Press release·02/21/2025 10:51:28

Executive Summary

Assurant, Inc. is a leading global provider of lifestyle and housing solutions that supports, protects and connects major consumer purchases. The company reported strong financial results for the year ended December 31, 2024, with consolidated net income increasing 18% to $760.2 million compared to the prior year.

Financial Performance Overview

Assurant’s Global Lifestyle segment, which includes mobile device solutions, extended service contracts and financial services, saw a 2% decrease in Adjusted EBITDA (a measure of profitability) to $773.4 million. This was primarily due to elevated claims costs in the Global Automotive business and investments in new client programs and capabilities in the Connected Living business. However, the segment’s net earned premiums, fees and other income increased 5% to $8.97 billion, driven by contributions from newly launched trade-in and device protection programs.

The Global Housing segment, which includes homeowners, renters and flood insurance, had a strong year, with Adjusted EBITDA increasing 17% to $671.2 million. This was mainly due to growth in the Homeowners business, including higher policies in-force and premium rates, as well as more favorable prior year reserve development and lower reinsurance costs. The segment’s net earned premiums, fees and other income grew 15% to $2.46 billion.

The Corporate and Other segment, which includes corporate expenses, reported an Adjusted EBITDA loss of $122.2 million, compared to a loss of $109.0 million in the prior year, primarily due to higher employee-related and third-party consulting expenses.

Overall, Assurant’s consolidated net income increased 18% to $760.2 million, driven by the strong performance in Global Housing, lower impact of foreign exchange, and reduced losses from non-core operations and restructuring costs. However, this was partially offset by higher reportable catastrophes and higher depreciation expense.

Investments and Liquidity

Assurant had total investments of $8.54 billion as of December 31, 2024, primarily consisting of fixed maturity securities. The company’s net investment income increased 6% to $518.9 million, mainly due to higher yields and asset balances in fixed maturity securities and short-term investments.

As of December 31, 2024, Assurant had $1.81 billion in cash and cash equivalents and $673.0 million in holding company liquidity, which is $448.0 million above the company’s targeted minimum level. The company’s subsidiaries generated $804.7 million in dividends and returns of capital during the year, which Assurant used primarily for common stock repurchases, dividend payments, and to fund investments and acquisitions.

Assurant has a $500 million revolving credit facility and a commercial paper program, both of which provide additional liquidity. The company did not utilize these facilities during 2024.

Regulatory and Capital Management

Assurant’s insurance subsidiaries are subject to regulatory requirements regarding capital, dividends and other aspects of their business. The company’s capital management strategy is focused on maintaining appropriate capital levels to support its operations and meet regulatory requirements, while also providing flexibility for growth opportunities and returning capital to shareholders.

For the year ending December 31, 2025, the maximum amount of dividends Assurant’s regulated U.S. insurance subsidiaries could pay the holding company without prior regulatory approval is approximately $524.2 million. The company also has the ability to access dividends and other payments from its international and non-insurance subsidiaries.

Assurant’s Board of Directors declared a quarterly dividend of $0.80 per common share in January 2025, representing an 11% increase from the prior year. The company also repurchased $299.9 million of its common stock during 2024 and had $374.5 million remaining under its current $600 million share repurchase authorization as of year-end.

Key Risks and Uncertainties

Assurant’s results depend on various factors, including the appropriateness of its product pricing and underwriting, the accuracy of its reserving methodology, the frequency and severity of catastrophes, investment performance, and its ability to grow profitably and manage expenses. The company also faces risks related to competitive pressures, changes in customer preferences, regulatory changes, and the performance of its mobile and homeowners businesses.

Assurant uses various analytical models to assist in decision-making, but actual results may differ materially from the models due to factors such as changes in economic conditions, inflation, and other variables that are difficult to predict. The company also faces credit risk from reinsurers and counterparties, which it manages through a probability of default and loss given default methodology.

Outlook and Conclusion

Assurant’s strong financial performance in 2024, driven by growth in its Global Housing segment and improved profitability in Global Lifestyle, positions the company well for the future. The company continues to invest in technology, talent, and new client programs to support future growth, while also maintaining a disciplined approach to capital management and expense control.

However, Assurant faces ongoing challenges, including the impact of inflation on claims costs, competitive pressures, and the potential for more frequent and severe catastrophe events. The company’s ability to navigate these risks and capitalize on opportunities in its key markets will be crucial to its long-term success.

Overall, Assurant’s 2024 results demonstrate the strength of its diversified business model and the effectiveness of its strategic initiatives. The company remains focused on delivering value to its customers, shareholders, and other stakeholders through innovative solutions and disciplined execution.