Marita Zuraitis
HORACE MANN EDUCATORS CORP /DE/About Marita Zuraitis
President & CEO of Horace Mann Educators Corp. (HMN); age 64; Director since 2013; committees: Executive and Investment & Finance; not independent as a sitting CEO . In 2024, HMN delivered a strong finish with adjusted ROE above 9% and AIP payout at 160.2% of target, while 2022–2024 PBRSUs paid below target at 70.2% (77.2% after a +7% CSR modifier), evidencing pay-for-performance rigor . TSR over the most recent disclosed period lagged peers (value of $100 investment in 2024: HMN $107.23 vs peer group $200.73), but AIP adjusted core earnings met/exceeded targets ($141M vs $129M target) as P&C earnings improved 238% to $49.1M, highlighting operational progress under her tenure .
Past Roles
| Organization | Role | Years | Strategic impact |
|---|---|---|---|
| The Hanover Insurance Group | President, Property & Casualty Companies | 2004–2013 | Executive leadership of P&C; member of Executive Leadership Team |
| The St. Paul/Travelers Companies | President & CEO, Commercial Lines | 6 years (prior to 2004) | Led Commercial Lines; senior leadership in underwriting and operations |
| United States Fidelity & Guaranty; Aetna Life & Casualty | Underwriting and field management roles | Not disclosed | Progressive underwriting and field leadership roles |
External Roles
| Organization | Role | Status/Years | Notes |
|---|---|---|---|
| Citizens Financial Group, Inc. | Director | Current | Public company board; financial services exposure |
| The Institutes (CPCU) | Chair, Board of Trustees | Past | Industry education leadership; risk/insurance acumen |
| LL Global (LIMRA/LOMA) | Director | Past | Insurance industry trade association governance |
Fixed Compensation
| Metric (USD) | FY 2022 | FY 2023 | FY 2024 |
|---|---|---|---|
| Base Salary | $1,000,000 | $1,033,333 | $1,040,000 |
| All Other Compensation | $139,205 | $144,707 | $81,800 |
| Total Reported Compensation | $5,081,705 | $6,135,530 | $8,197,986 |
Notes:
- 2024 base salary held flat; other NEOs received raises to move toward market median; CEO’s 2024 increase applied only to at‑risk pay .
- CEO Pay Ratio for 2024: 105:1 (CEO $8,197,986 vs median employee $78,123) .
Performance Compensation
Annual Incentive Plan (AIP) – 2024 Design and Outcome
| Measure | Threshold | Target | Maximum | Actual | Result | Weight | Payout Contribution |
|---|---|---|---|---|---|---|---|
| AIP Adjusted Core Earnings ($M) | 114 | 129 | 144 | 141 | 182.4% | 50% | 91.2% |
| AIP Adjusted ROE (%) | 7.5 | 8.5 | 9.5 | 9.3 | 182.0% | 25% | 45.5% |
| Insurance Premiums & Contract Charges Earned ($M) | 1,131 | 1,148 | 1,171 | 1,144 | 94.1% | 25% | 23.5% |
| Total AIP Payout vs Target | 100% | 160.2% |
| AIP Target and Payout (CEO) | 2024 |
|---|---|
| Target Opportunity (% of Salary) | 175% |
| Actual AIP Payout (USD) | $2,916,186 |
| Actual as % of Salary | 280.4% |
Design notes: AIP metrics balanced growth and profitability; committee set stretch goals above prior year; maximum AIP capped at 200% of target .
Long‑Term Incentive Plan (LTIP) – Structure and 2024 Grants
| Component | 2024 Target/Grant | Vesting | Performance Basis |
|---|---|---|---|
| Total LTIP Target (CEO) | $4,160,000 | ||
| Performance‑based RSUs (PBRSUs) | Target 58,774 sh; threshold 29,387; max 117,548 | Cliff vest after 3‑year performance period | 50% relative TSR; 50% relative 3‑yr Core ROE; ±10% CSR modifier |
| Service‑vested RSUs | 23,511 sh | 3 annual installments | Time‑based |
| Stock Options | 153,612 options @ $35.39; 10‑yr term | 25% per year over 4 years | Time‑based; value only if stock appreciates |
2022–2024 PBRSU Outcome (matured Jan 1, 2025): 70.2% of target based on relative TSR (33.0%) and relative Core ROE (37.2%); +7% CSR modifier → final payout 77.2% .
Program changes for 2025 (shareholder feedback response): PBRSU weight increased to 60% (from 50%); options reduced to 20% (from 30%); no increase to target CEO pay; CEO ownership guideline raised to 600% of salary .
Equity Ownership & Alignment
| Item | Detail |
|---|---|
| Beneficial Ownership (3/15/2025) | 958,802 shares (2.3% of class) |
| Stock Ownership Guideline (CEO) | 500% of salary in 2024; increased to 600% for 2025 |
| Actual Ownership vs Guideline (2024) | 1,753% (507,436 shares; $18,227,112 12‑mo avg value) |
| Hedging/Pledging | Prohibited for directors and executive officers |
| Post‑Exercise Holding | 12‑month holding of net shares from option exercises |
| Minimum Vesting | 1‑year minimum vesting for all equity grants (except death/disability) |
Outstanding equity awards (12/31/2024):
- Unvested service RSUs: 45,556 sh ($1,787,162 @ $39.23)
- Unearned PBRSUs: 159,556 sh ($6,259,382 @ $39.23)
- Unexercisable options by grant: 26,181 (@$40.10; exp. 2031), 52,898 (@$41.39; exp. 2032), 100,824 (@$35.98; exp. 2033), 153,612 (@$35.39; exp. 2034)
2024 equity activity (liquidity signals):
| Type | Shares | Value |
|---|---|---|
| Options exercised | 145,942 | $1,298,723 |
| Shares vested (stock awards) | 44,503 | $1,571,378 |
Insider trading compliance: One late Form 4 attributed to a system error (reported) .
Employment Terms
| Provision | Terms |
|---|---|
| Employment agreement | Company minimizes individual employment agreements; for succession/retention, Ms. Zuraitis’ outstanding equity will fully vest at separation/retirement if she remains employed through Dec 31, 2027; performance awards still subject to goal achievement |
| Severance plan multiple (no CIC) | 2.0x salary + target bonus; salary continuation |
| Change‑in‑control (CIC) plan | Double‑trigger; 2.5x salary + target bonus; lump sum; no tax gross‑ups; no duplication with severance plan |
| Clawback | Updated Oct 2, 2023 per SEC Rule 10D‑1; applies to incentive‑based pay; misconduct recovery under CECP also retained |
| Deferred comp | NQDCP employer contribution $34,750 in 2024; balance $345,348 at 12/31/2024 |
| Perquisites | Financial planning and limited executive physical; $20,000 perqs; $61,800 company DC plan contributions; total other comp $81,800 (2024) |
Estimated payments if terminated as of Dec 31, 2024:
| Scenario | Cash Severance | AIP | Equity Acceleration (Options/RSUs) | H&W | 280G Cap Adjustment | Total |
|---|---|---|---|---|---|---|
| Involuntary w/o cause (no CIC) | $5,720,000 | $1,820,000 | $0 / $0 | $32,798 | N/A | $7,572,798 |
| Change in control (double trigger) | $7,150,000 | $1,820,000 | $917,548 / $7,503,207 | $32,798 | $(1,967,203) | $15,456,350 |
Board Governance
| Item | Detail |
|---|---|
| Board service | Director since 2013; currently CEO Director |
| Committees | Executive Committee; Investment & Finance Committee |
| Independence | Not independent (employee director) |
| Attendance | Board met 8x in 2024; no incumbent director attended <90% of meetings |
| Director compensation | Employee directors receive no board fees; non‑employee director pay and equity outlined separately |
| Executive sessions | Board Chair presides over executive sessions of non‑employee directors |
Dual‑role note: As CEO and director, Ms. Zuraitis participates on the Executive and Investment & Finance Committees; all standing committees are independent except for her participation, and the Board Chair leads executive sessions to maintain independent oversight .
Compensation Peer Group and Benchmarking
- Peer group (2024) includes multiline and specialty insurers such as Kemper, Hanover, Selective, Primerica, RLI, CNO, Employers, Ambac, ProAssurance, National Western Life, United Fire, White Mountains, et al. (full list in proxy) .
- Philosophy: target around median with discretion for performance/tenure/role complexity; greater emphasis on at‑risk pay for CEO .
- 2024 context: CEO core total direct comp ~15% above median after an 8.9% increase (reflecting experience and complexity); 85% of CEO target pay at risk; ~60% of 2024 target comp in equity .
- 2025 changes after shareholder engagement: increased PBRSU weight to 60%; reduced options to 20%; no increase to target CEO pay; CEO ownership guideline increased to 600% .
Say‑on‑Pay and Shareholder Feedback
- 2024/2025 engagement outcomes: investors asked for clearer benchmarking, metric rationales, and less emphasis on options; HMN responded by holding CEO target flat for 2025, increasing PBRSU weighting to 60%, and enhancing disclosure around goals and peer selection; ROE retained across AIP (absolute) and LTIP (relative) with rationale disclosed .
Related Party Transactions and Policies
- Audit Committee reviews/approves related party transactions >$120k; policy posted online; 2024 payments to BlackRock for analytics software (~$375,634) and investments in BlackRock‑managed funds disclosed; no other related party transactions requiring disclosure .
- Insider trading: strict pre‑clearance; 10b5‑1 plans permitted under SEC rules; prohibitions on short sales, derivatives, margin, hedging/pledging .
Performance & Track Record
| Indicator | 2021 | 2022 | 2023 | 2024 |
|---|---|---|---|---|
| HMN TSR – $100 initial value | 94.37 | 94.31 | 86.04 | 107.23 |
| Peer Group TSR – $100 initial value | 131.54 | 144.86 | 158.28 | 200.73 |
| AIP Adjusted Core Earnings ($M) | 161.70 | 133.00 | 85.50 | 141.00 |
Additional 2024 operational highlight: P&C earnings improved 238% to $49.1M vs a loss of $35.5M in 2023, materially contributing to the above‑target AIP outcome (160.2%) .
Compensation Committee and Governance Practices
- Compensation Committee (independent): Mark E. Konen (Chair), Beverley J. McClure, H. Wade Reece .
- Independent consultant: Compensation Advisory Partners (CAP) supports peer selection and market analysis .
- Practices: no option repricing/exchange without shareholder approval; clawback policy compliant with NYSE/SEC; double‑trigger CIC; no tax gross‑ups; minimum one‑year vesting .
Investment Implications
- Alignment positives: significant personal ownership (2.3% of shares; 1,753% of salary vs 500%/600% guideline), strong at‑risk mix (85% of target; 60% equity), strict hedging/pledging prohibitions, double‑trigger CIC with no gross‑ups, and enhanced PBRSU weighting in 2025 following investor feedback—favorable for long‑term alignment and reduced agency risk .
- Retention: special vesting arrangement if employed through 12/31/2027, plus sizable unvested RSUs and unexercisable options vesting through 2027, suggest low near‑term departure risk but create potential share supply around vesting dates (mitigated by 12‑month post‑exercise holding and 10b5‑1 plans) .
- Pay-for-performance: 2024 AIP paid 160.2% on strong ROE/earnings; PBRSUs for 2022–2024 paid below target (77.2% incl. CSR), evidencing outcome sensitivity to multi‑year relative metrics—balanced but may under‑reward near‑term rebounds if not sustained .
- Governance/dual‑role: CEO also serves on the Board (Exec and I&F). Independent committees and Board Chair‑led executive sessions help mitigate independence concerns; continued disclosure and independent oversight remain important .
- Performance risk: TSR trail to peers over the recent window while operations improved; sustained underwriting/investment execution will be key to unlocking relative TSR and LTIP outcomes; watch for continued ROE trajectory and PBRSU cohort performance into 2025–2027 .