Assurant reports. . . . Preneed seems to be “up in the air”

February 16, 2021/Finance, Preneed/

Worldwide insurance conglomerate Assurant reported both its 4Q 2020 and its Full Year 2020 results last week. The company reports in three distinctive segments — Global Housing, Global Lifestyle, and Global Preneed.

The total Earned Premiums of the entire company for the Full Year 2020 combined to $9.52 billion which is a better than 2% increase over the combined Earned Premiums of about $9.33 billion in FY 2019. The company press release, which you can read here, had this to say about that increase: “Excluding the impact from the mobile program contract change, revenue increased 3 percent, mainly due to growth across Global Automotive and Connected Living in Global Lifestyle, partially offset by anticipated declines in Global Housing.”

Profit wise, Assurant reported Net Income in FY2020 of $423.1 million as compared to FY2019’s Net Income of $363.9 million.

From our point of view at Funeral Director Daily we are most concerned with reporting the results of Assurant’s Preneed Insurance business. If you remember, last November Funeral Director Daily reported, in this article, that Assurant was fairly certain that they would be divesting their preneed business in order to concentrate on other endeavors.

For FY2020 Assurant’s Global Preneed division reported Earned Premiums of $209.4 million as compared to FY 2019’s Earned Premiums of $200.9 million. . . that’s a 4.2 % increase. However, Net Operating Income for the Global Preneed division decreased in FY2020 compared to what the company recorded in FY2019. For FY2020 Assurant reported Global Preneed Operating Income of $48 million as compared to Global Preneed Operating Income in FY2019 of $52 million.

Here is what the report said about the decrease in Global Preneed Operating Income: “Full-year 2020 net operating income decreased compared to 2019, primarily due to higher mortality from COVID-19 and lower investment income.”

In their 2021 Outlook and the forward looking statements provision of the report, Assurant had these things to say regarding their Global Preneed franchise and last November’s announcement of potential divestment of the division:

“The company expects to provide its full-year 2021 outlook following the outcome of its evaluation of strategic alternatives, including a potential sale, of Global Preneed.”
“Some of the statements included in this news release and its exhibits, particularly those with respect to the process to explore strategic alternatives for Global Preneed, including any statements regarding the company’s anticipating future financial performance, business prospects, growth and operating strategies and similar matters, may constitute forward-looking statements. . . . . The company does not have a definitive timetable to complete its review of strategic alternatives for Global Preneed and there can be no assurance that any such process will result in a transaction.”

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