Horace Mann Affirms Full-Year 2020 EPS Guidance

Horace Mann Educators Corporation (NYSE:HMN) today affirmed its 2020 full-year guidance of $2.80 to $3.00 per diluted share, even though its full-year catastrophe loss assumption has risen to 13 to 14 points on the Property & Casualty combined ratio due to anticipated losses from catastrophe events through mid-September.

"Horace Mann entered this year better positioned than ever before to meet our long-term objectives by leveraging our market leadership position to meet the financial needs of even more educators. Deepening our market penetration will lead to accelerated shareholder value creation and achievement of a double-digit return on equity," said President and CEO Marita Zuraitis. "Our commitment to the education market remains central to our mission. For 75 years, Horace Mann has helped educators protect what they have today and prepare for a successful tomorrow, and the COVID-19 pandemic has only deepened our appreciation for educators nationwide.

"Despite the pandemic's sweeping effects on everyone's work and home lives, our first-half 2020 results showed the benefit of 2019's transformational actions, including the addition of our Supplemental segment and our annuity reinsurance transaction, as well as improvements to the company's products, distribution and infrastructure completed over the past several years," Zuraitis said. "During the second half of the year and beyond, we expect our results to continue to reflect the value of the solutions we provide to the educational community.

"Our full-year 2020 core EPS guidance range of $2.80 to $3.00 takes into account the favorable results in the first half of the year, as well as the subrogation benefit we will record in the third quarter as a result of PG&E's successful emergence from bankruptcy," Zuraitis said. "While wildfires remain active in the western states and the Atlantic storm season has not yet ended, based on currently available information, we have updated our assumption for full-year 2020 catastrophe losses to $85 and $90 million, or as much as 13 to 14 points on the combined ratio. Higher third-quarter catastrophe losses should be largely offset over the second half of the year by Auto loss frequency levels that remain lower than anticipated, investment income slightly ahead of previous guidance on strong market performance, and lower-than-anticipated expenses.

"We currently anticipate 2021 earnings will mark continued progress toward our long-term objectives, even though the results will be offset by the anticipated return to pre-pandemic Auto loss frequency levels and the absence of the subrogation recovery," Zuraitis said. "The impact of a largely remote educator workforce is temporarily slowing our top-line growth, but we are taking what we're learning in this environment and incorporating it into our growth strategy for 2021 and beyond. Horace Mann has 75 years of experience helping educators solve the issues they face every day, and we're more committed than ever to helping them achieve a lifetime of financial success."

About Horace Mann

Horace Mann Educators Corporation (NYSE: HMN) is the largest financial services company focused on providing America's educators and school employees with insurance and retirement solutions. Founded by Educators for Educators^® in 1945, the company is headquartered in Springfield, Illinois. For more information, visit horacemann.com.

Safe Harbor Statement and Non-GAAP Measures

Statements included in this news release that are not historical in nature are forward-looking within the meaning of the Private Securities Litigation Reform Act of 1995 and are subject to certain risks and uncertainties. Horace Mann is not under any obligation to (and expressly disclaims any such obligation to) update or revise any forward-looking statements, whether as a result of new information, future events or otherwise. Please refer to the company's Quarterly Report on Form 10-Q for the period ended June 30, 2020, and the company's past and future filings and reports filed with the Securities and Exchange Commission (SEC) for information concerning important factors that could cause actual results to differ materially from those in forward-looking statements. Information contained in this news release include measures which are based on methodologies other than accounting principles generally accepted in the United States of America (GAAP). Reconciliations of non-GAAP measures to the closest GAAP measures are contained in the Appendix to the Investor Supplement and additional descriptions of the non-GAAP measures are contained in the Glossary of Selected Terms included as an exhibit to the company's SEC filings.