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DATE

Thursday, Aug. 6, 2026 at 11:00 a.m. ET

CALL PARTICIPANTS

• Vice President, Investor Relations - Rachael Luber
• President and Chief Executive Officer - Marita Zuraitis
• Executive Vice President and Chief Financial Officer - Ryan Edward Greenier

TAKEAWAYS

• Core EPS -- $1.17, rising more than 10% from the prior year quarter due to diversified operating performance.
• Core EPS Guidance -- $4.60 to $4.90, increased for the full year 2026 based on strong first-half results and updated catastrophe loss expectations.
• Core ROE -- 12.8% on a trailing 12-month basis, aligning with the long-term target of 12% to 13%.
• Total Revenues -- 8% increase year over year, reflecting growth across all business segments.
• Property & Casualty Core Earnings -- $26 million, a 56% increase from the prior year quarter.
• Property & Casualty Combined Ratio -- 89.6%, an improvement of 7.0 points driven by rate actions and favorable weather conditions.
• Prior Year Reserve Development -- $7 million favorable, including $5 million in property and $2 million in auto due to lower than expected claim severity.
• Property & Casualty Net Written Premiums -- $212 million, remaining essentially flat as the company prioritizes profitability over volume.
• Property Premiums -- 6% increase, reflecting higher average premiums and positive sales trends.
• Catastrophe Loss Assumption -- $75 million, reduced from the previous $90 million estimate for the full year 2026.
• Life & Retirement Core Earnings -- $17 million, supported by stable fee income and strong persistency levels.
• Life Sales -- 20% increase, reflecting the impact of investments in agent recruiting and coaching.
• Life Persistency -- 96%, maintaining high levels of customer retention.
• Supplemental & Group Benefits Sales -- 44% increase, driven by strong demand for cancer coverage and family leave products.
• Individual Supplemental Sales -- 5% increase, led by the latest generation of cancer protection offerings.
• Blended Benefit Ratio Guidance -- 42%, increased for the full year to reflect the rising contribution of the paid family and medical leave product.
• Managed Portfolio Income Guidance -- $365 million to $375 million, factoring in market impacts on alternative investment strategies.
• Net Investment Income Guidance -- $465 million to $475 million for the full year 2026.
• New Money Yields -- 5.85% for core fixed income, exceeding the total portfolio yield by more than 100 basis points.
• Dividends -- $15 million, returned to shareholders during the second quarter.
• Share Repurchase Authorization -- $37 million, remaining available for opportunistic buybacks under the current program.
• Tangible Book Value Per Share -- 10% increase year over year, reflecting consistent earnings and prudent capital management.
• M&A Purchase Price -- $115 million, for the recently announced acquisitions from Medical Mutual of Ohio.
• M&A Accretion Guidance -- $0.40 to $0.50 per share, expected to be immediately accretive beginning in 2027.
• M&A ROE Accretion -- 100 basis points, projected once the acquisitions are fully integrated into the enterprise.

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RISKS

• Greenier warned that the company expects "a period of elevated utilization as newly covered employees begin accessing benefits available to them" regarding the recently introduced paid family and medical leave product.
• Greenier stated that "elevated interest rates... also continue to pressure earnings from certain investment strategies" such as private equity and real estate related strategies.

SUMMARY

Management at Horace Mann Educators Corporation (HMN -1.38%) increased full-year core earnings guidance following second-quarter results driven by significant underwriting improvements in the Property & Casualty segment and strong sales momentum in supplemental and group benefits. The company is executing a strategy to expand its educator-centric platform through digital quoting tools, expanded agency distribution, and the strategic acquisition of employer services and group life businesses. Management indicated that while higher interest rates benefit core fixed income yields, certain alternative investment strategies face return pressures. The enterprise remains focused on achieving a 10% compound annual growth rate in core earnings per share and maintaining a core return on equity between 12% and 13%.

• CEO Zuraitis noted that more than one-third of educators nationwide now recognize the Horace Mann brand, which she stated "strengthens customer reinforces long term relationships and positions us to continue serving more customers."
• The company's Paid Family and Medical Leave (PFML) product is sold as an enhancement to short-term disability, with Greenier noting it has a "meaningful lower expense ratio" than other group offerings.
• Online quoting activity grew 10% year over year as the company expands its digital distribution capabilities.
• Regarding the acquisition of Medical Mutual of Ohio's businesses, CEO Zuraitis stated that mental health and stress are the "number 1 concern" for educators and school districts.
• CEO Zuraitis highlighted a new relationship with the Women's Professional Baseball League to support women's sports and celebrate their inaugural season.
• Management updated the catastrophe loss assumption to $75 million from $90 million following favorable first-half weather experience.

INDUSTRY GLOSSARY

• 403(b): A tax-advantaged retirement savings plan available for public education employees, and certain non-profit organizations.
• PFML: Paid Family and Medical Leave, a state-mandated or employer-provided insurance benefit providing income replacement during family, or medical absences.
• Combined Ratio: An insurance metric calculated by dividing the sum of incurred losses and expenses by earned premium; a ratio below 100% indicates an underwriting profit.
• Core Earnings: A non-GAAP financial measure that excludes the impact of net investment gains or losses, and other non-recurring items to reflect ongoing operational performance.
• Persistency: A measure of the percentage of insurance policies that remain in force without lapsing, or being canceled by the policyholder.
• Tangible Book Value: A measure of a company's net worth that excludes intangible assets like goodwill, and patents.

Full Conference Call Transcript

Operator: Good day, and welcome to the Horace Mann Educators Second Quarter 26 Investor Call. All participants will be in a listen only mode. After today's presentation, there will be an opportunity to ask questions. Please note that this event is being recorded. I would now like to turn the conference over to Rachael Luber, Vice President, Investor Relations. Please go ahead.

Rachael Luber: Thank you. Welcome to Horace Mann's discussion of our second quarter 26 results. Yesterday, we issued our earnings release, investor supplement and investor presentation. Copies are available on the Investors page of our website. Our speakers today are Marita Zuraitis, President and Chief Executive Officer and Ryan Edward Greenier, Executive Vice President and Chief Financial Officer. Before turning it over to Marita, I want to note that our presentation today includes forward looking statements as defined in the Private Securities Litigation Reform Act of 2000. The company cautions investors that any forward looking statements include risks and uncertainties and are not guarantees of future performance.

These forward looking statements are based on management's current expectations, and we assume no obligation to update them. Actual results may differ materially due to a variety of factors, which are described in our news release and SEC filings. In our prepared remarks, we use some non-GAAP measures. Reconciliation of these measures to the most comparable GAAP measures are available in our investor supplement. Now turn the call over to Marita.

Marita Zuraitis: Thanks, Rachael, good morning, everyone. Yesterday, Horace Mann reported another strong quarter with record second quarter core earnings of $1.17 per share, an increase of more than 10% over prior year, Core shareholder return on equity for the trailing 12 months was 12.8%. These results reflect continued strong operating performance across our diversified business and demonstrates the progress we are making against the long term strategy we outlined at Investor Day. Our diversified business model continues to prove its value across a variety of economic and industry conditions.

The investments we have made to strengthen our portfolio improve execution, and expand our distribution capabilities are translating into consistent operating performance and keep us on track to deliver our 3-year financial objectives. As a result of our strong first half operating performance, and our confidence in the outlook for the remainder of the year, we are increasing our full year 2026 core earnings guidance to a range of $4.60 to $4.90 per share.

This morning, I will discuss the operating momentum we are seeing across the business, the progress we are making to strengthen relationships with educators school districts and other employers and why we remain confident in our long term strategy to continue delivering sustainable, profitable growth and long term shareholder value. Turning to operating performance, the strength of our second quarter results reflects disciplined execution across the business. Property and Casualty continued to perform well during the quarter The property and casualty combined ratio improved 7.0 points from the prior year period, reflecting the rate and non rate actions we have taken over the past several years together with generally favorable weather conditions and lower catastrophe losses.

At the same time, life and retirement and individual supplemental and group benefits continued to generate attractive returns and further diversify our earnings profile. Those results are supported by continued growth across the enterprise, reflecting the investments we have made to strengthen both our product offerings and our distribution capabilities. Total revenues increased 8% over the prior year quarter, Sales were particularly strong in individual supplemental and group benefits up 44% and in life up 20%.

Momentum we are seeing reflects the deliberate investments we have made in 2 areas, First, we continue to enhance our portfolio with products and solutions that address evolving customer and employer needs, and second, we are making it easier for customers to access those solutions by investing in our distribution capabilities, technology and agent development. In individual supplemental, our newest generation of cancer coverage continues to generate strong sales as it addresses the evolving protection needs of our customers. In Group Benefits, the paid family and medical leave enhancement we introduced alongside our short term disability offering earlier this year continues to support strong employer demand and continues to be an important driver of new business.

We are also seeing the benefits of our investments in distribution, Through continued investments in recruiting, training and coaching, we have strengthened our agency force and are helping new agents become successful more quickly. Those investments are expanding our distribution capacity supporting profitable growth and contributing to the continued momentum we are seeing in life sales. The benefits of these investments extend across our business In Property and Casualty, we continue to pursue profitable growth by focusing on markets and customer segments where we believe we can earn attractive long term returns. We are encouraged by the momentum we are seeing as we continue to grow customer relationships while maintaining the disciplined approach that supports our long term strategy.

Our approach to the auto market reflects the broader philosophy that extends across Horace Mann. We measure success by the strength and longevity of our customer relationships, not simply by quarterly sales or individual policy growth. Our relationships continue to be 1 of our greatest competitive advantages Auto household retention remains steady near 84% during the quarter, while customer retention across our other businesses remains near or above 90%. Those results reflect the trust our customers place in Horace Mann and value they see in the solutions we provide. Our relationships are built on a deep understanding of the educator community and a commitment to helping educators succeed both in and outside of the classroom.

We continue to invest in resources and solutions that strengthen our connections with educators while creating long term value for our shareholders. We are continuing to expand how we connect with educators Online quoting activity increased nearly 10% over prior year, and we continue to grow our points of distribution. Creating more opportunities to introduce educators to Horace Mann, and the solutions we provide throughout their careers. We are also expanding our reach through partnerships that allow us to meet educators where they are. Through our partnership with Crayola and the Disney Institute, thousands of educators have now completed professional development programs sponsored by Horace Mann.

More recently, we announced a new relationship with the Women's Professional Baseball League to create unique experiences for educators support women's sports, and celebrate the league's inaugural season. We are also proud to have established the first Horace Mann Educator Excellence Award Endowment in partnership with the Smithsonian Institution. This permanent endowment recognize and celebrates outstanding educators while reinforcing Horace Mann's long standing commitment to the profession we have served for more than 80 years. Our support of educators extends well beyond insurance products. During Teacher Appreciation Month in May, we celebrated educators nationwide through a variety of recognition and community initiatives.

As students return to the classroom this fall, our annual back to school campaign will once again provide educators with resources, classroom support, and opportunities to engage with Horace Mann both locally through our agents and nationally through our partnerships and digital channels. The result is a business model built on trusted solutions rather than transactions. Today, more than 1/3 of educators nationwide recognize the Horace Mann brand. That growing awareness strengthens customer reinforces long term relationships and positions us to continue serving more customers with more solutions over time. Before I turn the call over to Ryan, I want to briefly reiterate 1 point.

Today's guidance increase is entirely the result of the strong operating performance and disciplined execution we have discussed this morning The progress we have discussed today reinforces our confidence in the strategy we outlined at our Investor Day. We remain focused on delivering our long term financial objectives of a 10% compound annual growth rate in core earnings per share and a sustainable shareholder return on equity of 12% to 13%. Our recently announced acquisitions further strengthen that strategy. Expanding our ability to serve more customers and reinforcing our confidence in achieving those long term financial objectives. Our strategy is delivering results today while positioning Horace Mann for continued success tomorrow.

We are serving more educators and employers solving more customer needs over time, and building stronger long lasting customer relationships. Together, those advantages position us to continue delivering sustained profitable growth and long term value to our shareholders. Thank you. And with that, I will turn the call over to Ryan.

Ryan Edward Greenier: Thanks, Marita. We have had a strong first half of 26. The results we delivered along with our outlook for the remainder of the year support increasing our full year earnings guidance to a range of 4.60 to $4.90 per share. In updating our outlook for the balance of the year, we have also revised several key assumptions that underpin our guidance. Compared to our prior outlook, we have reduced our full year catastrophe loss assumption, lowered our net investment income expectations, and increased our individual supplemental and group benefits blended benefit ratio assumption to reflect the continued strong growth momentum we are seeing across that segment.

Our updated guidance assumes approximately $75 million in catastrophe losses for the full year total net investment income in the range of $465 million to $475 million with managed portfolio income of $365 million to $375 million and individual supplemental and group benefits blended benefit of approximately 42%, and interest expense and other corporate items of $35 million to $40 million As always, our guidance reflects what we believe is a balanced view of the trends that we are seeing across the business and our expectations for the remainder of the year. I will provide additional context across each of those assumptions as I discuss our segment results.

Before turning to the quarterly results, I would like to briefly address the acquisitions we announced in July. The transactions are progressing as planned Our expectations remain unchanged and we have no additional updates to share at this time. The transactions are not reflected in our updated 2026 guidance. As we do not expect a meaningful impact to earnings this year given our expectations for closing dates.

During our announcement call, we referenced a 6- to 7-year tangible book value payback period That metric reflects the standalone economics of the acquired businesses under the standard tangible book value dilution methodology Importantly, the ongoing earnings generation of the combined company is expected to replenish the reduction in book value associated with the transactions within approximately 1 year following closing. This clarification does not change the economics of the transaction. Beginning in 2027, we continue to expect the transactions to be immediately accretive to earnings per share and contribute approximately 100 basis points of return on equity accretion. Now let me turn to the quarterly results and the key drivers of our performance.

In Property and Casualty, core earnings increased 56% year-over-year to $26 million The reported combined ratio improved 7 points to 89.6 reflecting favorable weather lower catastrophe losses favorable prior year reserve development and the continued benefits of disciplined underwriting actions. Favorable prior year reserve development totaled $7 million, including $5 million in property and $2 million in auto, primarily reflecting lower than expected claim severity. Underlying loss trends were generally favorable during the quarter. In auto, frequency trends were favorable, reflecting both the rate and non rate actions we have taken over the past several years as well as broader trends affecting the personal auto industry.

We continue to closely monitor the underlying drivers of those trends, including business mix, geographic exposure, weather patterns, and driving behavior. And our outlook for the remainder of the year reflects what we believe is a balanced view of those underlying trends. As we have discussed in our updated guidance assumptions, we have reduced our full year catastrophe loss expectation from $90 million to $75 million based on our first half experience. At the same time, our outlook for P&C for the remainder of the year continues to reflect a balanced view of underlying loss trends and the normal variability including seasonality we expect over the course of the year.

From a premium standpoint, net written premiums were essentially flat at $212 million. Property premiums increased 6% reflecting higher average premiums with continued positive sales trends. In auto, our approach to growth remains disciplined. We continue to prioritize profitable growth over volume, focusing on markets where we see attractive long term opportunities while maintaining our underwriting standards. Overall, the quarter reflects the continued progress we have made in strengthening the profitability and quality of our P&C portfolio. Those improvements are the result of actions we have taken over the past several years and continue to support our confidence in the long term earnings potential of the business. Turning to Life and Retirement. Core earnings were $17 million.

Life sales increased 20% over the prior year quarter reflecting the continued success of the investments we have made in agent recruiting and productivity. Persistency remains strong at approximately 96%. In Retirement, contract deposits were modestly lower year over year, primarily reflecting product mix and market conditions, while fee income and strong persistency continued to support stable earnings. We continue to view the underlying fundamentals of the Life and Retirement business as strong and the segment remains well positioned to support our long term growth objectives. Turning to individual supplemental and group benefits. The momentum we have seen over the past several quarters continued.

This segment generated another excellent quarter with continued demand across both individual supplemental and group benefits while continuing to produce consistently strong returns. Individual supplemental continued to perform well during the quarter. Sales increased 5% reflecting continued demand for our enhanced cancer product, while persistency remained strong at approximately 89%. Group Benefits also delivered another strong sales quarter. Driven by continued employer demand for our paid family and medical leave enhancement introduced earlier this year. As I mentioned earlier, we have increased our full year blended benefit rate expectation to approximately 42%. That change reflects the continued strong growth of the segment and the increasing contribution of paid family and medical leave to our overall business mix.

As with many newer insurance products, we expect a period of elevated utilization as newly covered employees begin accessing benefits available to them. That first-year experience has been contemplated in our pricing, and long term return expectations from the outset. We also expect seasonality to become more pronounced as paid family and medical leave becomes a larger portion of the group business. Because a significant portion of our covered population consists of educators, utilization is naturally lower during the summer month when many educators are not actively working. Consistent with that expectation, claims activity in July has tracked in line with what we anticipated and supports our confidence in the updated full year benefit ratio assumption.

Importantly, nothing we have seen changes our expectations for the long term profitability of the segment. A blended benefit ratio around 42% remains a very attractive level of profitability for this business. As the business continues to grow, including the addition of the group business we announced in July, we expect business mix to continue to evolve while maintaining attractive long term returns. Turning to investments. Total net investment income increased modestly over the prior year quarter. Within our managed portfolio, higher core fixed income and limited partnership income more than offset lower income from our commercial mortgage loan portfolio.

As we discussed in our updated guidance assumptions, we have lowered our full year net investment income outlook to reflect the mixed impact of today's market environment across our investment portfolio. While elevated interest rates continue to benefit reinvestment yields, in our core fixed income portfolio, they also continue to pressure earnings from certain investment strategies. Our updated outlook reflects those conditions for the remainder of the year. Nothing has changed about our disciplined investment philosophy or the overall quality of the portfolio. Continue to maintain a high quality, well diversified portfolio that is positioned to support stable earnings and attractive long term returns. Turning to capital. Our approach remains disciplined and unchanged.

We continue to maintain a strong balance sheet return excess capital to shareholders and invest in opportunities that support long term profitable growth. During the quarter, we returned $15 million to shareholders through our dividend, and we continue to have approximately $37 million available under our current share repurchase authorization. We will continue to opportunistically buy back shares when market conditions are compelling. That disciplined approach continues to create value for shareholders Tangible book value per share increased 10% year over year, reflecting continued earnings generation and prudent capital management.

Stephen back, today's updated guidance reflects the first half experience we have discussed across each of our businesses while maintaining what we believe is a balanced view of the assumptions underlying the remainder of the year. That updated outlook keeps us on track to achieve the long term financial objectives we established at Investor Day. A 10% compound annual growth rate in core earnings per share and a sustainable 12% to 13% shareholder return on equity. Thank you. Operator, we are ready for questions.

Operator: Thank you. And we will now begin the Q&A session. Our first question today will come from Wilma Jackson Burdis with Raymond James. Please go ahead.

Wilma Jackson Burdis: Hey. Good morning. Can you talk about the pricing structure of Horace Mann's paid family and medical leave business and how often there are opportunities to reprice? Thanks.

Ryan Edward Greenier: Good morning, Wilma. This is Ryan. With the paid family medical leave business, when I think about the economic profile of that compared to the rest of our group offerings, The benefit ratio is higher, but that is offset by a meaningful lower expense ratio. So net, the geography, if you will, of the profitability by line is a little bit different than the short term, long term disability and term life offerings. You know, we do have an opportunity to reprice that annually, and I will say that the heavier utilization in the first half of the year was in line with our expectations and pricing assumptions.

Marita Zuraitis: And I think it is also important to point out, as Ryan said in his scripted remarks, that July coming in a little bit lower certainly is also in line with our expectations. So this is performing, you know, the way we had expected it to perform and in line with how we built our pricing and underwriting assumptions. I think it is also important to point out that this is not a stand alone coverage. it is sold as part of our short term disability product, and that is an important thing to point out where you are combining the economics of those pieces.

And there is nothing dissimilar here than what you are hearing from others in this business as we all respond to the mandatory PFML offerings of states like Minnesota and others to come. So I think we have done a really good job thinking about this. Combining it with a very solid, profitable, long-term, you know, approach here of a high-margin business, and we feel good about where we are with this portion of that short term disability offering.

Wilma Jackson Burdis: Okay. Thank you. And then can you talk about what increased the fixed annuity spread in the quarter? How the outlook is shaping up there? And then I guess on the other side of this question, what drove the factors of the decrease in the NII guidance Is there any specific asset classes that you can give us a little bit more color on there? Thanks.

Ryan Edward Greenier: Sure. Wilma, I will start and Marita can add any additional color. The biggest driver of variability in the fixed annuity spread number is limited partnership earnings. As well as commercial mortgage loan earnings. In the rebound this quarter, we had a particularly strong limited partnership quarter in our life and retirement segment. We had a number of venture capital investments that had very strong returns. And we saw that come through. So variability, if you will, in the fixed annuity the improvement, a large portion of it was related to limited partnerships.

But stepping back and thinking about net investment income, in the portfolio more broadly, you know, the change to guidance was primarily due to expectations for certain alternative strategies that are more sensitive to a higher for longer interest rate environment. You have heard from other life carriers, we are seeing lower but positive returns on some strategies. For us, private equity, infrastructure debt, real estate related strategies. And for those, we have incorporated lower but positive anticipated returns for the remainder of the year. But if you look at the portfolio in total, the interest rate environment that we are in today is quite constructive.

Our new money fixed our new money yields for the core fixed income portfolio were 5.85% for the quarter that is more than 100 basis points above the portfolio yield for that slice of our total portfolio. And that is the workhorse, that is the bulk of our assets. This is the eighteenth quarter in a row where we have seen new money yield exceeding what is in the portfolio. So I am optimistic for continued growth in net investment income as I look forward. But we wanted to calibrate our expectations within the guidance assumptions a little more closely for you.

Marita Zuraitis: I think you said that well. I do not have much to add other than the fact that it is a good NII story. And this is the way the math works out for the remainder of the year. So as we looked at our guidance in total, we wanted to factor those thoughts into that. Thank you.

Wilma Jackson Burdis: And if I can squeeze 1 more in. Congrats on the deal with Medical Mutual of Ohio. Just to kind of, I guess, take it to a higher level, we calculated, I think, something along the lines of high single digit EPS accretion there. Does that seem like it is in the ballpark? Is there anything we are missing, plus or minuses? And maybe just kind of talk about how you see that playing out. With EPS over the coming quarters? Thanks.

Ryan Edward Greenier: Sure, Wilma. You know, when I think about what that transaction does to for us, on a annual run rate basis, I think something in the neighborhood of 40 to 50¢ you know, overall. And that is really 2027. Go forward. The timing of the closes of the transactions the first 1, the employer services business, that is the EAP business. it is a recurring fee type business, quite attractive from an ROE and earnings perspective. But that closes in the fourth quarter. So we will pick up 1 quarter of earnings but we need to pay for the full amount of the transaction, that is 115 million at close.

So the foregone investment income interest expense, you know, that offsets the earnings you know, for that 1 quarter in 2026. I think you are thinking about it, you know, in the right way, and I hope that more granular specific guidance gives you a sense, you know, of how we have modeled it.

Marita Zuraitis: Although you asked about the math, I would be remiss not to again, reiterate the fact that this broadens our solutions platform you know, especially when we think about that EA business. When we survey educators, we learn that their number 1 concern, both for the individual educator, as well as the school districts that employ them, that mental health and the stress created by the world around us is their number 1 concern, and this helps us bring that solution to school districts and the individual educators we serve as web as well as the broader employer population.

It scales our distribution and brings us more points of distribution outlets and it expands our customer reach and brings us customers that are not yet Horace Mann customers. So first and foremost, we are excited about the strategic lift But as Ryan says, I think the economics speak for themselves.

Wilma Jackson Burdis: Thank you very much. Congrats on a great quarter. Thank you, Elyse.

Operator: Our next question will come from Michael David Zaremski with BMO. Please go ahead.

Michael David Zaremski: Hey, good morning. Nice quarter. On just capital, should we be just turning off the buybacks in the meantime? I am assuming there was a period you could not buy back with the M&A taking place this past quarter. But should we be turning that off in order to kind of pro forma provide leverage cushion for when you do spend money? Or is there any just kind of more direct guidance you want to-- you are going to give on that?

Marita Zuraitis: Yes, thanks for the question. I will start. And then I can turn it over to Ryan on the specifics of what you are asking. I think it is important to point out that our first priority remains maintaining a strong balance sheet, and financial flexibility. And as we continue to advance our profitable growth strategy, those things are important. And I think you saw with the recently announced acquisitions, the ability to do that. So that is our primary objective.

Ryan Edward Greenier: And, Mike, you know, when I think about buyback is a really important lever for us to return capital to shareholders. Our businesses produce they are quite efficient from a free cash flow perspective, and we have a 75% target free cash flow conversion. And the acquisitions we did or will close on as well as the growth in the more capital efficient businesses like individual supplemental and group that will meaningfully enhance and grow that free cash flow conversion over time. And so what that does for us is it puts us in good position, a position where we need to think about ways to return capital to shareholders.

So I would not think of buyback as being an on or off switch. I think of it as being opportunistic. So we will weigh it against other uses for the capital internally as well as market conditions. So we have got $37 million left on our authorization. You saw us be quite active in the first quarter. With buyback. So, you know, we will have to see what the market looks like. And with strong performance, obviously, increased flexibility for all of the components of our capital management strategy.

Michael David Zaremski: Okay. I think even though you are not giving a specific guidance, it is fairly clear. Okay. Maybe switching gears to property and casualty. Clearly excellent results continue on a profitability standpoint. I know there is still more work to do on organic policy growth. But I think you called out weather being a benefit So obviously, not going to run rate that. But the core loss ratio and especially PYD continues to be healthy. Any changes in loss trend views on either home auto or both? It seems like for the industry, trend appears to be just better than expected. Any color there?

Marita Zuraitis: Ryan can give you loss trends specifics. But I am gonna sound a little bit like a broken record here. You mentioned organic growth in there. I do not necessarily look at organic growth as soft and more work to be done. I am going to sound like a broken record, but our strategy is not a mono auto strategy. When I look at our household growth and our household growth strategy that we laid out in Investor Day, we are growing households. In our script, we talked about a 10% increase in online quoting. We talked about increase in agents and our points of distribution.

And sometimes the new households that we bring in start with auto, but sometimes they start with 403 or they start with an individual supplemental policy. But specifically to auto, auto remains a meaningful part of our acquisition strategy. there is no doubt about that. And we are growing, new business in targeted places where we can achieve our targeted combined ratio. And where we see the ability to do that well. Our ex California auto continues to grow. Our auto retention efforts are helping us keep existing business in a highly competitive market. So I feel like our strategy is working. And we are seeing solid steady retention across all of our product lines.

I think it is important to note that the auto rate of decline continues to improve, quarter over quarter. But we are not going to chase auto growth and sacrifice our disciplined approach to strong and steady earnings. And I feel like when you see these numbers and you digest these numbers quarter over quarter, you are gonna understand what we are doing. And then lastly to that, when you think about HMGA and our Horace Mann general agency, remember, that when we do not feel we can produce that new business auto policy at a long term profit, we can take a fee and place it with a third party carrier and not manufacture that auto.

But when it makes sense for us to do that, we certainly can put that on our paper. And I think the strategy, you know, is working when you see these kinds of results.

Operator: And I will take the loss trend component of your question.

Ryan Edward Greenier: I mean, first half for auto was particularly favorable weather as well as other factors, we believe, is driving the low single digit frequency trends that we are seeing In addition to that, we are seeing favorable severity on physical damage coverages. Our liability loss trend is in the mid-single-digit. And so when I put it all together, you know, our rate plan for 2026 of a mid single digit rate plan, you know, is on track to maintain the profitability on a go forward basis. it is stable. it is in line with our targets.

And when I think about second half of the year, you know, we have not seen weather so favorable like we did in the first half. So I would expect comp losses to normalize and, you know, we would not expect and did not plan for the favorable weather trend to continue.

Michael David Zaremski: that is very helpful. that is helpful answer. Thank you. You are welcome.

Operator: And this will conclude our Q&A session. I would like to turn the conference back over to Rachel Luber for any closing remarks.

Rachael Luber: Thank you for joining us today. We appreciate your continued interest in Horace Mann and look forward to updating you on our progress next quarter. Have a great day.

Operator: The conference has now concluded. Thank you for attending today's presentation. You may now disconnect your lines at this time.