Strong Double-Digit Earnings Growth Year-to-Date Led by Continued Outperformance in Global Housing

Company Increases 2024 Outlook to Deliver Low Double-Digit Growth in Adjusted EBITDA with Mid- to High-teens Growth in Adjusted EPS, Both Ex. Catastrophes

Assurant, Inc. (NYSE: AIZ), a leading global business services company that supports, protects and connects major consumer purchases, today reported results for the third quarter ended September 30, 2024.

“Our third quarter performance highlights continued strength within Global Housing with growing revenues and expense discipline. Global Lifestyle performed in-line with expectations, as we continued to prioritize strategic investments for growth in new and expanded Connected Living partnerships and saw further signs of stabilization within Global Automotive during the quarter. Across Assurant, we are delivering greater value to our clients and their end-consumers while establishing new growth opportunities,” said Assurant President and CEO Keith Demmings.

“Our year-to-date execution and performance enable us to increase our 2024 enterprise outlook. We now expect Adjusted EBITDA to increase low double-digits and Adjusted earnings per share to increase mid- to high-teens, both excluding reportable catastrophes. In addition, we expect to return $300 million in share repurchases in 2024, reflecting our strong capital position and risk management expertise,” Demmings added.

Note: The metrics included within the company’s outlook are non-GAAP financial measures and the company believes that it cannot, without unreasonable efforts, forecast certain information needed to reconcile to the GAAP measures, the probable significance of which cannot be determined. More information can be found in the Non-GAAP Financial Measures section.

Some of the metrics throughout this press release are non-GAAP measures of performance. A full reconciliation of each non-GAAP measure to the most comparable GAAP measure can be found in the Non-GAAP Financial Measures section.

Third Quarter 2024 Summary

• GAAP net income decreased 30 percent to $133.8 million, compared to the prior year period, while net income per diluted share decreased 28 percent to $2.55 versus the prior year period.
• Adjusted EBITDA, excluding reportable catastrophes², increased 8 percent to $385.1 million, or 9 percent on a constant currency basis⁵.
• Adjusted earnings, excluding reportable catastrophes, per diluted share⁴, increased 9 percent to $5.08.
• Holding company liquidity was $636 million; returned $138 million to shareholders via share repurchases and common stock dividends.

2024 Outlook

The company now expects:

• Adjusted EBITDA, excluding reportable catastrophes⁶, to increase low double-digits, led by strong growth in Global Housing, with modest growth in Global Lifestyle.
• Adjusted earnings, excluding reportable catastrophes, per diluted share⁶, to increase mid- to high-teens.
  
  
  
  Note: The metrics included within the company’s outlook are non-GAAP financial measures and the company believes that it cannot, without unreasonable efforts, forecast certain information needed to reconcile to the GAAP measures, the probable significance of which cannot be determined. More information can be found in the Non-GAAP Financial Measures section.

Third Quarter 2024 Consolidated Results

Note: Adjusted EBITDA of the Global Lifestyle, Global Housing and Corporate and Other segments is the segment measure of profitability in our GAAP financial statements and includes reportable catastrophes. Additional details regarding key financial metrics are included in the Financial Supplement located on Assurant’s Investor Relations website: https://ir.assurant.com/investor/default.aspx

Third Quarter 2024 Consolidated Results

• GAAP net income decreased to $133.8 million, compared to third quarter 2023 of $190.1 million, primarily due to higher reportable catastrophes within Global Housing. This was partially offset by higher top-line growth in Homeowners within Global Housing.

• GAAP net income per diluted share decreased to $2.55 compared to third quarter 2023 of $3.54. The decrease was primarily driven by the factors noted above.

• Adjusted EBITDA¹ decreased to $246.9 million compared to the prior year period of $330.7 million. Results included $111.8 million of higher pre-tax reportable catastrophes. Excluding reportable catastrophes, Adjusted EBITDA² increased 8 percent, or 9 percent on a constant currency basis⁵, to $385.1 million, primarily from higher earnings in Global Housing.

• Adjusted earnings, excluding reportable catastrophes, per diluted share⁴, increased 9 percent to $5.08 compared to the prior year period of $4.68, mainly from higher Global Housing earnings and the impact of share repurchases, partially offset by higher depreciation expense.

• Net earned premiums, fees and other income from the Global Lifestyle and Global Housing segments totaled $2.85 billion compared to $2.66 billion in third quarter 2023, up 7 percent, or 8 percent on a constant currency basis⁵, driven by growth across both segments.

Global Lifestyle

• Adjusted EBITDA decreased 4 percent compared to third quarter 2023, or 1 percent on a constant currency basis⁵. The decline was primarily driven by unfavorable foreign exchange and modestly lower results within Global Automotive, where elevated losses within select ancillary products were partially offset by higher investment income. On a constant currency basis, Connected Living⁵ was flat as investments in new client programs and capabilities to support future growth were offset by growth in mobile device protection programs from increased subscribers, particularly in the U.S.

• Net earned premiums, fees and other income increased 7 percent compared to third quarter 2023, or 8 percent on a constant currency basis⁵, primarily driven by Connected Living from mobile growth, including contributions from newly launched trade-in programs and global device protection programs.

Global Housing

• Adjusted EBITDA decreased 44 percent compared to third quarter 2023. Results included $110.6 million of higher pre-tax reportable catastrophes. Excluding reportable catastrophes, Adjusted EBITDA² increased 20 percent, primarily from continued top-line growth within Homeowners, including higher policies in-force from new lender-placed programs and portfolios and increased voluntary insurance market pressure, and $30.1 million of favorable year-over-year prior period reserve development. The increase was partially offset by a $27.5 million non-run rate adjustment related to a change in earnings pattern assumptions.

• Net earned premiums, fees and other income increased 9 percent compared to third quarter 2023, mainly driven by Homeowners top-line growth, including growth in policies in-force and higher average premiums within lender-placed as well as growth across various specialty products, partially offset by the non-run rate adjustment mentioned above.

Corporate and Other

• Adjusted EBITDA loss increased in third quarter 2024 compared to the prior year period, primarily driven by higher third-party and employee-related expenses.

Holding Company Liquidity Position

• Holding company liquidity totaled $636 million as of September 30, 2024, or $411 million above the company’s targeted minimum level of $225 million.
  
  
  
  Dividends paid by the operating segments to the holding company in third quarter 2024 totaled $161 million.

• Share repurchases and common stock dividends totaled $138 million in third quarter 2024. During third quarter 2024, Assurant repurchased approximately 530 thousand shares of common stock for $100 million and paid $38 million in common stock dividends. From October 1 through November 1, 2024, the company repurchased approximately 103 thousand shares for $20 million, for a total of $200 million in share repurchases year-to-date. $475 million remains under the current repurchase authorization.

2024 Company Outlook⁶

Note: Some of the metrics included within the company’s outlook are non-GAAP financial measures and the company believes that it cannot, without unreasonable efforts, forecast certain information needed to reconcile to the GAAP measures, the probable significance of which cannot be determined. More information can be found in the Non-GAAP Financial Measures section.

Based on current market conditions, for full year 2024, the company now expects:

• Adjusted EBITDA, excluding reportable catastrophes⁶, to increase by low double-digits, led by strong growth in Global Housing and modest growth in Global Lifestyle.
  • Global Housing Adjusted EBITDA, excluding reportable catastrophes⁶, to deliver strong growth, mainly driven by top-line growth in Homeowners, favorable non-catastrophe loss experience, benefits from expense leverage and lower catastrophe reinsurance premiums. Year-to-date 2024 included $85 million of favorable prior year reserve development. In fourth quarter 2024, Hurricane Milton is expected to be a reportable catastrophe event with losses in the range of $75 to $110 million pre-tax.
  • Global Lifestyle Adjusted EBITDA to increase modestly. The company continues to expect organic growth and improved profitability in Connected Living programs, partially offset by investments to support growth, including new client and program implementation expenses. We now expect Global Automotive to be down due to continued loss pressure from inflation and elevated losses in select ancillary products. Implemented rate actions are expected to drive improvement over time. We continue to monitor the impact from macroeconomic conditions, including inflation, foreign exchange and interest rate levels, which have impacted and may continue to impact the pace and timing of growth.
  • Corporate and Other Adjusted EBITDA loss to now approximate $115 million.

• Adjusted earnings, excluding reportable catastrophes, per diluted share⁶ growth rate to increase by mid- to high-teens. The company now expects an effective tax rate of approximately 18 to 20 percent and depreciation expense of approximately $135 million, and continues to expect interest expense of approximately $107 million and amortization of purchased intangible assets of approximately $70 million.

• Business segment dividends are now expected to be below two-thirds of segment Adjusted EBITDA, including reportable catastrophes⁶. This is subject to the business and investment portfolio performance, and rating agency and regulatory capital requirements.

• Capital deployment priorities to focus on maintaining a strong financial position, supporting business growth by funding investments and M&A, and returning capital to shareholders through common stock dividends and share repurchases, subject to Board approval.

Earnings Conference Call

The third quarter 2024 earnings conference call and webcast will be held on Wednesday, November 6, 2024 at 8:00 a.m. E.T. The slide presentation used by management during the webcast includes supplemental information and will be available on Assurant’s Investor Relations website prior to the conference call. The live and archived webcast, along with supplemental information, will also be available on Assurant’s Investor Relations website:

https://ir.assurant.com/investor/default.aspx

About Assurant

Assurant, Inc. (NYSE: AIZ) is a leading global business services company that supports, protects and connects major consumer purchases. A Fortune 500 company with a presence in 21 countries, Assurant supports the advancement of the connected world by partnering with the world’s leading brands to develop innovative solutions and to deliver an enhanced customer experience through mobile device solutions, extended service contracts, vehicle protection services, renters insurance, lender-placed insurance products and other specialty products.

Learn more at assurant.com

Safe Harbor Statement

Some of the statements in this news release and its exhibits, including our outlook, business and financial plans and any statements regarding the company’s anticipated future financial performance, business prospects, growth and operating strategies and similar matters, may constitute forward-looking statements within the meaning of the U.S. Private Securities Litigation Reform Act of 1995.

You can identify forward-looking statements by the use of words such as “outlook,” “objective,” “will,” “may,” “can,” “anticipates,” “expects,” “estimates,” “projects,” “intends,” “plans,” “believes,” “targets,” “forecasts,” “potential,” “approximately,” and the negative version of those words and other words and terms with a similar meaning. Any forward-looking statements contained in this news release or its exhibits are based upon our historical performance and on current plans, estimates and expectations. The inclusion of this forward-looking information should not be regarded as a representation by us or any other person that our future plans, estimates or expectations will be achieved. Our actual results might differ materially from those projected in the forward-looking statements. We undertake no obligation to update or review any forward-looking statement, whether as a result of new information, future events or other developments. The following factors could cause our actual results to differ materially from those currently estimated by management, including those projected in the company outlook:

1. the loss of significant clients, distributors or other parties with whom we do business, or if we are unable to renew contracts with them on favorable terms, or if they disintermediate us, or if those parties face financial, reputational or regulatory issues;
2. significant competitive pressures, changes in customer preferences and disruption;
3. the failure to execute our strategy, including through the continuing service of key executives, senior leaders, highly-skilled personnel and a high-performing workforce;
4. the failure to find suitable acquisitions at attractive prices, integrate acquired businesses or divest of non-strategic businesses effectively or achieve organic growth;
5. our inability to recover should we experience a business continuity event;
6. the failure to manage vendors and other third parties on whom we rely to conduct business and provide services to our clients;
7. risks related to our international operations;
8. declines in the value and availability of mobile devices, and regulatory compliance or other risks in our mobile business;
9. our inability to develop and maintain distribution sources or attract and retain sales representatives and executives with key client relationships;
10. risks associated with joint ventures, franchises and investments in which we share ownership and management with third parties;
11. the impact of catastrophe and non-catastrophe losses, including as a result of the current inflationary environment and climate change;
12. negative publicity relating to our business, industry or clients;
13. the impact of general economic, financial market and political conditions (including the Israel-Hamas war) and conditions in the markets in which we operate, including the current inflationary environment;
14. the adequacy of reserves established for claims and our inability to accurately predict and price for claims and other costs;
15. a decline in financial strength ratings of our insurance subsidiaries or in our corporate senior debt ratings;
16. fluctuations in exchange rates, including in the current environment;
17. an impairment of goodwill or other intangible assets;
18. the failure to maintain effective internal control over financial reporting;
19. unfavorable conditions in the capital and credit markets;
20. a decrease in the value of our investment portfolio, including due to market, credit and liquidity risks, and changes in interest rates;
21. an impairment in the value of our deferred tax assets;
22. the unavailability or inadequacy of reinsurance coverage and the credit risk of reinsurers, including those to whom we have sold business through reinsurance;
23. the credit risk of some of our agents, third-party administrators and clients;
24. the inability of our subsidiaries to pay sufficient dividends to the holding company and limitations on our ability to declare and pay dividends or repurchase shares;
25. limitations in the analytical models we use to assist in our decision-making;
26. the failure to effectively maintain and modernize our technology systems and infrastructure, or the failure to integrate those of acquired businesses;
27. breaches of our technology systems or those of third parties with whom we do business, or the failure to protect the security of data in such systems, including due to cyberattacks and as a result of working remotely;
28. the costs of complying with, or the failure to comply with, extensive laws and regulations to which we are subject, including those related to privacy, data security, data protection and tax;
29. the impact of litigation and regulatory actions;
30. reductions or deferrals in the insurance premiums we charge;
31. changes in insurance, tax and other regulations, including the Inflation Reduction Act of 2022;
32. volatility in our common stock price and trading volume; and
33. employee misconduct.

For additional information on factors that could affect our actual results, please refer to the factors identified in the reports we file with the U.S. Securities and Exchange Commission, including the risk factors identified in our most recent Annual Report on Form 10-K and Quarterly Reports on Form 10-Q.

Non-GAAP Financial Measures

Assurant uses the following non-GAAP financial measures to analyze the company’s operating performance. Assurant’s non-GAAP financial measures should not be considered in isolation or as a substitute for GAAP financial measures. 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.

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