Fitch rates Horace Mann debt BBB+

Fitch Ratings said it assigned a BBB+ rating to Horace Mann Educators Corp.'s recently announced $75 million senior debt due 2015. The outlook remains negative.

Horace Mann expects to use $28.6 million of the proceeds to redeem its 6.625% senior notes due 2006 and $25 million to repay its bank credit facility, the agency said.

Included in the outlook are the senior convertible debt due 2032, senior 6 5/8% notes due 2006 and the senior 6.05% notes due 2015, all at BBB+, the agency said.

The rating reflects heightened comfort with the company's reserve adequacy and solid risk-based capitalization, high quality, liquid investment portfolios and well defined niche in the educators market, Fitch said.

Additionally, the ratings reflect Horace Mann's conservative capital structure with a debt-to-capital ratio less than 30% and strong run-rate operating earnings-based interest coverage, the agency said.

Fitch said the outlook is based on continued concerns about the company's ability to generate run-rate underwriting profitability supportive of its current ratings and on concerns about Horace Mann's comparatively high operating leverage and risk management capabilities.

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