A Message
to Our Shareholders
Deep and rewarding client partnerships, a relentless commitment to innovation, and our strong culture form the foundation of Assurant’s continued success.
Keith Demmings, President and CEO, Assurant, Inc.
Thriving in a Connected World
In 2022, we articulated a refreshed vision for the future that serves as a roadmap for success: To be the leading global business services company supporting the advancement of the connected world. This vision is the product of our multiyear transformation and will drive shareholder value.
I appreciate the history of this great organization, and I feel privileged to lead our more than 13,000 employees around the world as we continue taking the company forward. This year, we delivered our sixth consecutive year of profitable operating growth4 and took actions to strengthen the company for the long term. We continued to grow and deepen our partnerships with key clients, delivered new and innovative solutions, and enhanced our culture — The Assurant Way — all while navigating more volatile market conditions. I am exceptionally proud of and grateful to our employees around the world for their ongoing dedication to serving our clients, customers, and each other. We also continued to make progress on integrating our sustainability efforts with our long-term strategy, global business operations, and our product and service offerings to build a more sustainable company for all our stakeholders. We continue to believe we have a compelling strategy, strong fundamentals, and momentum with clients across the world.
Adjusted EBITDA1
excluding reportable catastrophes
(in millions)
Adjusted EPS1
excluding reportable catastrophes
Total Revenue
(in billions)
Managing Headwinds to Deliver Profitable Operating Growth
In 2022, our portfolio of Lifestyle and Housing businesses proved resilient, but not immune, to macroeconomic headwinds. We grew adjusted earnings per diluted share 11 percent and delivered $1.1 billion of adjusted EBITDA, both excluding reportable catastrophes1. Excluding $27 million of unfavorable foreign exchange, adjusted EBITDA, excluding reportable catastrophes, grew 3 percent,1 demonstrating the underlying strength of our business. Broadly across Assurant, we accelerated several initiatives to realize greater efficiencies to position us for continued long-term growth. This included realigning our organizational structure, including in Global Housing, to better deploy talent to support the diverse needs of our businesses. We also accelerated our ongoing real estate consolidation strategy to support work-from-home arrangements, given our increasingly hybrid workforce.
We maintained a strong balance sheet as we navigated ongoing macroeconomic uncertainty. In 2022, our businesses contributed a total of $550 million in dividends to the holding company, representing approximately 52 percent of segment earnings. We returned a total of $718 million in share repurchases and common stock dividends, including the balance of net proceeds from the sale of Global Preneed in 2021.
Throughout the year, we gained momentum in both Global Lifestyle and Global Housing, winning new clients and renewing existing clients in each of our major lines of business. In Global Lifestyle, adjusted EBITDA increased 7 percent. Driven by growth in both Connected Living and Global Automotive, we grew 11 percent on a constant currency basis.1
In Connected Living, we grew adjusted EBITDA by 15 percent on a constant currency basis,1 driven by mobile protection program growth in North America. Our ability to continuously innovate our products and services has supported a strong and more differentiated customer experience, resulting in increased net promoter scores. In Global Automotive, we grew adjusted EBITDA by 5 percent, driven by the strength of our client relationships and our well-diversified business model.
In Global Housing, we took swift action to mitigate the impact of high inflation within our lender-placed business. We began to see improved performance as we exited the year, reflecting the accelerated rate increases implemented in the third quarter.
We also continued to reduce our environmental impact as a core pillar of our ESG strategy. Building on our progress to date, in December, we announced our goal to reduce greenhouse gas (GHG) emissions by 40 percent by 2030. This target aligns with the Paris Agreement and ensures we drive meaningful reductions.
As I reflect on our performance in 2022 and our priorities for 2023, what drives our resilience and allows us to deliver sustainable financial performance are our clients, capabilities, and culture and talent.
Anticipating Needs and Delivering for Clients
Each day, our focus is to serve our clients and their customers. Our purpose — to help people thrive in a connected world — is fulfilled through the products and services we deliver on behalf of our clients to 300 million of their customers. We protect and enhance the brands of the world’s leading consumer companies, currently serving 15 of the top 50 most valuable global brands.5
For many clients, we operate as an extension of their team — delivering direct customer support and leveraging embedded systems to share and track data in real time. We have the scale and proven track record to win and retain large clients. In Connected Living, in addition to key partner renewals, including T-Mobile, we secured new business opportunities and new client partnerships, continuing to diversify our broad client base. We added several new trade-in clients and now have more than 40 trade-in programs globally. In 2022, we renewed multiple lender-placed clients with multiyear agreements, and we have partnerships longer than 20 years with some of our top clients, showcasing our commitment to customer experience. In Multifamily Housing, we signed several new partnerships, including two top property management companies with 100,000 combined units, and successfully completed multiyear renewals for various key client relationships.
Developing Capabilities that Enhance Customer Experience
While the role we play with clients is simple to articulate, delivering is complex — and should be. We are relentless in how we seek out and find the best ways to develop and deliver solutions for our clients and customers. We are uniquely positioned relative to our competitors due to the specialized nature of our solutions and our broad set of capabilities, which take years to tailor and perfect.
For example, we operate a comprehensive set of repair capabilities and trade-in services that complement our mobile protection business; we have an entire field force dedicated to helping our auto clients drive their Financing & Insurance performance and optimize results; and we track insurance for more than 50 percent of all U.S. mortgages.6
Today, our portfolio of businesses are market leaders — with strong market positions in each of our verticals. But my aspirations as CEO are bolder: over time, I expect Assurant to be the leading provider in every one of our businesses. We have continued to simplify our portfolio — focusing on the best opportunities and investing in key businesses where we have a clear path to win.
Refreshing our Culture to Galvanize Our People
As we drive the company forward, we are leveraging the power of our people and our collective commitment as a purpose-driven organization to build a more sustainable business. In 2022, we redefined the tenets of our culture to drive further alignment with our company purpose and business strategy, including our steadfast commitment to being a socially responsible company in delivering for all our stakeholders. This included increased focus on the critical role our talent plays in our culture and our success.
Looking ahead, we remain optimistic and focused on driving Assurant to be a leader in business services as we pursue profitable growth in more fee-based, capital-light businesses, which account for the majority of our earnings. In addition, we will continue to optimize results and cash flow generation in our risk-based business. In 2023, we believe we can drive growth — albeit at a more moderate pace, given some of the near-term deceleration expected in the broader economy that will have some impact on our businesses.
In the following pages, you can learn more about the clients we serve, the capabilities we deliver, and the culture and talent that makes it all come to life. Of course, none of this would be possible without your investment and partnership, and for that I am deeply grateful. I am optimistic about the future and look forward to our continued success.
Keith Demmings
Footnotes:
1 These measures are non-GAAP financial measures. See Non-GAAP Financial Measures for more information on these non-GAAP financial measures and a reconciliation of such measures to their most directly comparable GAAP measure.
4 Based on adjusted earnings per diluted share and adjusted EBITDA, both excluding reportable catastrophes, which are non-GAAP financial measures. See Non-GAAP Financial Measures for more information on these non-GAAP financial measures and a reconciliation of such measures to their most directly comparable GAAP measure.
5 Source: World© 100 Most Valuable Brands in 2022 by Visual Capitalist.
6 According to Black Knight January 2023 Mortgage Monitor, there are 52.5 million active loans in the U.S, and Assurant tracks 31 million.
