The Specialty Property & Casualty Insurance segment reported Segment Net Operating Income of $337.9 million for the year ended December 31, 2020, compared to $283.1 million in 2019. Segment Net Operating Income increased by $54.8 million due primarily to an improvement in underlying losses and LAE as a percentage of earned premiums and higher investment income, partially offset by the impact of adverse loss reserve development. Underlying losses and LAE exclude the impact of catastrophes and loss and LAE reserve development.
Other income increased by $4.5 million in 2019, compared to 2018, due primarily to a higher level of COLI.
The components of Net Realized Gains on Sales of Investments for the year ended December 31, 2020, 2019 and 2018 are presented below.
The following table summarizes the fair value of the Company’s investments in non-governmental fixed maturities by range of amount invested at December 31, 2020.
The Company designates debt obligations as either short-term or long-term based on maturity date at issuance. Total amortized cost of Long-term Debt outstanding at December 31, 2020 and December 31, 2019 was:
On May 6, 2020, Kemper’s Board of Directors authorized the repurchase of up to an additional $200 million of Kemper common stock, in addition to the $243.7 million remaining under the previous authorization as of December 31, 2019. As of December 31, 2020, the remaining share repurchase authorization was $333.3 million under the repurchase program. During the year ended December 31, 2020, Kemper repurchased and retired 1.6 million shares of its common stock in open market transactions under its share repurchase authorization for an aggregate cost of $110.4 million and average cost per share of $68.29.
Generally, there is a time lag between when premiums are collected and when policyholder benefits and insurance claims are paid. During periods of growth, property and casualty insurance companies typically experience positive operating cash flows
1A., “Risk Factors” under the title “The Company’s investment portfolio is exposed to a variety of risks that may negatively impact net investment income and cause realized and unrealized losses”).
•Estimated rate used to discount the expected benefit payment to a present value.
Consolidated Statements of Comprehensive Income (Loss) for the Years Ended December 31, 2020, 2019 and 2018 71
The amortized cost and estimated fair values of the Company’s Investments in Fixed Maturities at December 31, 2020 were:
Equity Method Limited Liability Investments include investments in limited liability investment companies and limited partnerships in which the Company’s interests are not deemed minor and are accounted for under the equity method of accounting. The HLBV equity method of accounting is used for the Company’s investments in Alternative Energy Partnerships. The Company’s investments in Equity Method Limited Liability Investments are generally of a passive nature in that the Company does not take an active role in the management of the investment entity.
Policyholder Obligations at December 31, 2020 and 2019 were as follows:
Kemper did not repurchase any of its common stock in open market transactions in 2019 or 2018.
Under the ESPP, the Company issued 60,703 shares under the plan in 2020 at an average discounted price of $61.57 per share and 24,080 shares under the plan in 2019 at an average discounted price of 66.08 per share. Compensation costs charged against income were $0.7 million and $0.3 million for the years ended December 31, 2020 and 2019, respectively.
Activity related to DSU awards for the year ended December 31, 2020 is presented below.
The fair values of pension plan assets are estimated using the same methodologies and inputs as those used to determine the fair values for the respective asset category of the Company. These methodologies and inputs are disclosed in Note 22, “Fair Value Measurements,” to the Consolidated Financial Statements. Fair value measurements for the Pension Plan’s assets at December 31, 2020 are summarized below.
Fair value measurements for the Pension Plan’s assets at December 31, 2019 are summarized below.
Earned Premiums by product line for the years ended December 31, 2020, 2019 and 2018 were:
In 2020, 2019 and 2018 the Company paid $0.0 million, $0.0 million and $0.4 million respectively, in reinstatement premium.