Keith W. Demmings
President and Chief Executive Officer at Assurant
Thanks, Sean, and good morning, everyone. Our strong first half 2024 results demonstrate continued outperformance from Global Housing, and underlying momentum in Connected Living, positioning us to increase our full year 2024 growth expectations for Assurant overall. Excluding reportable catastrophes, adjusted EBITDA increased 20% year-to-date and adjusted EPS grew 29%. These results reflect the power of our combined Housing and Lifestyle business model.
Starting with our first half business highlights. In Global Lifestyle, first half 2024 adjusted EBITDA was $397 million, consistent with the first half of 2023. Our year-to-date performance has been driven by continued growth and momentum within our Connected Living business, particularly in the U.S. In Connected Living, adjusted EBITDA increased 6% or 8% on a constant currency basis. As we previously discussed, 2024 includes incremental spending related to the implementation of new partnerships and programs that we expect will support long-term growth for Assurant.
Excluding first half investments of approximately $13 million, year-to-date growth for Connected Living was 14% on a constant currency basis. One example of our innovative new offerings included the rollout of two programs with Spectrum Mobile, anytime upgrade and the repair and replace plan. Additionally, we onboarded the pre and postpaid device protection subscribers of Telstra, our new partner in Australia. Combined, these new programs added 1.6 million mobile subscribers, driving strong sequential growth.
This year, we've also completed long-term contract extensions with all of our major U.S. mobile device protection clients, including T-Mobile and two U.S. cable operators, continuing to strengthen our position in the market. In total, these renewals represent three of the top five largest U.S. carriers by subscribers. With T-Mobile, this included a multi year contract extension to continue supporting their postpaid and prepaid consumers beyond 2030. The renewal of T-Mobile allows us to continue to invest in this critical partnership and drive innovation for the future.
In Financial Services, we expanded our long standing relationship with Chase. By partnering with Chase card services within our growing card benefits business, we executed a multi year contract to provide coverage to millions of Chase cardholders. This program will provide end-to-end delivery for approximately 15 travel and purchase protection benefits, including underwriting, claim processing, and benefit servicing. We expect continued investments over the second half of this year as we move toward program launch at the end of 2024. This represents a marquee win for our card benefits business, which has gained strong momentum over the last several years. Our relationship with Chase now spans across our Lifestyle and Housing businesses, reinforcing the depth of client partnerships that we drive across the Assurant enterprise.
Moving to Global Automotive. Our first half earnings have continued to be pressured by ongoing inflation impacts on motor vehicle repair costs. We expect that the effects of inflation will continue to impact our auto results throughout the second half of 2024 in our vehicle service contract business. In addition, we expect continued elevated loss experience within our ancillary guaranteed asset protection, or GAP product. Our longer term outlook, however, is bright as we've begun to see moderation of claims inflation on our vehicle service contract business given the rate actions taken over the past 24 months.
Within our GAP product, we're experiencing elevated losses, driven by the combination of continued declines in used car prices from pandemic highs, higher interest rates, and the increase in the number of vehicles declared total losses by the primary insurance carrier. We expect this impact to be shorter term in nature relative to vehicle service contracts, as the majority of GAP claims are made within the first 24 months after vehicle purchase. In addition, over the past year we've been proactively partnering with several clients to transition the risk on the GAP business, which will reduce a substantial amount of our claims exposure over time. Lastly, we believe the auto business will continue to benefit from our position as a market leader with scale and strong partnerships across multiple distribution channels.
Now, let's turn to Global Housing. For the first half of the year, Global Housing's earnings increased nearly 45%, excluding reportable catastrophes. Housing's year-to-date results have demonstrated both the importance of the business to our overall portfolio and the power of our unique and differentiated business model, which has largely outperformed the broader P&C market. Our lender-placed insurance business safeguards homes that need insurance regardless of geography, while supporting the U.S. mortgage industry by removing the risk of uninsured loss for lenders, investors and homeowners. We review rates with each state on a regular basis to ensure that they are appropriate and that homeowners are protected. This process allows us to work together to balance risk and reward with fair and adequate rates while creating product safeguards to address macroeconomic factors such as inflation.
In addition, we benefit from our strong track record, continued investments in customer experience and our compliance expertise, our most critical competitive advantages. These efforts have allowed us to renew existing partnerships and win new clients, including Bank of America. This in turn has contributed to increased scale, which combined with technology investments, has led to significant operational efficiencies. Ultimately, this creates meaningful expense leverage, which we'll continue to benefit from going forward.
Our specialized product and client base provide Assurant with differentiated advantages compared to many traditional homeowners insurance carriers. Overall, these combined advantages have led to the recovery and growth of this business within a relatively short time frame. We believe we are well positioned and we continue to believe there's an opportunity for the market to better value our specialized lender-placed business.
In renters, we benefit from an attractive financial profile that is more capital efficient compared to traditional P&C businesses. We are focused on expanding our presence as a market leader within the property management company, or PMC channel, while providing our partners with innovative new offerings. In the first half of the year, we increased gross written premiums in our PMC channel by over 20%, reflecting strong client demand for our Cover360 solution. This marks eight straight quarters of double-digit growth of gross written premium in the PMC channel. Following the initial launch of our Assurant Tech Pro resident troubleshooting service, we recently signed a partnership with the largest PMC in the U.S. to be the first to provide this service to the industry. We expect to begin rollout in the second half of this year.
Turning to our enterprise outlook. Given the strength of our first half results, we now expect full year adjusted EBITDA to grow high single digits and adjusted earnings per share to increase low double digits, both excluding catastrophes. This represents an increase from our initial expectation for both metrics. We anticipate strong growth within Global Housing, which is expected to lead our enterprise growth for 2024. In Global Lifestyle, we expect modest growth in 2024. Connected Living is expected to deliver another year of growth as we remain focused on driving long-term momentum through new partnerships and programs.
Overall, we believe our first half performance and our increased 2024 outlook demonstrate the power of our differentiated business model with unique advantages which make Assurant attractively valued. Over time, we've enhanced Assurant's risk profile by focusing on our capital efficient businesses within Lifestyle and Housing, which are highly cash generative. We've established a track record of winning and delivering for B2B2C clients throughout both Lifestyle and Housing, many of whom are industry leaders and market disruptors across the globe.
We've created leadership positions and amplified competitive advantages through our protection solutions across devices, automobiles and homes. Together with our clients, we've seen these deliver mutual benefit from scale and deep integration, supporting innovative and flexible solutions to differentiate the customer experience. We focused on specialized, attractive markets with growth opportunities and long term secular tailwinds. These factors contributed to long-term outperformance versus the broader PNC market, particularly the S&P Composite 1500 P&C Index. We believe this comparison better reflects our current mix of businesses and offerings as we provide insurance solutions and fee-based services to our partners and their end consumers. In June, our subindustry index classification under the Global Industry Classification standard, or GICs, transition from multiline insurance to P&C insurance, a product of our multi year transformation that included exiting preneed, health and life insurance related businesses.
Before handing it over to Keith Meier, I wanted to highlight our recently published 2024 Sustainability Report, which demonstrates our progress in advancing our sustainability strategy and initiatives. We've introduced our new sustainability vision focused on advancing a connected, respected and protected world. We've established long-term ambitions to support a thriving society, a circular economy and a stable climate. We believe there's an important connection between our vision and ambitions and how we deliver value for our business and for our stakeholders. These priorities strengthen Assurant for the future, including how we attract, empower and reward a diverse workforce to drive innovation, contribute to the development and adoption of sustainable products and reduce the climate impact of Assurant's operations and supply chain.
Overall, we're excited about the progress we've made so far this year, continuing to drive attractive financial results and outperformance for the overall enterprise. As we look ahead, we believe we are well positioned to continue to drive business momentum in the second half and beyond.
I'll now turn it over to Keith Meier, to review our second quarter results and business trends impacting our 2024 outlook.
