Edgar Filing: ASSURANT INC

Form 10-Q for the period ended September 30, 2007

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C. 20549

FORM 10-Q

x	Quarterly Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the quarterly period ended September 30, 2007

¨	Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934

For the transition period from to

Assurant, Inc.

(Exact name of registrant as specified in its charter)

Delaware

001-31978

39-1126612

(State or other jurisdiction

of incorporation)

(Commission File Number)

(I.R.S. Employer

Identification No.)

One Chase Manhattan Plaza, 41st Floor

New York, New York 10005

(212) 859-7000

(Address, including zip code, and telephone number, including

area code, of Registrant’s Principal Executive Offices)

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days. YES x NO ¨

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, or a non-accelerated filer. See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act.

Large accelerated filer x Accelerated filer ¨ Non-accelerated filer ¨

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act). YES ¨ NO x

The number of shares of the registrant’s Common Stock outstanding at November 1, 2007 was 117,909,170.

ASSURANT, INC.

QUARTERLY REPORT ON FORM 10-Q

FOR THE QUARTERLY PERIOD ENDED SEPTEMBER 30, 2007

TABLE OF CONTENTS


Item Number		Page Number
	PART I FINANCIAL INFORMATION
1.	Financial Statements of Assurant, Inc. and Subsidiaries
	Consolidated Balance Sheets at September 30, 2007 (unaudited) and December 31, 2006	2
	Consolidated Statement of Operations (unaudited) for the three and nine months ended September 30, 2007 and 2006	4
	Consolidated Statement of Changes in Stockholders’ Equity (unaudited) from December 31, 2006 through September 30, 2007	5
	Consolidated Statement of Cash Flows (unaudited) for the nine months ended September 30, 2007 and 2006	6
	Notes to Consolidated Financial Statements (unaudited)	7

2.	Management’s Discussion and Analysis of Financial Condition and Results of Operations	22

3.	Quantitative and Qualitative Disclosures About Market Risk	41

4.	Controls and Procedures	41

	PART II OTHER INFORMATION

1.	Legal Proceedings	42

1A.	Risk Factors	42

2.	Unregistered Sale of Equity Securities and Use of Proceeds	43

6.	Exhibits	43

	Signatures	44

Assurant, Inc. and Subsidiaries

Consolidated Balance Sheets

At September 30, 2007 (unaudited) and December 31, 2006


	September 30, 2007		December 31, 2006
	(in thousands except per share and share amounts)
Assets
Investments:
Fixed maturities available for sale, at fair value (amortized cost - $ 9,873,677 in 2007 and $8,934,017 in 2006)	$	9,891,107	$	9,118,049
Equity securities available for sale, at fair value (cost - $ 735,797 in 2007 and $735,566 in 2006)		707,204		741,639
Commercial mortgage loans on real estate, at amortized cost		1,407,742		1,266,158
Policy loans		57,747		58,733
Short-term investments		319,475		314,114
Collateral held under securities lending		654,860		365,958
Other investments		546,731		564,494

Total investments		13,584,866		12,429,145
Cash and cash equivalents		815,147		987,672
Premiums and accounts receivable, net		584,688		612,011
Reinsurance recoverables		3,920,626		3,914,972
Accrued investment income		159,258		137,803
Deferred acquisition costs		2,746,099		2,397,906
Property and equipment, at cost less accumulated depreciation		276,960		275,201
Goodwill		801,709		790,519
Value of business acquired		134,481		134,437
Other assets		239,329		186,939
Assets held in separate accounts		3,305,217		3,298,543

Total assets	$	26,568,380	$	25,165,148

See the accompanying notes to the consolidated financial statements

Assurant, Inc. and Subsidiaries

Consolidated Balance Sheets

At September 30, 2007 (unaudited) and December 31, 2006


	September 30, 2007			December 31, 2006
	(in thousands except per share and share amounts)
Liabilities
Future policy benefits and expenses	$	7,164,149		$	6,766,343
Unearned premiums		5,142,208			4,429,893
Claims and benefits payable		3,418,070			3,412,166
Commissions payable		261,143			304,640
Reinsurance balances payable		77,271			84,891
Funds held under reinsurance		50,939			49,980
Deferred gain on disposal of businesses		225,018			249,911
Obligations under securities lending		654,860			365,958
Accounts payable and other liabilities		1,288,572			1,282,903
Deferred income taxes, net		37,034			57,157
Income taxes payable		27,843			36,232
Debt		971,831			971,774
Mandatorily redeemable preferred stock		21,160			22,160
Liabilities related to separate accounts		3,305,217			3,298,543

Total liabilities	$	22,645,315		$	21,332,551

Commitments and contingencies (Note 11)

Stockholders’ equity
Common stock, par value $0.01 per share, 800,000,000 shares authorized, 143,882,171 and 143,080,961 shares issued, 117,689,194 and 122,618,317 shares outstanding at September 30, 2007 and December 31, 2006, respectively	$	1,437		$	1,430
Additional paid-in capital		2,902,187			2,894,892
Retained earnings		2,162,450			1,676,171
Accumulated other comprehensive (loss)/income		(2,486	)		88,064
Treasury stock, at cost; 25,997,943 and 20,308,610 shares at September 30, 2007 and December 31, 2006, respectively		(1,140,523	)		(827,960	)

Total stockholders’ equity		3,923,065			3,832,597

Total liabilities and stockholders’ equity	$	26,568,380		$	25,165,148

See the accompanying notes to the consolidated financial statements

Assurant, Inc. and Subsidiaries

Consolidated Statement of Operations (unaudited)

Three and Nine Months Ended September 30, 2007 and 2006


	Three Months Ended September 30,						Nine Months Ended September 30,
	2007			2006			2007			2006
	(in thousands except number of shares and per share amounts)
Revenues
Net earned premiums and other considerations	$	1,893,388		$	1,717,640		$	5,451,584		$	5,075,615
Net investment income		194,049			180,672			601,247			553,672
Net realized (losses) on investments		(13,076	)		(2,675	)		(10,592	)		(4,855	)
Amortization of deferred gain on disposal of businesses		8,298			9,428			24,893			28,283
Fees and other income		65,533			79,014			203,050			210,236

Total revenues		2,148,192			1,984,079			6,270,182			5,862,951

Benefits, losses and expenses
Policyholder benefits		936,286			888,317			2,729,816			2,652,200
Amortization of deferred acquisition costs and value of business acquired		359,756			298,372			1,034,515			868,536
Underwriting, general and administrative expenses		552,717			551,042			1,645,833			1,590,718
Interest expense		15,288			15,307			45,881			45,937

Total benefits, losses and expenses		1,864,047			1,753,038			5,456,045			5,157,391

Income before provision for income taxes and cumulative effect of change in accounting principle		284,145			231,041			814,137			705,560
Provision for income taxes		96,954			79,738			281,209			242,196

Net income before cumulative effect of change in accounting principle		187,191			151,303			532,928			463,364
Cumulative effect of change in accounting principle		—			—			—			1,547

Net income	$	187,191		$	151,303		$	532,928		$	464,911

Earnings per common share:

Basic
Net income before cumulative effect of change in accounting principle	$	1.58		$	1.20		$	4.43		$	3.62
Cumulative effect of change in accounting principle		—			—			—			0.01

Net income	$	1.58		$	1.20		$	4.43		$	3.63

Diluted
Net income before cumulative effect of change in accounting principle	$	1.56		$	1.18		$	4.37		$	3.57
Cumulative effect of change in accounting principle		—			—			—			0.01

Net income	$	1.56		$	1.18		$	4.37		$	3.58

Dividends per share	$	0.12		$	0.10		$	0.34		$	0.28

Share Data:
Weighted average shares outstanding used in basic per share calculations		118,447,175			125,793,731			120,404,471			128,078,026
Plus: Dilutive securities		1,294,259			1,972,318			1,657,540			1,799,587

Weighted average shares used in diluted per share calculations		119,741,434			127,766,049			122,062,011			129,877,613

See the accompanying notes to the consolidated financial statements

Assurant, Inc. and Subsidiaries

Consolidated Statement of Changes in Stockholders’ Equity (unaudited)

From December 31, 2006 through September 30, 2007


	Common Stock		Additional Paid-in Capital			Retained Earnings			Accumulated Other Comprehensive Income (Loss)			Treasury Stock			Total			Shares of Common Stock Issued
	(in thousands except number of shares)
Balance, December 31, 2006	$	1,430	$	2,894,892		$	1,676,171		$	88,064		$	(827,960	)	$	3,832,597		143,080,961
Stock plan exercises		7		(14,817	)		—			—			—			(14,810	)	801,210
Stock plan compensation expense		—		14,641			—			—			—			14,641		—
Tax benefit of exercise of stock options		—		7,471			—			—			—			7,471		—
Dividends		—		—			(40,877	)		—			—			(40,877	)	—
Acquisition of treasury shares		—		—			—			—			(312,563	)		(312,563	)	—
Cumulative effect of change in accounting principles (Note 2)		—		—			(5,772	)		—			—			(5,772	)	—
Comprehensive income:
Net income		—		—			532,928			—			—			532,928		—
Other comprehensive income:
Net change in unrealized (losses) on securities, net of taxes		—		—			—			(131,257	)		—			(131,257	)	—
Net change in foreign currency translation, net of taxes		—		—			—			33,626			—			33,626		—
Amortization of pension and postretirement																—
unrecognized net periodic benefit (cost), net of taxes		—		—			—			7,081			—			7,081

Total other comprehensive loss																(90,550	)	—

Total comprehensive income:																442,378		—

Balance, September 30, 2007	$	1,437	$	2,902,187		$	2,162,450		$	(2,486	)	$	(1,140,523	)	$	3,923,065		143,882,171

See the accompanying notes to the consolidated financial statements

Assurant, Inc. and Subsidiaries

Consolidated Statement of Cash Flows (unaudited)

Nine Months Ended September 30, 2007 and 2006


	Nine Months Ended September 30,
	2007			2006
	(in thousands)
Net cash provided by operating activities	$	836,839		$	611,537

Investing activities
Sales of:
Fixed maturities available for sale		1,484,451			1,355,305
Equity securities available for sale		224,181			199,382
Property, equipment and other		1,251			1,391
Maturities, prepayments, and scheduled redemption of:
Fixed maturities available for sale		483,301			455,955
Purchases of:
Fixed maturities available for sale		(2,392,169	)		(2,366,848	)
Equity securities available for sale		(211,433	)		(227,730	)
Property and equipment		(39,753	)		(32,806	)
Subsidiaries, net of cash (paid) received		(102,237	)		47,514
Change in commercial mortgage loans on real estate		(138,293	)		(48,260	)
Change in short term investments		4,308			156,837
Change in other invested assets		17,854			(18,242	)
Change in policy loans		1,280			2,532
Change in collateral held under securities lending		(288,902	)		(51,945	)

Net cash (used in) investing activities		(956,161	)		(526,915	)

Financing activities
Repayment of mandatorily redeemable preferred stock		(1,000	)		(1,000	)
Excess tax benefits from stock-based payment arrangements		7,471			877
Acquisition of treasury stock		(315,570	)		(318,465	)
Dividends paid		(40,877	)		(35,837	)
Change in obligation under securities lending		288,902			51,945
Commercial paper issued		39,958			59,941
Commercial paper repaid		(40,000	)		(60,000	)

Net cash (used in) financing activities		(61,116	)		(302,539	)

Effect of exchange rate changes on cash and cash equivalents		7,913			9,485

Change in cash and cash equivalents		(172,525	)		(208,432	)
Cash and cash equivalents at beginning of period		987,672			855,569

Cash and cash equivalents at end of period	$	815,147		$	647,137

See the accompanying notes to the consolidated financial statements

Assurant, Inc. and Subsidiaries

Notes to Consolidated Financial Statements (unaudited)

(in thousands, except per share and share amounts)

1. Nature of Operations

Assurant, Inc. (formerly, Fortis, Inc.) (the “Company”) is a holding company whose subsidiaries provide specialized insurance products and related services in North America and selected international markets. Prior to the Initial Public Offering (the “IPO”) on February 5, 2004, Fortis, Inc. was incorporated in Nevada and was indirectly wholly owned by Fortis N.V. of the Netherlands and Fortis SA/NV of Belgium (collectively, “Fortis”) through their affiliates, including their wholly owned subsidiary, Fortis Insurance N.V.

In connection with the IPO, Fortis, Inc. was merged into Assurant, Inc., a Delaware corporation, which was formed solely for the purpose of the redomestication of Fortis, Inc. After the merger, Assurant, Inc. became the successor to the business, operations and obligations of Fortis, Inc. Assurant, Inc. is traded on the New York Stock Exchange under the symbol AIZ.

Through its operating subsidiaries, the Company provides creditor-placed homeowners insurance, manufactured housing homeowners insurance, debt protection administration, credit insurance, warranties and extended service contracts, individual health and small employer group health insurance, group dental insurance, group disability insurance, group life insurance and pre-funded funeral insurance.

2. Basis of Presentation

The accompanying unaudited interim consolidated financial statements have been prepared in accordance with accounting principles generally accepted in the United States of America (“GAAP”) for interim financial information. Accordingly, these statements do not include all of the information and footnotes required by generally accepted accounting principles for complete financial statements.

In the opinion of management, all adjustments (consisting of a normal recurring nature) considered necessary for a fair statement of the financial statements have been included. Certain prior period amounts have been reclassified to conform to the 2007 presentation.

The Company recorded an after-tax cumulative effect of change in accounting principles of $(4,264) and $(1,508) on January 1, 2007. The charge of $(4,264) related to the adoption of AICPA Statement of Position 05-1, Accounting by Insurance Enterprises for Deferred Acquisition Costs in Connection With Modification or Exchange of Insurance Contracts, (“SOP 05-1”) and the charge of $(1,508) related to the adoption of FASB Interpretation No. 48, Accounting for Uncertainty in Income Taxes – an interpretation of FASB Statement No. 109 (“FIN 48”) (Note 4) are reflected in the statement of changes in stockholder’s equity as required. The Company also recorded an after-tax cumulative effect of change in accounting principle of $1,547 on January 1, 2006 related to the adoption of Statement of Financial Accounting Standards (“FAS”) No. 123 (revised 2004), Share Based Payment (“FAS 123R”) which is reflected in the statement of operations.

The consolidated financial statements include the accounts of the Company and all of its wholly owned subsidiaries. All inter-company transactions and balances are eliminated in consolidation.

Operating results for the three and nine months ended September 30, 2007 are not necessarily indicative of the results that may be expected for the year ending December 31, 2007. The accompanying unaudited interim consolidated financial statements should be read in conjunction with the audited consolidated financial statements and related notes included in the Company’s Annual Report on Form 10-K for the year ended December 31, 2006.

Assurant, Inc. and Subsidiaries

Notes to Consolidated Financial Statements (unaudited)

(in thousands, except per share and share amounts)

3. Acquisitions

During the third quarter of 2007, the Company made several acquisitions for approximately $117,000 with available cash. The major transactions are:

On July 12, 2007, the Company acquired 100% of the outstanding stock of Swansure Group (“Swansure”), a privately held company in the United Kingdom. Swansure owns D&D Homecare Limited and Adminicle Limited. D&D Homecare designs and distributes general insurance products, including mortgage payment protection and buildings and contents insurance. Adminicle provides a range of insurance administration and outsourcing services, including premium processing and disbursement, policy fulfillment, claims and data processing, and performance reporting.

On July 1, 2007, the Company acquired 100% of the outstanding stock of Mayflower National Life Insurance Company (“Mayflower”). Mayflower is a leading provider of pre-funded funeral (“Preneed”) insurance products and services.

4. Recent Accounting Pronouncements

Recent Accounting Pronouncements Adopted

On January 1, 2007, the Company adopted SOP 05-1. SOP 05-1 provides guidance on internal replacements of insurance and investment contracts. An internal replacement is a modification in product benefits, features, rights or coverages that occurs by the exchange of a contract for a new contract or by amendment, endorsement, or rider to a contract, or by the election of a feature or coverage within a contract. Modifications that result in a new contract that is substantially different from the replaced contract are accounted for as an extinguishment of the replaced contract, and the associated unamortized Deferred Acquisition Cost (“DAC”), unearned revenue liabilities and deferred sales inducements from the replaced contract must be reported as an expense immediately. Modifications resulting in a new contract that is substantially the same as the replaced contract are accounted for as a continuation of the replaced contract. Prior to the adoption of the SOP 05-1, certain internal replacements that did not meet the new criteria were accounted for as continuations of the replaced contract. Therefore, the accounting policy for certain internal replacements has changed as a result of the adoption of SOP 05-1. At adoption, the Company recognized a $4,264 decrease to deferred acquisition costs, and a corresponding decrease to retained earnings.

On January 1, 2007, the Company adopted FAS No. 155, Accounting for Certain Hybrid Financial Instruments—an amendment of FASB Statements No. 133 (“FAS 133”) and 140 (“FAS 155”). FAS 155 resolves issues addressed in FAS 133 Implementation Issue No. D1, Application of Statement 133 to Beneficial Interest in Securitized Financial Assets. FAS 155 (a) permits fair value remeasurement for any hybrid financial instrument that contains an embedded derivative that otherwise would require bifurcation; (b) clarifies which interest-only strips and principal-only strips are not subject to the requirements of FAS 133; (c) establishes a requirement to evaluate beneficial interests in securitized financial assets to identify interests that are freestanding derivatives or that are hybrid financial instruments that contain an embedded derivative requiring bifurcation; (d) clarifies that concentrations of credit risk in the form of subordination are not embedded derivatives; and (e) eliminates restrictions on a qualifying special-purpose entity’s ability to hold passive derivative financial instruments that pertain to beneficial interests that are or contain a derivative financial instrument. FAS 155 also requires presentation within the consolidated financial statements that identifies those hybrid financial instruments for which the fair value election has been applied and information on the income statement impact of the changes in fair value of those instruments. The adoption of FAS 155 did not have a material impact on the Company’s financial position or results of operations.

On January 1, 2007, the Company adopted FIN 48. As a result of the adoption, the Company recognized a $1,508 increase to the liability for unrecognized tax benefits, which, as required, was accounted for as a reduction to the January 1, 2007 balance of retained earnings. At adoption, total unrecognized tax benefits are $33,339. Of the total unrecognized tax benefits, $11,998, if recognized,

Assurant, Inc. and Subsidiaries

Notes to Consolidated Financial Statements (unaudited)

(in thousands, except per share and share amounts)

would impact the Company’s consolidated effective tax rate. The Company, or one of its subsidiaries, files income tax returns in the U.S. and various state and foreign jurisdictions. The Company has substantially concluded all U.S. federal income tax matters for years through 2002. Substantially all state, local and non-U.S. income tax matters have been concluded for the years through 1999. The Company’s continuing practice is to recognize interest and/or penalties related to income tax matters in the provision for income taxes. At the date of adoption, the Company had $3,541 accrued for tax related interest and penalties in deferred income taxes on its Consolidated Balance Sheets. The Company does not anticipate a significant change to the total amount of unrecognized tax benefits within the next 12 months.

Recent Accounting Pronouncements Outstanding

In September 2006, the Financial Accounting Standards Board (“FASB”) issued FAS No. 157, Fair Value Measurements (“FAS 157”). FAS 157 defines fair value, addresses how companies should measure fair value when they are required to use a fair value measure for recognition or disclosure purposes under GAAP, and expands disclosures about fair value measurements. FAS 157 is effective for financial statements issued for fiscal years beginning after November 15, 2007, and interim periods within those fiscal years. The Company plans to adopt FAS 157 on January 1, 2008. The Company is currently evaluating the potential impact that FAS 157 will have on its consolidated financial position or results of operations.

In February 2007, the FASB issued FAS No. 159, The Fair Value Option for Financial Assets and Financial Liabilities (“FAS 159”). FAS 159 provides a choice to measure many financial instruments and certain other items at fair value on specified election dates and requires disclosures about the election of the fair value option. Unrealized gains and losses on items for which the fair value option has been elected are reported in earnings. FAS 159 is effective for fiscal years beginning after November 15, 2007. The Company plans to adopt FAS 159 on January 1, 2008. The Company is currently evaluating the potential impact that FAS 159 will have on its consolidated financial position or results of operations.

In March 2007, the FASB ratified the consensus reached by the Emerging Issues Task Force (“EITF”) in Issue No. 06-10, Accounting for Deferred Compensation and Postretirement Benefit Aspects of Collateral Assignment Split-Dollar Life Insurance Arrangements (“EITF 06-10”). EITF 06-10 provides guidance regarding the employer’s recognition of the liability and the related compensation costs for collateral assignment split-dollar life insurance arrangements that provide a benefit to an employee that extends into postretirement periods. This consensus concludes that for a collateral assignment split-dollar life insurance arrangement, an employer should recognize a liability for future benefits in accordance with FASB Statement No. 106 (if, in substance, a postretirement benefit plan exists) or APB Opinion No. 12 (if the arrangement is, in substance, an individual deferred compensation contract) based on the substantive agreement with the employee. EITF 06-10 is effective for financial statements issued for fiscal years beginning after December 15, 2007 and therefore the Company is required to adopt EITF 06-10 on January 1, 2008. The Company has recorded the liability for future benefits in accordance with APB Opinion No. 12 and thus the adoption of EITF 06-10 will not have an effect on the Company’s consolidated financial position or results of operations.

Assurant, Inc. and Subsidiaries

Notes to Consolidated Financial Statements (unaudited)

(in thousands, except per share and share amounts)

5. Debt

In February 2004, the Company issued two series of senior notes with an aggregate principal amount of $975,000. The Company received net proceeds of $971,537 from this transaction, which represents the principal amount less the discount. The discount of $3,463 is amortized over the life of the notes and is included as part of interest expense on the statement of operations.

The interest expense incurred related to the senior notes was $15,047 for the three months ended September 30, 2007 and 2006, respectively, and $45,141 for the nine months ended September 30, 2007 and 2006, respectively. There was $7,523 of accrued interest at September 30, 2007 and 2006, respectively. The Company made interest payments of $30,094 on February 15, 2007 and August 15, 2007.

In March 2004, the Company established a $500,000 commercial paper program, which is available for working capital and other general corporate purposes. This program is backed up by a $500,000 senior revolving credit facility. On both January 9, 2007 and April 18, 2007, the Company used $20,000 from the commercial paper program for general corporate purposes, which was subsequently repaid on January 16, 2007 and April 25, 2007, respectively. There were no amounts relating to the commercial paper program outstanding at September 30, 2007 or December 31, 2006. The Company did not use the revolving credit facility during the nine months ended September 30, 2007 or the twelve months ended December 31, 2006 and no amounts are currently outstanding.

The revolving credit facility contains restrictive covenants. The terms of the revolving credit facility also require that the Company maintain certain specified minimum ratios and thresholds. The Company is in compliance with all covenants, minimum ratios and thresholds.

6. Stock Based Compensation

Directors Compensation Plan

The Company’s Directors Compensation Plan permits the issuance of up to 500,000 shares of the Company’s common stock to non-employee Directors. The compensation expense recorded related to these shares was zero for the three months ended September 30, 2007 and 2006, and $625 and $565 for the nine months ended September 30, 2007 and 2006, respectively.

Long-Term Incentive Plan

The Assurant, Inc. 2004 Long-Term Incentive Plan provides for the granting of up to 10,000,000 shares of the Company’s common stock to employees and officers under the Assurant Long Term Incentive Plan (the “ALTIP”), Business Value Rights (“BVR”) Program and CEO or Compensation Committee Equity Grants. Restricted stock grants under the ALTIP vest pro ratably over a three year period and Stock Appreciation Rights (“SAR”) grants under the ALTIP vest as of December 31 of the second calendar year following the calendar year in which the right was granted. SARs grants under the BVR Program have a three year cliff vesting period. Restricted stock grants under the CEO Equity Grants Program have variable vesting schedules

Restricted Stock

A summary of the Company’s outstanding restricted stock as of September 30, 2007, is presented below:


	Shares		Weighted-Average Grant-Date Fair Value
Shares outstanding at December 31, 2006	154,033		$	45.55
Grants	110,459			55.23
Vests	(56,049	)		44.37
Forfeitures	(13,410	)		48.34

Shares outstanding at September 30, 2007	195,033		$	51.18

Assurant, Inc. and Subsidiaries

Notes to Consolidated Financial Statements (unaudited)

(in thousands, except per share and share amounts)

The compensation expense recorded related to restricted stock was $1,618 and $903 for the three months ended September 30, 2007 and 2006, respectively, and $3,698 and $2,423 for the nine months ended September 30, 2007 and 2006, respectively. The related total income tax benefit recognized was $566 and $316 for the three months ended September 30, 2007 and 2006, respectively, and $1,294 and $847 for the nine months ended September 30, 2007 and 2006, respectively. The weighted average grant date fair value for restricted stock granted during the nine months ended September 30, 2007 and 2006 was $55.23 and $49.36, respectively.

As of September 30, 2007, there was $5,219 of unrecognized compensation cost related to outstanding restricted stock. That cost is expected to be recognized over a weighted-average period of 1.4 years. The total fair value of shares vested during the three months ended September 30, 2007 and 2006 was $179 and $127, respectively, and $3,182 and $2,358 for the nine months ended September 30, 2007 and 2006, respectively.

SAR

A summary of the Company’s SARs as of September 30, 2007 is presented below:


	Rights		Weighted Average Exercise Price		Weighted Average Remaining Contractual Term	Aggregate Intrinsic Value
SARs outstanding, December 31, 2006	6,212,180		$	32.35
Grants	1,541,505			53.52
Exercises	(1,607,792	)		24.71
Forfeitures and adjustments	(312,445	)		46.51

SARs outstanding, September 30, 2007	5,833,448		$	39.29	3.8	$	82,934

SARs exercisable at September 30, 2007	2,141,179		$	25.90	5.0	$	59,155

There were zero SARs granted during the three months ended September 30, 2007 and 2006 and 1,541,505 and 1,400,377 SARs granted during the nine months ended September 30, 2007 and 2006, respectively. The compensation expense recorded related to SARs was $3,236 and $3,252 for the three months ended September 30, 2007 and 2006, respectively, and $9,241 and $9,930 for the nine months ended September 30, 2007 and 2006, respectively. The related income tax benefit recognized was $1,132 and $1,138 for the three months ended September 30, 2007 and 2006, respectively, and $3,196 and $3,444 for the nine months ended September 30, 2007 and 2006. The weighted average grant date fair value for SARs granted during the nine months ended September 30, 2007 was $11.37.

The total intrinsic value of SARs exercised during the nine months ended September 30, 2007 and 2006 was $53,389 and $10,144, respectively. As of September 30, 2007, there was approximately $19,605 of unrecognized compensation cost related to outstanding SARs. That cost is expected to be recognized over a weighted-average period of 1.5 years.

Assurant, Inc. and Subsidiaries

Notes to Consolidated Financial Statements (unaudited)

(in thousands, except per share and share amounts)

The fair value of each SAR outstanding was estimated on the date of grant using the Black-Scholes option-pricing model. Expected volatilities for awards issued during the nine months ended September 30, 2007 were based on the median historical stock price volatility of a peer group of insurance companies and implied volatilities from traded options on the Company’s stock. The expected term for grants issued during the nine months ended September 30, 2007 was assumed to equal the average of the vesting period of the SARs and the full contractual term of the SARs. The risk-free rate for periods within the contractual life of the option was based on the U.S. Treasury yield curve in effect at the time of grant.


	For awards granted during the nine months ended September 30,
	2007	2006
Expected Volatility	19.99 - 20.57%	20.25 - 22.85%
Risk Free Interest Rates	4.41 - 4.43%	4.77 - 4.89%
Dividend Yield	0.75%	0.65%
Expected Life	3.0 - 4.0	3.00 - 3.88

Employee Stock Purchase Plan

Under the Employee Stock Purchase Plan (“ESPP”), the Company is authorized to issue up to 5,000,000 new shares to employees who are participants in the ESPP. The compensation expense recorded related to the ESPP was $415 and $360 for the three months ended September 30, 2007 and 2006, respectively, and $1,076 and $934 for the nine months ended September 30, 2007 and 2006, respectively.

In January 2007, the Company issued 80,282 shares to employees at a price of $43.52 for the offering period of July 1 through December 31, 2006. In January 2006, the Company issued 73,992 shares to employees at a price of $32.59 for the offering period of July 1 through December 31, 2005.

In July 2007, the Company issued 76,085 shares to employees at a price of $50.26 for the offering period of January 1 through June 30, 2007. In July 2006, the Company issued 78,575 shares to employees at a price of $39.66 for the offering period of January 1 through June 30, 2006.

The fair value of each award under ESPP was estimated at the beginning of each offering period using the Black-Scholes option-pricing model and the assumptions in the following table. Expected volatilities are based on implied volatilities from traded options on the Company’s stock and the historical volatility of the Company’s stock. The risk-free rate for periods within the contractual life of the option is based on the U.S. Treasury yield curve in effect at the time of grant.


	For awards issued during the nine months ended September 30,
	2007	2006
Expected Volatility	17.15% - 22.43%	21.06 - 21.09%
Risk Free Interest Rates	5.03 - 5.24%	3.35 - 4.35%
Dividend Yield	0.71 - .82%	0.72 - 0.88%
Expected Life	0.5	0.5

Assurant, Inc. and Subsidiaries

Notes to Consolidated Financial Statements (unaudited)

(in thousands, except per share and share amounts)

7. Stock Repurchase

The following table shows the shares repurchased during the periods indicated:


Period in 2007	Number of Shares Purchased	Average Price Paid Per Share		Total Number of Shares Purchased as Part of Publicly Announced Program
January	360,000	$	56.12	360,000
February	370,000		54.70	370,000
March	691,833		53.50	691,833
April	623,000		57.01	623,000
May	647,700		59.78	647,700
June	713,700		58.82	713,700
July	971,200		54.98	971,200
August	1,311,900		49.92	1,311,900
September	—		—	—

Total	5,689,333	$	54.94	5,689,333

For the nine months ended September 30, 2007, the Company repurchased 5,689,333 shares of the Company’s outstanding common stock at a cost of $312,563 pursuant to the November 10, 2006 publicly announced repurchase program.

On September 4, 2007, the Company announced that it had suspended the November 10, 2006 stock buyback program, which has $260,992 remaining under the current authorization. In the future, the Company will evaluate the potential for reinstituting the buyback program.

Assurant, Inc. and Subsidiaries

Notes to Consolidated Financial Statements (unaudited)

(in thousands, except per share and share amounts)

8. Earnings Per Common Share

The following table presents the weighted average common shares used in calculating basic earnings per common share and those used in calculating diluted earnings per common share for each income category presented below.


	Three months ended September 30,				Nine months ended September 30,
	2007		2006		2007		2006
Numerator
Net income before cumulative effect of change in accounting principle	$	187,191	$	151,303	$	532,928	$	463,364
Cumulative effect of change in accounting principle (Note 2)		—		—		—		1,547

Net income	$	187,191	$	151,303	$	532,928	$	464,911

Denominator
Weighted average shares outstanding used in basic per share calculations		118,447,175		125,793,731		120,404,471		128,078,026
Incremental common shares from assumed:
SARs		1,216,688		1,916,658		1,585,790		1,753,194
Restricted stock		77,571		54,367		71,750		45,100
ESPP		—		1,293		—		1,293

Weighted average shares used in diluted per share calculations		119,741,434		127,766,049		122,062,011		129,877,613

Earnings per common share:
Basic
Net income before cumulative effect of change in accounting principle	$	1.58	$	1.20	$	4.43	$	3.62
Cumulative effect of change in accounting principle		—		—		—		0.01

Net income	$	1.58	$	1.20	$	4.43	$	3.63

Diluted
Net income before cumulative effect of change in accounting principle	$	1.56	$	1.18	$	4.37	$	3.57
Cumulative effect of change in accounting principle		—		—		—		0.01

Net income	$	1.56	$	1.18	$	4.37	$	3.58

Average restricted shares totaling 26,662 and zero for the three months ended September 30, 2007 and 2006, respectively, and 65,579 and 57,878 for the nine months ended September 30, 2007 and 2006, respectively, were outstanding but were anti-dilutive and thus not included in the computation of diluted EPS under the treasury stock method. Average SARs totaling 1,468,543 and zero for the three months ended September 30, 2007 and 2006, respectively, and 1,145,150 and 729,335 for the nine months ended September 30, 2007 and 2006, respectively, were also outstanding but were anti-dilutive and thus not included in the computation of diluted EPS under the treasury stock method.

Assurant, Inc. and Subsidiaries

Notes to Consolidated Financial Statements (unaudited)

(in thousands, except per share and share amounts)

9. Retirement and Other Employee Benefits

The components of net periodic benefit cost for the Company’s qualified pension benefits plan, nonqualified pension benefits plan and retirement health benefits plan for the three and nine months ended September 30, 2007 and 2006 were as follows:


	Qualified Pension Benefits						Nonqualified Pension Benefits (1)				Retirement Health Benefits
	For the three months ended September 30,						For the three months ended September 30,				For the three months ended September 30,
	2007			2006			2007		2006		2007			2006
Service cost	$	5,252		$	4,992		$	514	$	473	$	726		$	697
Interest cost		6,222			5,551			1,456		1,323		849			746
Expected return on plan assets		(8,312	)		(7,191	)		—		—		(321	)		(288	)
Amortization of prior service cost		758			758			250		160		341			337
Amortization of net loss		2,003			1,957			264		893		—			—

Net periodic benefit cost	$	5,923		$	6,067		$	2,484	$	2,849	$	1,595		$	1,492


	Qualified Pension Benefits						Nonqualified Pension Benefits (1)				Retirement Health Benefits
	For the nine months ended September 30,						For the nine months ended September 30,				For the nine months ended September 30,
	2007			2006			2007		2006		2007			2006
Service cost	$	15,486		$	14,853		$	1,523	$	1,388	$	2,210		$	2,095
Interest cost		18,437			16,285			4,260		3,939		2,615			2,342
Expected return on plan assets		(24,253	)		(21,351	)		—		—		(935	)		(846	)
Amortization of prior service cost		2,297			2,297			850		500		1,002			995
Amortization of net loss		5,471			6,028			1,274		2,722		—			—
Settlement Charge under FAS 88		—			—			115		609		—			—

Net periodic benefit cost	$	17,438		$	18,112		$	8,022	$	9,158	$	4,892		$	4,586

(1)	The Company’s nonqualified plans are unfunded.

During the first nine months of 2007, the Company contributed $30,000 to the qualified pension benefits plan. The Company expects to contribute $40,000 to the qualified pension benefits plan for the full year 2007.

Assurant, Inc. and Subsidiaries

Notes to Consolidated Financial Statements (unaudited)

(in thousands, except per share and share amounts)

10. Segment Information

On April 1, 2006, the Company separated the Assurant Solutions business segment into two business segments: Assurant Solutions and Assurant Specialty Property. In addition, concurrent with the creation of the new Assurant Solutions and Assurant Specialty Property segments, the Company realigned the Preneed segment under the new Assurant Solutions segment.

In connection with the segment changes described above, the Company transferred the run-off Asbestos business previously in the Assurant Solutions segment to the Corporate & Other segment. The transfer of this business is consistent with the Company’s policy of managing run-off business in the Corporate & Other segment.

The Company has five reportable segments, which are defined based on the nature of the products and services offered: Assurant Solutions, Assurant Specialty Property, Assurant Health, Assurant Employee Benefits, and Corporate & Other. Assurant Solutions provides credit insurance, including life, disability and unemployment, debt protection administration services, warranties and extended service contracts, life insurance policies and annuity products that provide benefits to fund pre-arranged funerals. Assurant Specialty Property provides creditor-placed homeowners insurance and manufactured housing homeowners insurance. Assurant Health provides individual, short-term and small group health insurance. Assurant Employee Benefits provides employee and employer paid dental, disability, and life insurance products and related services. Corporate & Other includes activities of the holding company, financing and interest expenses, net realized gains (losses) on investments, interest income earned from short-term investments held and additional costs associated with excess of loss reinsurance programs reinsured and ceded to certain subsidiaries in the London market between 1995 and 1997. Corporate & Other also includes the amortization of deferred gains associated with the sales of Fortis Financial Group and Long-Term Care through reinsurance agreements.

The Company evaluates performance of the operating business segments based on segment income (loss) after-tax excluding realized gains (losses) on investments. The Company determines reportable segments in a manner consistent with the way the Company organizes for purposes of making operating decisions and assessing performance.

Assurant, Inc. and Subsidiaries

Notes to Consolidated Financial Statements (unaudited)

(in thousands, except per share and share amounts)

The following tables summarize selected financial information by segment:


	Three Months Ended September 30, 2007
	Solutions		Specialty Property		Health		Employee Benefits		Corporate & Other			Consolidated
Revenues
Net earned premiums and other considerations	$	649,915	$	445,211	$	514,233	$	284,029	$	—		$	1,893,388
Net investment income		105,631		25,862		15,753		38,046		8,757			194,049
Net realized (losses) on investments		—		—		—		—		(13,076	)		(13,076	)
Amortization of deferred gain on disposal of businesses		—		—		—		—		8,298			8,298
Fees and other income		36,623		12,063		10,688		6,040		119			65,533

Total revenues		792,169		483,136		540,674		328,115		4,098			2,148,192

Benefits, losses and expenses
Policyholder benefits		284,755		129,354		326,479		195,698		—			936,286
Amortization of deferred acquisition costs and value of business acquired		277,005		70,341		4,420		7,990		—			359,756
Underwriting, general and administrative expenses		174,505		107,397		149,508		93,247		28,060			552,717
Interest expense		—		—		—		—		15,288			15,288

Total benefits, losses and expenses		736,265		307,092		480,407		296,935		43,348			1,864,047


Segment income (loss) before provision for income taxes		55,904		176,044		60,267		31,180		(39,250	)		284,145
Provision for income taxes		18,527		61,362		20,902		10,788		(14,625	)		96,954

Segment income (loss) after tax	$	37,377	$	114,682	$	39,365	$	20,392	$	(24,625	)

Net income												$	187,191


	Three Months Ended September 30, 2006
	Solutions		Specialty Property		Health		Employee Benefits		Corporate & Other			Consolidated
Revenues
Net earned premiums and other considerations	$	591,237	$	313,644	$	521,527	$	291,232	$	—		$	1,717,640
Net investment income		96,625		19,584		17,689		39,893		6,881			180,672
Net realized (losses) on investments		—		—		—		—		(2,675	)		(2,675	)
Amortization of deferred gain on disposal of businesses		—		—		—		—		9,428			9,428
Fees and other income		47,262		13,329		11,035		6,685		703			79,014

Total revenues		735,124		346,557		550,251		337,810		14,337			1,984,079

Benefits, losses and expenses
Policyholder benefits		250,886		115,379		325,325		196,727		—			888,317
Amortization of deferred acquisition costs and value of business acquired		228,656		57,670		5,683		6,363		—			298,372
Underwriting, general and administrative expenses		195,628		90,870		149,503		97,363		17,678			551,042
Interest expense		—		—		—		—		15,307			15,307

Total benefits, losses and expenses		675,170		263,919		480,511		300,453		32,985			1,753,038


Segment income (loss) before provision for income taxes		59,954		82,638		69,740		37,357		(18,648	)		231,041
Provision for income taxes		18,247		29,193		24,893		12,957		(5,552	)		79,738

Segment income (loss) after tax	$	41,707	$	53,445	$	44,847	$	24,400	$	(13,096	)

Net income												$	151,303

Assurant, Inc. and Subsidiaries

Notes to Consolidated Financial Statements (unaudited)

(in thousands, except per share and share amounts)


	Nine Months Ended September 30, 2007
	Solutions		Specialty Property		Health		Employee Benefits		Corporate & Other			Consolidated
Revenues
Net earned premiums and other considerations	$	1,851,601	$	1,205,866	$	1,540,953	$	853,164	$	—		$	5,451,584
Net investment income		318,432		71,398		51,313		129,341		30,763			601,247
Net realized (losses) on investments				—		—		—		(10,592	)		(10,592	)
Amortization of deferred gain on disposal of businesses		—		—		—		—		24,893			24,893
Fees and other income		115,631		37,313		30,821		18,696		589			203,050

Total revenues		2,285,664		1,314,577		1,623,087		1,001,201		45,653			6,270,182

Benefits, losses and expenses
Policyholder benefits		786,626		377,007		973,590		592,593		—			2,729,816
Amortization of deferred acquisition costs and value of business acquired		795,765		200,914		15,146		22,690		—			1,034,515
Underwriting, general and administrative expenses		538,530		306,915		459,280		277,635		63,473			1,645,833
Interest expense		—		—		—		—		45,881			45,881

Total benefits, losses and expenses		2,120,921		884,836		1,448,016		892,918		109,354			5,456,045


Segment income (loss) before provision for income taxes		164,743		429,741		175,071		108,283		(63,701	)		814,137
Provision for income taxes		53,087		150,418		61,344		37,459		(21,099	)		281,209

Segment income (loss) after tax	$	111,656	$	279,323	$	113,727	$	70,824	$	(42,602	)

Net income												$	532,928


	As of September 30, 2007
Segment Assets:
Segments assets, excluding goodwill	$	11,820,742	$	2,880,858	$	1,290,255	$	2,871,504	$	6,903,312		$	25,766,671

Goodwill													801,709

Total Assets												$	26,568,380


	Nine Months Ended September 30, 2006
	Solutions		Specialty Property		Health		Employee Benefits		Corporate & Other			Consolidated
Revenues
Net earned premiums and other considerations	$	1,753,807	$	857,365	$	1,564,519	$	899,924	$	—		$	5,075,615
Net investment income		292,658		54,297		58,800		119,476		28,441			553,672
Net realized (losses) on investments		—		—		—		—		(4,855	)		(4,855	)
Amortization of deferred gain on disposal of businesses		—		—		—		—		28,283			28,283
Fees and other income		120,957		36,374		31,011		21,064		830			210,236

Total revenues		2,167,422		948,036		1,654,330		1,040,464		52,699			5,862,951

Benefits, losses and expenses
Policyholder benefits		746,474		296,312		972,048		637,361		5			2,652,200
Amortization of deferred acquisition costs and value of business acquired		659,034		171,707		19,156		18,639		—			868,536
Underwriting, general and administrative expenses		584,557		208,291		461,761		286,028		50,081			1,590,718
Interest expense		—		—		—		—		45,937			45,937

Total benefits, losses and expenses		1,990,065		676,310		1,452,965		942,028		96,023			5,157,391


Segment income (loss) before provision for income taxes		177,357		271,726		201,365		98,436		(43,324	)		705,560
Provision for income taxes		58,755		94,561		70,406		34,261		(15,787	)		242,196

Segment income (loss) after tax	$	118,602	$	177,165	$	130,959	$	64,175	$	(27,537	)	$	463,364

Cumulative effect of change in accounting principle													1,547

Net income												$	464,911


	At December 31, 2006
Segment Assets:
Segments assets, excluding goodwill	$	10,637,152	$	2,189,673	$	1,278,108	$	2,806,337	$	7,463,359		$	24,374,629

Goodwill													790,519

Total Assets												$	25,165,148

Assurant, Inc. and Subsidiaries

Notes to Consolidated Financial Statements (unaudited)

(in thousands, except per share and share amounts)

11. Commitments and Contingencies

In the normal course of business, letters of credit are issued primarily to support reinsurance arrangements. These letters of credit are supported by commitments with financial institutions. The Company had $33,803 and $33,219 of letters of credit outstanding as of September 30, 2007 and December 31, 2006, respectively.

The Company is involved in litigation in the ordinary course of business, both as a defendant and as a plaintiff. The Company may from time to time be subject to a variety of legal and regulatory actions relating to the Company’s current and past business operations. While the Company cannot predict the outcome of any pending or future litigation, examination or investigation and although no assurances can be given, the Company does not believe that any pending matter will have a material adverse effect individually or in the aggregate, on the Company’s financial condition, results of operations, or cash flows.

One of the Company’s subsidiaries, American Reliable Insurance Company (“ARIC”), participated in certain excess of loss reinsurance programs in the London market and, as a result, reinsured certain personal accident, ransom and kidnap insurance risks from 1995 to 1997. ARIC and a foreign affiliate ceded a portion of these risks to retrocessionaires. ARIC ceased reinsuring such business in 1997. However, certain risks continued beyond 1997 due to the nature of the reinsurance contracts written. ARIC and some of the other reinsurers involved in the programs are seeking to avoid certain treaties on various grounds, including material misrepresentation and non-disclosure by the ceding companies and intermediaries involved in the programs. Similarly, some of the retrocessionaires are seeking avoidance of certain treaties with ARIC and the other reinsurers and some reinsureds are seeking collection of disputed balances under some of the treaties. The disputes generally involve multiple layers of reinsurance, and allegations that the reinsurance programs involved interrelated claims “spirals” devised to disproportionately pass claims losses to higher-level reinsurance layers.

Many of the companies involved in these programs, including ARIC, are currently involved in negotiations, arbitrations and/or litigation between multiple layers of retrocessionaires, reinsurers, ceding companies and intermediaries, including brokers, in an effort to resolve these disputes. Many of the disputes involving ARIC and an affiliate, Bankers Insurance Company Limited (“BICL”), relating to the 1995 and 1997 program years, were resolved by settlement or arbitration in 2005. As a result of the settlements and an arbitration (in which ARIC did not prevail) additional information became available in 2005, and based on management’s best estimate, the Company increased its reserves and recorded a total pre-tax charge of $61,943 for the year ended December 31, 2005. Negotiations, arbitrations and litigation are still ongoing or will be scheduled for the remaining disputes. On February 28, 2006 there was a settlement relating to the 1996 program. Loss accruals previously established relating to the 1996 program were adequate. The Company believes, based on information currently available, that the amounts accrued for currently outstanding disputes are adequate. However, the inherent uncertainty of arbitrations and lawsuits, including the uncertainty of estimating whether any settlements the Company may enter into in the future would be on favorable terms, makes it difficult to predict the outcomes with certainty.

As part of an ongoing, industry-wide investigation, the Company has received subpoenas and requests from the Securities and Exchange Commission (“SEC”) in connection with its investigation into certain loss mitigation products. The Company is cooperating fully and is complying with the requests.

The Company conducted an evaluation of the transactions that could potentially fall within the scope of the subpoenas, as defined by the authorities, and has provided information as requested. Based on the Company’s investigation to date, the Company has concluded that there was a verbal side agreement with respect to one of our reinsurers under our catastrophic reinsurance program. While management believes that the difference resulting from the appropriate alternative accounting treatment would be immaterial to our financial position or results of operations, regulators may reach a different conclusion. In 2004 and 2003, premiums ceded to this reinsurer were $2,600 and $1,500, respectively, and losses ceded were $10,000 and zero, respectively. This contract expired in December 2004 and was not renewed.

In July 2007, the Company learned that each of the following five individuals, Robert B. Pollock, President and Chief Executive Officer, Philip Bruce Camacho, Executive Vice President and Chief Financial Officer, Adam Lamnin, Executive Vice President and Chief Financial Officer of Assurant Solutions/Assurant Specialty Property, Michael Steinman, Senior Vice President and Chief Actuary of Assurant Solutions/Assurant Specialty Property and Dan Folse, Vice President-Risk Management of Assurant Solutions/Assurant Specialty Property, received Wells notices from the SEC in connection with its ongoing investigation. A Wells notice is an indication that the staff of the SEC is considering recommending that the SEC bring a civil enforcement action against the recipient for violating various provisions of the federal securities laws. Under SEC procedures, the recipients have the opportunity to respond to the SEC staff before a formal recommendation is finalized.

Assurant, Inc. and Subsidiaries

Notes to Consolidated Financial Statements (Unaudited)

Nine Months Ended September 30, 2007 and 2006

(in thousands, except per share and share amounts)

On July 17, 2007, the Company announced that the Board of Directors had placed all five employees on administrative leave, pending further review of this matter. On July 18, the Board of Directors appointed J. Kerry Clayton as interim President and Chief Executive Officer and Michael J. Peninger as interim Chief Financial Officer of the Company. On August 9, 2007, Messrs. Steinman and Folse’s employment with the Company was terminated. Messrs. Pollock, Camacho, and Lamnin remain on administrative leave.

During the third quarter, the Board of Directors formed a Special Committee of non-management directors that evaluated the situation. The Special Committee reviewed the relevant documents, conducted interviews and worked with outside counsel in order to investigate these matters and to recommend appropriate actions to the Board with respect to the SEC investigation.

In relation to the SEC investigation discussed above, the SEC may impose fines and/or penalties on the Company and individuals involved; however, the Company has not accrued for fines and/or penalties since it cannot reasonably estimate the amount of such fines and/or penalties at this time.

12. Subsequent Events

On October 1, 2007, the Company announced that its affiliate in the United Kingdom had acquired Centrepoint Insurance Services Limited (“Centrepoint”). Centrepoint is a leading distributor of buildings and contents and mortgage payment protection to financial intermediaries in the U.K., through its 4,200 mortgage-broker network.

On November 9, 2007, the Company announced that the Board of Directors declared a quarterly dividend of $0.12 per common share. The dividend will be payable on December 10, 2007 to the Company’s stockholders of record as of November 26, 2007.

Item 2.

Management’s Discussion and Analysis of Financial Condition and Results of Operations.

(Dollar amounts in thousands)

Management’s Discussion and Analysis of Financial Condition and Results of Operations (“MD&A”) addresses the financial condition of Assurant, Inc. and its subsidiaries (which we refer to collectively as Assurant) as of September 30, 2007, compared with December 31, 2006, and our results of operations for the three and nine months ended September 30, 2007 and 2006. This discussion should be read in conjunction with our MD&A and annual audited consolidated financial statements as of December 31, 2006 included in our Annual Report on Form 10-K for the year ended December 31, 2006 filed with the U.S Securities and Exchange Commission (“SEC”) and the September 30, 2007 unaudited consolidated financial statements and related notes included elsewhere in this Form 10-Q.

Some of the statements in this MD&A and elsewhere in this report may contain forward-looking statements which reflect our current views with respect to, among other things, future events and financial performance. You can identify these forward-looking statements by the use of forward-looking words such as “outlook,” “believes,” “expects,” “potential,” “continues,” “may,” “will,” “should,” “seeks,” “approximately,” “predicts,” “intends,” “plans,” “estimates,” “anticipates” or the negative version of those words or other comparable words. Any forward-looking statements contained in this report 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 the future plans, estimates or expectations contemplated by us will be achieved. Such forward-looking statements are subject to various risks and uncertainties. Accordingly, there are or will be important factors that could cause our actual results to differ materially from those indicated in this report. We believe that these factors include but are not limited to those described under the subsection entitled “Risk Factors” in our 2006 Annual Report on Form 10-K. These factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in this report. We undertake no obligation to publicly update or review any forward-looking statement, whether as a result of new information, future developments or otherwise. If one or more of these or other risks or uncertainties materialize, or if our underlying assumptions prove to be incorrect, actual results may vary materially from what we projected. Any forward-looking statements you read in this report reflect our current views with respect to future events and are subject to these and other risks, uncertainties and assumptions relating to our operations, results of operations, financial condition, growth strategy and liquidity.

Company Overview

Assurant is a premier provider of specialized insurance products and related services in North America and selected international markets. On April 1, 2006, the Company separated the Assurant Solutions business segment into two business segments: Assurant Solutions and Assurant Specialty Property. In addition, concurrent with the creation of the new Assurant Solutions and Assurant Specialty Property segments, the Company realigned the Preneed segment under the new Assurant Solutions segment. We have five reportable segments, of these five, four are business segments — Assurant Solutions; Assurant Specialty Property; Assurant Health; and Assurant Employee Benefits. These business segments have partnered with clients who are leaders in their industries and have built leadership positions in a number of specialty insurance market segments in the U.S. and selected international markets. The Assurant business segments provide creditor-placed homeowners insurance; manufactured housing homeowners insurance; debt protection administration services; credit insurance including life, disability and unemployment; warranties and extended services contracts; individual, short-term and small employer group health insurance; group dental insurance; group disability insurance; group life insurance; and pre-funded funeral insurance. Our remaining segment is Corporate & Other which includes activities of the holding company, financing and interest expenses, net realized gains (losses) on investments, interest income earned from short-term investments held and additional costs associated with excess of loss reinsurance programs reinsured and ceded to certain subsidiaries in the London market between 1995 and 1997. Corporate & Other also includes the amortization of deferred gains associated with the sales of Fortis Financial Group and Long-Term Care through reinsurance agreements.

Critical Factors Affecting Results

Our results depend on the adequacy of our product pricing, underwriting and the accuracy of our methodology for the establishment of reserves for future policyholder benefits and claims, returns on invested assets and our ability to manage our expenses. Therefore, factors affecting these items may have a material adverse effect on our results of operations or financial condition.

Critical Accounting Policies and Estimates

Our 2006 Annual Report on Form 10-K described the accounting policies and estimates that are critical to the understanding of our results of operations, financial condition and liquidity. The accounting policies and estimates described in the 2006 Annual Report on Form 10-K were consistently applied to the consolidated interim financial statements for the nine months ended September 30, 2007.

Recent Accounting Pronouncements

See – Financial Statement Footnote 4.

Assurant Consolidated

Overview

The table below presents information regarding our consolidated results of operations:


	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
	2007			2006			2007			2006
	(in thousands)
Revenues:
Net earned premiums and other considerations	$	1,893,388		$	1,717,640		$	5,451,584		$	5,075,615
Net investment income		194,049			180,672			601,247			553,672
Net realized (losses) on investments		(13,076	)		(2,675	)		(10,592	)		(4,855	)
Amortization of deferred gain on disposal of businesses		8,298			9,428			24,893			28,283
Fees and other income		65,533			79,014			203,050			210,236

Total revenues		2,148,192			1,984,079			6,270,182			5,862,951

Benefits, losses and expenses:
Policyholder benefits		(936,286	)		(888,317	)		(2,729,816	)		(2,652,200	)
Selling, underwriting and general expenses (1)		(912,473	)		(849,414	)		(2,680,348	)		(2,459,254	)
Interest expense		(15,288	)		(15,307	)		(45,881	)		(45,937	)

Total benefits, losses and expenses		(1,864,047	)		(1,753,038	)		(5,456,045	)		(5,157,391	)

Income before provision for income taxes and cumulative effect of change in accounting principle		284,145			231,041			814,137			705,560
Provision for income taxes		(96,954	)		(79,738	)		(281,209	)		(242,196	)

Net income before cumulative effect of change in accounting principle		187,191			151,303			532,928			463,364

Cumulative effect of change in accounting principle		—			—			—			1, 547

Net income	$	187,191		$	151,303		$	532,928		$	464,911

(1)	Includes amortization of DAC and VOBA and underwriting, general and administrative expenses.

For The Three Months Ended September 30, 2007 Compared to The Three Months Ended September 30, 2006.

Net Income

Net income increased $35,888, or 24%, to $187,191 for the three months ended September 30, 2007 from $151,303 for the three months ended September 30, 2006. The increase was primarily driven by an increase in Assurant Specialty Property’s creditor-placed homeowners business. The increase in net income is partially offset by less favorable loss experience in Assurant Solutions’ domestic extended service contract business and Assurant Employee Benefits’ group life business with a slight deterioration of claim experience in Assurant Health’s small employer group business.

For The Nine Months Ended September 30, 2007 Compared to The Nine Months Ended September 30, 2006.

Net Income

Net income increased $68,017, or 15%, to $532,928 for the nine months ended September 30, 2007 from $464,911 for the nine months ended September 30, 2006. The increase was primarily driven by an increase in Assurant Specialty Property’s creditor-placed homeowners business. The increase in net income is partially offset by less favorable loss experience in Assurant Solutions’ domestic extended service contract business, continued investment to support Assurant Solutions’ strategic international expansion and slight deterioration of claim experience in Assurant Health’s small employer group business.

Assurant Solutions

Overview

The tables below present information regarding our Assurant Solutions’ segment results of operations:


	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
	2007			2006			2007			2006
	(in thousands)
Revenues:
Net earned premiums and other considerations	$	649,915		$	591,237		$	1,851,601		$	1,753,807
Net investment income		105,631			96,625			318,432			292,658
Fees and other income		36,623			47,262			115,631			120,957

Total revenues		792,169			735,124			2,285,664			2,167,422

Benefits, losses and expenses:
Policyholder benefits		(284,755	)		(250,886	)		(786,626	)		(746,474	)
Selling, underwriting and general expenses		(451,510	)		(424,284	)		(1,334,295	)		(1,243,591	)

Total benefits, losses and expenses		(736,265	)		(675,170	)		(2,120,921	)		(1,990,065	)

Segment income before provision for income taxes		55,904			59,954			164,743			177,357
Provision for income taxes		(18,527	)		(18,247	)		(53,087	)		(58,755	)

Segment net income	$	37,377		$	41,707		$	111,656		$	118,602

Net earned premiums and other considerations:
Domestic:
Credit	$	75,638		$	88,470		$	232,668		$	282,527
Service contracts		292,762			255,962			834,899			762,079
Other (1)		14,496			18,034			46,702			61,492

Total Domestic		382,896			362,466			1,114,269			1,106,098

International:
Credit		98,431			104,372			287,721			290,194
Service contracts		64,561			18,868			169,821			58,045
Other (1)		8,307			24,327			27,546			51,571

Total International		171,299			147,567			485,088			399,810

Preneed		95,720			81,204			252,244			247,899

Total	$	649,915		$	591,237		$	1,851,601		$	1,753,807

Fee and other income:
Domestic:
Debt protection	$	7,415		$	13,698		$	23,634			40,530
Service contracts		16,679			23,556			50,746			50,555
Other (1)		6,320			4,884			18,018			13,702

Total Domestic		30,414			42,138			92,398			104,787

International		5,179			4,069			14,055			12,510


Preneed		1,030			1,055			9,178			3,660

Total	$	36,623		$	47,262		$	115,631		$	120,957

Gross written premiums (2):
Domestic:
Credit	$	168,135		$	184,120		$	497,716		$	535,536
Service contracts		434,465			398,170			1,337,012			1,131,768
Other (1)		22,353			25,851			65,232			81,664

Total Domestic		624,953			608,141			1,899,960			1,748,968

International:
Credit		219,945			175,417			612,713			495,649
Service contracts		118,754			91,407			285,284			228,993
Other (1)		11,176			11,353			35,531			34,607

Total International		349,875			278,177			933,528			759,249

Total	$	974,828		$	886,318		$	2,833,488		$	2,508,217

Preneed (face sales)	$	107,341		$	105,031		$	295,759		$	349,264

Combined ratio (3):
Domestic		100.9	%		98.4	%		100.9	%		99.2	%
International		102.3	%		101.7	%		104.7	%		99.2	%

(1)	This includes emerging products and run-off products lines.

(2)	Gross written premiums does not necessarily translate to an equal amount of subsequent net earned premiums since Assurant Solutions reinsures a portion of its premiums to insurance subsidiaries of its clients.

(3)	The combined ratio is equal to total benefits, losses and expenses divided by net earned premiums and other considerations and fees and other income excluding the preneed business.

For The Three Months Ended September 30, 2007 Compared to The Three Months Ended September 30, 2006.

Net Income

Segment net income decreased $4,330, or 10%, to $37,377 for the three months ended September 30, 2007 from $41,707 for the three months ended September 30, 2006. The decrease in net income was primarily due to $5,041 of after-tax fee income from a closed block of extended service contracts business, recognized in the third quarter of 2006. Net income declined primarily as a result of higher domestic and international combined ratios due to less favorable domestic service contract loss experience and continued investments made to support the business’ international strategic expansion. Also, fee and other income declined by $3,108 (after-tax) in the third quarter of 2007 due to the loss of a debt deferment client at the end of 2006.

These decreases were partially offset by an increase in investment income of $5,854 (after-tax), due to higher average invested assets. Average invested assets have increased due to continued strong growth in gross written premiums, particularly in the extended service contract and international businesses and from the acquisition of Mayflower Life Insurance Company (“Mayflower”) during July 2007.

Total Revenues

Total revenues increased $57,045, or 8%, to $792,169 for the three months ended September 30, 2007 from $735,124 for the three months ended September 30, 2006. This increase is mainly due to higher net earned premiums and other considerations of $58,678. This increase in premiums is primarily attributable to growth in our domestic and international extended service contract business. These net earned premium increases are partially offset by the continued decline of our domestic credit insurance business.

We experienced growth in the majority of our product lines, with the exception of the domestic credit insurance business and other runoff products. Gross written premiums in our domestic extended service contract business increased $36,295, primarily due to the addition of a new client. Gross written premiums in our international service contract business increased $27,347, mainly driven by increased premium from existing clients. Gross written premiums from our international credit business increased $44,528 mainly due to growth in Canada from existing clients, and growth in our expansion countries. We experienced a net increase of $2,310 in our Preneed business due to

growth associated with the Mayflower acquisition. These improvements were partially offset by a decrease of $15,985 in gross written premiums in our domestic credit insurance business as a result of the continued runoff of this product line as well as the loss of a client.

Total Benefits, Losses and Expenses

Total benefits, losses and expenses increased $61,095, or 9%, to $736,265 for the three months ended September 30, 2007 from $675,170 for the three months ended September 30, 2006. This increase was due to an increase in policyholder benefits of $33,869 primarily due to growth in our international and domestic service contract businesses. Commissions, taxes, licenses and fees, of which amortization of Deferred Acquisition Cost (“DAC”) is a component, increased $25,427 primarily due to the associated increase in revenues and increase in commission rates due to a change in the mix of business. The commission rate increase is due to the higher commission rates on our growing service contract business compared to the lower commission rates on the decreasing domestic credit business. General expenses increased by $1,797 from the continued investment in international expansion as well as costs associated with growth of the domestic service contract business.

For The Nine Months Ended September 30, 2007 Compared to The Nine Months Ended September 30, 2006.

Net Income

Segment net income decreased $6,946, or 6%, to $111,656 for the nine months ended September 30, 2007 from $118,602 for the nine months ended September 30, 2006. The decrease is primarily due to an increase in expenses related to investment made to support the business’ international strategic expansion and less favorable domestic service contract loss experience. These results include $6,560 (after-tax) in losses resulting from unfavorable experience in a credit life product in Brazil, which has since been repriced for some clients and discontinued for other clients. The decline is also partially the result of one-time fee income of $5,041 (after-tax) for a closed block of extended service contracts, recognized in the third quarter of 2006. These declines were partially offset by improved preneed results including a slightly accretive contribution from Mayflower in July 2007, an increase in investment income from real estate partnerships of $8,817 (after-tax), the receipt of $3,510 (after-tax) of contract settlement fees in the second quarter of 2007 related to the sale of marketing rights for the independent U.S. preneed business in November 2005, and $5,068 (after-tax) of income stemming from improvements in our reconciliation of clients’ commission payable accounts.

Total Revenues

Total revenues increased $118,242, or 5%, to $2,285,664 for the nine months ended September 30, 2007 from $2,167,422 for the nine months ended September 30, 2006. This increase is due to higher net earned premiums and other considerations of $97,794, primarily attributable to growth in our domestic and international extended service contract business. These increases are partially offset by the decrease in the net earned premium from the continued decline of our domestic credit insurance business and run-off business. The increase in revenues was also due to an increase in net investment income of $25,774, or 9%, primarily due to an increase in investment income from real estate partnerships of $13,000 and higher average invested assets.

We experienced growth in the majority of product lines, with the exception of our domestic credit insurance business and our preneed business. Gross written premiums from our international credit business increased $117,064 as a result of growth in Canada from existing clients, and to a lesser extent increases in most other countries. Gross written premiums in our domestic credit insurance business decreased $37,820 due to the continued decline of this product line and the loss of a client. Gross written premiums in our international service contract business increased by $56,291, mainly due to increased premium from existing clients. Gross written premiums in our domestic service contract business increased by $205,245 due to the addition of a new client and growth generated from existing clients. We experienced a decrease in our preneed business due to the late 2005 sale of the U.S. independent distribution channel offset by growth in the business from the Mayflower acquisition.

Total Benefits, Losses and Expenses

Total benefits, losses and expenses increased $130,856, or 7%, to $2,120,921 for the nine months ended September 30, 2007 from $1,990,065 for the nine months ended September 30, 2006. This increase was due to an increase in selling, underwriting and general expenses of $90,704. Commissions, taxes, licenses and fees, of which amortization of DAC is a component, increased

$84,324 resulting from additional commissions proportional with the increase in revenues, losses resulting from unfavorable experience in a credit life product in Brazil, which has since been repriced for some clients and discontinued for other clients, and an increase in overall commission rates due to the change in the mix of business. The commission rate increase is due to our growing service contract business which has higher commission rates compared to the lower commission rates on the decreasing domestic credit business. General expenses increased by $6,380 due to continued investment in international expansion as well as costs associated with growth of the domestic service contract business. Policyholder benefits increased by $40,152 primarily driven by growth in our international and domestic service contract businesses.

Assurant Specialty Property

Overview

The tables below present information regarding our Assurant Specialty Property’s segment results of operations:


	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
	2007			2006			2007			2006
	(in thousands)
Revenues:
Net earned premiums and other considerations	$	445,211		$	313,644		$	1,205,866		$	857,365
Net investment income		25,862			19,584			71,398			54,297
Fees and other income		12,063			13,329			37,313			36,374

Total revenues		483,136			346,557			1,314,577			948,036

Benefits, losses and expenses:
Policyholder benefits		(129,354	)		(115,379	)		(377,007	)		(296,312	)
Selling, underwriting and general expenses		(177,738	)		(148,540	)		(507,829	)		(379,998	)

Total benefits, losses and expenses		(307,092	)		(263,919	)		(884,836	)		(676,310	)

Segment income before provision for income taxes		176,044			82,638			429,741			271,726
Provision for income taxes		(61,362	)		(29,193	)		(150,418	)		(94,561	)

Segment net income	$	114,682		$	53,445		$	279,323		$	177,165

Net earned premiums and other considerations by major product groupings:
Homeowners (Creditor Placed and Voluntary)	$	317,607		$	198,733		$	845,159		$	519,988
Manufactured Housing (Creditor Placed and Voluntary)		54,132			52,535			155,254			162,687
Other (1)		73,472			62,376			205,453			174,690

Total	$	445,211		$	313,644		$	1,205,866		$	857,365

Ratios:
Loss ratio (2)		29.1	%		36.8	%		31.3	%		34.6	%
Expense ratio (3)		38.9	%		45.4	%		40.8	%		42.5	%
Combined ratio (4)		67.2	%		80.7	%		71.2	%		75.7	%

(1)	This includes flood, renters, agricultural, specialty auto and other insurance products.

(2)	The loss ratio is equal to policyholder benefits divided by net earned premiums and other considerations.

(3)	The expense ratio is equal to selling, underwriting and general expenses divided by net earned premiums and other considerations and fees and other income.

(4)	The combined ratio is equal to total benefits, losses and expenses divided by net earned premiums and other considerations and fees and other income.

For The Three Months Ended September 30, 2007 Compared to The Three Months Ended September 30, 2006.

Net Income

Segment net income increased $61,237, or 115%, to $114,682 for the three months ended September 30, 2007 from $53,445 for the three months ended September 30, 2006. This increase in net income is primarily due to higher net earned premiums resulting from the growth of the creditor placed homeowners business. The increase was also due to favorable combined ratios primarily due to the absence of any material weather related events and increasing investment income.

Total Revenues

Total revenues increased $136,579, or 39%, to $483,136 for the three months ended September 30, 2007 from $346,557 for the three months ended September 30, 2006. The increase in revenues is mainly due to increased net earned premiums of $131,567, or 42%. This increase is attributable to the growth in the creditor placed homeowners business. The growth was primarily driven by an increased client loan tracking portfolio, increased percentage of policies placed per loans tracked and higher average insured value. Also, net investment income increased $6,278 or 32%, due to higher average invested assets.

Total Benefits, Losses and Expenses

Total benefits, losses and expenses increased $43,173, or 16%, to $307,092 for the three months ended September 30, 2007 from $263,919 for the three months ended September 30, 2006. This increase was due to an increase in policyholder benefits of $13,975 and an increase in selling, underwriting and general expenses of $29,198. The increase in policyholder benefits is attributable to the corresponding growth in the creditor placed homeowners business. The combined ratio improved to 67.2% from 80.7% primarily due to favorable loss experience and an increase in revenues that was proportionally larger than the increase in expenses. Commissions, taxes, licenses and fees, of which amortization of DAC is a component, increased $20,852, primarily due to the associated increase in revenues. General expenses increased $8,346 due primarily to increases in employment related expenses consistent with business growth.

For The Nine Months Ended September 30, 2007 Compared to The Nine Months Ended September 30, 2006.

Net Income

Segment net income increased $102,158, or 58%, to $279,323 for the nine months ended September 30, 2007 from $177,165 for the nine months ended September 30, 2006. This increase in net income is primarily due to higher net earned premiums resulting from the growth of the creditor placed homeowners business, including results from the Safeco Financial Insurance Service (“SFIS”) acquisition in May 2006. The increase was also due to favorable combined ratios primarily due to the absence of any material weather related events. Net income also improved due to an increase in investment income of $11,116 (after-tax). This increase was due to higher average invested assets resulting from the continued growth in the business.

Total Revenues

Total revenues increased $336,541, or 39%, to $1,314,577 for the nine months ended September 30, 2007 from $948,036 for the nine months ended September 30, 2006. The increase in revenues is mainly due to increased net earned premiums of $348,501, or 41%. The increase is attributable to the growth in the creditor placed homeowners business, both through acquisitions and organic growth. The growth was driven by an increased client loan tracking portfolio, increased percentage of policies placed per loans tracked and higher average insured value. The increase in net earned premiums was partially offset by increased catastrophe reinsurance premiums of $51,000. Also, net investment income increased $17,101 or 31%, due to higher average invested assets.

Total Benefits, Losses and Expenses

Total benefits, losses and expenses increased $208,526, or 31%, to $884,836 for the nine months ended September 30, 2007 from $676,310 for the nine months ended September 30, 2006. This increase was due to a rise in policyholder benefits of $80,695 and an increase in selling, underwriting and general expenses of $127,831. The increase in policyholder benefits is attributable to the corresponding growth in the creditor placed homeowners business, as well as $10,500 of lower reimbursements from the National Flood Insurance Program which are recorded against policyholder benefits. The combined ratio improved to 71.2% from 75.7%, primarily due to favorable loss experience. Commissions, taxes, licenses and fees of which amortization of DAC is a component, increased $77,650, primarily due to the associated increase in revenues. General expenses increased $50,181 due primarily to increases in employment related expenses consistent with business growth and additional operating expenses associated with the SFIS acquisition.

Assurant Health

Overview

The tables below present information regarding Assurant Health’s segment results of operations:


	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
	2007			2006			2007			2006
	(in thousands)
Revenues:

Net earned premiums and other considerations	$	514,233		$	521,527		$	1,540,953		$	1,564,519
Net investment income		15,753			17,689			51,313			58,800
Fees and other income		10,688			11,035			30,821			31,011

Total revenues		540,674			550,251			1,623,087			1,654,330

Benefits, losses and expenses:

Policyholder benefits		(326,479	)		(325,325	)		(973,590	)		(972,048	)
Selling, underwriting and general expenses		(153,928	)		(155,186	)		(474,426	)		(480,917	)

Total benefits, losses and expenses		(480,407	)		(480,511	)		(1,448,016	)		(1,452,965	)

Segment income before provision for income taxes		60,267			69,740			175,071			201,365

Provision for income taxes		(20,902	)		(24,893	)		(61,344	)		(70,406	)

Segment net income	$	39,365		$	44,847		$	113,727		$	130,959

Net earned premiums and other considerations:

Individual markets:

Individual medical	$	323,490		$	305,246		$	958,594		$	902,851

Short term medical		26,336			26,839			72,396			77,329

Subtotal		349,826			332,085			1,030,990			980,180

Small employer group:		164,407			189,442			509,963			584,339

Total	$	514,233		$	521,527		$	1,540,953		$	1,564,519

Membership by product line:
Individual markets:


Individual medical			638	639
Short term medical			101	99

Subtotal			739	738
Small employer group:			171	216

Total			910	954

Ratios:
Loss ratio (1)	63.5%	62.4%	63.2%	62.1%
Expense ratio (2)	29.3%	29.1%	30.2%	30.1%
Combined ratio (3)	91.5%	90.2%	92.1%	91.1%

(1)	The loss ratio is equal to policyholder benefits divided by net earned premiums and other considerations.

(2)	The expense ratio is equal to selling, underwriting and general expenses divided by net earned premiums and other considerations and fees and other income.

(3)	The combined ratio is equal to total benefits, losses and expenses divided by net earned premiums and other considerations and fees and other income.

For The Three Months Ended September 30, 2007 Compared to The Three Months Ended September 30, 2006.

Net Income

Segment net income decreased $5,482, or 12%, to $39,365 for the three months ended September 30, 2007 from $44,847 for the three months ended September 30, 2006. The decrease in segment net income was primarily attributable to the continuing decline in small employer group net earned premiums and higher claim experience on small employer group business.

Total Revenues

Total revenues decreased $9,577, or 2%, to $540,674 for the three months ended September 30, 2007 from $550,251 for the three months ended September 30, 2006. Net earned premiums and other considerations from our individual markets business increased $17,741, or 5%, due to new member sales and premium rate increases. Although individual medical premiums for the quarter grew, individual medical sales for the quarter declined due to increased competitive pressures. Net earned premiums and other considerations from our small employer group business decreased $25,035, or 13%, due to a decline in members, partially offset by premium rate increases. The decline in the small employer group business is due to increased competition and our adherence to strict underwriting guidelines.

Total Benefits, Losses and Expenses

Total benefits, losses and expenses decreased $104, to $480,407 for the three months ended September 30, 2007 from $480,511 for the three months ended September 30, 2006. Policyholder benefits increased $1,153, or less than 1%, and the benefit loss ratio increased 110 basis points, to 63.5% from 62.4%. The increase in policyholder benefits was primarily due to the growth in the individual medical business, and the deterioration of the benefit loss ratio was primarily a result of higher claim experience in the small employer group business. Selling, underwriting and general expenses decreased $1,257, or 1%, primarily due to lower externally contracted services.

For The Nine Months Ended September 30, 2007 Compared to The Nine Months Ended September 30, 2006.

Net Income

Segment net income decreased $17,232, or 13%, to $113,727 for the nine months ended September 30, 2007 from $130,959 for the nine months ended September 30, 2006. The decrease in segment net income was primarily attributable to the continuing decline in small employer group net earned premiums and higher claim experience on small employer group business.

Total Revenues

Total revenues decreased $31,243, or 2%, to $1,623,087 for the nine months ended September 30, 2007 from $1,654,330 for the nine months ended September 30, 2006. Net earned premiums and other considerations from our individual markets business increased $50,811, or 5%, due to new member sales and premium rate increases. Net earned premiums and other considerations from our small employer group business decreased $74,377, or 13%, due to a decline in members, partially offset by premium rate increases. The decline in small employer group business is due to increased competition and our adherence to strict underwriting guidelines. Also, net investment income decreased $7,487 due to lower real estate investment income and lower average invested assets.

Total Benefits, Losses and Expenses

Total benefits, losses and expenses decreased $4,949, to $1,448,016 for the nine months ended September 30, 2007 from $1,452,965 for the nine months ended September 30, 2006. Policyholder benefits increased $1,542, or less than 1%. The benefit loss ratio increased 110 basis points, to 63.2% from 62.1%. The increase in the benefit loss ratio was due primarily to higher claims experience on small employer group business. Selling, underwriting and general expenses decreased $6,491, or 1%, primarily due to lower externally contracted services.

Assurant Employee Benefits

Overview

The tables below present information regarding Assurant Employee Benefits’ segment results of operations:


	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
	2007			2006			2007			2006
	(in thousands)
Revenues:
Net earned premiums and other considerations	$	284,029		$	291,232		$	853,164		$	899,924
Net investment income		38,046			39,893			129,341			119,476
Fees and other income		6,040			6,685			18,696			21,064

Total revenues		328,115			337,810			1,001,201			1,040,464

Benefits, losses and expenses:
Policyholder benefits		(195,698	)		(196,727	)		(592,593	)		(637,361	)
Selling, underwriting and general expenses		(101,237	)		(103,726	)		(300,325	)		(304,667	)

Total benefits, losses and expenses		(296,935	)		(300,453	)		(892,918	)		(942,028	)

Segment income before provision for income taxes		31,180			37,357			108,283			98,436
Provision for income taxes		(10,788	)		(12,957	)		(37,459	)		(34,261	)

Segment net income	$	20,392		$	24,400		$	70,824		$	64,175

Ratios:
Loss ratio (1)		68.9	%		67.5	%		69.5	%		70.8	%
Expense ratio (2)		34.9	%		34.8	%		34.4	%		33.1	%
Net earned premiums and other considerations

By major product grouping:
Group dental	$	103,770		$	104,367		$	307,872		$	323,770
Group disability single premiums for closed blocks (3)		12,283			12,393			35,130			46,313
All Other group disability		114,904			119,679			348,632			361,112
Group life		53,072			54,793			161,530			168,729

Total	$	284,029		$	291,232		$	853,164		$	899,924

(1)	The loss ratio is equal to policyholder benefits divided by net earned premiums and other considerations.

(2)	The expense ratio is equal to selling, underwriting and general expenses divided by net earned premiums and other considerations and fees and other income.

(3)	This represents single premium on closed blocks of group disability business.

For The Three Months Ended September 30, 2007 Compared to The Three Months Ended September 30, 2006.

Net Income

Segment net income decreased $4,008, or 16%, to $20,392 for the three months ended September 30, 2007 from $24,400 for the three months ended September 30, 2006. The decrease in net income was primarily driven by less favorable experience in the group life business. This decline was partially offset by continued favorable group disability experience.

Total Revenues

Total revenues decreased $9,695, or 3%, to $328,115 for the three months ended September 30, 2007 from $337,810 for the three months ended September 30, 2006. This decline is primarily due to reduced net earned premiums and other considerations, resulting from the continuing implementation of the business’ small case strategy and adherence to pricing discipline. Sales increased 13% for the three months ended September 30, 2007 compared to the prior year period.

Total Benefits, Losses and Expenses

Total benefits, losses and expenses decreased $3,518, or 1%, to $296,935 for the three months ended September 30, 2007 from $300,453 for the three months ended September 30, 2006. Although the benefits, losses and expenses decreased, the loss ratio increased 140 basis points, to 68.9% from 67.5%, driven by less favorable group life experience relative to excellent experience in the prior year third quarter, partially offset by continued favorable group disability experience. The favorable group disability experience was driven by continued good incidence and favorable disability recovery rates. Selling, underwriting, and general expenses have decreased $2,488, or 2%, period over period due to expense reduction efforts by management.

For The Nine Months Ended September 30, 2007 Compared to The Nine Months Ended September 30, 2006.

Net Income

Segment net income increased $6,649, or 10%, to $70,824 for the nine months ended September 30, 2007 from $64,175 for the nine months ended September 30, 2006. The increase in net income was primarily driven by $9,270 (after-tax) of additional investment income from real estate partnerships and continued favorable group disability experience.

Total Revenues

Total revenues decreased $39,263, or 4%, to $1,001,201 for the nine months ended September 30, 2007 from $1,040,464 for the nine months ended September 30, 2006. Excluding group disability single premium for closed blocks, net earned premiums and other considerations decreased $35,576 or 4%. The decrease is primarily a result of the continuing implementation of the business’ small case strategy and adherence to pricing discipline. Sales increased 39% for the nine months ended September 30, 2007 compared to the prior year period. The decrease in net earned premiums was partially offset by an increase in investment income of $9,865, or 8%, primarily driven by an increase in investment income from real estate partnerships.

Total Benefits, Losses and Expenses

Total benefits, losses and expenses decreased $49,110, or 5%, to $892,918 for the nine months ended September 30, 2007 from $942,028 for the nine months ended September 30, 2006. Although the benefits, losses and expenses decreased, the loss ratio increased 130 basis points, to 69.5% from 70.8%, driven by less favorable group life experience relative to excellent experience in the prior year third quarter, partially offset by continued favorable group disability experience. The favorable group disability experience was driven by continued good incidence and favorable disability recovery rates. Selling, underwriting, and general expenses have decreased $4,342, or 1%, period over period due to expense reduction efforts by management. The expense ratio increased 130 basis points, to 34.4% from 33.1%, despite the decline in expenses due to the continued decrease in revenues.

Assurant Corporate & Other

Overview

The Corporate and Other segment includes activities of the holding company, financing expenses, net realized gains (losses) on investments, interest income earned from short-term investments held and additional costs associated with excess of loss reinsurance programs reinsured and ceded to certain subsidiaries in the London market between 1995 and 1997. The Corporate and Other segment also includes the amortization of deferred gains associated with the sales of Fortis Financial Group (“FFG”) (a business we sold via reinsurance in April 2001) and Long Term Care (“LTC”) (a business we sold via reinsurance in March 2000).

The table below presents information regarding the Corporate & Other segment’s results of operations:


	For the Three Months Ended September 30,						For the Nine Months Ended September 30,
	2007			2006			2007			2006
	(in thousands)
Revenues:
Net investment income	$	8,757		$	6,881		$	30,763		$	28,441
Net realized (losses) on investments		(13,076	)		(2,675	)		(10,592	)		(4,855	)
Amortization of deferred gain on disposal of businesses		8,298			9,428			24,893			28,283
Fees and other income		119			703			589			830

Total revenues		4,098			14,337			45,653			52,699

Benefits, losses and expenses:
Policyholder benefits		—			—			—			(5	)
Selling, underwriting and general expenses		(28,060	)		(17,678	)		(63,473	)		(50,081	)
Interest expense		(15,288	)		(15,307	)		(45,881	)		(45,937	)

Total benefits, losses and expenses		(43,348	)		(32,985	)		(109,354	)		(96,023	)

Segment loss before provision for income taxes		(39,250	)		(18,648	)		(63,701	)		(43,324	)
Provision for income taxes		(14,625	)		(5,552	)		(21,099	)		(15,787	)

Segment net loss	$	(24,625	)	$	(13,096	)	$	(42,602	)	$	(27,537	)

For The Three Months Ended September 30, 2007 Compared to The Three Months Ended September 30, 2006.

Net Loss

Segment net loss increased $11,529, or 88%, to ($24,625) for the three months ended September 30, 2007 from ($13,096) for the three months ended September 30, 2006. This deterioration is mainly due to increased realized losses on investments and legal expenses related to the ongoing SEC investigation. This change was partially offset by increased net investment income resulting from higher short-term interest rates.

Total Revenues

Total revenues decreased $10,239, or 71%, to $4,098 for the three months ended September 30, 2007 from $14,337 for the three months ended September 30, 2006. The decline in revenues was mainly due to $10,401 of net realized losses on investments, primarily resulting from approximately $6,700 of fixed income investment writedowns for other than temporary declines in market values. Amortization of deferred gain on disposal of businesses declined by $1,130, in correlation with the runoff of the businesses sold.

Total Benefits, Losses and Expenses

Total benefits, losses and expenses increased $10,363, or 31%, to $43,348 for the three months ended September 30, 2007 from $32,985 for the three months ended September 30, 2006. This increase was mainly due to approximately $4,900 of expenses related to the ongoing SEC investigation. Also contributing to the increase is higher compensation expense and external contracted services fees.

For The Nine Months Ended September 30, 2007 Compared to The Nine Months Ended September 30, 2006.

Net Income

Segment net loss increased $15,065, or 55%, to $(42,602) for the nine months ended September 30, 2007 from $(27,537) for the nine months ended September 30, 2006. This deterioration is mainly due to realized losses on investments primarily resulting from fixed income investment that experienced writedowns for other than temporary declines in market values, increased legal expenses related to an ongoing SEC investigation and expense recognized due to the change in certain tax liabilities. Also, in 2006, the Company recognized $1,547 of income from a cumulative effect of change in accounting principle related to the adoption of FAS 123R. This change was partially offset by increased net investment income resulting from higher short-term interest rates.

Total Revenues

Total revenues decreased $7,046, or 13%, to $45,653 for the nine months ended September 30, 2007 from $52,699 for the nine months ended September 30, 2006. The decline in revenues was mainly due to $5,737 of realized losses on investments, primarily resulting from the writedown of certain fixed income investments that experienced other than temporary declines in market values. Amortization of deferred gain on disposal of businesses declined $3,390, in correlation with the runoff of the businesses sold.

Total Benefits, Losses and Expenses

Total benefits, losses and expenses increased $13,331, or 14%, to $109,354 for the nine months ended September 30, 2007 from $96,023 for the nine months ended September 30, 2006. This increase was primarily due to approximately $4,900 of legal expenses related to the ongoing SEC investigation. Also contributing to the increase is higher compensation expense and external contracted services fees.

Investments

The following table shows the carrying value of our investments by type of security as of the dates indicated:


	As of September 30, 2007				As of December 31, 2006
Fixed maturities	$	9,891,107	73	%	$	9,118,049	73	%
Equity securities		707,204	5	%		741,639	6	%
Commercial mortgage loans on real estate		1,407,742	10	%		1,266,158	10	%
Policy loans		57,747	1	%		58,733	1	%
Short-term investments		319,475	2	%		314,114	3	%
Collateral held under securities lending		654,860	5	%		365,958	3	%
Other investments		546,731	4	%		564,494	4	%

Total investments	$	13,584,866	100	%	$	12,429,145	100	%

Of our fixed maturity securities shown above, 69% and 67% (based on total fair value) were invested in securities rated “A” or better as of September 30, 2007 and December 31, 2006, respectively.

The following table provides the cumulative net unrealized losses/gains (pre-tax) on fixed maturity securities and equity securities as of the dates indicated:


	As of September 30, 2007			As of December 31, 2006
Fixed maturities:
Amortized cost	$	9,873,677		$	8,934,017
Net unrealized gains		17,430			184,032

Fair value	$	9,891,107		$	9,118,049

Equities:
Cost	$	735,797		$	735,566
Net unrealized (losses) gains		(28,593	)		6,073

Fair value	$	707,204		$	741,639

Net unrealized gains on fixed maturity securities decreased $166,602 from December 31, 2006 to September 30, 2007 to a net unrealized gain of $17,430. The decrease is primarily due to widening corporate bond spreads across many sectors during 2007, partially offset by a modest decrease in treasury yields. The 10 year A-rated corporate spread, which started the year at 80 basis points over treasury securities, increased to 134 basis points over treasury securities at September 30, 2007. The yield on 10-year treasury securities decreased 12 basis points between December 31, 2006 and September 30, 2007. Net unrealized gains on equity securities, which consist of Non-Sinking Fund preferred stock, decreased $34,666 from December 31, 2006 to September 30, 2007 to a net unrealized loss of $28,593. The decrease is primarily due to a decline in the Merrill Lynch Preferred Stock Hybrid Securities Index of 7.3%.

Net investment income increased $13,377, or 7%, to $194,049 for the three months ended September 30, 2007 from $180,672 for the three months ended September 30, 2006. The increase is primarily due to an increase in average invested assets. Net investment income increased $47,575, or 9%, to $601,247 for the nine months ended September 30, 2007 from $553,672 for the nine months ended September 30, 2006. The increase is primarily due to an increase in average invested assets and higher investment income from real estate partnerships.

The investment category of the Company’s gross unrealized losses on fixed maturities and equity securities at September 30, 2007 and the length of time the securities have been in an unrealized loss position were as follows :


	Less than 12 months					12 Months or More					Total
	Fair Value		Unrealized Losses			Fair Value		Unrealized Losses			Fair Value		Unrealized Losses
Fixed maturities
Bonds	$	3,879,376	$	(113,627	)	$	1,500,169	$	(47,692	)	$	5,379,545	$	(161,319	)

Equity securities
Non-redeemable preferred stocks	$	435,489	$	(24,087	)	$	124,992	$	(9,371	)		560,481	$	(33,458	)

Total	$	4,314,865	$	(137,714	)	$	1,625,161	$	(57,063	)	$	5,940,026	$	(194,777	)

The total unrealized loss represents 3% of the aggregate fair value of the related securities. Approximately 71% of these unrealized losses have been in a continuous loss position for less than twelve months. The total unrealized losses are comprised of 1,666 individual securities with 83% of the individual securities having an unrealized loss of less than $200. The total unrealized losses on securities that were in a continuous unrealized loss position for greater than six months but less than 12 months were approximately $65,929. There were no securities with an unrealized loss of greater than $200 having a market value below 71% of book value.

As part of our ongoing monitoring process, we regularly review our investment portfolio to ensure that investments that may be other than temporarily impaired are identified on a timely basis and that any impairment is charged against earnings in the proper period. We have reviewed these securities and recorded $6,699 and $0 of additional other than temporary impairments as of September 30, 2007 and 2006, respectively. Due to issuers’ continued satisfaction of the securities’ obligations in accordance with their contractual terms and their continued expectations to do so, as well as our evaluation of the fundamentals of the issuers’ financial condition, we believe that the prices of the securities in an unrealized loss position as of September 30, 2007 in the table discussed above were temporarily depressed primarily as a result of the prevailing level of interest rates at the time the securities were purchased. We have the intent and ability to hold these assets until the date of recovery.

The following table represents our exposure to sub-prime and related mortgages within our fixed maturity portfolio as well as the current net unrealized loss position at September 30, 2007.


	Market Value		Percentage of Portfolio		Net Unrealized Loss
	(in thousands)
Fixed maturity portfolio:
Sub-prime first lien mortgages	$	57,083	0.58	%	$	(876	)
Second lien mortgages (including sub-prime second lien mortgages)		28,678	0.29	%		(1,285	)

Total exposure to sub-prime collateral	$	85,761	0.87	%	$	(2,161	)

At September 30, 2007, approximately 8.0% of the asset-backed and mortgage-backed securities had exposure to the sub-prime mortgage collateral. This represents 0.9% of the total fixed maturity portfolio and 1.3% of the total unrealized loss position. Of the securities with sub-prime exposure, approximately 100% are investment grade rated. We have no sub-prime exposure to Alt-A mortgages or collateralized debt obligations. All asset-backed securities, including those with sub-prime exposure, are reviewed as part of the ongoing other-than-temporary-impairment monitoring process.

The U.S. residential mortgage market is experiencing serious disruption due to credit quality deterioration in a significant portion of loans originated, primarily to non-prime and sub-prime borrowers. At September 30, 2007, only a small portion of our asset-backed or mortgage-backed securities were secured by sub-prime mortgage collateral.

While there are no significant investments in sub-prime backed securities as of September 30, 2007, if the market disruption continues and/or expands beyond the U.S. sub-prime residential mortgage market, these events could ultimately impact on our fixed maturity and mortgage loan portfolio and may have a material adverse effect on our operations, value of its investment portfolio, results of operations, financial position and cash flows.

Liquidity and Capital Resources

Regulatory Requirements

Assurant, Inc. is a holding company, and as such, has limited direct operations of its own. Our holding company assets consist primarily of the capital stock of our subsidiaries. Accordingly, our future cash flows depend upon the availability of dividends and other statutorily permissible payments from our subsidiaries, such as payments under our tax allocation agreement and under management agreements with our subsidiaries. The ability to pay such dividends and to make such other payments will be limited by applicable laws and regulations of the states in which our subsidiaries are domiciled, which subject our subsidiaries to significant regulatory restrictions. The dividend requirements and regulations vary from state to state and by type of insurance provided by the applicable subsidiary. These laws and regulations require, among other things, our insurance subsidiaries to maintain

minimum solvency requirements and limit the amount of dividends these subsidiaries can pay to the holding company. Solvency regulations, capital requirements and rating agencies are some of the factors used in determining the amount of capital used for dividends. For 2007, the maximum amount of distributions our subsidiaries could pay, under applicable laws and regulations without prior regulatory approval for our statutory subsidiaries, is approximately $476,070.

Liquidity

Dividends paid by our subsidiaries to the holding company were $273,905 and $554,270 for the nine months ended September 30, 2007 and for the year ended December 31, 2006, respectively. We use these cash inflows primarily to pay expenses, to make interest payments on indebtedness, to make dividend payments to our stockholders, and to repurchase our outstanding common stock.

The primary sources of funds for our subsidiaries consist of premiums and fees collected, the proceeds from the sales and maturity of investments and investment income. Cash is primarily used to pay insurance claims, agent commissions, operating expenses and taxes. We generally invest our subsidiaries’ excess funds in order to generate investment income.

Generally, our subsidiaries’ premiums, fees and investment income, along with planned asset sales and maturities, provide sufficient cash to pay claims and expenses. However, there are instances where unexpected cash needs arise in excess of that available from usual operating sources. In such instances, we have several options to raise needed funds including selling assets from the subsidiaries’ investment portfolios, using holding company cash (if available), issuing commercial paper and drawing funds from our revolving credit facility. We consider the permanence of the cash need as well as the cost of each source of funds in determining which option to utilize.

We paid dividends to shareholders of $0.12 per common share on September 11, 2007 to shareholders of record as of August 27, 2007, $0.12 per common share on June 12, 2007 to stockholders of record as of May 29, 2007 and $0.10 per common share on March 12, 2007 to stockholders of record as of February 26, 2007. Any determination to pay future dividends will be at the discretion of our Board of Directors and will be dependent upon: our subsidiaries’ payment of dividends and/or other statutorily permissible payments to us; our results of operations and cash flows; our financial position and capital requirements; general business conditions; any legal, tax, regulatory and contractual restrictions on the payment of dividends; and any other factors our Board of Directors deems relevant.

Retirement and Other Employee Benefits

Our qualified and non-qualified pension plans were $113,026 under-funded at December 31, 2006. In prior years we established a funding policy in which service cost plus 15% of qualified plan deficit will be contributed annually. During the first nine months of 2007, we contributed $30,000 to the qualified pension benefits plan. We expect to contribute $40,000 to the qualified pension benefits plan for the full year 2007.

Commercial Paper Program

In March 2004, we established a $500,000 commercial paper program, which is available for working capital and other general corporate purposes. This program is backed up by a $500,000 senior revolving credit facility. On both January 9, 2007 and April 18, 2007, we used $20,000 from the commercial paper program for general corporate purposes. These amounts were subsequently repaid on January 16, 2007 and April 25, 2007, respectively. We incurred a minimal amount of service charge relating to the use of the commercial paper program. There were no amounts relating to the commercial paper program outstanding at September 30, 2007 or December 31, 2006. We did not use the revolving credit facility during the nine months ended September 30, 2007 or the twelve months ended December 31, 2006 and no amounts are outstanding.

The revolving credit facility contains restrictive covenants. The terms of the revolving credit facility also require that we maintain certain specified minimum ratios or thresholds. We are in compliance with all covenants, minimum ratios and thresholds.

Senior Notes

On February 18, 2004, we issued two series of senior notes in an aggregate principal amount of $975,000. The first series is $500,000 in principal amount and bears interest at 5.625% per year. The principal is payable in a single installment due February 15, 2014. The second series is $475,000 in principal amount and bears interest at 6.750% per year. The principal is payable in a single installment due February 15, 2034. Our senior notes are rated bbb by A.M. Best, Baa1 by Moody’s and BBB+ by S&P.

Interest on our senior notes is payable semi-annually on February 15 and August 15 of each year. The senior notes are unsecured obligations and rank equally with all of our other senior unsecured indebtedness. The senior notes are not redeemable prior to maturity.

In management’s opinion, our subsidiaries’ cash flow from operations together with our income and realized gains from our investment portfolio will provide sufficient liquidity to meet our needs in the ordinary course of business.

Cash Flows

We monitor cash flows at both the consolidated and subsidiary levels. Cash flow forecasts at the consolidated and subsidiary levels are provided on a monthly basis, and we use trend and variance analyses to project future cash needs.

The table below shows our recent net cash flows:


	For The Nine Months Ended September 30,
	2007			2006
	(in thousands)
Net cash provided by (used in):
Operating activities (1)	$	844,752		$	621,022
Investing activities		(956,161	)		(526,915	)
Financing activities		(61,116	)		(302,539	)

Net change in cash	$	(172,525	)	$	(208,432	)

(1)	Includes effect of exchange rate changes on cash and cash equivalents.

Net cash provided by operating activities was $844,752 and $621,022 for the nine months ended September 30, 2007 and 2006, respectively. The $223,730 increase in net cash provided by operating activities is primarily due to the increase in gross written premiums from our extended service contracts and creditor placed homeowners businesses and lower claim payments related to hurricane losses during the first nine months in 2007 over the comparable period in 2006.

Net cash used in investing activities was $956,161 and $526,915 for the nine months ended September 30, 2007 and 2006, respectively. The $429,248 increase in net cash used in investing activities is mainly due to the acquisitions of Swansure Group (“Swansure”) and Mayflower, as well as changes in collateral held under securities lending and short term investments.

Net cash used in financing activities was $61,116 and $302,539 for the nine months ended September 30, 2007 and 2006, respectively. The $241,423 decrease in cash used in financing activities is primarily due to changes in collateral held under securities lending.

The table below shows our cash outflows for distributions and dividends for the periods indicated:


	For the Nine Months Ended September 30,
Security	2007		2006
	(in thousands)
Mandatorily redeemable preferred stock dividends and interest paid	$	60,862	$	60,922
Common stock dividends		40,877		35,837

Total	$	101,739	$	96,759

Letters of Credit

In the normal course of business, letters of credit are issued to support reinsurance arrangements and other corporate initiatives. These letters of credit are supported by commitments with financial institutions. We had $33,803 and $33,219 of letters of credit outstanding as of September 30, 2007 and December 31, 2006, respectively.

Item 3.

Quantitative and Qualitative Disclosures About Market Risk.

Our 2006 Annual Report on Form 10-K described our Quantitative and Qualitative Disclosures About Market Risk. There were no material changes to the assumptions or risks during the nine months ended September 30, 2007.

Item 4.

Controls and Procedures.

Evaluation of Disclosure Controls and Procedures

The Company’s interim Chief Executive Officer and interim Chief Financial Officer have evaluated the effectiveness of the Company’s disclosure controls and procedures pursuant to Rule 13a-15 under the Exchange Act of 1934, as of September 30, 2007. This included an evaluation of disclosure controls and procedures applicable to the period covered by and existing through the filing of this periodic report. Based on that review, the Company’s interim Chief Executive Officer and interim Chief Financial Officer have concluded that the Company’s disclosure controls and procedures are effective to provide reasonable assurance that information the Company is required to disclose in its reports under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported accurately including, without limitation, ensuring that such information is accumulated and communicated to the Company’s management as appropriate to allow timely decisions regarding required disclosure.

Internal Controls over Financial Reporting

No material weaknesses were identified at September 30, 2007. During the quarter ending September 30, 2007, we have made no changes in our internal control over financial reporting that have materially affected, or are reasonably likely to materially affect, our internal control over financial reporting.

PART II

OTHER INFORMATION

Item 1.

Legal Proceedings.

As previously disclosed, as part of an ongoing, industry-wide investigation, we have received subpoenas and requests from the Securities and Exchange Commission (“SEC”) in connection with its investigation into certain loss mitigation products. We are cooperating fully and are complying with the requests.

We have conducted an evaluation of the transactions that could potentially fall within the scope of the subpoenas, as defined by the authorities, and has provided information as requested. Based on our investigation to date, we have concluded that there was a verbal side agreement with respect to one of our reinsurers under our catastrophic reinsurance program. While management believes that the difference resulting from the appropriate alternative accounting treatment would be immaterial to our financial position or results of operations, regulators may reach a different conclusion. In 2004 and 2003, premiums ceded to this reinsurer were $2,600 and $1,500, respectively, and losses ceded were $10,000 and zero, respectively. This contract expired in December 2004 and was not renewed.

In July 2007, we learned that each of the following five individuals, Robert B. Pollock, President and Chief Executive Officer, Philip Bruce Camacho, Executive Vice President and Chief Financial Officer, Adam Lamnin, Executive Vice President and Chief Financial Officer of Assurant Solutions/Assurant Specialty Property, Michael Steinman, Senior Vice President and Chief Actuary of Assurant Solutions/Assurant Specialty Property and Dan Folse, Vice President—Risk Management of Assurant Solutions/Assurant Specialty Property, received Wells notices from the SEC in connection with its ongoing investigation. A Wells notice is an indication that the staff of the SEC is considering recommending that the SEC bring a civil enforcement action against the recipient for violating various provisions of the federal securities laws. Under SEC procedures, the recipients have the opportunity to respond to the SEC staff before a formal recommendation is finalized.

On July 17, 2007, we announced that the Board of Directors had placed all five employees on administrative leave, pending further review of this matter. On July 18, the Board of Directors appointed J. Kerry Clayton as interim President and Chief Executive Officer and Michael J. Peninger as interim Chief Financial Officer of the Company. On August 9, 2007, Messrs. Steinman and Folse’s employment with the Company was terminated. Messrs. Pollock, Camacho, and Lamnin remain on administrative leave.

In relation to the SEC investigation discussed above, the SEC may impose fines and/or penalties on the Company and individuals involved; however, we have not accrued for fines and/or penalties since it cannot reasonably estimate the amount of such fines and/or penalties at this time.

Item 1A.

Risk Factors.

Our 2006 Annual Report on Form 10-K described our Risk Factors. As discussed in Note 11- Commitments and Contingences on p. 19 and above in Item 1—Legal Proceedings, additional developments in the SEC investigation have occurred since we filed our last Form 10K. The disclosures in the aforementioned sections are incorporated by reference into the Risk Factors.

Item 2.

Unregistered Sale of Equity Securities and Use of Proceeds.

Repurchase of Equity Securities:


Period	Total Number of Shares Purchased	Average Price Paid per Share		Total Number of Shares Purchased as Part of Publicly Announced Programs (1)	Maximum Number of Shares that may yet be Purchased under the Programs (1)
January 1, 2007 – January 31, 2007	360,000	$	56.12	360,000	9,955,951
February 1, 2007 – February 28, 2007	370,000		54.70	370,000	9,974,021
March 1, 2007 – March 31, 2007	691,833		53.50	691,833	9,250,329
April 1, 2007 – April 30, 2007	623,000		57.01	623,000	8,005,907
May 1, 2007 – May 31, 2007	647,700		59.78	647,700	7,096,088
June 1, 2007 – June 30, 2007	713,700		58.82	713,700	6,447,372
July 1, 2007 – July 31, 2007	971,200		54.98	971,200	6,436,972
August 1, 2007 – August 31, 2007	1,311,900		49.92	1,311,900	5,063,870
September 1, 2007 – September 30, 2007	—		—	—	5,063,870

Total	5,689,333	$	54.94	5,689,333	5,063,870

1.	Shares purchased pursuant to the November 10, 2006 publicly announced repurchase program. As discussed in Note 7-Stock Repurchase, on September 4, the Company announced that it suspended the November 10, 2006 stock buyback program.

Item 6.

Exhibits.

The following exhibits either (a) are filed with this report or (b) have previously been filed with the SEC and are incorporated herein by reference to those prior filings. Exhibits are available upon request at the investor relations section of our website at www.assurant.com.

31.1	Rule 13a-14(a)/15d-14(a) Certification of Principal Executive Officer.

31.2	Rule 13a-14(a)/15d-14(a) Certification of Principal Financial Officer.

32.1	Certification of Chief Executive Officer of Assurant, Inc. pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

32.2	Certification of Chief Financial Officer of Assurant, Inc. pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.


	ASSURANT, INC.

Date: November 9, 2007	By:	/s/ J. Kerry Clayton
	Name:	J. Kerry Clayton
	Title:	Interim President and Chief Executive Officer

Date: November 9, 2007	By:	/s/ Michael J. Peninger
	Name:	Michael J. Peninger
	Title:	Executive Vice President and Interim Chief Financial Officer