This 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, 2008, compared with December 31, 2007, and our results of operations for the three and nine months ended September 30, 2008 and 2007. This discussion should be read in conjunction with our MD&A and annual audited consolidated financial statements as of December 31, 2007 included in our Annual Report on Form 10-K for the year ended December 31, 2007 filed with the U.S. Securities and Exchange Commission (the "SEC") and the September 30, 2008 unaudited consolidated financial statements and related notes included elsewhere in this Form 10-Q.

Some of the statements included in this MD&A and elsewhere in this report, particularly those anticipating future financial performance, business prospects, growth and operating strategies and similar matters, are forward-looking statements that involve a number of risks and uncertainties. You can identify these statements by the fact that they may use words such as "will," "may," "anticipates," "expects," "estimates," "projects," "intends," "plans," "believes," "targets," "forecasts," "potential," "approximately," or the negative version of those words and other words and terms with a similar meaning. 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. Our actual results might differ materially from those projected in the forward-looking statements. The Company undertakes no obligation to update or review any forward-looking statement, whether as a result of new information, future events or other developments.

In addition to the factors described in the section below entitled "Critical Factors Affecting Results," the following risk factors could cause our actual results to differ materially from those currently estimated by management:
(i) failure to maintain significant client relationships, distribution sources and contractual arrangements; (ii) failure to attract and retain sales representatives; (iii) general global economic, financial market and political conditions (including difficult conditions in financial markets and the global economic slowdown, fluctuations in interest rates, mortgage rates, monetary policies and inflationary pressure); (iv) inadequacy of reserves established for future claims losses; (v) failure to predict or manage benefits, claims and other costs; (vi) diminished value of invested assets in our investment portfolio (due to, among other things, the recent volatility in financial markets and global economic slowdown, credit and liquidity risk, environmental liability exposure and inability to target an appropriate overall risk level);
(vii) losses due to natural and man-made catastrophes; (viii) unavailability, inadequacy and unaffordable pricing of reinsurance coverage; (ix) inability of reinsurers to meet their obligations; (x) insolvency of third parties to whom we have sold or may sell businesses through reinsurance or modified co-insurance;
(xi) credit risk of some of our agents in Assurant Specialty Property and Solutions; (xii) a further decline in the manufactured housing industry;
(xiii) a decline in our credit or financial strength ratings (including the current heightened risk of rating downgrades in the insurance industry);
(xiv) failure to effectively maintain and modernize our information systems;
(xv) failure to protect client information and privacy; (xvi) failure to find and integrate suitable acquisitions and new insurance ventures; (xvii) inability of our subsidiaries to pay sufficient dividends; (xviii) failure to provide for succession of senior management and key executives; (xix) negative publicity and impact on our business due to unfavorable outcomes in litigation and regulatory investigations (including the potential impact on our reputation and business of a negative outcome in the ongoing SEC investigation); (xx) significant competitive pressures in our businesses and cyclicality of the insurance industry: (xxi) current or new laws and regulations that could increase our costs or limit our growth. These risk factors should not be construed as exhaustive and should be read in conjunction with the other cautionary statements that are included in this report. For a more detailed discussion of the risk factors that could affect our actual results, please refer to the "Risk Factors" in item 1A of this Form 10-Q and in our 2007 Annual Report on Form 10-K.

Company Overview

Assurant is a premier provider of specialized insurance products and related services in North America and selected international markets. We have five reportable segments, four of which are operating segments, Assurant Solutions, Assurant Specialty Property, Assurant Health, and Assurant Employee Benefits. These operating 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 and values of invested assets and our ability to manage our expenses. Therefore, factors affecting these items, including difficult conditions in financial markets and the global economic slowdown, may have a material adverse effect on our results of operations or financial condition.

For information on how the current state of the global capital and credit markets may affect our results, refer to "Item 1A-Risk Factors."

Critical Accounting Policies and Estimates

Our 2007 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 2007 Annual Report on Form 10-K were consistently applied to the unaudited interim consolidated financial statements for the nine months ended September 30, 2008.

Assurant Consolidated

Overview

The tables below present information regarding our consolidated results of
operations:



                                              For the Three Months Ended          For the Nine Months Ended
                                                     September 30,                      September 30,
                                                 2008              2007              2008             2007
                                                                      (in thousands)
Revenues:
Net earned premiums and other
considerations                              $    1,984,136      $ 1,893,388     $    5,921,069     $ 5,451,584
Net investment income                              192,314          194,049            591,299         601,247
Net realized losses on investments                (299,205 )        (13,076 )         (376,922 )       (10,592 )
Amortization of deferred gain on disposal
of businesses                                        7,379            8,298             22,085          24,893
Fees and other income                               69,911           65,533            223,089         203,050

Total revenues                                   1,954,535        2,148,192          6,380,620       6,270,182

Benefits, losses and expenses:
Policyholder benefits                            1,095,048          935,545          3,030,715       2,727,120
Selling, underwriting and general
expenses (1)(2)                                  1,007,817          913,214          2,932,318       2,683,044
Interest expense                                    15,190           15,288             45,765          45,881

Total benefits, losses and expenses              2,118,055        1,864,047          6,008,798       5,456,045

(Loss) income before (benefit) provision
for income taxes                                  (163,520 )        284,145            371,822         814,137
(Benefit) provision for income taxes               (52,091 )         96,954            106,467         281,209

Net (loss) income                           $     (111,429 )    $   187,191     $      265,355     $   532,928

(1) Includes amortization of deferred acquisition costs ("DAC") and value of business acquired ("VOBA").

(2) Includes commissions, taxes, licenses and fees.

The following discussion provides a high level analysis of how the consolidated results were affected by our four operating segments and our Corporate and Other segment for the three and nine months ended September 30, 2008 ("Third Quarter 2008" and "Nine Months 2008", respectively) and three and nine months ended September 30, 2007 ("Third Quarter 2007" and "Nine Months 2007", respectively). Please see the discussion that follows, for each of these segments, for a more detailed analysis of the fluctuations.

For The Three Months Ended September 30, 2008 Compared to The Three Months Ended September 30, 2007.

Net Income

Third Quarter 2008 incurred a net loss of $(111,429), a decrease of $298,620, or 160%, compared with $187,191 in net income for Third Quarter 2007. The decrease was primarily due to net realized losses on investments of $194,483 (after-tax) and losses associated with hurricanes Gustav and Ike of $86,200 (after-tax). Included in realized losses are other-than-temporary impairments of $148,946 (after-tax).

For The Nine Months Ended September 30, 2008 Compared to The Nine Months Ended September 30, 2007.

Net Income

Net income decreased $267,573, or 50%, to $265,355 for Nine Months 2008 from $532,928 for Nine Months 2007. The decrease was primarily due to the reasons noted above.

Assurant Solutions

Overview

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



                                            For the Three Months Ended          For the Nine Months Ended
                                                   September 30,                      September 30,
                                               2008               2007             2008             2007
                                                                    (in thousands)
Revenues:
Net earned premiums and other
considerations                            $      707,115       $  649,915     $    2,091,237     $ 1,851,601
Net investment income                            105,539          105,631            320,694         318,432
Fees and other income                             40,623           36,623            132,572         115,631

Total revenues                                   853,277          792,169          2,544,503       2,285,664

Benefits, losses and expenses:
Policyholder benefits                            295,190          284,755            888,043         786,626
Selling, underwriting and general
expenses (4)(5)                                  527,779          451,510          1,506,385       1,334,295

Total benefits, losses and expenses              822,969          736,265          2,394,428       2,120,921

Segment income before provision for
income taxes                                      30,308           55,904            150,075         164,743
Provision for income taxes                         9,921           18,527             49,776          53,087

Segment net income                        $       20,387       $   37,377     $      100,299     $   111,656

Net earned premiums and other
considerations:
Domestic:
Credit                                    $       70,270       $   75,638     $      213,331     $   232,668
Service contracts                                334,386          292,762            989,453         834,899
Other (1)                                         13,685           14,496             44,305          46,702

Total Domestic                                   418,341          382,896          1,247,089       1,114,269

International:
Credit                                            98,645           98,431            285,570         287,721
Service contracts                                 93,745           64,561            261,540         169,821
Other (1)                                           (139 )          8,307             16,362          27,546

Total International                              192,251          171,299            563,472         485,088

Preneed                                           96,523           95,720            280,676         252,244

Total                                     $      707,115       $  649,915     $    2,091,237     $ 1,851,601

Fees and other income:
Domestic:
Debt protection                           $        8,495       $    7,415     $       24,694     $    23,634
Service contracts                                 18,472           16,679             56,783          50,746
Other (1)                                          6,873            6,320             20,047          18,018

Total Domestic                                    33,840           30,414            101,524          92,398

International                                      7,272            5,179             26,718          14,055
Preneed                                             (489 )          1,030              4,330           9,178

Total                                     $       40,623       $   36,623     $      132,572     $   115,631

Gross written premiums (2):
Domestic:
Credit                                    $      151,717       $  168,135     $      456,788     $   497,716
Service contracts                                385,153          434,465          1,175,121       1,337,012
Other (1)                                         17,858           22,353             51,692          65,232

Total Domestic                                   554,728          624,953          1,683,601       1,899,960

International:
Credit                                           213,322          219,945            646,941         612,713
Service contracts                                133,226          118,754            344,942         285,284
Other (1)                                          1,375           11,176             21,685          35,531

Total International                              347,923          349,875          1,013,568         933,528

Total                                     $      902,651       $  974,828     $    2,697,169     $ 2,833,488

Preneed (face sales)                      $      121,021       $  107,341     $      346,304     $   295,759
Combined ratio (3):
Domestic                                           104.7 %          100.9 %            100.2 %         100.9 %
International                                      105.6 %          102.3 %            106.4 %         104.7 %

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

(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.

(4) Includes amortization of DAC and VOBA.

(5) Includes commissions, taxes, licenses and fees.

For The Three Months Ended September 30, 2008 Compared to The Three Months Ended September 30, 2007.

Net Income

Segment net income decreased $16,990, or 45%, to $20,387 for Third Quarter 2008 from $37,377 for Third Quarter 2007. The decrease was primarily due to less favorable results in our domestic service contract business, including the effects of the termination of the existing strategic alliance with General Electric ("GE"). Also contributing to the decrease was less favorable credit insurance loss experience in the United Kingdom and increased expenses in certain countries to support our international expansion. Partially offsetting these declines were favorable client settlements related to reserves previously established for a credit life product in Brazil.

On September 26, 2008, the Company acquired the Warranty Management Group business from GE Consumer & Industrial, a unit of GE. The Company paid GE $140,000 in cash for the sale, transfer and conveyance of certain assets and will assume certain liabilities. As part of the acquisition, the Company entered into a new 10-year agreement to market extended warranties and service contracts on GE-branded major appliances in the United States.

In a separate transaction, GE paid the Company $115,000 in cash in connection with the termination of the existing strategic alliance. Under the pre-existing relationship, the Company sold extended warranties directly to GE appliance purchasers and through leading retailers. After the acquisition, the Company assumed full responsibility for operating the extended warranty business it previously co-managed and shared with GE. Due to the termination of the existing strategic alliance, the Company reduced its deferred acquisition costs ("DAC") asset.

Total Revenues

Total revenues increased $61,108, or 8%, to $853,277 for Third Quarter 2008 from $792,169 for Third Quarter 2007. The increase in revenues is primarily attributable to increased net earned premiums and other considerations of $57,200. This increase is due to growth in our domestic and international service contract business, which was driven by higher earnings on premiums written in prior periods. We also experienced growth

in our Preneed life insurance ("Preneed") business from increased earnings from our existing exclusive distribution partnership with Service Corporation International ("SCI") funeral homes. These increases were partially offset by the continued runoff of our domestic credit insurance and Preneed Independent US business and a recently acquired runoff block of preneed business from Mayflower National Life Insurance Company ("Mayflower"). Subsequent to the acquisition, we merged Mayflower, a leading provider of preneed insurance products and services, into our existing preneed life insurer, American Memorial Life Insurance Company, where we continue to write all new preneed business. Also contributing to the increase in revenues was an increase in fees and other income of $4,000, or 11%, primarily from various international acquisitions made in and subsequent to Third Quarter 2007, combined with the continued growth of our service contract businesses.

Gross written premiums decreased $72,177, to $902,651 in the Third Quarter 2008 from $974,828 for Third Quarter 2007. Gross written premiums from our domestic service contract business decreased $49,312, primarily due to the store closings of a client and the impact of lower retail sales from other clients, partially offset by increases in premium from new clients. Gross written premiums from our domestic credit insurance business decreased $16,418 due to the continued runoff of this product line. Gross written premiums from our international credit business decreased $6,623 primarily driven by credit difficulties experienced in the United Kingdom housing market. This was offset by growth in other countries from increased marketing efforts, strong client production, and the favorable impact of foreign exchange rates. Partially offsetting these decreases is increased gross written premiums in our international service contracts business of $14,472 primarily from growth with both new and existing clients, which is consistent with our international expansion strategy, and the favorable impact of foreign exchange rates. We experienced an increase in our Preneed face sales of $13,680 primarily due to new business generated from former Alderwoods funeral homes and growth from our existing exclusive distribution partnership with SCI funeral homes.

Total Benefits, Losses and Expenses

Total benefits, losses and expenses increased $86,704, or 12%, to $822,969 for Third Quarter 2008 from $736,265 for Third Quarter 2007. Policyholder benefits increased $10,435, primarily driven by the growth in net earned premiums from our domestic and international service contract and Preneed businesses. This was partially offset by improved loss experience in our international business including the improved results in the credit life product in Brazil. Selling, underwriting and general expenses increased $76,269. Commissions, taxes, licenses and fees, of which amortization of DAC is a component, increased $62,637, primarily due to an increase in the overall commission rate caused by the change in business mix. This was evidenced by higher earnings in our service contract business, which has higher commission rates, compared to the lower commission rates on the decreasing domestic credit business. Additionally, Third Quarter 2008 includes the effects of the termination of the existing strategic alliance with GE. General expenses increased $13,632, due to higher employment expenses associated with our continued investment in international expansion combined with the amortization of intangibles associated with international acquisitions made during the latter part of 2007.

For The Nine Months Ended September 30, 2008 Compared to The Nine Months Ended September 30, 2007.

Net Income

Segment net income decreased $11,357, or 10%, to $100,299 for Nine Months 2008 from $111,656 for Nine Months 2007. The decrease is due in part to income recognized of $8,600 (after-tax) in 2007 related to settlement fees received related to the sale of marketing rights for the Independent U.S. Preneed business and the completed clients commission reconciliation project. In addition, net income decreased due to less favorable loss experience in our international businesses and continued investments made to support our strategic international expansion and higher expenses associated with the acquisitions internationally during the latter part of 2007. Net investment income increased $1,470 (after-tax). This increase is primarily attributable to an increase of approximately $10,900 (after-tax) resulting from higher average invested assets attributable to growth in our international and domestic service contract business partially offset by decreased investment income from lower distributions from real estate joint venture partnerships of approximately $9,400 (after-tax). The decrease in real estate joint venture partnership income is due to greater sales of underlying properties in Nine Months 2007 compared with Nine Months 2008 given more favorable real estate market conditions in 2007.

Total Revenues

Total revenues increased $258,839, or 11%, to $2,544,503 for Nine Months 2008 from $2,285,664 for Nine Months 2007. The increase in revenues is primarily attributable to increased net earned premiums and other considerations of $239,636. This increase is due to growth in our domestic and international service contract business driven by higher earnings on premiums written in prior periods. We also experienced growth in our Preneed business from increased earnings from the acquisition of Mayflower in late 2007 and earnings from the existing exclusive distribution partnership with SCI funeral homes. These increases were offset by the continued runoff of our domestic credit insurance and the Preneed Independent US businesses. Also contributing to the increase in revenues was an increase in fees and other income of $16,941, or 15%, primarily from various international acquisitions made during the latter part of 2007 combined with the continued growth of our service contract businesses. Net investment income increased $2,262, or 1%, despite net investment income of $15,680 recognized in Nine Months 2007 from real estate joint venture partnerships compared with $1,210 in Nine Months 2008. Absent this investment income from real estate joint venture partnerships, net investment income increased $16,732, or 6%, primarily attributable to higher average invested assets from growth in our international and domestic service contract businesses.

Gross written premiums decreased $136,319, to $2,697,169 in the Third Quarter 2008 from $2,833,488 for Third Quarter 2007. Gross written premiums from our domestic service contract business decreased $161,891, primarily due to the store closings of a client and the impact of lower retail sales from other clients, partially offset by increases in premium from new clients. Gross written premiums from our domestic credit insurance business decreased $40,928 due to the continued runoff of this product line. These decreases were partially offset by increased gross written premiums in our international business. Gross written premiums from our international credit business increased $34,228 primarily driven by increased marketing efforts, strong client production, and the favorable impact of foreign exchange rates partially offset by credit difficulties experienced in the United Kingdom housing market. Gross written premiums in our international service contracts business increased $59,658 primarily from growth with both new and existing clients consistent with our international expansion strategy, and the favorable impact of foreign exchange rates. We experienced an increase in our Preneed face sales of $50,545 primarily due to new business generated from former Alderwoods funeral homes and growth from our existing exclusive distribution partnership with SCI funeral homes.

Total Benefits, Losses and Expenses

Total benefits, losses and expenses increased $273,507, or 13%, to $2,394,428 for Nine Months 2008 from $2,120,921 for Nine Months 2007. Policyholder benefits . . .