence, outstanding service as well as
disciplined management of both expenses and capital within
Assurant Employee Benefi ts.
With a strong strategic focus on the small case voluntary
market, we continue to believe Assurant Employee Benefi ts
can provide attractive long-term returns.
OUR LEGACY, OUR VALUES
In 2012, Assurant also embraced our legacy as we celebrated
120 years in business. In spite of the many changes rapidly
transforming the ways people live and work, we are
steadfast in our commitment to help protect what matters
most to consumers.
Each day, four enduring values guide our actions:
• We embrace Common Sense as we take a fact-based
approach to deliver value to our customers. Our specialty
products are designed to fulfi ll unmet needs and help
safeguard against risks.
• We act with Common Decency, treating all of our
constituents in ways we would like to be treated. Our
responsiveness to customers, our daily operations, and our
community stewardship refl ect high levels of ethics and
integrity.
• We encourage Uncommon Thinking. We cultivate a work
environment that is open and allows good ideas to fl ourish.
Transparency and candor run deep.
• Our Uncommon Results are expressed as the products we
offer bring value to our customers and above average
returns for our shareholders.
I am proud and grateful for the commitment of our
employees worldwide who are doing their part – every day –
to serve our customers and help create long-term value for
our shareholders.
Thanks for your investment in Assurant.
Sincerely,
Robert B. Pollock
President and Chief Executive Offi cer