EX-99.2 3 dex992.htm PRESENTATION ENTITLED "ASSURANT, INC. FINANCIAL SUPPLEMENT AS OF JUNE 30, 2007". Presentation entitled "Assurant, Inc. Financial Supplement as of June 30, 2007".

Exhibit 99.2

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Assurant, Inc. (AIZ)

Financial Supplement as of June 30, 2007

 


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ASSURANT, INC. AND SUBSIDIARIES

EARNINGS RELEASE SUPPLEMENT

AS OF JUNE 30, 2007

INDEX TO SUPPLEMENT

 

     Page:

REGULATION G – NON GAAP MEASURES

   1

SUMMARY FINANCIAL HIGHLIGHTS (unaudited)

   2

SEGMENTED CONDENSED BALANCE SHEETS (unaudited)

   4

RECONCILIATION OF NET OPERATING INCOME TO NET INCOME (unaudited)

   5

CONSOLIDATED CONDENSED STATEMENT OF OPERATIONS (unaudited)

   6

CONDENSED SEGMENT STATEMENTS OF OPERATIONS (unaudited)

   7

INVESTMENTS (unaudited)

   15

INVESTMENT RESULTS BY ASSET CATEGORY & ANNUALIZED YIELDS (unaudited)

   16

SUMMARY OF NET OPERATING INCOME DISCLOSED ITEMS (unaudited)

   17

About Assurant:

Assurant is a premier provider of specialized insurance products and related services in North America and selected other international markets. The four key businesses – Assurant Solutions; Assurant Specialty Property; Assurant Health; and Assurant Employee Benefits – have partnered with clients who are leaders in their industries and have built leadership positions in a number of specialty insurance market segments in the U.S. and selected international markets. The Assurant business units provide debt protection administration; credit-related insurance; warranties and service contracts; pre-funded funeral insurance; creditor-placed homeowners insurance; manufactured housing homeowners insurance; individual health and small employer group health insurance; group dental insurance; group disability insurance; and group life insurance.

Assurant, a Fortune 500 company and a member of the S&P 500, is traded on the New York Stock Exchange under the symbol AIZ. Assurant has more than $25 billion in assets and $7 billion in annual revenue. Assurant has more than 13,000 employees and is headquartered in New York’s financial district. www.assurant.com.

Safe Harbor Statement:

Some of the statements included in this statistical supplement, particularly those anticipating future financial performance, business prospects, growth and operating strategies and similar matters, are forward-looking statements that involve a number of risks and uncertainties. For those statements, we claim the protection of the safe harbor for forward-looking statements contained in the Private Securities Litigation Reform Act of 1995. For a discussion of the factors that could affect our actual results please refer to the risk factors identified from time to time in our SEC reports, including, but not limited to our 10-K, as filed with the SEC.


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Regulation G – Non GAAP Measures

Assurant uses the following non-GAAP financial measures to analyze the company’s operating performance for the periods presented in the press release. Because Assurant’s calculation of these measures may differ from similar measures used by other companies, investors should be careful when comparing Assurant’s non-GAAP financial measures to those of other companies.

(1) Assurant uses net operating income as an important measure of the company’s operating performance. Net operating income equals net income, excluding net realized gains (losses) on investments and unusual and/or infrequent items. The company believes net operating income provides investors a valuable measure of the performance of the company’s ongoing business, because it excludes both the effect of realized gains (losses) on investments that tend to be highly variable from period to period, and those events that are unusual and/or unlikely to recur.

 

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Assurant, Inc. and Subsidiaries

Summary Financial Highlights

(Unaudited)

 

     For the Three Months Ended
June 30,
   For the Six Months Ended
June 30,
 
($ in thousands, except shares and per share amounts)    2007     2006    2007    2006  

Net operating income (1)

   $ 168,286     $ 149,659    $ 344,122    $ 313,478  

Net realized (losses) gains on investments

     (2,006 )     1,477      1,615      (1,417 )
                              

Net income before cumulative effect of change in accounting principle

     166,280       151,136      345,737      312,061  

Cumulative effect of change in accounting principle

     —         —        —        1,547  
                              

Net income

   $ 166,280     $ 151,136    $ 345,737    $ 313,608  
                              

Total revenues

   $ 2,064,727     $ 1,949,090    $ 4,121,990    $ 3,878,872  

PER SHARE AND SHARE DATA:

          

Basic earnings per share

          

Net operating income

   $ 1.39     $ 1.16    $ 2.83    $ 2.43  

Net income before cumulative effect of change in accounting principle

   $ 1.38     $ 1.18    $ 2.85    $ 2.42  

Net income

   $ 1.38     $ 1.18    $ 2.85    $ 2.43  

Weighted average of common shares outstanding - basic

     120,657,052       128,488,126      121,399,339      129,239,104  

Diluted earnings per share

          

Net operating income

   $ 1.37     $ 1.15    $ 2.79    $ 2.39  

Net income before cumulative effect of change in accounting principle

   $ 1.36     $ 1.16    $ 2.80    $ 2.38  

Net income

   $ 1.36     $ 1.16    $ 2.80    $ 2.39  

Weighted average of common shares outstanding - diluted

     122,492,504       130,327,634      123,334,227      131,197,145  

 

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Assurant, Inc. and Subsidiaries

Summary Financial Highlights (continued)

(Unaudited)

 

     As of
June 30,
    As of
December 31,
 
($ in thousands, except shares and per share amounts)    2007     2006  

Total assets

   $ 25,772,955     $ 25,165,148  

Total stockholders’ equity

   $ 3,814,392     $ 3,832,597  

Total stockholders’ equity (excluding AOCI)

   $ 3,862,608     $ 3,744,533  

Basic book value per share

   $ 31.82     $ 31.26  

Basic book value per share (excluding AOCI) (2)

   $ 32.22     $ 30.54  

Shares outstanding for basic book value per share calculation

     119,883,278       122,618,317  

Diluted book value per share

   $ 31.41     $ 30.68  

Diluted book value per share (excluding AOCI) (2)

   $ 31.81     $ 29.97  

Shares outstanding for diluted book value per share calculation

     121,443,537       124,926,639  

Debt to total capital ratio (excluding AOCI)

     20.5 %     21.0 %

 

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Assurant, Inc. and Subsidiaries

Segmented Condensed Balance Sheets

At June 30, 2007 and December 31, 2006

(Unaudited)

 

     At June 30, 2007  
     Solutions    Specialty
Property
   Health    Employee
Benefits
   Corporate &
Other(1)
    Consolidated  
     ($ in thousands)  

Assets

                

Investments and cash and cash equivalents

   $ 7,254,138    $ 1,864,820    $ 1,133,736    $ 2,614,366    $ 993,741     $ 13,860,801  

Reinsurance recoverables

     683,135      255,992      4,320      17,918      2,904,082       3,865,447  

Deferred acquisition costs

     2,410,781      155,724      42,767      25,225      —         2,634,497  

Goodwill

     —        —        —        —        791,195       791,195  

Assets held in separate accounts

     261,973      —        —        —        3,053,909       3,315,882  

Other assets

     524,707      295,342      120,207      209,222      155,655       1,305,133  
                                            

Total assets

     11,134,734      2,571,878      1,301,030      2,866,731      7,898,582       25,772,955  
                                            

Liabilities

                

Policyholder benefits and claims payable

     4,293,002      290,818      543,312      1,922,684      3,171,972       10,221,788  

Unearned premiums

     3,780,690      893,820      127,265      13,543      44,758       4,860,076  

Debt

     —        —        —        —        971,818       971,818  

Mandatorily redeemable preferred stock

     —        —        —        —        22,160       22,160  

Liabilities related to separate accounts

     261,973      —        —        —        3,053,909       3,315,882  

Accounts payable and other liabilities

     1,252,363      455,271      222,459      290,253      346,493       2,566,839  
                                            

Total liabilities

     9,588,028      1,639,909      893,036      2,226,480      7,611,110       21,958,563  

Stockholders’ equity

                

Equity, excluding accumulated other comprehensive loss

     1,546,706      931,969      407,994      640,251      335,688       3,862,608  

Accumulated other comprehensive loss

     —        —        —        —        (48,216 )     (48,216 )
                                            

Total stockholders’ equity

     1,546,706      931,969      407,994      640,251      287,472       3,814,392  
                                            

Total liabilities and stockholders’ equity

   $ 11,134,734    $ 2,571,878    $ 1,301,030    $ 2,866,731    $ 7,898,582     $ 25,772,955  
                                            

 

     At December 31, 2006
     Solutions    Specialty
Property
   Health    Employee
Benefits
   Corporate &
Other(1)
   Consolidated
     ($ in thousands)

Assets

                 

Investments and cash and cash equivalents

   $ 6,875,585    $ 1,473,357    $ 1,150,679    $ 2,569,710    $ 1,347,486    $ 13,416,817

Reinsurance recoverables

     721,134      290,653      5,239      22,872      2,875,074      3,914,972

Deferred acquisition costs

     2,168,708      148,635      53,059      27,504      —        2,397,906

Goodwill

     —        —        —        —        790,519      790,519

Assets held in separate accounts

     255,784      —        —        —        3,042,759      3,298,543

Other assets

     615,941      277,028      69,131      186,251      198,040      1,346,391
                                         

Total assets

     10,637,152      2,189,673      1,278,108      2,806,337      8,253,878      25,165,148
                                         

Liabilities

                 

Policyholder benefits and claims payable

     4,253,205      278,664      556,726      1,936,662      3,153,252      10,178,509

Unearned premiums

     3,431,658      820,533      119,934      12,694      45,074      4,429,893

Debt

     —        —        —        —        971,774      971,774

Mandatorily redeemable preferred stock

     —        —        —        —        22,160      22,160

Liabilities related to separate accounts

     255,784      —        —        —        3,042,759      3,298,543

Accounts payable and other liabilities

     1,131,710      337,563      184,683      241,369      536,347      2,431,672
                                         

Total liabilities

     9,072,357      1,436,760      861,343      2,190,725      7,771,366      21,332,551

Stockholders’ equity

                 

Equity, excluding accumulated other comprehensive income

     1,564,795      752,913      416,765      615,612      394,448      3,744,533

Accumulated other comprehensive income

     —        —        —        —        88,064      88,064
                                         

Total stockholders’ equity

     1,564,795      752,913      416,765      615,612      482,512      3,832,597
                                         

Total liabilities and stockholders’ equity

   $ 10,637,152    $ 2,189,673    $ 1,278,108    $ 2,806,337    $ 8,253,878    $ 25,165,148
                                         

 

(1) Corporate and Other segment includes Accumulated Other Comprehensive Income (Loss), Reinsurance Recoverables related to the disposal of FFG and LTC businesses, goodwill, separate accounts related to the disposal of FFG business and all of Assurant, Inc.’s debt.

 

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Assurant, Inc. and Subsidiaries

Reconciliation of Net Operating Income to Net Income

(Unaudited)

 

     For the Three Months Ended     For the Six
Months Ended
 
($ in thousands, net of tax)    June 30,
2007
    March 31,
2007
    December 31,
2006
    September 30,
2006
    June 30,
2006
    March 31,
2006
    June 30,
2007
    June 30,
2006
 

Assurant Solutions

   $ 30,210     $ 44,069     $ 39,810     $ 41,707     $ 37,148     $ 39,747     $ 74,279     $ 76,895  

Assurant Specialty Property

     90,207       74,434       63,956       53,445       59,276       64,444       164,641       123,720  

Assurant Health

     33,838       40,524       36,960       44,847       41,016       45,096       74,362       86,112  

Assurant Employee Benefits

     21,475       28,957       19,428       24,400       20,590       19,185       50,432       39,775  

Corporate and other

     (2,862 )     (7,632 )     (19,908 )     (7,535 )     (4,930 )     (439 )     (10,494 )     (5,369 )

Amortization of deferred gains on disposal of businesses

     5,360       5,427       5,861       6,128       6,514       5,741       10,787       12,255  

Interest expense

     (9,942 )     (9,943 )     (9,949 )     (9,950 )     (9,955 )     (9,955 )     (19,885 )     (19,910 )
                                                                

Net operating income

     168,286       175,836       136,158       153,042       149,659       163,819       344,122       313,478  

Adjustments:

                

Net realized (losses) gains on investments

     (2,006 )     3,621       75,868       (1,739 )     1,477       (2,894 )     1,615       (1,417 )

Assurant Solutions legal settlement

     —         —         40,481       —         —         —         —         —    
                                                                

Net income before cumulative effect of change in

                

    accounting principle

     166,280       179,457       252,507       151,303       151,136       160,925       345,737       312,061  

Cumulative effect of change in accounting principle

     —         —         —         —         —         1,547       —         1,547  
                                                                

Net income

   $ 166,280     $ 179,457     $ 252,507     $ 151,303     $ 151,136     $ 162,472     $ 345,737     $ 313,608  
                                                                

 

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Assurant, Inc. and Subsidiaries

Consolidated Condensed Statements of Operations

(Unaudited)

 

     For the Three Months Ended     For the Six Months
Ended
 
($ in thousands)    June 30,
2007
    March 31,
2007
    December 31,
2006
    September 30,
2006
    June 30,
2006
    March 31,
2006
    June 30,
2007
    June 30,
2006
 

Revenues:

                

Net earned premiums and other considerations

   $ 1,798,687     $ 1,759,509     $ 1,768,160     $ 1,717,640     $ 1,685,322     $ 1,672,653     $ 3,558,196     $ 3,357,975  

Net investment income

     190,302       216,896       183,014       180,672       180,438       192,562       407,198       373,000  

Net realized (losses) gains on investments

     (3,086 )     5,570       116,720       (2,675 )     2,272       (4,452 )     2,484       (2,180 )

Amortization of deferred gains on disposal of businesses

     8,246       8,349       9,017       9,428       10,022       8,833       16,595       18,855  

Fees and other income*

     70,578       66,939       130,722       79,014       71,036       60,186       137,517       131,222  
                                                                
     2,064,727       2,057,263       2,207,633       1,984,079       1,949,090       1,929,782       4,121,990       3,878,872  
                                                                

Benefits, losses and expenses:

                

Policyholder benefits

     903,081       890,449       886,747       888,317       874,204       889,679       1,793,530       1,763,883  

Selling, underwriting, general and administrative expenses

     893,876       873,999       915,398       849,414       827,408       782,432       1,767,875       1,609,840  

Interest expense

     15,296       15,297       15,306       15,307       15,315       15,315       30,593       30,630  
                                                                
     1,812,253       1,779,745       1,817,451       1,753,038       1,716,927       1,687,426       3,591,998       3,404,353  
                                                                

Income before income taxes and cumulative effect of change in accounting principle

     252,474       277,518       390,182       231,041       232,163       242,356       529,992       474,519  

Income taxes

     86,194       98,061       137,675       79,738       81,027       81,431       184,255       162,458  
                                                                

Net income before cumulative effect of change in accounting principle

     166,280       179,457       252,507       151,303       151,136       160,925       345,737       312,061  

Cumulative effect of change in accounting principle

     —         —         —         —         —         1,547       —         1,547  
                                                                

Net income

   $ 166,280     $ 179,457     $ 252,507     $ 151,303     $ 151,136     $ 162,472     $ 345,737     $ 313,608  
                                                                

Share repurchase program:

                

Shares repurchased

     1,984,400       1,421,833       1,826,416       3,081,000       2,140,000       1,416,800       3,406,233       3,556,800  

Average repurchase price per share

   $ 58.56     $ 54.48     $ 54.45     $ 50.34     $ 48.43     $ 45.17     $ 56.86     $ 47.13  

Repurchase price

   $ 116,216     $ 77,460     $ 99,444     $ 155,109     $ 103,630     $ 64,001     $ 193,676     $ 167,631  

AIZ Closing stock price (NYSE)

   $ 58.92     $ 53.63     $ 55.25     $ 53.41     $ 48.40     $ 49.25     $ 58.92     $ 48.40  

Investment yield (1)

     5.69 %     5.66 %     5.73 %     5.66 %     5.83 %     5.75 %     5.68 %     5.77 %

Real estate investment income (1)

   $ 2,972     $ 33,540     $ 614     $ 3,229     $ —       $ 14,735     $ 36,512     $ 14,735  

 

(1) Investment yield excludes investment income from real estate partnerships.

 

* The three months ended December 31, 2006 includes $62,278 related to a legal settlement in Assurant Solutions. See page 7.

 

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Assurant Solutions

Condensed Statements of Operations

(Unaudited)

 

     For the Three Months Ended    For the Six
Months Ended
($ in thousands)    June 30,
2007
   March 31,
2007
   December 31,
2006
   September 30,
2006
   June 30,
2006
   March 31,
2006
   June 30,
2007
   June 30,
2006

Revenues:

                       

Net earned premiums and other considerations

   $ 618,675    $ 583,011    $ 617,798    $ 591,237    $ 592,182    $ 570,388    $ 1,201,686    $ 1,162,570

Net investment income

     100,784      112,017      99,852      96,625      98,951      97,082      212,801      196,033

Fees and other income*

     40,957      38,051      38,516      47,262      39,525      34,170      79,008      73,695
                                                       
     760,416      733,079      756,166      735,124      730,658      701,640      1,493,495      1,432,298
                                                       

Benefits, losses and expenses:

                       

Policyholder benefits

     258,527      243,344      252,296      250,886      247,208      248,380      501,871      495,588

Selling, underwriting, general and administrative expenses

     455,140      427,645      446,185      424,284      424,429      394,878      882,785      819,307
                                                       
     713,667      670,989      698,481      675,170      671,637      643,258      1,384,656      1,314,895
                                                       

Income before income taxes

     46,749      62,090      57,685      59,954      59,021      58,382      108,839      117,403

Income taxes*

     16,539      18,021      17,875      18,247      21,873      18,635      34,560      40,508
                                                       

Net operating income*

   $ 30,210    $ 44,069    $ 39,810    $ 41,707    $ 37,148    $ 39,747    $ 74,279    $ 76,895
                                                       

Net earned premiums and other considerations:

                       

Domestic:

                       

Credit

   $ 76,109    $ 80,921    $ 86,185    $ 88,470    $ 98,206    $ 95,851    $ 157,030    $ 194,057

Service contracts

     280,274      261,863      278,691      255,962      256,135      249,982      542,137      506,117

Other

     15,517      16,689      19,791      18,034      19,759      23,699      32,206      43,458
                                                       

Total Domestic

     371,900      359,473      384,667      362,466      374,100      369,532      731,373      743,632
                                                       

International:

                       

Credit

     92,413      96,877      104,288      104,372      97,612      88,210      189,290      185,822

Service contracts

     62,543      42,717      41,449      18,868      24,416      14,761      105,260      39,177

Other

     10,260      8,979      15,158      24,327      13,311      13,933      19,239      27,244
                                                       

Total International

     165,216      148,573      160,895      147,567      135,339      116,904      313,789      252,243
                                                       

Preneed

     81,559      74,965      72,236      81,204      82,743      83,952      156,524      166,695
                                                       

Total

   $ 618,675    $ 583,011    $ 617,798    $ 591,237    $ 592,182    $ 570,388    $ 1,201,686    $ 1,162,570
                                                       

Fee income:

                       

Domestic:

                       

Debt protection

   $ 7,469    $ 8,750    $ 13,523    $ 13,698    $ 13,750    $ 13,082    $ 16,219    $ 26,832

Service contracts

     17,190      16,877      15,872      23,556      14,432      12,567      34,067      26,999

Other

     5,205      6,493      4,092      4,884      4,796      4,022      11,698      8,818
                                                       

Total Domestic

     29,864      32,120      33,487      42,138      32,978      29,671      61,984      62,649
                                                       

International

     4,384      4,492      4,433      4,069      4,165      4,276      8,876      8,441

Preneed

     6,709      1,439      596      1,055      2,382      223      8,148      2,605
                                                       

Total

   $ 40,957    $ 38,051    $ 38,516    $ 47,262    $ 39,525    $ 34,170    $ 79,008    $ 73,695
                                                       

 

* For supplemental purposes, segment net operating income for the three months ended December 31, 2006 excludes $62,278 of fees and other income and related tax expense of $21,797 resulting from a third-party legal settlement. These amounts are included in the Consolidated Statements of Operations for the three months and year ended December 31, 2006 in this disclosure (see Page 5). In compliance with GAAP standards and SEC reporting requirements, the impact of this legal settlement is included in the Assurant Solutions segment statements of operations in Assurant, Inc.’s annual report on Form 10-K for the fiscal year ended December 31, 2006 filed with the SEC.

 

Page 7


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Assurant Solutions (continued)

Condensed Statements of Operations

(Unaudited)

 

     For the Three Months Ended     For the Six
Months Ended
 
($ in thousands)    June 30,
2007
    March 31,
2007
    December 31,
2006
    September 30,
2006
    June 30,
2006
    March 31,
2006
    June 30,
2007
    June 30,
2006
 

Gross written premiums:

                

Domestic:

                

Credit

   $ 167,738     $ 161,843     $ 179,255     $ 184,120     $ 182,489     $ 168,927     $ 329,581     $ 351,416  

Service contracts

     448,143       454,404       468,820       398,170       378,636       354,962       902,547       733,598  

Other

     22,014       20,865       26,905       25,851       24,335       31,478       42,879       55,813  
                                                                

Total Domestic

     637,895       637,112       674,980       608,141       585,460       555,367       1,275,007       1,140,827  
                                                                

International:

                

Credit

     201,353       191,415       184,448       175,417       159,208       161,024       392,768       320,232  

Service contracts

     86,948       79,582       112,893       91,407       71,330       66,256       166,530       137,586  

Other

     13,933       10,422       10,048       11,353       11,817       11,437       24,355       23,254  
                                                                

Total International

     302,234       281,419       307,389       278,177       242,355       238,717       583,653       481,072  
                                                                

Total

   $ 940,129     $ 918,531     $ 982,369     $ 886,318     $ 827,815     $ 794,084     $ 1,858,660     $ 1,621,899  
                                                                

Preneed (face sales)

   $ 102,360     $ 86,058     $ 84,246     $ 105,031     $ 120,545     $ 123,688     $ 188,418     $ 244,233  

Combined ratios (a):

                

Domestic

     100.8 %     100.9 %     100.1 %     98.4 %     99.1 %     100.0 %     100.9 %     99.5 %

International

     109.7 %     102.1 %     99.3 %     101.7 %     100.0 %     95.2 %     106.1 %     97.8 %

Preneed yield (1)

     6.27 %     6.29 %     6.36 %     6.21 %     6.35 %     6.32 %     6.25 %     6.32 %

Preneed average invested assets

   $ 3,650,784     $ 3,600,420     $ 3,600,069     $ 3,644,564     $ 3,565,666     $ 3,468,298     $ 3,610,906     $ 3,529,311  

Investment yield (1)

     5.83 %     5.80 %     5.93 %     5.67 %     5.94 %     5.77 %     5.82 %     5.87 %

Real estate investment income (1)

   $ 1,045     $ 14,448     $ 276     $ 1,453     $ —       $ 2,506     $ 15,493     $ 2,506  

 

(a) The combined ratio is equal to total benefits, losses and expenses divided by net earned premiums and other considerations and fees and other income excluding the preneed business.

 

(1) Investment yield excludes investment income from real estate partnerships.

 

Page 8


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Assurant Specialty Property

Condensed Statements of Operations

(Unaudited)

 

     For the Three Months Ended     For the Six
Months Ended
 
($ in thousands)    June 30,
2007
    March 31,
2007
    December 31,
2006
    September 30,
2006
    June 30,
2006
    March 31,
2006
    June 30,
2007
    June 30,
2006
 

Revenues:

                

Net earned premiums and other considerations

   $ 393,614     $ 367,041     $ 350,946     $ 313,644     $ 290,972     $ 252,749     $ 760,655     $ 543,721  

Net investment income

     23,667       21,869       20,204       19,584       17,923       16,790       45,536       34,713  

Fees and other income

     12,654       12,596       13,050       13,329       13,587       9,458       25,250       23,045  
                                                                
     429,935       401,506       384,200       346,557       322,482       278,997       831,441       601,479  
                                                                

Benefits, losses and expenses:

                

Policyholder benefits

     130,866       116,787       112,409       115,379       110,474       70,459       247,653       180,933  

Selling, underwriting, general and administrative expenses

     159,292       170,799       173,454       148,540       122,369       109,089       330,091       231,458  
                                                                
     290,158       287,586       285,863       263,919       232,843       179,548       577,744       412,391  
                                                                

Income before income taxes

     139,777       113,920       98,337       82,638       89,639       99,449       253,697       189,088  

Income taxes

     49,570       39,486       34,381       29,193       30,363       35,005       89,056       65,368  
                                                                

Net operating income

   $ 90,207     $ 74,434     $ 63,956     $ 53,445     $ 59,276     $ 64,444     $ 164,641     $ 123,720  
                                                                

Net Earned Premiums for selected product groupings:

                

Homeowners (Creditor Placed & Voluntary)

   $ 276,663     $ 250,889     $ 233,181     $ 198,733     $ 178,363     $ 142,892     $ 527,552     $ 321,255  

Manufactured Housing (Creditor Placed & Voluntary)

     50,452       50,670       51,774       52,535       54,184       55,968       101,122       110,152  

Other

     66,499       65,482       65,991       62,376       58,425       53,889       131,981       112,314  
                                                                

Total

   $ 393,614     $ 367,041     $ 350,946     $ 313,644     $ 290,972     $ 252,749     $ 760,655     $ 543,721  
                                                                

Gross Written Premiums for selected product groupings:

                

Homeowners (Creditor Placed & Voluntary)

   $ 380,099     $ 319,053     $ 330,882     $ 271,632     $ 247,538     $ 184,096     $ 699,152     $ 431,634  

Manufactured Housing (Creditor Placed & Voluntary)

     77,042       67,785       73,590       82,401       80,981       69,610       144,827       150,591  

Other

     150,435       112,322       121,711       130,820       127,555       101,386       262,757       228,941  
                                                                

Total

   $ 607,576     $ 499,160     $ 526,183     $ 484,853     $ 456,074     $ 355,092     $ 1,106,736     $ 811,166  
                                                                

Ratios:

                

Loss ratio (a)

     33.2 %     31.8 %     32.0 %     36.8 %     38.0 %     27.9 %     32.6 %     33.3 %

Expense ratio (b)

     39.2 %     45.0 %     47.7 %     45.4 %     40.2 %     41.6 %     42.0 %     40.8 %

Combined ratio (c)

     71.4 %     75.8 %     78.5 %     80.7 %     76.5 %     68.5 %     73.5 %     72.8 %

Investment yield (1)

     5.28 %     5.51 %     5.54 %     5.62 %     5.70 %     5.82 %     5.39 %     5.70 %

Real estate investment income (1)

   $ 297     $ 159     $ —       $ —       $ —       $ —       $ 456     $ —    

 

(a) The loss ratio is equal to policyholder benefits divided by net earned premiums and other considerations.
(b) The expense ratio is equal to selling, underwriting and general expenses divided by net earned premiums and other considerations and fees and other income.
(c) The combined ratio is equal to total benefits, losses and expenses divided by net earned premiums and other considerations and fees and other income.

 

(1) Investment yield excludes investment income from real estate partnerships.

 

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Assurant Health

Condensed Statements of Operations

(Unaudited)

 

     For the Three Months Ended    For the Six
Months Ended
($ in thousands)    June 30,
2007
   March 31,
2007
   December 31,
2006
   September 30,
2006
   June 30,
2006
   March 31,
2006
   June 30,
2007
   June 30,
2006

Revenues:

                       

Net earned premiums and other considerations

   $ 513,936    $ 512,784    $ 519,438    $ 521,527    $ 519,587    $ 523,405    $ 1,026,720    $ 1,042,992

Net investment income

     16,290      19,270      16,415      17,689      17,110      24,001      35,560      41,111

Fees and other income

     10,445      9,688      10,549      11,035      10,250      9,726      20,133      19,976
                                                       
     540,671      541,742      546,402      550,251      546,947      557,132      1,082,413      1,104,079
                                                       

Benefits, losses and expenses:

                       

Policyholder benefits

     329,327      317,784      328,769      325,325      321,322      325,401      647,111      646,723

Selling, underwriting, general and administrative expenses

     159,088      161,410      160,411      155,186      163,019      162,712      320,498      325,731
                                                       
     488,415      479,194      489,180      480,511      484,341      488,113      967,609      972,454
                                                       

Income before income taxes

     52,256      62,548      57,222      69,740      62,606      69,019      114,804      131,625

Income taxes

     18,418      22,024      20,262      24,893      21,590      23,923      40,442      45,513
                                                       

Net operating income

   $ 33,838    $ 40,524    $ 36,960    $ 44,847    $ 41,016    $ 45,096    $ 74,362    $ 86,112
                                                       

Net earned premiums and other considerations:

                       

Individual:

                       

Individual medical

   $ 320,442    $ 314,662    $ 310,826    $ 305,246    $ 300,267    $ 297,338    $ 635,104    $ 597,605

Short-term medical

     23,499      22,561      24,125      26,839      25,489      25,001      46,060      50,490
                                                       

Subtotal

     343,941      337,223      334,951      332,085      325,756      322,339      681,164      648,095

Small employer group

     169,995      175,561      184,487      189,442      193,831      201,066      345,556      394,897
                                                       

Total

   $ 513,936    $ 512,784    $ 519,438    $ 521,527    $ 519,587    $ 523,405    $ 1,026,720    $ 1,042,992
                                                       

 

Page 10


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Assurant Health (continued)

Condensed Statements of Operations

(Unaudited)

 

     For the Three Months Ended     For the Six
Months Ended
 
($ in thousands)    June 30,
2007
    March 31,
2007
    December 31,
2006
    September 30,
2006
    June 30,
2006
    March 31,
2006
    June 30,
2007
    June 30,
2006
 

Sales (Annualized issued premiums):

                

Individual:

                

Individual medical

   $ 100,468     $ 99,614     $ 88,154     $ 90,271     $ 76,616     $ 76,192     $ 200,082     $ 152,808  

Short-term medical

     33,606       31,939       29,078       34,841       33,612       35,014       65,545       68,626  
                                                                

Subtotal

     134,074       131,553       117,232       125,112       110,228       111,206       265,627       221,434  

Small employer group

     28,307       29,520       28,652       33,336       32,527       34,573       57,827       67,100  
                                                                

Total

   $ 162,381     $ 161,073     $ 145,884     $ 158,448     $ 142,755     $ 145,779     $ 323,454     $ 288,534  
                                                                

Membership by product line:

                

Individual:

                

Individual medical

     650       641       641       639       632       636       650       632  

Short-term medical

     99       85       87       99       105       100       99       105  
                                                                

Subtotal

     749       726       728       738       737       736       749       737  

Small employer group

     181       191       207       216       226       239       181       226  
                                                                

Total

     930       917       935       954       963       975       930       963  
                                                                

Ratios:

                

Loss ratio (a)

     64.1 %     62.0 %     63.3 %     62.4 %     61.8 %     62.2 %     63.0 %     62.0 %

Expense ratio (b)

     30.3 %     30.9 %     30.3 %     29.1 %     30.8 %     30.5 %     30.6 %     30.6 %

Combined ratio (c)

     93.1 %     91.7 %     92.3 %     90.2 %     91.4 %     91.6 %     92.4 %     91.5 %

Investment yield (1)

     5.84 %     5.70 %     5.69 %     5.76 %     5.83 %     5.70 %     5.80 %     5.76 %

Real estate investment income (1)

   $ 590     $ 3,535     $ 123     $ 646     $ —       $ 7,372     $ 4,125     $ 7,372  

 

(a) The loss ratio is equal to policyholder benefits divided by net earned premiums and other considerations.
(b) The expense ratio is equal to selling, underwriting and general expenses divided by net earned premiums and other considerations and fees and other income.
(c) The combined ratio is equal to total benefits, losses and expenses divided by net earned premiums and other considerations and fees and other income.

 

(1) Investment yield excludes investment income from real estate partnerships.

 

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Assurant Employee Benefits

Condensed Statements of Operations

(Unaudited)

 

     For the Three Months Ended    For the Six
Months Ended
($ in thousands)    June 30,
2007
   March 31,
2007
   December 31,
2006
   September 30,
2006
   June 30,
2006
   March 31,
2006
   June 30,
2007
   June 30,
2006

Revenues:

                       

Net earned premiums and other considerations

   $ 272,462    $ 296,673    $ 279,978    $ 291,232    $ 282,581    $ 326,111    $ 569,135    $ 608,692

Net investment income

     39,408      51,887      39,049      39,893      38,744      40,839      91,295      79,583

Fees and other income

     6,379      6,277      6,477      6,685      7,547      6,832      12,656      14,379
                                                       
     318,249      354,837      325,504      337,810      328,872      373,782      673,086      702,654
                                                       

Benefits, losses and expenses:

                       

Policyholder benefits

     184,361      212,534      193,273      196,727      195,195      245,439      396,895      440,634

Selling, underwriting, general and administrative expenses

     101,062      98,026      102,353      103,726      101,827      99,114      199,088      200,941
                                                       
     285,423      310,560      295,626      300,453      297,022      344,553      595,983      641,575
                                                       

Income before income taxes

     32,826      44,277      29,878      37,357      31,850      29,229      77,103      61,079

Income taxes

     11,351      15,320      10,450      12,957      11,260      10,044      26,671      21,304
                                                       

Net operating income

   $ 21,475    $ 28,957    $ 19,428    $ 24,400    $ 20,590    $ 19,185    $ 50,432    $ 39,775
                                                       

Net earned premiums and other considerations by:

                       

Major product grouping:

                       

Group dental

   $ 102,567    $ 101,535    $ 104,448    $ 104,367    $ 108,010    $ 111,393    $ 204,102    $ 219,403

Group disability single premiums for closed blocks

     —        22,847      —        12,393      —        33,920      22,847      33,920

All other group disability

     115,539      118,189      119,812      119,679      119,847      121,586      233,728      241,433

Group life

     54,356      54,102      55,718      54,793      54,724      59,212      108,458      113,936
                                                       

Total

   $ 272,462    $ 296,673    $ 279,978    $ 291,232    $ 282,581    $ 326,111    $ 569,135    $ 608,692
                                                       

 

Page 12


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Assurant Employee Benefits (continued)

Condensed Statements of Operations

(Unaudited)

 

     For the Three Months Ended     For the Six
Months Ended
 
($ in thousands)    June 30,
2007
    March 31,
2007
    December 31,
2006
    September 30,
2006
    June 30,
2006
    March 31,
2006
    June 30,
2007
    June 30,
2006
 

Sales:

                

Group dental

   $ 19,747     $ 42,212     $ 17,119     $ 20,678     $ 12,843     $ 26,979     $ 61,959     $ 39,822  

Group disability

     14,121       20,394       11,126       12,362       10,022       13,633       34,515       23,655  

Group life

     7,051       11,875       5,859       6,954       5,344       6,681       18,926       12,025  
                                                                

Total

   $ 40,919     $ 74,481     $ 34,104     $ 39,994     $ 28,209     $ 47,293     $ 115,400     $ 75,502  
                                                                

Ratios:

                

Loss ratio (a)

     67.7 %     71.6 %     69.0 %     67.5 %     69.1 %     75.3 %     69.7 %     72.4 %

Expense ratio (b)

     36.2 %     32.4 %     35.7 %     34.8 %     35.1 %     29.8 %     34.2 %     32.3 %

Investment yield (1)

     6.21 %     6.09 %     6.32 %     6.25 %     6.17 %     6.47 %     6.17 %     6.32 %

Real estate investment income (1)

   $ 1,040     $ 14,164     $ 215     $ 1,130     $ —       $ —       $ 15,204     $ —    

 

(a) The loss ratio is equal to policyholder benefits divided by net earned premiums and other considerations.
(b) The expense ratio is equal to selling, underwriting and general expenses divided by net earned premiums and other considerations and fees and other income.

 

(1) Investment yield excludes investment income from real estate partnerships.

 

Page 13


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Assurant Corporate and Other

Condensed Statements of Operations

(Unaudited)

 

     For the Three Months Ended     For the Six
Months Ended
 
($ in thousands)    June 30,
2007
    March 31,
2007
    December 31,
2006
    September 30,
2006
    June 30,
2006
    March 31,
2006
    June 30,
2007
    June 30,
2006
 

Revenues:

                

Net earned premiums and other considerations

   $ —       $ —       $ —       $ —       $ —       $ —       $ —       $ —    

Net investment income

     10,153       11,853       7,494       6,881       7,710       13,850       22,006       21,560  

Net realized (losses) gains on investments

     (3,086 )     5,570       116,720       (2,675 )     2,272       (4,452 )     2,484       (2,180 )

Amortization of deferred gains on disposal of businesses

     8,246       8,349       9,017       9,428       10,022       8,833       16,595       18,855  

Fees and other income

     143       327       (148 )     703       127       —         470       127  
                                                                
     15,456       26,099       133,083       14,337       20,131       18,231       41,555       38,362  
                                                                

Benefits, losses and expenses:

                

Policyholder benefits

     —         —         —         —         5       —         —         5  

Selling, underwriting, general and administrative expenses

     19,294       16,119       32,995       17,678       15,764       16,639       35,413       32,403  

Interest expense

     15,296       15,297       15,306       15,307       15,315       15,315       30,593       30,630  
                                                                
     34,590       31,416       48,301       32,985       31,084       31,954       66,006       63,038  
                                                                

Loss before income taxes and cumulative effect of change in accounting principle

     (19,134 )     (5,317 )     84,782       (18,648 )     (10,953 )     (13,723 )     (24,451 )     (24,676 )

Income taxes

     (9,684 )     3,210       32,910       (5,552 )     (4,059 )     (6,176 )     (6,474 )     (10,235 )
                                                                

Net operating (loss) income before cumulative effect of change in accounting principle

     (9,450 )     (8,527 )     51,872       (13,096 )     (6,894 )     (7,547 )     (17,977 )     (14,441 )

Cumulative effect of change in accounting principle

       —         —         —         —         1,547       —         1,547  
                                                                

Net operating (loss) income

   $ (9,450 )   $ (8,527 )   $ 51,872     $ (13,096 )   $ (6,894 )   $ (6,000 )   $ (17,977 )   $ (12,894 )
                                                                

Real estate investment income

   $ —       $ 1,234     $ —       $ —       $ —       $ 4,857     $ 1,234     $ 4,857  

Corporate and Other Reconciliation

                

Assurant Corporate and Other Segment Net Operating Income

   $ (9,450 )   $ (8,527 )   $ 51,872     $ (13,096 )   $ (6,894 )   $ (6,000 )   $ (17,977 )   $ (12,894 )

Adjustments, net of tax:

                

Amortization of deferred gains on disposal of businesses

     (5,360 )     (5,427 )     (5,861 )     (6,128 )     (6,514 )     (5,741 )     (10,787 )     (12,255 )

Interest expense

     9,942       9,943       9,949       9,950       9,955       9,955       19,885       19,910  

Net realized losses (gains) on investments

     2,006       (3,621 )     (75,868 )     1,739       (1,477 )     2,894       (1,615 )     1,417  

Cumulative effect of change in accounting principle

     —         —         —         —         —         (1,547 )     —         (1,547 )
                                                                

Corporate and Other per Reconciliation of Net Operating Income to Net Income (page 5)

   $ (2,862 )   $ (7,632 )   $ (19,908 )   $ (7,535 )   $ (4,930 )   $ (439 )   $ (10,494 )   $ (5,369 )
                                                                

 

Page 14


LOGO

Assurant, Inc. and Subsidiaries

Investments

(Unaudited)

 

($ in thousands)    As of
June 30,
2007
         As of
December 31,
2006
      

Investments by Type

          

Fixed maturities: available-for-sale, at fair value

   $ 9,267,665      $ 9,118,049   

Equity Securities: available-for-sale, at fair value

          

Preferred stocks

     726,382        740,603   

Common stocks

     788        1,036   

Commercial mortgage loans on real estate, at amortized cost

     1,356,957        1,266,158   

Policy loans

     57,872        58,733   

Cash and short-term investments

     1,274,016        1,301,786   

Collateral held under securities lending

     629,263        365,958   

Other investments

     547,858        564,494   
                  

Total

   $ 13,860,801      $ 13,416,817   
                  

Fixed Maturity Securities by Credit Quality (Fair Value)

          

Aaa / Aa / A

   $ 6,302,482    68 %   $ 6,127,830    67 %

Baa

     2,373,027    26 %     2,386,317    26 %

Ba

     470,234    5 %     479,037    5 %

B and lower

     121,922    1 %     124,865    2 %
                          

Total

   $ 9,267,665    100 %   $ 9,118,049    100 %
                          

Fixed Maturity Securities by Issuer Type (Fair Value)

          

U.S government and government agencies and authorities

   $ 309,686    3 %   $ 327,463    3 %

State, municipalities and political subdivisions

     540,583    6 %     236,429    3 %

Foreign government

     745,476    8 %     652,662    7 %

Public utilities

     1,059,369    12 %     1,104,167    12 %

Mortgage backed securities

     1,043,707    11 %     1,206,597    14 %

All other corporate bonds

     5,568,844    60 %     5,590,731    61 %
                          

Total

   $ 9,267,665    100 %   $ 9,118,049    100 %
                          

 

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Assurant, Inc. and Subsidiaries

Investment Results by Asset Category and Annualized Yields

(Unaudited)

 

    For the Three Months Ended
June 30, 2007
    For the Three Months Ended
June 30, 2006
    For the Six Months Ended
June 30, 2007
    For the Six Months Ended
June 30, 2006
 
($ in thousands)   Yield     Investment
Income
    Investment
Gain
(Loss)
    Yield     Investment
Income
    Investment
Gain
(Loss)
    Yield     Investment
Income
    Investment
Gain
(Loss)
    Yield     Investment
Income
    Investment
Gain
(Loss)
 

Fixed maturities: available for sale, at fair value

  5.94 %   $ 137,417     $ (5,042 )   5.76 %   $ 127,725     $ (258 )   5.94 %   $ 271,671     $ (1,566 )   5.78 %   $ 254,566     $ (2,875 )

Equity Securities: available for sale, at fair value

  6.42 %     11,898       (1,077 )   7.11 %     13,519       37     6.50 %     24,038       (1,424 )   6.81 %     25,302       (1,617 )

Commercial mortgage loans on real estate, at amortized cost

  6.83 %     22,573       —       7.21 %     22,409       (84 )   6.77 %     44,133       —       7.43 %     45,762       (209 )

Policy loans

  8.41 %     1,222       —       9.78 %     1,457       —       7.19 %     2,095       —       7.75 %     2,330       —    

Cash and short-term investments

  4.59 %     14,152       9     4.59 %     10,417       7     4.62 %     29,015       26     3.75 %     20,473       148  

Other investments

  6.72 %     9,346       3,024     8.10 %     11,119       2,570     17.48 %     48,863       5,448     13.59 %     37,084       2,373  
                                                                       

Total

      196,608     $ (3,086 )       186,646     $ 2,272         419,815     $ 2,484         385,517     $ (2,180 )
                                               

Investment expenses

      (6,306 )         (6,208 )         (12,617 )         (12,517 )  
                                               

Net investment income

    $ 190,302         $ 180,438         $ 407,198         $ 373,000    
                                               

Gross investment gain

      $ 11,846         $ 10,682         $ 21,187         $ 16,808  

Gross investment loss

        (14,932 )         (8,410 )         (18,703 )         (18,988 )

Write-downs on available for sale securities

        —             —             —             —    
                                               

Net investment gain

      $ (3,086 )       $ 2,272         $ 2,484         $ (2,180 )
                                               

 

Page 16


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Assurant, Inc. and Subsidiaries

Summary of Net Operating Income Disclosed Items—(Note 1)

Income / (Expense) Items

(unaudited)

 

    For the Three Months Ended  
($ in millions, after-tax)   June 30,
2007
    March 31,
2007
    December 31,
2006
    September 30,
2006
  June 30,
2006
    March 31,
2006
 
    $     Diluted
EPS
    $     Diluted
EPS
    $     Diluted
EPS
    $   Diluted
EPS
  $     Diluted
EPS
    $     Diluted
EPS
 

Assurant Solutions:

                       

Closed block of extended service contracts(a)

  $ —       —       $ —       —       $ —       —       $ 5.4   0.04   $ —       —       $ —       —    

Fees/(Expenses) from sale of US pre-need independent
franchise(a)(c)

  $ 3.5     0.03     $ —       —       $ —       —       $ —     —     $ (0.7 )   (0.01 )   $ (1.3 )   (0.01 )

Loss from restructured international product(b)(c)

  $ (4.4 )   (0.04 )   $ —       —       $ —       —       $ —     —     $ —       —       $ —       —    

Reconciliation of commissions payable accounts(c)

  $ 4.5     0.04     $ —       —       $ —       —       $ —     —     $ —       —       $ —       —    

Assurant Specialty Property:

                       

Reconciliation of commissions payable accounts(c)(b)

  $ 5.5     0.04     $ —       —       $ —       —       $ —     —     $ —       —       $ —       —    

Processing fees for the National Flood Insurance Program(b)

  $ —       —       $ —       —       $ —       —       $ 0.3   0.00   $ 1.3     0.01     $ 5.2     0.04  

Catastrophe losses, net of reinsurance(b)

  $ —       —       $ —       —       $ —       —       $ —     —     $ (4.5 )   (0.03 )   $ —       —    

Client related settlements

  $ —       —       $ —       —       $ 5.5     0.04     $ —     —     $ —       —       $ —       —    

Assurant Health:

                       

Legal related settlements(c)

  $ —       —       $ —       —       $ —       —       $ 2.6   0.02   $ —       —       $ —       —    

Assurant Corporate and Other:

                       

Assurant Foundation funding(c)

  $ —       —       $ —       —       $ (3.3 )   (0.03 )   $ —     —     $ —       —       $ —       —    

Change in certain tax liabilities(d)

  $ 2.9     0.02     $ (5.8 )   (0.05 )   $ (6.2 )   (0.05 )   $ —     —     $ —       —       $ —       —    

Statement of Operations line impact:

(a) Fees and other income
(b) Policyholder benefits
(c) Selling, underwriting, general and administrative expenses
(d) Income taxes

 

Page 17