A.M. Best Co. has assigned indicative ratings of “bbb” on senior debt, “bbb-” on subordinated debt and “bb+” on the preferred stock of Horace Mann Educators Corporation (HMEC) [NYSE: HMN] (Delaware). The outlook assigned to these ratings is stable. The new shelf registration replaces HMEC’s previous shelf registration, which has expired. Consequently, the indicative ratings for the previous shelf registration have been withdrawn. The rating assignments recognize Horace Mann Property & Casualty’s strong overall capitalization, moderate operating earnings and continued expertise in writing personal lines products in the educators’ market, which has enabled the group to obtain numerous endorsements from local, state and national educational associations. The rating assignments also recognize Horace Mann Life’s important role within HMEC and the benefits it derives from HMEC’s strong business franchise in the K-12 educators’ market. Furthermore, the ratings reflect Horace Mann Life’s strong risk-adjusted capital position and considerable improvement in its operating results in recent years due to strong annuity sales and improving yields in its investment portfolio. As of September 30, 2011, HMEC’s unadjusted debt-to-capital and debt-to-tangible capital ratios were 18.4% and 19.1%, respectively, well within the guidelines for the ratings. While HMEC’s interest coverage declined from historical levels through the third quarter of 2011, largely due to a significant increase in catastrophe and weather-related losses, historical interest coverage has been very strong and well supportive of the ratings. The methodology used in determining these ratings is Best’s Credit Rating Methodology, which provides a comprehensive explanation of A.M. Best’s rating process and contains the different rating criteria employed in the rating process. Key criteria utilized include: “A.M. Best's Ratings & the Treatment of Debt” and “Risk Management and the Rating Process for Insurance Companies.” Best’s Credit Rating Methodology can be found at www.ambest.com/ratings/methodology. Founded in 1899, A.M. Best Company is the world’s oldest and most authoritative insurance rating and information source. For more information, visit www.ambest.com. Copyright © 2012 by A.M. Best Company, Inc. ALL RIGHTS RESERVED.