Unum Group - FORM 8-K - EX-99.2 - EXHIBIT - August 5, 2013

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Unum Group
Statistical Supplement Second Quarter 2013

 TABLE OF CONTENTS

(dollars in millions, except share data and where noted)
Interim Results are Unaudited

 
 
Page
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Segment operating results exclude net realized investment gains or losses, non-operating retirement-related gains or losses, and income tax.
 
 
 
 
See "Notes to Statistical Supplement" on page 15 for a discussion of non-GAAP financial measures and significant transactions and events.
 
 
 
 
N.M. = not a meaningful percentage



Unum Group Financial Highlights

 
Three Months Ended
 
Six Months Ended
 
Year Ended
 
6/30/2013
 
6/30/2012
 
6/30/2013
 
6/30/2012
 
12/31/2012
 
12/31/2011
 
12/31/2010
Premium Income
$
1,905.8

 
$
1,927.6

 
$
3,836.7

 
$
3,849.5

 
$
7,716.1

 
$
7,514.2

 
$
7,431.4

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Segment Operating Revenue
$
2,588.6

 
$
2,620.0

 
$
5,203.1

 
$
5,218.9

 
$
10,459.2

 
$
10,282.9

 
$
10,168.5

Net Realized Investment Gain (Loss)
13.3

 
(2.1
)
 
23.6

 
10.3

 
56.2

 
(4.9
)
 
24.7

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Revenue
$
2,601.9

 
$
2,617.9

 
$
5,226.7

 
$
5,229.2

 
$
10,515.4

 
$
10,278.0

 
$
10,193.2

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net Income
$
218.6

 
$
216.4

 
$
431.2

 
$
430.3

 
$
894.4

 
$
284.2

 
$
878.7

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Assets
 
 
 
 
$
59,366.2

 
$
60,678.7

 
$
62,236.1

 
$
59,555.2

 
$
56,602.7

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Stockholders' Equity
 
 
 
 
$
8,380.6

 
$
8,385.9

 
$
8,612.6

 
$
8,169.7

 
$
8,484.9


2013
In June 2013, we announced plan amendments which freeze participation and benefit accruals in our U.S. qualified and non-qualified defined benefit pension plans, effective December 31, 2013. Because the amendments eliminate all future service accruals subsequent to December 31, 2013 for active employees in these plans, we were required to remeasure the benefit obligations of our U.S. plans during the second quarter of 2013, which decreased our net pension liability by $327.4 million, with a corresponding increase in other comprehensive income, less applicable income tax of $114.6 million. The decrease in the net pension liability resulted primarily from the curtailment of benefits under the plan amendments as well as an increase in the discount rate assumption used to remeasure the benefit obligations.

2012
Effective January 1, 2012, we adopted an accounting standards update regarding the capitalization of costs associated with the acquisition of insurance contracts and applied the amendments retrospectively. Operating income by segment has been adjusted to reflect our retrospective adoption.

We previously allocated the amortization of prior period actuarial gains or losses, the component of the net periodic benefit costs for our pensions and other postretirement benefit plans which we consider to be non-operating, to our Corporate segment. During the first quarter of 2012, we determined that we would modify our segment reporting. Effective January 1, 2012, the amortization of prior period actuarial gains or losses was no longer included in operating income or operating loss by segment. Prior period segment results for our Corporate segment have been adjusted to conform to current year reporting.
2011
Year ended December 31, 2011 results included the following:
•
A deferred acquisition costs impairment charge of $196.0 million before tax and $127.5 million after tax related to our long-term care closed block business.
•
A reserve charge of $573.6 million before tax and $372.8 million after tax related to our long-term care closed block business.
•
A reserve charge of $183.5 million before tax and $119.3 million after tax related to our individual disability closed block business.
•
An income tax benefit of $41.3 million due to a final settlement with the Internal Revenue Service with respect to our appeal of audit adjustments for the tax years 1996 to 2004.
•
An income tax charge of $18.6 million related to the repatriation of £150.0 million of dividends from our U.K. subsidiaries.
2010
Year ended December 31, 2010 results included a tax charge of $10.2 million to reflect the impact of a tax law change.

 
1
 


Unum Group Per Common Share Information

 
Three Months Ended
 
Six Months Ended
 
Year Ended
 
6/30/2013
 
6/30/2012
 
6/30/2013
 
6/30/2012
 
12/31/2012
 
12/31/2011
 
12/31/2010
Net Income
 
 
 
 
 
 
 
 
 
 
 
 
 
Basic
$
0.82

 
$
0.76

 
$
1.61

 
$
1.50

 
$
3.18

 
$
0.94

 
$
2.70

Assuming Dilution
$
0.82

 
$
0.76

 
$
1.61

 
$
1.50

 
$
3.17

 
$
0.94

 
$
2.69

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Dividends Paid
$
0.130

 
$
0.105

 
$
0.260

 
$
0.210

 
$
0.470

 
$
0.395

 
$
0.350

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Price (UNM closing price on last trading day of period)
 
 
 
 
$
29.37

 
$
19.13

 
$
20.82

 
$
21.07

 
$
24.22


 
6/30/2013
 
6/30/2012
 
12/31/2012
 
12/31/2011
 
12/31/2010
 
(in millions)
 
per share
 
(in millions)
 
per share
 
(in millions)
 
per share
 
(in millions)
 
per share
 
(in millions)
 
per share
Book Value
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total Stockholders' Equity, As Reported
$
8,380.6

 
$
31.80

 
$
8,385.9

 
$
29.94

 
$
8,612.6

 
$
31.87

 
$
8,169.7

 
$
27.91

 
$
8,484.9

 
$
26.80

Net Unrealized Gain on Securities
295.6

 
1.12

 
728.1

 
2.60

 
873.5

 
3.23

 
614.8

 
2.11

 
416.1

 
1.31

Net Gain on Cash Flow Hedges
405.5

 
1.54

 
410.6

 
1.46

 
401.6

 
1.48

 
408.7

 
1.39

 
361.0

 
1.14

Subtotal
7,679.5

 
29.14

 
7,247.2

 
25.88

 
7,337.5

 
27.16

 
7,146.2

 
24.41

 
7,707.8

 
24.35

Foreign Currency Translation Adjustment
(141.6
)
 
(0.53
)
 
(108.0
)
 
(0.38
)
 
(72.6
)
 
(0.26
)
 
(117.6
)
 
(0.41
)
 
(107.1
)
 
(0.34
)
Subtotal
7,821.1

 
29.67

 
7,355.2

 
26.26

 
7,410.1

 
27.42

 
7,263.8

 
24.82

 
7,814.9

 
24.69

Unrecognized Pension and Postretirement Benefit Costs
(342.8
)
 
(1.30
)
 
(430.2
)
 
(1.54
)
 
(574.5
)
 
(2.13
)
 
(444.1
)
 
(1.51
)
 
(318.6
)
 
(1.00
)
Total Stockholders' Equity, Excluding AOCI
$
8,163.9

 
$
30.97

 
$
7,785.4

 
$
27.80

 
$
7,984.6

 
$
29.55

 
$
7,707.9

 
$
26.33

 
$
8,133.5

 
$
25.69



 
1. 1
 


Unum Group Consolidated Statements of Income

 
Three Months Ended
 
Six Months Ended
 
Year Ended
 
6/30/2013
 
6/30/2012
 
6/30/2013
 
6/30/2012
 
12/31/2012
 
12/31/2011
 
12/31/2010
Revenue
 
 
 
 
 
 
 
 
 
 
 
Premium Income
$
1,905.8


$
1,927.6

 
$
3,836.7

 
$
3,849.5

 
$
7,716.1

 
$
7,514.2

 
$
7,431.4

Net Investment Income
626.1


633.5

 
1,247.2

 
1,253.0

 
2,515.2

 
2,519.6

 
2,495.5

Net Realized Investment Gain (Loss)
13.3


(2.1
)
 
23.6

 
10.3

 
56.2

 
(4.9
)
 
24.7

Other Income
56.7


58.9

 
119.2

 
116.4

 
227.9

 
249.1

 
241.6

Total Revenue
2,601.9


2,617.9


5,226.7

 
5,229.2

 
10,515.4

 
10,278.0

 
10,193.2

 
 

 
 
 
 
 
 
 
 
 
 
 
Benefits and Expenses
 

 
 
 
 
 
 
 
 
 
 
 
Benefits and Change in Reserves for Future Benefits
1,661.8


1,683.2

 
3,310.3

 
3,346.1

 
6,722.2

 
7,209.5

 
6,354.1

Commissions
220.8


230.8

 
459.0

 
463.1

 
917.2

 
879.2

 
855.4

Interest and Debt Expense - Non-recourse Debt
2.1


3.0

 
4.4

 
6.0

 
11.5

 
11.5

 
12.9

Interest and Debt Expense - All Other Debt
35.2


32.2

 
70.0

 
64.7

 
133.9

 
131.8

 
128.9

Deferral of Acquisition Costs
(113.3
)

(119.2
)
 
(231.5
)
 
(236.6
)
 
(467.3
)
 
(442.5
)
 
(422.5
)
Amortization of Deferred Acquisition Costs
101.3


99.2

 
225.1

 
198.6

 
378.7

 
365.7

 
373.3

Impairment of Deferred Acquisition Costs
—


—

 
—

 
—

 
—

 
196.0

 
—

Other Expenses
382.5


392.3

 
774.1

 
780.9

 
1,569.7

 
1,593.5

 
1,571.2

Total Benefits and Expenses
2,290.4


2,321.5


4,611.4

 
4,622.8

 
9,265.9

 
9,944.7

 
8,873.3

 
 

 
 
 
 
 
 
 
 
 
 
 
Income Before Income Tax
311.5


296.4


615.3

 
606.4

 
1,249.5

 
333.3

 
1,319.9

Income Tax Expense
92.9


80.0

 
184.1

 
176.1

 
355.1

 
49.1

 
441.2

 
 

 
 
 
 
 
 
 
 
 
 
 
Net Income
$
218.6


$
216.4


$
431.2

 
$
430.3

 
$
894.4

 
$
284.2

 
$
878.7

 
 

 
 
 
 
 
 
 
 
 
 
 
Average Weighted Shares Outstanding
 
 
 
 
 
 
 
 
 
 
 
 
 
Basic
265,560,417

 
283,316,596

 
267,451,981

 
286,874,477

 
281,355,942

 
302,399,783

 
325,839,020

Dilutive Securities:
 
 
 
 
 
 
 
 
 
 
 
 
 
Options and Other Nonvested Stock Awards
1,175,885

 
424,036

 
1,084,577

 
639,293

 
400,901

 
1,171,250

 
1,382,036

Assuming Dilution
266,736,302

 
283,740,632

 
268,536,558

 
287,513,770

 
281,756,843

 
303,571,033

 
327,221,056

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Actual Number of Shares Outstanding
 
 
 
 
263,564,941

 
280,046,813

 
270,205,185

 
292,715,954

 
316,573,452




 
2
 


Unum Group Sales Data by Segment

 
Three Months Ended
 
Six Months Ended
 
Year Ended
 
6/30/2013
 
6/30/2012
 
% Change
 
6/30/2013
 
6/30/2012
 
% Change
 
12/31/2012
 
12/31/2011
 
12/31/2010
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Unum US
$
131.4

 
$
161.6

 
(18.7
)%
 
$
328.9

 
$
356.5

 
(7.7
)%
 
$
760.5

 
$
707.3

 
$
643.4

 
 
 
 
 
 
 
 
 
 
 

 
 
 
 
 
 
Unum UK
£
14.2

 
£
15.3

 
(7.2
)
 
£
24.7

 
£
34.9

 
(29.2
)
 
£
59.5

 
£
62.7

 
£
77.2

 
 
 
 
 
 
 
 
 
 
 

 
 
 
 
 
 
Colonial Life
$
84.1

 
$
85.8

 
(2.0
)
 
$
151.7

 
$
156.9

 
(3.3
)
 
$
361.9

 
$
365.9

 
$
358.8





 
3
 


Unum Group Sales Data for Unum US Segment

 
Three Months Ended
 
Six Months Ended
 
Year Ended
 
6/30/2013
 
6/30/2012
 
% Change
 
6/30/2013
 
6/30/2012
 
% Change
 
12/31/2012
 
12/31/2011
 
12/31/2010
Sales by Product
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Group Disability, Group Life, and AD&D
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Group Long-term Disability
$
32.8

 
$
36.0

 
(8.9
)%
 
$
63.9

 
$
71.8

 
(11.0
)%
 
$
182.2

 
$
165.0

 
$
148.2

Group Short-term Disability
18.7

 
23.6

 
(20.8
)
 
34.5

 
37.0

 
(6.8
)
 
97.4

 
84.9

 
80.3

Group Life
33.6

 
45.2

 
(25.7
)
 
67.3

 
78.2

 
(13.9
)
 
188.0

 
185.3

 
166.9

AD&D
2.9

 
4.9

 
(40.8
)
 
6.0

 
7.8

 
(23.1
)
 
19.5

 
17.6

 
18.1

Subtotal
88.0

 
109.7

 
(19.8
)
 
171.7

 
194.8

 
(11.9
)
 
487.1

 
452.8

 
413.5

Supplemental and Voluntary
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Individual Disability - Recently Issued
10.2

 
15.3

 
(33.3
)
 
25.4

 
30.2

 
(15.9
)
 
57.0

 
55.6

 
42.7

Voluntary Benefits
33.2

 
36.6

 
(9.3
)
 
131.8

 
131.5

 
0.2

 
216.4

 
198.9

 
187.2

Subtotal
43.4

 
51.9

 
(16.4
)
 
157.2

 
161.7

 
(2.8
)
 
273.4

 
254.5

 
229.9

Total Sales
$
131.4

 
$
161.6

 
(18.7
)
 
$
328.9

 
$
356.5

 
(7.7
)
 
$
760.5

 
$
707.3

 
$
643.4

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Sales by Market Sector
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Group Disability, Group Life, and AD&D
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Core Market (< 2,000 lives)
$
65.2

 
$
83.1

 
(21.5
)
 
$
116.7

 
$
141.5

 
(17.5
)
 
$
334.9

 
$
322.1

 
$
294.0

Large Case Market
22.8

 
26.6

 
(14.3
)
 
55.0

 
53.3

 
3.2

 
152.2

 
130.7

 
119.5

Subtotal
88.0

 
109.7

 
(19.8
)
 
171.7

 
194.8

 
(11.9
)
 
487.1

 
452.8

 
413.5

Supplemental and Voluntary
43.4

 
51.9

 
(16.4
)
 
157.2

 
161.7

 
(2.8
)
 
273.4

 
254.5

 
229.9

Total Sales
$
131.4

 
$
161.6

 
(18.7
)
 
$
328.9

 
$
356.5

 
(7.7
)
 
$
760.5

 
$
707.3

 
$
643.4




 
3. 1
 


Unum Group Sales Data for Unum UK Segment

 
Three Months Ended
 
Six Months Ended
 
Year Ended
(in millions of dollars)
6/30/2013
 
6/30/2012
 
% Change
 
6/30/2013
 
6/30/2012
 
% Change
 
12/31/2012
 
12/31/2011
 
12/31/2010
Sales by Product
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Group Long-term Disability
$
13.8

 
$
13.5

 
2.2
 %
 
$
24.7

 
$
24.7

 
—
 %
 
$
51.2

 
$
47.8

 
$
53.1

Group Life
6.8

 
9.1

 
(25.3
)
 
11.3

 
27.1

 
(58.3
)
 
38.0

 
43.8

 
57.3

Supplemental and Voluntary
1.1

 
1.4

 
(21.4
)
 
2.1

 
3.0

 
(30.0
)
 
4.9

 
8.6

 
8.8

Total Sales
$
21.7

 
$
24.0

 
(9.6
)
 
$
38.1

 
$
54.8

 
(30.5
)
 
$
94.1

 
$
100.2

 
$
119.2

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Sales by Market Sector
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Group Long-term Disability and Group Life
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Core Market (< 500 lives)
$
10.6

 
$
10.9

 
(2.8
)
 
$
19.1

 
$
21.0

 
(9.0
)
 
$
38.7

 
$
37.5

 
$
51.6

Large Case Market
10.0

 
11.7

 
(14.5
)
 
16.9

 
30.8

 
(45.1
)
 
50.5

 
54.1

 
58.8

Subtotal
20.6

 
22.6

 
(8.8
)
 
36.0

 
51.8

 
(30.5
)
 
89.2

 
91.6

 
110.4

Supplemental and Voluntary
1.1

 
1.4

 
(21.4
)
 
2.1

 
3.0

 
(30.0
)
 
4.9

 
8.6

 
8.8

Total Sales
$
21.7

 
$
24.0

 
(9.6
)
 
$
38.1

 
$
54.8

 
(30.5
)
 
$
94.1

 
$
100.2

 
$
119.2

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(in millions of pounds)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Sales by Product
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Group Long-term Disability
£
9.0

 
£
8.6

 
4.7

 
£
16.0

 
£
15.7

 
1.9

 
£
32.3

 
£
29.8

 
£
34.4

Group Life
4.5

 
5.8

 
(22.4
)
 
7.4

 
17.3

 
(57.2
)
 
24.1

 
27.5

 
37.1

Supplemental and Voluntary
0.7

 
0.9

 
(22.2
)
 
1.3

 
1.9

 
(31.6
)
 
3.1

 
5.4

 
5.7

Total Sales
£
14.2

 
£
15.3

 
(7.2
)
 
£
24.7

 
£
34.9

 
(29.2
)
 
£
59.5

 
£
62.7

 
£
77.2

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Sales by Market Sector
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Group Long-term Disability and Group Life
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Core Market (< 500 lives)
£
6.9

 
£
7.0

 
(1.4
)
 
£
12.4

 
£
13.4

 
(7.5
)
 
£
24.4

 
£
23.4

 
£
33.5

Large Case Market
6.6

 
7.4

 
(10.8
)
 
11.0

 
19.6

 
(43.9
)
 
32.0

 
33.9

 
38.0

Subtotal
13.5

 
14.4

 
(6.3
)
 
23.4

 
33.0

 
(29.1
)
 
56.4

 
57.3

 
71.5

Supplemental and Voluntary
0.7

 
0.9

 
(22.2
)
 
1.3

 
1.9

 
(31.6
)
 
3.1

 
5.4

 
5.7

Total Sales
£
14.2

 
£
15.3

 
(7.2
)
 
£
24.7

 
£
34.9

 
(29.2
)
 
£
59.5

 
£
62.7

 
£
77.2







 
3. 2
 



Unum Group Sales Data for Colonial Life Segment

 
Three Months Ended
 
Six Months Ended
 
Year Ended
 
6/30/2013
 
6/30/2012
 
% Change
 
6/30/2013
 
6/30/2012
 
% Change
 
12/31/2012
 
12/31/2011
 
12/31/2010
Sales by Product
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Accident, Sickness, and Disability
$
54.5

 
$
56.7

 
(3.9
)%
 
$
98.4

 
$
103.2

 
(4.7
)%
 
$
233.0

 
$
242.9

 
$
237.4

Life
15.8

 
16.0

 
(1.3
)
 
29.3

 
29.8

 
(1.7
)
 
67.3

 
65.5

 
65.7

Cancer and Critical Illness
13.8

 
13.1

 
5.3

 
24.0

 
23.9

 
0.4

 
61.6

 
57.5

 
55.7

Total Sales
$
84.1

 
$
85.8

 
(2.0
)
 
$
151.7

 
$
156.9

 
(3.3
)
 
$
361.9

 
$
365.9

 
$
358.8

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Sales by Market Sector
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Commercial
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Core Market (<1,000 lives)
$
58.6

 
$
59.7

 
(1.8
)
 
$
109.4

 
$
112.5

 
(2.8
)
 
$
248.3

 
$
248.0

 
$
237.4

Large Case Market
9.6

 
10.6

 
(9.4
)
 
15.3

 
16.0

 
(4.4
)
 
40.9

 
43.9

 
47.4

Subtotal
68.2

 
70.3

 
(3.0
)
 
124.7

 
128.5

 
(3.0
)
 
289.2

 
291.9

 
284.8

Public Sector
15.9

 
15.5

 
2.6

 
27.0

 
28.4

 
(4.9
)
 
72.7

 
74.0

 
74.0

Total Sales
$
84.1

 
$
85.8

 
(2.0
)
 
$
151.7

 
$
156.9

 
(3.3
)
 
$
361.9

 
$
365.9

 
$
358.8



 
3. 3
 


Unum Group Consolidated Balance Sheets
 
June 30
 
December 31
 
2013
 
2012
 
2011
Assets
 
 
 
 
 
Investments
 
 
 
 
 
Fixed Maturity Securities
$
42,594.2

 
$
44,973.0

 
$
42,486.7

Mortgage Loans
1,735.3

 
1,712.7

 
1,612.3

Policy Loans
3,113.1

 
3,133.8

 
3,051.4

Other Long-term Investments
583.6

 
625.0

 
639.2

Short-term Investments
867.8

 
1,460.3

 
1,423.5

Total Investments
48,894.0

 
51,904.8

 
49,213.1

 
 
 
 
 
 
Other Assets
 
 
 
 
 
Cash and Bank Deposits
47.8

 
77.3

 
116.6

Accounts and Premiums Receivable
1,697.3

 
1,632.6

 
1,672.2

Reinsurance Recoverable
4,817.9

 
4,842.6

 
4,854.6

Accrued Investment Income
788.7

 
694.6

 
681.8

Deferred Acquisition Costs
1,782.6

 
1,755.5

 
1,677.1

Goodwill
201.0

 
201.7

 
201.2

Property and Equipment
504.7

 
501.6

 
493.3

Income Tax Receivable
8.6

 
—

 
—

Other Assets
623.6

 
625.4

 
645.3

Total Assets
$
59,366.2

 
$
62,236.1

 
$
59,555.2

 
 
 
 
 
 
Liabilities
 
 
 
 
 
Policy and Contract Benefits
$
1,519.9

 
$
1,484.6

 
$
1,494.0

Reserves for Future Policy and Contract Benefits
42,998.8

 
44,694.4

 
43,051.9

Unearned Premiums
517.3

 
426.7

 
433.2

Other Policyholders’ Funds
1,639.5

 
1,644.9

 
1,625.9

Income Tax Payable
—

 
54.2

 
38.2

Deferred Income Tax
101.4

 
269.4

 
44.7

Short-term Debt
153.6

 
455.8

 
312.3

Long-term Debt - Non-recourse
470.0

 
562.5

 
632.5

Long-term Debt - All Other
2,174.0

 
2,192.9

 
1,937.7

Other Liabilities
1,411.1

 
1,838.1

 
1,815.1

Total Liabilities
50,985.6

 
53,623.5

 
51,385.5

 
 
 
 
 
 
Stockholders’ Equity
 
 
 
 
 
Common Stock
36.0

 
36.0

 
35.9

Additional Paid-in Capital
2,619.7

 
2,607.7

 
2,591.1

Accumulated Other Comprehensive Income
216.7

 
628.0

 
461.8

Retained Earnings
7,732.4

 
7,371.6

 
6,611.0

Treasury Stock
(2,224.2
)
 
(2,030.7
)
 
(1,530.1
)
Total Stockholders’ Equity
8,380.6

 
8,612.6

 
8,169.7

Total Liabilities and Stockholders’ Equity
$
59,366.2

 
$
62,236.1

 
$
59,555.2


 
4
 


Unum Group Deferred Acquisition Costs by Segment

 
Unum US
 
Unum UK
 
Colonial Life
 
Closed Block
 
Consolidated
Balances at December 31, 2010
$
943.7

 
$
41.0

 
$
628.0

 
$
203.4

 
$
1,816.1

Capitalized
220.3

 
15.4

 
203.1

 
3.7

 
442.5

Amortized
(188.1
)
 
(15.3
)
 
(151.2
)
 
(11.1
)
 
(365.7
)
Impairment of Deferred Acquisition Costs
—

 
—

 
—

 
(196.0
)
 
(196.0
)
Adjustment Related to Unrealized Investment Gains/Losses
(4.1
)
 
—

 
(15.5
)
 
—

 
(19.6
)
Foreign Currency
—

 
(0.2
)
 
—

 
—

 
(0.2
)
Balances at December 31, 2011
971.8

 
40.9

 
664.4

 
—

 
1,677.1

Capitalized
249.2

 
11.8

 
206.3

 
—

 
467.3

Amortized
(196.5
)
 
(15.7
)
 
(166.5
)
 
—

 
(378.7
)
Adjustment Related to Unrealized Investment Gains/Losses
(0.2
)
 
—

 
(11.8
)
 
—

 
(12.0
)
Foreign Currency
—

 
1.8

 
—

 
—

 
1.8

Balances at December 31, 2012
1,024.3

 
38.8

 
692.4

 
—

 
1,755.5

Capitalized
124.2

 
4.7

 
102.6

 
—

 
231.5

Amortized
(131.5
)
 
(7.6
)
 
(86.0
)
 
—

 
(225.1
)
Adjustment Related to Unrealized Investment Gains/Losses
5.7

 
—

 
17.5

 
—

 
23.2

Foreign Currency
—

 
(2.5
)
 
—

 
—

 
(2.5
)
Balances at June 30, 2013
$
1,022.7

 
$
33.4

 
$
726.5

 
$
—

 
$
1,782.6



 
4. 1
 


Unum Group Balance Sheets by Segment - June 30, 2013

 
Unum US
 
 
 
 
 
 
 
 
 
 
 
Group Disability
 
Group Life and Accidental Death & Dismemberment
 
Supplemental and Voluntary
 
Total Unum US
 
Unum UK
 
Colonial Life
 
Closed Block
 
Corporate
 
Consolidated
Assets
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Investments
$
9,537.5

 
$
2,515.0

 
$
3,997.0

 
$
16,049.5

 
$
3,347.1

 
$
2,456.0

 
$
25,465.1

 
$
1,576.3

 
$
48,894.0

Deferred Acquisition Costs
50.6

 
44.5

 
927.6

 
1,022.7

 
33.4

 
726.5

 
—

 
—

 
1,782.6

Goodwill
2.5

 
—

 
187.5

 
190.0

 
11.0

 
—

 
—

 
—

 
201.0

All Other
646.3

 
153.8

 
467.2

 
1,267.3

 
139.6

 
200.1

 
6,224.6

 
657.0

 
8,488.6

Total Assets
$
10,236.9

 
$
2,713.3

 
$
5,579.3

 
$
18,529.5

 
$
3,531.1

 
$
3,382.6

 
$
31,689.7

 
$
2,233.3

 
$
59,366.2

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Liabilities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Reserves and Policyholder Benefits
$
8,400.3

 
$
1,715.5

 
$
3,438.6

 
$
13,554.4

 
$
2,774.3

 
$
1,965.9

 
$
28,380.9

 
$
—

 
$
46,675.5

Debt
10.6

 
—

 
—

 
10.6

 
—

 
—

 
486.7

 
2,300.3

 
2,797.6

All Other
284.4

 
73.8

 
352.2

 
710.4

 
99.9

 
223.1

 
(36.9
)
 
516.0

 
1,512.5

Total Liabilities
8,695.3

 
1,789.3

 
3,790.8

 
14,275.4

 
2,874.2

 
2,189.0

 
28,830.7

 
2,816.3

 
50,985.6

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Allocated Stockholders' Equity
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Other Allocated Stockholders' Equity
1,540.6

 
892.8

 
1,678.4

 
4,111.8

 
600.1

 
1,111.0

 
2,585.6

 
(729.0
)
 
7,679.5

Net Unrealized Gain/Loss on Securities and Net Gain on Cash Flow Hedges
1.0

 
31.2

 
110.1

 
142.3

 
56.8

 
82.6

 
273.4

 
146.0

 
701.1

Total Allocated Stockholders' Equity
1,541.6

 
924.0

 
1,788.5

 
4,254.1

 
656.9

 
1,193.6

 
2,859.0

 
(583.0
)
 
8,380.6

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total Liabilities and Allocated Stockholders' Equity
$
10,236.9

 
$
2,713.3

 
$
5,579.3

 
$
18,529.5

 
$
3,531.1

 
$
3,382.6

 
$
31,689.7

 
$
2,233.3

 
$
59,366.2


Allocated stockholders' equity is determined on the basis of an internal allocation formula that reflects the volume and risk components of the business and aligns with the Company's target capital levels for regulatory and rating agency purposes. This formula is modified periodically to recognize changes in the views of capital requirements.



 
4. 2
 


Unum Group Balance Sheets by Segment - December 31, 2012

 
Unum US
 
 
 
 
 
 
 
 
 
 
 
Group Disability
 
Group Life and Accidental Death & Dismemberment
 
Supplemental and Voluntary
 
Total Unum US
 
Unum UK
 
Colonial Life
 
Closed Block
 
Corporate
 
Consolidated
Assets
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Investments
$
10,088.7

 
$
2,646.6

 
$
4,202.5

 
$
16,937.8

 
$
3,675.2

 
$
2,521.4

 
$
27,498.4

 
$
1,272.0

 
$
51,904.8

Deferred Acquisition Costs
47.4

 
40.8

 
936.1

 
1,024.3

 
38.8

 
692.4

 
—

 
—

 
1,755.5

Goodwill
2.5

 
—

 
187.5

 
190.0

 
11.7

 
—

 
—

 
—

 
201.7

All Other
646.3

 
149.4

 
443.4

 
1,239.1

 
250.1

 
221.1

 
5,570.8

 
1,093.0

 
8,374.1

Total Assets
$
10,784.9

 
$
2,836.8

 
$
5,769.5

 
$
19,391.2

 
$
3,975.8

 
$
3,434.9

 
$
33,069.2

 
$
2,365.0

 
$
62,236.1

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Liabilities
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Reserves and Policyholder Benefits
$
8,847.6

 
$
1,749.1

 
$
3,456.7

 
$
14,053.4

 
$
2,821.9

 
$
1,878.2

 
$
29,497.1

 
$
—

 
$
48,250.6

Debt
63.1

 
—

 
—

 
63.1

 
—

 
—

 
564.3

 
2,583.8

 
3,211.2

All Other
362.1

 
123.2

 
451.3

 
936.6

 
112.7

 
305.9

 
124.4

 
682.1

 
2,161.7

Total Liabilities
9,272.8

 
1,872.3

 
3,908.0

 
15,053.1

 
2,934.6

 
2,184.1

 
30,185.8

 
3,265.9

 
53,623.5

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Allocated Stockholders' Equity
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Other Allocated Stockholders' Equity
1,513.3

 
913.9

 
1,688.0

 
4,115.2

 
866.4

 
1,097.7

 
2,462.6

 
(1,204.4
)
 
7,337.5

Net Unrealized Gain/Loss on Securities and Net Gain on Cash Flow Hedges
(1.2
)
 
50.6

 
173.5

 
222.9

 
174.8

 
153.1

 
420.8

 
303.5

 
1,275.1

Total Allocated Stockholders' Equity
1,512.1

 
964.5

 
1,861.5

 
4,338.1

 
1,041.2

 
1,250.8

 
2,883.4

 
(900.9
)
 
8,612.6

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Total Liabilities and Allocated Stockholders' Equity
$
10,784.9

 
$
2,836.8

 
$
5,769.5

 
$
19,391.2

 
$
3,975.8

 
$
3,434.9

 
$
33,069.2

 
$
2,365.0

 
$
62,236.1




 
4. 3
 


Unum Group Financial Results by Segment

 
Three Months Ended
 
Six Months Ended
 
6/30/2013
 
6/30/2012
 
% Change
 
6/30/2013
 
6/30/2012
 
% Change
Premium Income
 
 
 
 
 
 
 
 
 
 
 
Unum US
$
1,131.5

 
$
1,115.0

 
1.5
 %
 
$
2,271.2

 
$
2,227.0

 
2.0
 %
Unum UK
137.6

 
173.2

 
(20.6
)
 
281.4

 
343.9

 
(18.2
)
Colonial Life
307.9

 
296.9

 
3.7

 
615.0

 
593.2

 
3.7

Closed Block
328.8

 
342.5

 
(4.0
)
 
669.1

 
685.4

 
(2.4
)
 
1,905.8

 
1,927.6

 
(1.1
)
 
3,836.7

 
3,849.5

 
(0.3
)
Net Investment Income
 
 
 
 
 
 
 
 
 
 
 
Unum US
231.1

 
236.9

 
(2.4
)
 
466.8

 
475.5

 
(1.8
)
Unum UK
45.4

 
49.2

 
(7.7
)
 
76.2

 
85.7

 
(11.1
)
Colonial Life
34.3

 
34.0

 
0.9

 
74.0

 
69.6

 
6.3

Closed Block
316.1

 
304.5

 
3.8

 
629.2

 
606.1

 
3.8

Corporate
(0.8
)
 
8.9

 
(109.0
)
 
1.0

 
16.1

 
(93.8
)
 
626.1

 
633.5

 
(1.2
)
 
1,247.2

 
1,253.0

 
(0.5
)
Other Income
 
 
 
 
 
 
 
 
 
 
 
Unum US
32.1

 
30.7

 
4.6

 
68.8

 
61.8

 
11.3

Unum UK
(0.1
)
 
—

 
N.M.
 
—

 
0.1

 
(100.0
)
Colonial Life
0.1

 
0.1

 
—

 
0.1

 
0.2

 
(50.0
)
Closed Block
23.8

 
26.6

 
(10.5
)
 
47.9

 
52.5

 
(8.8
)
Corporate
0.8

 
1.5

 
(46.7
)
 
2.4

 
1.8

 
33.3

 
56.7

 
58.9

 
(3.7
)
 
119.2

 
116.4

 
2.4

Total Operating Revenue
 
 
 
 
 
 
 
 
 
 
 
Unum US
1,394.7

 
1,382.6

 
0.9

 
2,806.8

 
2,764.3

 
1.5

Unum UK
182.9

 
222.4

 
(17.8
)
 
357.6

 
429.7

 
(16.8
)
Colonial Life
342.3

 
331.0

 
3.4

 
689.1

 
663.0

 
3.9

Closed Block
668.7

 
673.6

 
(0.7
)
 
1,346.2

 
1,344.0

 
0.2

Corporate
—

 
10.4

 
(100.0
)
 
3.4

 
17.9

 
(81.0
)
 
$
2,588.6

 
$
2,620.0

 
(1.2
)
 
$
5,203.1

 
$
5,218.9

 
(0.3
)


 
5
 


Unum Group Financial Results by Segment

 
Three Months Ended
 
Six Months Ended
 
6/30/2013
 
6/30/2012
 
% Change
 
6/30/2013
 
6/30/2012
 
% Change
Benefits and Expenses
 
 
 
 
 
 
 
 
 
 
 
Unum US
$
1,180.7

 
$
1,169.9

 
0.9
 %
 
$
2,384.7

 
$
2,345.7

 
1.7
 %
Unum UK
149.4

 
192.4

 
(22.3
)
 
292.8

 
360.9

 
(18.9
)
Colonial Life
271.2

 
263.4

 
3.0

 
542.6

 
525.7

 
3.2

Closed Block
639.1

 
647.9

 
(1.4
)
 
1,289.3

 
1,302.9

 
(1.0
)
Corporate
37.1

 
36.3

 
2.2

 
74.2

 
64.4

 
15.2

 
2,277.5

 
2,309.9

 
(1.4
)
 
4,583.6

 
4,599.6

 
(0.3
)
Income (Loss) Before Income Tax, Net Realized Investment Gain (Loss) and Non-operating Retirement-related Loss
 
 
 
 
 
 
 
 
 
 
 
Unum US
214.0

 
212.7

 
0.6

 
422.1

 
418.6

 
0.8

Unum UK
33.5

 
30.0

 
11.7

 
64.8

 
68.8

 
(5.8
)
Colonial Life
71.1

 
67.6

 
5.2

 
146.5

 
137.3

 
6.7

Closed Block
29.6

 
25.7

 
15.2

 
56.9

 
41.1

 
38.4

Corporate
(37.1
)
 
(25.9
)
 
(43.2
)
 
(70.8
)
 
(46.5
)
 
(52.3
)
 
311.1

 
310.1

 
0.3

 
619.5

 
619.3

 
—

Income Tax Expense
92.6

 
84.8

 
9.2

 
185.4

 
180.8

 
(2.5
)
 
 
 
 
 
 
 
 
 
 
 
 
Income Before Net Realized Investment Gain (Loss) and Non-operating Retirement-related Loss
218.5

 
225.3

 
(3.0
)
 
434.1

 
438.5

 
(1.0
)
 


 
 
 
 
 
 
 
 
 
 
Net Realized Investment Gain (Loss), Net of Tax
8.6

 
(1.4
)
 
N.M.

 
15.3

 
6.9

 
121.7

 

 
 
 
 
 
 
 
 
 
 
Non-operating Retirement-related Loss, Net of tax
(8.5
)
 
(7.5
)
 
(13.3
)
 
(18.2
)
 
(15.1
)
 
(20.5
)
 
 
 
 
 
 
 
 
 
 
 
 
Net Income
$
218.6

 
$
216.4

 
1.0

 
$
431.2

 
$
430.3

 
0.2



 
5. 1
 


Unum Group Quarterly Historical Financial Results by Segment

 
6/30/13
 
3/31/13
 
12/31/12
 
9/30/12
 
6/30/12
 
3/31/12
 
12/31/11
 
9/30/11
 
6/30/11
Premium Income
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Unum US
$
1,131.5

 
$
1,139.7

 
$
1,117.6

 
$
1,111.9

 
$
1,115.0

 
$
1,112.0

 
$
1,083.0

 
$
1,074.4

 
$
1,069.8

Unum UK
137.6

 
143.8

 
175.5

 
175.2

 
173.2

 
170.7

 
169.2

 
175.5

 
175.8

Colonial Life
307.9

 
307.1

 
301.9

 
299.4

 
296.9

 
296.3

 
289.2

 
283.7

 
282.0

Closed Block
328.8

 
340.3

 
342.2

 
342.9

 
342.5

 
342.9

 
347.1

 
347.6

 
347.4

 
1,905.8

 
1,930.9

 
1,937.2

 
1,929.4

 
1,927.6

 
1,921.9

 
1,888.5

 
1,881.2

 
1,875.0

Net Investment Income
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Unum US
231.1

 
235.7

 
240.5

 
236.3

 
236.9

 
238.6

 
238.8

 
240.0

 
238.9

Unum UK
45.4

 
30.8

 
50.3

 
34.8

 
49.2

 
36.5

 
50.6

 
43.3

 
51.1

Colonial Life
34.3

 
39.7

 
35.1

 
33.9

 
34.0

 
35.6

 
32.8

 
32.5

 
35.8

Closed Block
316.1

 
313.1

 
317.1

 
307.3

 
304.5

 
301.6

 
300.8

 
300.1

 
294.5

Corporate
(0.8
)
 
1.8

 
—

 
6.9

 
8.9

 
7.2

 
11.6

 
13.3

 
16.8

 
626.1

 
621.1

 
643.0

 
619.2

 
633.5

 
619.5

 
634.6

 
629.2

 
637.1

Other Income
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Unum US
32.1

 
36.7

 
31.5

 
31.3

 
30.7

 
31.1

 
30.7

 
30.4

 
29.5

Unum UK
(0.1
)
 
0.1

 
—

 
—

 
—

 
0.1

 
0.2

 
—

 
—

Colonial Life
0.1

 
—

 
0.1

 
—

 
0.1

 
0.1

 
0.1

 
0.1

 
0.2

Closed Block
23.8

 
24.1

 
21.2

 
26.4

 
26.6

 
25.9

 
25.5

 
26.4

 
26.7

Corporate
0.8

 
1.6

 
0.6

 
0.4

 
1.5

 
0.3

 
17.8

 
2.2

 
(0.4
)
 
56.7

 
62.5

 
53.4

 
58.1

 
58.9

 
57.5

 
74.3

 
59.1

 
56.0

Total Operating Revenue
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Unum US
1,394.7

 
1,412.1

 
1,389.6

 
1,379.5

 
1,382.6

 
1,381.7

 
1,352.5

 
1,344.8

 
1,338.2

Unum UK
182.9

 
174.7

 
225.8

 
210.0

 
222.4

 
207.3

 
220.0

 
218.8

 
226.9

Colonial Life
342.3

 
346.8

 
337.1

 
333.3

 
331.0

 
332.0

 
322.1

 
316.3

 
318.0

Closed Block
668.7

 
677.5

 
680.5

 
676.6

 
673.6

 
670.4

 
673.4

 
674.1

 
668.6

Corporate
—

 
3.4

 
0.6

 
7.3

 
10.4

 
7.5

 
29.4

 
15.5

 
16.4

 
$
2,588.6

 
$
2,614.5

 
$
2,633.6

 
$
2,606.7

 
$
2,620.0

 
$
2,598.9

 
$
2,597.4

 
$
2,569.5

 
$
2,568.1




 
6
 


Unum Group Quarterly Historical Financial Results by Segment

 
6/30/13
 
3/31/13
 
12/31/12
 
9/30/12
 
6/30/12
 
3/31/12
 
12/31/11
 
9/30/11
 
6/30/11
Benefits and Expenses
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Unum US
$
1,180.7

 
$
1,204.0

 
$
1,177.4

 
$
1,163.2

 
$
1,169.9

 
$
1,175.8

 
$
1,145.1

 
$
1,135.6

 
$
1,132.6

Unum UK
149.4

 
143.4

 
190.8

 
182.5

 
192.4

 
168.5

 
168.1

 
184.1

 
171.7

Colonial Life
271.2

 
271.4

 
268.8

 
264.6

 
263.4

 
262.3

 
257.1

 
249.6

 
246.1

Closed Block
639.1

 
650.2

 
651.7

 
651.0

 
647.9

 
655.0

 
1,595.7

 
643.3

 
638.2

Corporate
37.1

 
37.1

 
35.2

 
34.7

 
36.3

 
28.1

 
48.2

 
36.3

 
33.4

 
2,277.5

 
2,306.1

 
2,323.9

 
2,296.0

 
2,309.9

 
2,289.7

 
3,214.2

 
2,248.9

 
2,222.0

Income (Loss) Before Income Tax, Net Realized Investment Gain (Loss) and Non-operating Retirement-related Loss
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Unum US
214.0

 
208.1

 
212.2

 
216.3

 
212.7

 
205.9

 
207.4

 
209.2

 
205.6

Unum UK
33.5

 
31.3

 
35.0

 
27.5

 
30.0

 
38.8

 
51.9

 
34.7

 
55.2

Colonial Life
71.1

 
75.4

 
68.3

 
68.7

 
67.6

 
69.7

 
65.0

 
66.7

 
71.9

Closed Block
29.6

 
27.3

 
28.8

 
25.6

 
25.7

 
15.4

 
(922.3
)
 
30.8

 
30.4

Corporate
(37.1
)
 
(33.7
)
 
(34.6
)
 
(27.4
)
 
(25.9
)
 
(20.6
)
 
(18.8
)
 
(20.8
)
 
(17.0
)
 
311.1

 
308.4

 
309.7

 
310.7

 
310.1

 
309.2

 
(616.8
)
 
320.6

 
346.1

Income Tax Expense (Benefit)
92.6

 
92.8

 
84.7

 
86.7

 
84.8

 
96.0

 
(248.1
)
 
97.5

 
111.1

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Income (Loss) Before Net Realized Investment Gain (Loss) and Non-operating Retirement-related Loss
218.5

 
215.6

 
225.0

 
224.0

 
225.3

 
213.2

 
(368.7
)
 
223.1

 
235.0

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net Realized Investment Gain (Loss), Net of Tax
8.6

 
6.7

 
16.4

 
13.8

 
(1.4
)
 
8.3

 
4.8

 
(15.9
)
 
(2.2
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Non-operating Retirement-related Loss, Net of tax
(8.5
)
 
(9.7
)
 
(7.5
)
 
(7.6
)
 
(7.5
)
 
(7.6
)
 
(5.1
)
 
(5.2
)
 
(5.2
)
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net Income (Loss)
$
218.6

 
$
212.6

 
$
233.9

 
$
230.2

 
$
216.4

 
$
213.9

 
$
(369.0
)
 
$
202.0

 
$
227.6

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Net Income (Loss) Per Common Share - Assuming Dilution
$
0.82

 
$
0.79

 
$
0.85

 
$
0.83

 
$
0.76

 
$
0.73

 
$
(1.26
)
 
$
0.68

 
$
0.74




 
6. 1
 


Unum Group Financial Results for Unum US Segment

 
Three Months Ended
 
Six Months Ended
 
Year Ended
 
6/30/2013
 
6/30/2012
 
6/30/2013
 
6/30/2012
 
12/31/2012
 
12/31/2011
 
12/31/2010
Operating Revenue
 
 
 
 
 
 
 
 
 
 
 
 
 
Premium Income
$
1,131.5

 
$
1,115.0

 
$
2,271.2

 
$
2,227.0

 
$
4,456.5

 
$
4,296.0

 
$
4,255.4

Net Investment Income
231.1

 
236.9

 
466.8

 
475.5

 
952.3

 
951.4

 
941.5

Other Income
32.1

 
30.7

 
68.8

 
61.8

 
124.6

 
121.6

 
122.8

Total
1,394.7

 
1,382.6

 
2,806.8

 
2,764.3

 
5,533.4

 
5,369.0

 
5,319.7

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Benefits and Expenses
 
 
 
 
 
 
 
 
 
 
 
 
 
Benefits and Change in Reserves for Future Benefits
814.7

 
804.4

 
1,622.6

 
1,610.6

 
3,238.6

 
3,113.5

 
3,124.4

Commissions
122.7

 
129.7

 
258.6

 
259.0

 
507.5

 
474.0

 
460.6

Interest and Debt Expense
—

 
0.3

 
0.1

 
0.6

 
1.1

 
1.0

 
1.2

Deferral of Acquisition Costs
(60.2
)
 
(64.3
)
 
(124.2
)
 
(126.2
)
 
(249.2
)
 
(220.3
)
 
(207.8
)
Amortization of Deferred Acquisition Costs
54.8

 
53.2

 
131.5

 
106.8

 
196.5

 
188.1

 
192.6

Other Expenses
248.7

 
246.6

 
496.1

 
494.9

 
991.8

 
995.8

 
979.7

Total
1,180.7

 
1,169.9

 
2,384.7

 
2,345.7

 
4,686.3

 
4,552.1

 
4,550.7

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Operating Income Before Income Tax and Net Realized Investment Gains and Losses
$
214.0

 
$
212.7

 
$
422.1

 
$
418.6

 
$
847.1

 
$
816.9

 
$
769.0

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Operating Ratios (% of Premium Income):
 
 
 
 
 
 
 
 
 
 
 
 
 
Benefit Ratio
72.0
%
 
72.1
%
 
71.4
%
 
72.3
%
 
72.7
%
 
72.5
%
 
73.4
%
Other Expense Ratio
22.0
%
 
22.1
%
 
21.8
%
 
22.2
%
 
22.3
%
 
23.2
%
 
23.0
%
Before-tax Operating Income Ratio
18.9
%
 
19.1
%
 
18.6
%
 
18.8
%
 
19.0
%
 
19.0
%
 
18.1
%


 
7
 


Unum Group Financial Results for Unum US Group Disability

 
Three Months Ended
 
Six Months Ended
 
Year Ended
 
6/30/2013
 
6/30/2012
 
6/30/2013
 
6/30/2012
 
12/31/2012
 
12/31/2011
 
12/31/2010
Operating Revenue
 
 
 
 
 
 
 
 
 
 
 
 
 
Premium Income
 
 
 
 
 
 
 
 
 
 
 
 
 
Group Long-term Disability
$
394.8

 
$
397.8

 
$
787.5

 
$
793.3

 
$
1,578.8

 
$
1,580.2

 
$
1,639.4

Group Short-term Disability
129.1

 
118.2

 
260.1

 
235.9

 
476.7

 
455.2

 
430.9

Total Premium Income
523.9

 
516.0

 
1,047.6

 
1,029.2

 
2,055.5

 
2,035.4

 
2,070.3

Net Investment Income
137.7

 
142.0

 
279.2

 
289.4

 
576.9

 
605.0

 
614.6

Other Income
22.7

 
23.1

 
50.5

 
46.6

 
93.7

 
89.4

 
86.7

Total
684.3

 
681.1

 
1,377.3

 
1,365.2

 
2,726.1

 
2,729.8

 
2,771.6

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Benefits and Expenses
 
 
 
 
 
 
 
 
 
 
 
 
 
Benefits and Change in Reserves for Future Benefits
439.6

 
436.8

 
881.0

 
872.5

 
1,741.6

 
1,722.1

 
1,747.8

Commissions
40.7

 
40.3

 
84.3

 
80.7

 
159.3

 
159.5

 
159.7

Interest and Debt Expense
—

 
0.3

 
0.1

 
0.6

 
1.1

 
1.0

 
1.2

Deferral of Acquisition Costs
(6.9
)
 
(5.8
)
 
(13.6
)
 
(11.9
)
 
(26.3
)
 
(21.9
)
 
(18.2
)
Amortization of Deferred Acquisition Costs
5.2

 
4.5

 
10.4

 
8.7

 
18.3

 
19.8

 
20.5

Other Expenses
132.7

 
134.6

 
264.2

 
269.5

 
539.0

 
547.0

 
543.7

Total
611.3

 
610.7

 
1,226.4

 
1,220.1

 
2,433.0

 
2,427.5

 
2,454.7

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Operating Income Before Income Tax and Net Realized Investment Gains and Losses
$
73.0

 
$
70.4

 
$
150.9

 
$
145.1

 
$
293.1

 
$
302.3

 
$
316.9

 
 
 
 
 
 
 
 
 
 
 
 
 

Operating Ratios (% of Premium Income):
 
 
 
 
 
 
 
 
 
 
 
 
 
Benefit Ratio
83.9
%
 
84.7
%
 
84.1
%
 
84.8
%
 
84.7
%
 
84.6
%
 
84.4
%
Other Expense Ratio
25.3
%
 
26.1
%
 
25.2
%
 
26.2
%
 
26.2
%
 
26.9
%
 
26.3
%
Before-tax Operating Income Ratio
13.9
%
 
13.6
%
 
14.4
%
 
14.1
%
 
14.3
%
 
14.9
%
 
15.3
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Premium Persistency:
 
 
 
 
 
 
 
 
 
 
 
 
 
Group Long-term Disability
 
 
 
 
88.5
%
 
91.7
%
 
90.7
%
 
90.2
%
 
89.4
%
Group Short-term Disability
 
 
 
 
88.5
%
 
89.8
%
 
88.0
%
 
89.9
%
 
88.6
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Case Persistency:
 
 
 
 
 
 
 
 
 
 
 
 
 
Group Long-term Disability
 
 
 
 
88.3
%
 
88.3
%
 
88.8
%
 
89.0
%
 
88.4
%
Group Short-term Disability
 
 
 
 
87.6
%
 
87.8
%
 
88.2
%
 
88.0
%
 
87.3
%


 
7. 1
 


Unum Group Financial Results for Unum US Group Life and Accidental Death & Dismemberment

 
Three Months Ended
 
Six Months Ended
 
Year Ended
 
6/30/2013

 
6/30/2012

 
6/30/2013

 
6/30/2012

 
12/31/2012
 
12/31/2011
 
12/31/2010
Operating Revenue
 
 
 
 
 
 
 
 
 
 
 
 
 
Premium Income
 
 
 
 
 
 
 
 
 
 
 
 
 
Group Life
$
303.6

 
$
294.2

 
$
605.8

 
$
587.8

 
$
1,182.1

 
$
1,106.7

 
$
1,090.3

Accidental Death & Dismemberment
30.2

 
28.7

 
61.1

 
57.0

 
115.3

 
109.2

 
106.1

Total Premium Income
333.8

 
322.9

 
666.9

 
644.8

 
1,297.4

 
1,215.9

 
1,196.4

Net Investment Income
35.1

 
38.2

 
70.8

 
73.1

 
146.9

 
135.5

 
129.6

Other Income
0.4

 
0.4

 
0.9

 
0.9

 
1.9

 
2.2

 
2.4

Total
369.3

 
361.5

 
738.6

 
718.8

 
1,446.2

 
1,353.6

 
1,328.4

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Benefits and Expenses
 
 
 
 
 
 
 
 
 
 
 
 
 
Benefits and Change in Reserves for Future Benefits
237.3

 
232.2

 
472.6

 
463.9

 
936.4

 
854.6

 
839.9

Commissions
27.2

 
25.9

 
55.6

 
52.1

 
104.6

 
95.5

 
89.3

Deferral of Acquisition Costs
(5.7
)
 
(5.0
)
 
(11.4
)
 
(10.1
)
 
(22.4
)
 
(18.5
)
 
(15.4
)
Amortization of Deferred Acquisition Costs
3.6

 
3.3

 
7.7

 
6.7

 
13.6

 
14.2

 
14.1

Other Expenses
49.6

 
47.8

 
98.9

 
96.5

 
193.1

 
199.3

 
196.5

Total
312.0

 
304.2

 
623.4

 
609.1

 
1,225.3

 
1,145.1

 
1,124.4

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Operating Income Before Income Tax and Net Realized Investment Gains and Losses
$
57.3

 
$
57.3

 
$
115.2

 
$
109.7

 
$
220.9

 
$
208.5

 
$
204.0

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Operating Ratios (% of Premium Income):
 
 
 
 
 
 
 
 
 
 
 
 
 
Benefit Ratio
71.1
%
 
71.9
%
 
70.9
%
 
71.9
%
 
72.2
%
 
70.3
%
 
70.2
%
Other Expense Ratio
14.9
%
 
14.8
%
 
14.8
%
 
15.0
%
 
14.9
%
 
16.4
%
 
16.4
%
Before-tax Operating Income Ratio
17.2
%
 
17.7
%
 
17.3
%
 
17.0
%
 
17.0
%
 
17.1
%
 
17.1
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Premium Persistency:
 
 
 
 
 
 
 
 
 
 
 
 
 
Group Life
 
 
 
 
89.1
%
 
91.6
%
 
90.6
%
 
88.0
%
 
91.5
%
Accidental Death & Dismemberment
 
 
 
 
89.5
%
 
91.3
%
 
90.0
%
 
88.2
%
 
90.7
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Case Persistency:
 
 
 
 
 
 
 
 
 
 
 
 
 
Group Life
 
 
 
 
88.3
%
 
88.1
%
 
88.3
%
 
88.6
%
 
88.3
%
Accidental Death & Dismemberment
 
 
 
 
88.3
%
 
88.0
%
 
88.3
%
 
88.6
%
 
88.4
%


 
7. 2
 


Unum Group Financial Results for Unum US Supplemental and Voluntary

 
Three Months Ended
 
Six Months Ended
 
Year Ended
 
6/30/2013

 
6/30/2012

 
6/30/2013

 
6/30/2012

 
12/31/2012
 
12/31/2011
 
12/31/2010
Operating Revenue
 
 
 
 
 
 
 
 
 
 
 
 
 
Premium Income
 
 
 
 
 
 
 
 
 
 
 
 
 
Individual Disability - Recently Issued
$
114.3

 
$
118.7

 
$
234.4

 
$
237.1

 
$
477.6

 
$
464.7

 
$
457.9

Voluntary Benefits
159.5

 
157.4

 
322.3

 
315.9

 
626.0

 
580.0

 
530.8

Total Premium Income
273.8

 
276.1

 
556.7

 
553.0

 
1,103.6

 
1,044.7

 
988.7

Net Investment Income
58.3

 
56.7

 
116.8

 
113.0

 
228.5

 
210.9

 
197.3

Other Income
9.0

 
7.2

 
17.4

 
14.3

 
29.0

 
30.0

 
33.7

Total
341.1

 
340.0

 
690.9

 
680.3

 
1,361.1

 
1,285.6

 
1,219.7

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Benefits and Expenses
 
 
 
 
 
 
 
 
 
 
 
 
 
Benefits and Change in Reserves for Future Benefits
137.8

 
135.4

 
269.0

 
274.2

 
560.6

 
536.8

 
536.7

Commissions
54.8

 
63.5

 
118.7

 
126.2

 
243.6

 
219.0

 
211.6

Deferral of Acquisition Costs
(47.6
)
 
(53.5
)
 
(99.2
)
 
(104.2
)
 
(200.5
)
 
(179.9
)
 
(174.2
)
Amortization of Deferred Acquisition Costs
46.0

 
45.4

 
113.4

 
91.4

 
164.6

 
154.1

 
158.0

Other Expenses
66.4

 
64.2

 
133.0

 
128.9

 
259.7

 
249.5

 
239.5

Total
257.4

 
255.0

 
534.9

 
516.5

 
1,028.0

 
979.5

 
971.6

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Operating Income Before Income Tax and Net Realized Investment Gains and Losses
$
83.7

 
$
85.0

 
$
156.0

 
$
163.8

 
$
333.1

 
$
306.1

 
$
248.1

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Operating Ratios (% of Premium Income):
 
 
 
 
 
 
 
 
 
 
 
 
 
Benefit Ratios:
 
 
 
 
 
 
 
 
 
 
 
 
 
Individual Disability - Recently Issued
53.4
%
 
52.1
%
 
49.7
%
 
51.8
%
 
52.4
%
 
52.2
%
 
53.3
%
Voluntary Benefits
48.2
%
 
46.8
%
 
47.3
%
 
47.9
%
 
49.5
%
 
50.7
%
 
55.1
%
Other Expense Ratio
24.3
%
 
23.3
%
 
23.9
%
 
23.3
%
 
23.5
%
 
23.9
%
 
24.2
%
Before-tax Operating Income Ratio
30.6
%
 
30.8
%
 
28.0
%
 
29.6
%
 
30.2
%
 
29.3
%
 
25.1
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest Adjusted Loss Ratio:
 
 
 
 
 
 
 
 
 
 
 
 
 
Individual Disability - Recently Issued
31.3
%
 
30.8
%
 
28.2
%
 
30.6
%
 
31.2
%
 
30.8
%
 
32.5
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Premium Persistency:
 
 
 
 
 
 
 
 
 
 
 
 
 
Individual Disability - Recently Issued
 
 
 
 
90.7
%
 
90.3
%
 
91.4
%
 
89.3
%
 
90.7
%
Voluntary Benefits
 
 
 
 
76.5
%
 
79.4
%
 
78.9
%
 
80.5
%
 
80.1
%





 
7. 3
 


Unum Group Financial Results for Unum UK Segment

 
Three Months Ended
 
Six Months Ended
 
Year Ended
 
6/30/2013
 
6/30/2012
 
6/30/2013
 
6/30/2012
 
12/31/2012
 
12/31/2011
 
12/31/2010
Operating Revenue
 
 
 
 
 
 
 
 
 
 
 
 
 
Premium Income
 
 
 
 
 
 
 
 
 
 
 
 
 
Group Long-term Disability
$
96.3

 
$
101.7

 
$
194.2

 
$
203.6

 
$
409.7

 
$
419.6

 
$
421.2

Group Life
26.5

 
55.5

 
57.5

 
108.2

 
221.3

 
203.6

 
171.6

Supplemental and Voluntary
14.8

 
16.0

 
29.7

 
32.1

 
63.6

 
64.4

 
57.8

Total Premium Income
137.6

 
173.2

 
281.4

 
343.9

 
694.6

 
687.6

 
650.6

Net Investment Income
45.4

 
49.2

 
76.2

 
85.7

 
170.8

 
189.9

 
170.5

Other Income
(0.1
)
 
—

 
—

 
0.1

 
0.1

 
0.3

 
1.2

Total
182.9

 
222.4

 
357.6

 
429.7

 
865.5

 
877.8

 
822.3

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Benefits and Expenses
 
 
 
 
 
 
 
 
 
 
 
 
 
Benefits and Change in Reserves for Future Benefits
115.8

 
147.9

 
215.8

 
271.5

 
541.4

 
493.8

 
435.8

Commissions
8.5

 
10.0

 
18.8

 
20.6

 
42.6

 
45.7

 
44.1

Deferral of Acquisition Costs
(2.4
)
 
(3.5
)
 
(4.7
)
 
(7.1
)
 
(11.8
)
 
(15.4
)
 
(15.1
)
Amortization of Deferred Acquisition Costs
3.5

 
4.1

 
7.6

 
8.0

 
15.7

 
15.3

 
13.6

Other Expenses
24.0

 
33.9

 
55.3

 
67.9

 
146.3

 
147.7

 
134.9

Total
149.4

 
192.4

 
292.8

 
360.9

 
734.2

 
687.1

 
613.3

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Operating Income Before Income Tax and Net Realized Investment Gains and Losses
$
33.5

 
$
30.0

 
$
64.8

 
$
68.8

 
$
131.3

 
$
190.7

 
$
209.0

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Operating Ratios (% of Premium Income):
 
 
 
 
 
 
 
 
 
 
 
 
 
Benefit Ratio
84.2
%
 
85.4
%
 
76.7
%
 
78.9
%
 
77.9
%
 
71.8
%
 
67.0
%
Other Expense Ratio
17.4
%
 
19.6
%
 
19.7
%
 
19.7
%
 
21.1
%
 
21.5
%
 
20.7
%
Before-tax Operating Income Ratio
24.3
%
 
17.3
%
 
23.0
%
 
20.0
%
 
18.9
%
 
27.7
%
 
32.1
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Premium Persistency:
 
 
 
 
 
 
 
 
 
 
 
 
 
Group Long-term Disability
 
 
 
 
82.0
%
 
84.1
%
 
84.0
%
 
86.6
%
 
91.3
%
Group Life
 
 
 
 
74.0
%
 
82.4
%
 
82.5
%
 
89.3
%
 
92.7
%
Supplemental and Voluntary
 
 
 
 
87.0
%
 
87.0
%
 
84.6
%
 
87.3
%
 
88.9
%




 
8
 


Unum Group Financial Results for Unum UK Segment - Continued

(in millions of pounds, except exchange rate)
Three Months Ended
 
Six Months Ended
 
Year Ended
 
6/30/2013
 
6/30/2012
 
6/30/2013
 
6/30/2012
 
12/31/2012
 
12/31/2011
 
12/31/2010
Operating Revenue
 
 
 
 
 
 
 
 
 
 
 
 
 
Premium Income
 
 
 
 
 
 
 
 
 
 
 
 
 
Group Long-term Disability
£
62.7

 
£
64.3

 
£
125.8

 
£
129.1

 
£
258.4

 
£
261.6

 
£
272.3

Group Life
17.3

 
35.1

 
37.3

 
68.6

 
139.6

 
127.0

 
110.9

Supplemental and Voluntary
9.6

 
10.0

 
19.3

 
20.3

 
40.1

 
40.1

 
37.4

Total Premium Income
89.6

 
109.4

 
182.4

 
218.0

 
438.1

 
428.7

 
420.6

Net Investment Income
29.6

 
31.0

 
49.4

 
54.3

 
107.7

 
118.4

 
110.2

Other Income
—

 
0.1

 
—

 
0.1

 
—

 
0.1

 
0.9

Total
119.2

 
140.5

 
231.8

 
272.4

 
545.8

 
547.2

 
531.7

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Benefits and Expenses
 
 
 
 
 
 
 
 
 
 
 
 
 
Benefits and Change in Reserves for Future Benefits
75.4

 
93.3

 
139.9

 
171.9

 
341.4

 
307.7

 
281.4

Commissions
5.6

 
6.4

 
12.2

 
13.1

 
26.9

 
28.5

 
28.5

Deferral of Acquisition Costs
(1.6
)
 
(2.2
)
 
(3.1
)
 
(4.5
)
 
(7.5
)
 
(9.5
)
 
(9.6
)
Amortization of Deferred Acquisition Costs
2.3

 
2.5

 
5.0

 
5.0

 
9.9

 
9.4

 
8.6

Other Expenses
15.7

 
21.4

 
35.8

 
43.1

 
92.2

 
92.1

 
87.4

Total
97.4

 
121.4

 
189.8

 
228.6

 
462.9

 
428.2

 
396.3

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Operating Income Before Income Tax and Net Realized Investment Gains and Losses
£
21.8

 
£
19.1

 
£
42.0

 
£
43.8

 
£
82.9

 
£
119.0

 
£
135.4

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Weighted Average Pound/Dollar Exchange Rate
1.537

 
1.571

 
1.543

 
1.571

 
1.584

 
1.603

 
1.543




 
8. 1
 


Unum Group Financial Results for Colonial Life Segment

 
Three Months Ended
 
Six Months Ended
 
Year Ended
 
6/30/2013
 
6/30/2012
 
6/30/2013
 
6/30/2012
 
12/31/2012
 
12/31/2011
 
12/31/2010
Operating Revenue
 
 
 
 
 
 
 
 
 
 
 
 
 
Premium Income
 
 
 
 
 
 
 
 
 
 
 
 
 
Accident, Sickness, and Disability
$
184.7

 
$
179.8

 
$
369.5

 
$
360.0

 
$
724.5

 
$
695.3

 
$
661.0

Life
55.3

 
52.4

 
110.1

 
104.1

 
209.7

 
190.7

 
176.5

Cancer and Critical Illness
67.9

 
64.7

 
135.4

 
129.1

 
260.3

 
249.3

 
238.2

Total Premium Income
307.9

 
296.9

 
615.0

 
593.2

 
1,194.5

 
1,135.3

 
1,075.7

Net Investment Income
34.3

 
34.0

 
74.0

 
69.6

 
138.6

 
132.4

 
122.5

Other Income
0.1

 
0.1

 
0.1

 
0.2

 
0.3

 
0.5

 
0.7

Total
342.3

 
331.0

 
689.1

 
663.0

 
1,333.4

 
1,268.2

 
1,198.9

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Benefits and Expenses
 
 
 
 
 
 
 
 
 
 
 
 
 
Benefits and Change in Reserves for Future Benefits
160.3

 
155.8

 
321.6

 
310.2

 
627.3

 
589.4

 
534.7

Commissions
62.5

 
63.3

 
126.5

 
127.2

 
254.5

 
245.9

 
232.6

Deferral of Acquisition Costs
(50.7
)
 
(51.4
)
 
(102.6
)
 
(103.3
)
 
(206.3
)
 
(203.1
)
 
(196.8
)
Amortization of Deferred Acquisition Costs
43.0

 
41.9

 
86.0

 
83.8

 
166.5

 
151.2

 
150.1

Other Expenses
56.1

 
53.8

 
111.1

 
107.8

 
217.1

 
214.7

 
208.6

Total
271.2

 
263.4

 
542.6

 
525.7

 
1,059.1

 
998.1

 
929.2

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Operating Income Before Income Tax and Net Realized Investment Gains and Losses
$
71.1

 
$
67.6

 
$
146.5

 
$
137.3

 
$
274.3

 
$
270.1

 
$
269.7

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Operating Ratios (% of Premium Income):
 
 
 
 
 
 
 
 
 
 
 
 
 
Benefit Ratio
52.1
%
 
52.5
%
 
52.3
%
 
52.3
%
 
52.5
%
 
51.9
%
 
49.7
%
Other Expense Ratio
18.2
%
 
18.1
%
 
18.1
%
 
18.2
%
 
18.2
%
 
18.9
%
 
19.4
%
Before-tax Operating Income Ratio
23.1
%
 
22.8
%
 
23.8
%
 
23.1
%
 
23.0
%
 
23.8
%
 
25.1
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Persistency:
 
 
 
 
 
 
 
 
 
 
 
 
 
Accident, Sickness, and Disability
 
 
 
 
75.8
%
 
74.6
%
 
75.7
%
 
73.8
%
 
75.9
%
Life
 
 
 
 
85.5
%
 
84.9
%
 
85.7
%
 
85.0
%
 
86.0
%
Cancer and Critical Illness
 
 
 
 
83.9
%
 
84.0
%
 
84.5
%
 
84.0
%
 
84.9
%



 
9
 


Unum Group Financial Results for Closed Block Segment

 
Three Months Ended
 
Six Months Ended
 
Year Ended
 
6/30/2013
 
6/30/2012
 
6/30/2013
 
6/30/2012
 
12/31/2012
 
12/31/2011
 
12/31/2010
Operating Revenue
 
 
 
 
 
 
 
 
 
 
 
 
 
Premium Income
 
 
 
 
 
 
 
 
 
 
 
 
 
Individual Disability
$
170.6

 
$
184.6

 
$
352.4

 
$
371.8

 
$
736.4

 
$
787.0

 
$
847.0

Long-term Care
157.8

 
156.9

 
316.6

 
312.1

 
631.9

 
608.1

 
599.2

All Other
0.4

 
1.0

 
0.1

 
1.5

 
2.2

 
0.2

 
3.5

Total Premium Income
328.8

 
342.5

 
669.1

 
685.4

 
1,370.5

 
1,395.3

 
1,449.7

Net Investment Income
316.1

 
304.5

 
629.2

 
606.1

 
1,230.5

 
1,189.7

 
1,166.4

Other Income
23.8

 
26.6

 
47.9

 
52.5

 
100.1

 
106.1

 
113.6

Total
668.7

 
673.6

 
1,346.2

 
1,344.0

 
2,701.1

 
2,691.1

 
2,729.7

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Benefits and Expenses
 
 
 
 
 
 
 
 
 
 
 
 
 
Benefits and Change in Reserves for Future Benefits
571.0

 
575.1

 
1,150.3

 
1,153.8

 
2,314.9

 
3,012.8

 
2,259.2

Commissions
27.1

 
27.8

 
55.1

 
56.3

 
112.6

 
113.6

 
118.1

Interest and Debt Expense
2.1

 
2.7

 
4.3

 
5.4

 
10.4

 
10.5

 
11.7

Deferral of Acquisition Costs
—

 
—

 
—

 
—

 
—

 
(3.7
)
 
(2.8
)
Amortization of Deferred Acquisition Costs
—

 
—

 
—

 
—

 
—

 
11.1

 
17.0

Impairment of Long-term Care Deferred Acquisition Costs
—

 
—

 
—

 
—

 
—

 
196.0

 
—

Other Expenses
38.9

 
42.3

 
79.6

 
87.4

 
167.7

 
180.0

 
207.9

Total
639.1

 
647.9

 
1,289.3

 
1,302.9

 
2,605.6

 
3,520.3

 
2,611.1

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Operating Income (Loss) Before Income Tax and Net Realized Investment Gains and Losses, as reported
$
29.6

 
$
25.7

 
$
56.9

 
$
41.1

 
$
95.5

 
$
(829.2
)
 
$
118.6

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest Adjusted Loss Ratios, as reported:
 
 
 
 
 
 
 
 
 
 
 
 
 
Individual Disability
82.7
%
 
82.7
%
 
82.1
%
 
82.9
%
 
83.0
%
 
108.0
 %
 
85.0
%
Long-term Care
90.1
%
 
87.8
%
 
89.8
%
 
89.5
%
 
90.1
%
 
179.3
 %
 
80.8
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Operating Ratios (% of Premium Income):
 
 
 
 
 
 
 
 
 
 
 
 
 
Other Expense Ratio
11.8
%
 
12.4
%
 
11.9
%
 
12.8
%
 
12.2
%
 
12.9
 %
 
14.3
%
Before-tax Operating Income (Loss) Ratio, as reported
9.0
%
 
7.5
%
 
8.5
%
 
6.0
%
 
7.0
%
 
(59.4
)%
 
8.2
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Premium Persistency:
 
 
 
 
 
 
 
 
 
 
 
 
 
Individual Disability
 
 
 
 
92.2
%
 
92.9
%
 
92.5
%
 
92.9
 %
 
93.0
%
Long-term Care
 
 
 
 
95.5
%
 
95.8
%
 
95.8
%
 
96.0
 %
 
95.8
%


 
10
 


Unum Group Financial Results for Closed Block Segment - Continued

 
Three Months Ended
 
Six Months Ended
 
Year Ended
 
6/30/2013
 
6/30/2012
 
6/30/2013
 
6/30/2012
 
12/31/2012
 
12/31/2011
 
12/31/2010
Operating Income (Loss) Before Income Tax and Net Realized Investment Gains and Losses, as reported
$
29.6

 
$
25.7

 
$
56.9

 
$
41.1

 
$
95.5

 
$
(829.2
)
 
$
118.6

Individual Disability Reserve Charge
—

 
—

 
—

 
—

 
—

 
183.5

 
—

Long-term Care Reserve Charge
—

 
—

 
—

 
—

 
—

 
573.6

 
—

Impairment of Long-term Care Deferred Acquisition Costs
—

 
—

 
—

 
—

 
—

 
196.0

 
—

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Operating Income Before Income Tax and Net Realized Investment Gains and Losses, as adjusted
$
29.6

 
$
25.7

 
$
56.9

 
$
41.1

 
$
95.5

 
$
123.9

 
$
118.6

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest Adjusted Loss Ratios, as adjusted:
 
 
 
 
 
 
 
 
 
 
 
 
 
Individual Disability
82.7
%
 
82.7
%
 
82.1
%
 
82.9
%
 
83.0
%
 
84.7
%
 
85.0
%
Long-term Care
90.1
%
 
87.8
%
 
89.8
%
 
89.5
%
 
90.1
%
 
84.9
%
 
80.8
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Operating Ratios (% of Premium Income):
 
 
 
 
 
 
 
 
 
 
 
 
 
Other Expense Ratio
11.8
%
 
12.4
%
 
11.9
%
 
12.8
%
 
12.2
%
 
12.9
%
 
14.3
%
Before-tax Operating Income Ratio, as adjusted
9.0
%
 
7.5
%
 
8.5
%
 
6.0
%
 
7.0
%
 
8.9
%
 
8.2
%




















 
10. 1
 


Unum Group Financial Results for Corporate Segment

 
Three Months Ended
 
Six Months Ended
 
Year Ended
 
6/30/2013
 
6/30/2012
 
6/30/2013
 
6/30/2012
 
12/31/2012
 
12/31/2011
 
12/31/2010
Operating Revenue
 
 
 
 
 
 
 
 
 
 
 
 
 
Net Investment Income
$
(0.8
)
 
$
8.9

 
$
1.0

 
$
16.1

 
$
23.0

 
$
56.2

 
$
94.6

Other Income
0.8

 
1.5

 
2.4

 
1.8

 
2.8

 
20.6

 
3.3

Total
—

 
10.4

 
3.4

 
17.9

 
25.8

 
76.8

 
97.9

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Expenses
 
 
 
 
 
 
 
 
 
 
 
 
 
Interest and Debt Expense
35.2

 
32.2

 
70.0

 
64.7

 
133.9

 
131.8

 
128.9

Other Expenses
1.9

 
4.1

 
4.2

 
(0.3
)
 
0.4

 
23.4

 
7.9

Total
37.1

 
36.3

 
74.2

 
64.4

 
134.3

 
155.2

 
136.8

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Operating Loss Before Non-operating Retirement-related Loss, Income Tax, and Net Realized Investment Gains and Losses
$
(37.1
)
 
$
(25.9
)
 
$
(70.8
)
 
$
(46.5
)
 
$
(108.5
)
 
$
(78.4
)
 
$
(38.9
)


























 
11
 


Unum Group Reserves

 
June 30, 2013
 
Gross
 
Total
 
 
 
Policy
 
 
 
Claim Reserves
 
 
 
 
 
Reinsurance
 
Total
 
Reserves
 
%
 
Incurred
 
IBNR
 
%
 
Total
 
Ceded
 
Net
Group Disability
$
—

 
—
%
 
$
6,909.1

 
$
596.5

 
30.7
%
 
$
7,505.6

 
$
65.6

 
$
7,440.0

Group Life and Accidental Death & Dismemberment
73.4

 
0.5

 
778.7

 
162.5

 
3.9

 
1,014.6

 
1.5

 
1,013.1

Individual Disability - Recently Issued
556.1

 
3.6

 
1,126.1

 
124.7

 
5.1

 
1,806.9

 
96.2

 
1,710.7

Voluntary Benefits
1,252.9

 
8.0

 
41.2

 
51.6

 
0.4

 
1,345.7

 
29.0

 
1,316.7

Unum US Segment
1,882.4

 
12.1

 
8,855.1

 
935.3

 
40.1

 
11,672.8

 
192.3

 
11,480.5

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Unum UK Segment
23.1

 
0.1

 
2,098.2

 
161.5

 
9.3

 
2,282.8

 
122.7

 
2,160.1

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Colonial Life Segment
1,533.0

 
9.8

 
258.9

 
105.9

 
1.5

 
1,897.8

 
8.4

 
1,889.4

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Individual Disability
918.3

 
5.9

 
10,405.4

 
294.2

 
43.8

 
11,617.9

 
1,537.3

 
10,080.6

Long-term Care
5,535.1

 
35.5

 
809.7

 
81.3

 
3.6

 
6,426.1

 
43.5

 
6,382.6

Other
5,714.6

 
36.6

 
244.1

 
164.5

 
1.7

 
6,123.2

 
4,847.8

 
1,275.4

Closed Block Segment
12,168.0

 
78.0

 
11,459.2

 
540.0

 
49.1

 
24,167.2

 
6,428.6

 
17,738.6

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Subtotal, Excluding Unrealized Adjustment
$
15,606.5

 
100.0
%
 
$
22,671.4

 
$
1,742.7

 
100.0
%
 
40,020.6

 
6,752.0

 
33,268.6

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Unrealized Adjustment to Reserves for Unrealized Gain on Securities
 
 
 
 
 
 
 
 
 
 
4,498.1

 
283.6

 
4,214.5

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Consolidated
 
 
 
 
 
 
 
 
 
 
$
44,518.7

 
$
7,035.6

 
$
37,483.1


Compared to the December 31, 2012 balance, the decline in the unrealized adjustment to reserves for unrealized gain on securities was due primarily to an increase in U.S. Treasury rates.


 
12
 


Unum Group Reserves

 
December 31, 2012
 
Gross
 
Total
 
 
 
Policy
 
 
 
Claim Reserves
 
 
 
 
 
Reinsurance
 
Total
 
Reserves
 
%
 
Incurred
 
IBNR
 
%
 
Total
 
Ceded
 
Net
Group Disability
$
—

 
—
%
 
$
7,000.8

 
$
596.0

 
30.9
%
 
$
7,596.8

 
$
61.3

 
$
7,535.5

Group Life and Accidental Death & Dismemberment
73.8

 
0.5

 
790.1

 
168.1

 
3.9

 
1,032.0

 
1.0

 
1,031.0

Individual Disability - Recently Issued
557.8

 
3.6

 
1,093.2

 
126.0

 
5.0

 
1,777.0

 
91.2

 
1,685.8

Voluntary Benefits
1,224.3

 
8.0

 
42.4

 
49.4

 
0.4

 
1,316.1

 
28.6

 
1,287.5

Unum US Segment
1,855.9

 
12.1

 
8,926.5

 
939.5

 
40.2

 
11,721.9

 
182.1

 
11,539.8

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Unum UK Segment
25.6

 
0.2

 
2,251.7

 
142.2

 
9.7

 
2,419.5

 
108.3

 
2,311.2

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Colonial Life Segment
1,490.3

 
9.7

 
251.4

 
99.4

 
1.4

 
1,841.1

 
9.4

 
1,831.7

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Individual Disability
985.7

 
6.4

 
10,406.2

 
297.3

 
43.6

 
11,689.2

 
1,492.7

 
10,196.5

Long-term Care
5,272.5

 
34.4

 
747.0

 
81.3

 
3.4

 
6,100.8

 
47.0

 
6,053.8

Other
5,704.5

 
37.2

 
258.8

 
165.7

 
1.7

 
6,129.0

 
4,829.9

 
1,299.1

Closed Block Segment
11,962.7

 
78.0

 
11,412.0

 
544.3

 
48.7

 
23,919.0

 
6,369.6

 
17,549.4

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Subtotal, Excluding Unrealized Adjustment
$
15,334.5

 
100.0
%
 
$
22,841.6

 
$
1,725.4

 
100.0
%
 
39,901.5

 
6,669.4

 
33,232.1

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Unrealized Adjustment to Reserves for Unrealized Gain on Securities
 
 
 
 
 
 
 
 
 
 
6,277.5

 
351.5

 
5,926.0

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Consolidated
 
 
 
 
 
 
 
 
 
 
$
46,179.0

 
$
7,020.9

 
$
39,158.1


















 
12. 1
 


Unum Group Investment Fact Sheet at June 30, 2013

 
 
6/30/2013
 
 
 
6/30/2013
 
3/31/2013
Fixed Maturity Securities (Fair Value)
 
 
 
 
 
Selected Statistics
 
 
 
 
Public
 
$
28,056.8

 
65.9
%
 
Duration Weighted Book Yield
 
6.35
%
 
6.41
%
Asset-Backed Securities (1)
 
34.8

 
0.1

 
Average Duration (in years)
 
7.62

 
7.80

Residential Mortgage-Backed Securities (2)
 
1,699.2

 
4.0

 
 
 
.

 
 
Commercial Mortgage-Backed Securities
 
123.0

 
0.3

 
 
 
 
 
 
Private Placements
 
5,252.5

 
12.3

 
 
 
 
 
 
High Yield
 
3,074.5

 
7.2

 
 
 
 
 
 
Government Securities
 
2,592.3

 
6.1

 
 
 
 
 
 
Municipal Securities (3)
 
1,723.0

 
4.0

 
 
 
 
 
 
Redeemable Preferred Stocks
 
38.1

 
0.1

 
 
 
 
 
 
Total
 
$
42,594.2

 
100.0
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Amortized Cost
 
Fair Value
 
 
 
 
 
 
Quality Ratings of Fixed Maturity Securities
 
 
 
 
 
Schedule BA and Non-Current
 
 
 
 
Aaa
 
7.5
%
 
7.7
%
 
Total Non-Current Investments
 
$
53.5

 
$
62.8

Aa
 
9.5

 
9.7

 
Total Schedule BA Assets
 
$
460.1

 
$
438.4

A
 
30.5

 
31.5

 
 
 
 
 
 
Baa
 
44.4

 
43.7

 
 
 
 
 
 
Below Baa
 
8.1

 
7.4

 
 
 
 
 
 
Total
 
100.0
%
 
100.0
%
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
(1) Includes $0.5 million of high yield asset-backed securities.
(2) Includes $48.6 million of high yield mortgage-backed securities.
(3) Includes $16.0 million of high yield taxable municipal securities.



 
13
 


Unum Group Investment Fact Sheet at June 30, 2013
Fixed Maturity Securities - By Industry Classification - Unrealized Gain (Loss)
Classification
 
Fair Value
 
Net Unrealized Gain
 
Fair Value of Fixed Maturity Securities with Gross Unrealized Loss
 
Gross Unrealized Loss
 
Fair Value of Fixed Maturity Securities with Gross Unrealized Gain
 
Gross Unrealized Gain
Basic Industry
 
$
2,537.5

 
$
164.8

 
$
628.4

 
$
40.5

 
$
1,909.1

 
$
205.3

Capital Goods
 
3,780.2

 
363.9

 
508.8

 
21.1

 
3,271.4

 
385.0

Communications
 
2,856.4

 
358.6

 
302.9

 
14.0

 
2,553.5

 
372.6

Consumer Cyclical
 
1,184.5

 
114.9

 
185.2

 
9.8

 
999.3

 
124.7

Consumer Non-Cyclical
 
5,800.1

 
624.9

 
852.8

 
49.8

 
4,947.3

 
674.7

Energy (Oil & Gas)
 
3,753.2

 
492.7

 
353.4

 
14.6

 
3,399.8

 
507.3

Financial Institutions
 
3,374.7

 
262.0

 
230.3

 
12.3

 
3,144.4

 
274.3

Mortgage/Asset-Backed
 
1,857.0

 
217.7

 
36.7

 
2.3

 
1,820.3

 
220.0

Sovereigns
 
1,355.4

 
171.8

 
30.3

 
2.1

 
1,325.1

 
173.9

Technology
 
1,147.7

 
83.6

 
377.6

 
19.6

 
770.1

 
103.2

Transportation
 
1,381.3

 
177.4

 
109.5

 
6.0

 
1,271.8

 
183.4

U.S. Government Agencies and Municipalities
 
2,959.9

 
358.5

 
363.0

 
30.8

 
2,596.9

 
389.3

Public Utilities
 
10,568.2

 
1,263.7

 
810.2

 
46.4

 
9,758.0

 
1,310.1

Redeemable Preferred Stocks
 
38.1

 
5.1

 
—

 
—

 
38.1

 
5.1

Total
 
$
42,594.2

 
$
4,659.6

 
$
4,789.1

 
$
269.3

 
$
37,805.1

 
$
4,928.9

 
 
 
 
 
 
 
 
 
 
 
 
 
Fixed Maturity Securities - Financial Institutions Classification - Unrealized Gain (Loss)
Associations
 
$
13.0

 
$
1.0

 
$
—

 
$
—

 
$
13.0

 
$
1.0

Banking
 
1,999.2

 
142.0

 
179.9

 
8.7

 
1,819.3

 
150.7

Finance Captive
 
236.6

 
17.3

 
—

 
—

 
236.6

 
17.3

Insurance
 
754.3

 
74.0

 
41.1

 
2.9

 
713.2

 
76.9

Other Financial Institutions
 
42.6

 
2.0

 
—

 
—

 
42.6

 
2.0

Real Estate Management Services
 
329.0

 
25.7

 
9.3

 
0.7

 
319.7

 
26.4

Total
 
$
3,374.7

 
$
262.0

 
$
230.3

 
$
12.3

 
$
3,144.4

 
$
274.3

 
 
 
 
 
 
 
 
 
 
 
 
 
Gross Unrealized Loss on Fixed Maturity Securities By Length of Time in Unrealized Loss Position
 
 
Investment-Grade
 
 
 
Below-Investment-Grade
 
 
Category
 
Fair Value
 
Gross Unrealized Loss
 
 
 
Fair Value
 
Gross Unrealized Loss
 
 
Less than 91 days
 
$
3,358.4

 
$
176.6

 
 
 
$
844.5

 
$
33.3

 
 
91 through 180 days
 
96.0

 
12.6

 
 
 
25.4

 
1.6

 
 
181 through 270 days
 
121.6

 
12.3

 
 
 
—

 
—

 
 
271 days to 1 year
 
5.5

 
0.1

 
 
 
7.4

 
0.5

 
 
Greater than 1 year
 
198.5

 
14.2

 
 
 
131.8

 
18.1

 
 
Total
 
$
3,780.0

 
$
215.8

 
 
 
$
1,009.1

 
$
53.5

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 

 
13. 1
 


Unum Group Investment Fact Sheet at June 30, 2013

Asset and Mortgage-Backed Securities Portfolio
 
 
Amortized Cost
 
Fair Value
 
% of Total Fixed Maturity Securities
 
Average Rating
Asset-Backed Securities
 
 
 
 
 
 
 
 
 
 
Credit Cards
 
$
19.6

 
$
19.9

 
1.1
%
 
0.1
%
 
Aaa
Equipment
 
15.3

 
14.4

 
0.8

 
—

 
A2
Home Equity
 
0.8

 
0.5

 
—

 
—

 
Caa2
Total
 
35.7

 
34.8

 
1.9

 
0.1

 
Aa3
 
 
 
 
 
 
 
 
 
 
 
Residential Mortgage-Backed Securities
 
 
 
 
 
 
 
 
 
 
Agency CMOs
 
1,351.7

 
1,555.0

 
83.7

 
3.7

 
Aaa
Agency Pass-throughs
 
91.6

 
95.7

 
5.2

 
0.2

 
Aaa
Non-agency CMOs - Prime
 
46.6

 
48.5

 
2.6

 
0.1

 
B1
Total
 
1,489.9

 
1,699.2

 
91.5

 
4.0

 
Aaa
 
 
 
 
 
 
 
 
 
 
 
Commercial Mortgage-Backed Securities
 
 
 
 
 
 
 
 
 
 
Agency CMBS
 
113.7

 
123.0

 
6.6

 
0.3

 
A3
 
 
 
 
 
 
 
 
 
 
 
Total
 
$
1,639.3

 
$
1,857.0

 
100.0
%
 
4.4
%
 
Aa1



 
13. 2
 


Unum Group Statutory Capital and Surplus

 
 
As of June 30, 2013
 
As of December 31, 2012
 
 
Capital and Surplus
 
AVR
 
Capital and Surplus + AVR
 
Capital and Surplus + AVR
Traditional U.S. Life Insurance Companies
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Provident Life and Accident
 
$
668.0

 
$
84.3

 
$
752.3

 
$
726.2

 
 
 
 
 
 
 
 
 
Unum Life of America
 
1,579.3

 
195.4

 
1,774.7

 
1,764.2

 
 
 
 
 
 
 
 
 
Paul Revere Life (1)
 
376.6

 
36.2

 
412.8

 
406.0

 
 
 
 
 
 
 
 
 
Colonial Life & Accident
 
558.8

 
32.8

 
591.6

 
566.0

 
 
 
 
 
 
 
 
 
Provident Life and Casualty
 
153.3

 
9.3

 
162.6

 
154.8

 
 
 
 
 
 
 
 
 
First Unum Life
 
239.9

 
18.5

 
258.4

 
267.8

 
 
 
 
 
 
 
 
 
Paul Revere Variable (1)
 
39.3

 
0.6

 
39.9

 
39.1

 
 
 
 
 
 
 
 
 
(1) Capital and Surplus of Paul Revere Variable is included in Paul Revere Life
 
 
 
 
 
 
 
 
 
Special Purpose Reinsurance Vehicles
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Tailwind Reinsurance Company
 
$
54.6

 
$
0.2

 
$
54.8

 
$
58.4

 
 
 
 
 
 
 
 
 
Northwind Reinsurance Company
 
1,119.2

 
4.2

 
1,123.4

 
1,134.4

 
 
 
 
 
 
 
 
 
UnumProvident International Ltd.
 
581.2

 
—

 
581.2

 
576.8

Amounts shown are preliminary estimates and may change prior to the regulatory filing of each subsidiary's financial information.



 
14
 


Unum Group Statutory Operating Results
 
 
Six Months Ended June 30
 
 
Net Gain (Loss) from Operations After Tax
 
Net Realized Investment Gains (Losses) After Tax and Transfer to IMR
 
Net Income (Loss)
 
Traditional U.S. Life Insurance Companies
2013
 
2012
 
2013
 
2012
 
2013
 
2012
 
Provident Life and Accident
$
107.4

 
$
79.9

 
$
(4.8
)
 
$
0.6

 
$
102.6

 
$
80.5

 
Unum Life of America
137.3

 
100.4

 
(13.0
)
 
(8.3
)
 
124.3

 
92.1

 
Paul Revere Life
42.2

 
42.3

 
(5.5
)
 
(1.1
)
 
36.7

 
41.2

 
Colonial Life & Accident
68.0

 
67.8

 
(1.1
)
 
0.1

 
66.9

 
67.9

 
Provident Life and Casualty
9.6

 
8.0

 
—

 
—

 
9.6

 
8.0

 
First Unum Life
18.4

 
8.4

 
(0.5
)
 
—

 
17.9

 
8.4

 
Paul Revere Variable
1.3

 
1.1

 
(0.2
)
 
0.1

 
1.1

 
1.2

 
Total, as reported
384.2

 
307.9

 
(25.1
)
 
(8.6
)
 
359.1

 
299.3

 
Intercompany Dividends
(11.3
)
 
(12.7
)
 
—

 
—

 
(11.3
)
 
(12.7
)
 
Total, as adjusted
$
372.9

 
$
295.2

 
$
(25.1
)
 
$
(8.6
)
 
$
347.8

 
$
286.6

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Special Purpose Reinsurance Vehicles
 
 
 
 
 
 
 
 
 
 
 
 
Tailwind Reinsurance Company
$
3.0

 
$
6.6

 
$
0.1

 
$
—

 
$
3.1

 
$
6.6

 
Northwind Reinsurance Company
20.0

 
10.5

 
(0.2
)
 
0.6

 
19.8

 
11.1

 
UnumProvident International Ltd.
(12.2
)
 
(12.0
)
 
(0.4
)
 
0.7

 
(12.6
)
 
(11.3
)
 
Total
$
10.8

 
$
5.1

 
$
(0.5
)
 
$
1.3

 
$
10.3

 
$
6.4

 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
Three Months Ended June 30
 
 
Net Gain (Loss) from Operations After Tax
 
Net Realized Investment Gains (Losses) After Tax and Transfer to IMR
 
Net Income (Loss)
 
Traditional U.S. Life Insurance Companies
2013
 
2012
 
2013
 
2012
 
2013
 
2012
 
Provident Life and Accident
$
39.4

 
$
33.2

 
$
(2.7
)
 
$
1.6

 
$
36.7

 
$
34.8

 
Unum Life of America
68.1

 
67.6

 
(8.1
)
 
(4.9
)
 
60.0

 
62.7

 
Paul Revere Life
21.6

 
19.3

 
—

 
(1.2
)
 
21.6

 
18.1

 
Colonial Life & Accident
39.6

 
40.4

 
(1.1
)
 
0.1

 
38.5

 
40.5

 
Provident Life and Casualty
7.0

 
1.0

 
0.1

 
—

 
7.1

 
1.0

 
First Unum Life
14.0

 
6.8

 
—

 
—

 
14.0

 
6.8

 
Paul Revere Variable
0.7

 
0.5

 
—

 
—

 
0.7

 
0.5

 
Total, as reported
190.4

 
168.8

 
(11.8
)
 
(4.4
)
 
178.6

 
164.4

 
Intercompany Dividends
(5.6
)
 
(6.4
)
 
—

 
—

 
(5.6
)
 
(6.4
)
 
Total, as adjusted
$
184.8

 
$
162.4

 
$
(11.8
)
 
$
(4.4
)
 
$
173.0

 
$
158.0

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Special Purpose Reinsurance Vehicles
 
 
 
 
 
 
 
 
 
 
 
 
Tailwind Reinsurance Company
$
1.4

 
$
1.6

 
$
0.1

 
$
—

 
$
1.5

 
$
1.6

 
Northwind Reinsurance Company
7.9

 
2.1

 
(0.1
)
 
0.4

 
7.8

 
2.5

 
UnumProvident International Ltd.
(14.0
)
 
3.8

 
(0.2
)
 
(0.4
)
 
(14.2
)
 
3.4

 
Total
$
(4.7
)
 
$
7.5

 
$
(0.2
)
 
$
—

 
$
(4.9
)
 
$
7.5

 
 
 
 
 
 
 
 
 
 
 
 
 
 
Note: Statutory results for our domestic insurers are reported in conformity with statutory accounting principles as prescribed by the National Association of Insurance Commissioners and adopted by the applicable state laws. For UnumProvident International Ltd., results are reported in conformity with accounting principles as prescribed by applicable Bermuda laws.
 
 
Amounts shown are preliminary estimates and may change prior to the regulatory filing of each subsidiary's financial information.

 
14. 1
 


Unum Life Insurance Company of America - Statutory Basis
Group Accident and Health Statutory Claim Reserves and Liabilities, Net of Ceded
On Claims Incurred Prior to January 1

 
 
2013
 
2012
 
2011
Reserve Balance from Prior Year End
 
$
6,682.4

 
$
6,755.9

 
$
6,829.4

Other Adjustments to Beginning Balance (see Schedule H)
 
—

 
(3.7
)
 
(3.9
)
Reserve Balance January 1 (a)
 
6,682.4

 
6,752.2

 
6,825.5

Paid on Prior Year Claims
 
(390.0
)
 
(391.2
)
 
(390.5
)
Interest Earned on Reserves
 
96.7

 
104.6

 
110.7

Incurred on Prior Year Claims
 
(123.3
)
 
(109.9
)
 
(122.3
)
Reserve Balance March 31
 
$
6,265.8

 
$
6,355.7

 
$
6,423.4

 
 
 
 
 
 
 
Reserve Balance March 31
 
$
6,265.8

 
$
6,355.7

 
$
6,423.4

Paid on Prior Year Claims
 
(324.2
)
 
(335.8
)
 
(339.9
)
Interest Earned on Reserves
 
91.6

 
96.6

 
104.0

Incurred on Prior Year Claims
 
(87.1
)
 
(130.3
)
 
(107.5
)
Reserve Balance June 30
 
$
5,946.1

 
$
5,986.2

 
$
6,080.0

 
 
 
 
 
 
 
Reserve Balance June 30
 

 
$
5,986.2

 
$
6,080.0

Paid on Prior Year Claims
 
 
 
(315.1
)
 
(316.4
)
Interest Earned on Reserves
 
 
 
89.5

 
98.9

Incurred on Prior Year Claims
 
 
 
(77.6
)
 
(49.4
)
Reserve Balance September 30
 

 
$
5,683.0

 
$
5,813.1

 
 
 
 
 
 
 
Reserve Balance September 30
 

 
$
5,683.0

 
$
5,813.1

Paid on Prior Year Claims
 
 
 
(273.2
)
 
(291.7
)
Interest Earned on Reserves
 
 
 
85.3

 
92.5

Incurred on Prior Year Claims
 
 
 
(93.5
)
 
(111.4
)
Reserve Balance December 31 on Prior Year Claims
 


 
5,401.6

 
5,502.5

Reserve Balance December 31 on Current Year Claims
 
 
 
1,280.8

 
1,253.4

Reserve Balance December 31 on Total Claims Incurred (b)
 


 
$
6,682.4

 
$
6,755.9

 
 
 
 
 
 
 
(a) 2012 and 2011 balances agree to Schedule H Part 3 Line 3.2 Column 2
 
 
 
 
 
 
(b) Agrees to Schedule H Part 2 Line C.1 Column 2
 
 
 
 
 
 

Amounts shown are preliminary estimates and may change prior to the regulatory filing of each subsidiary's financial information.


 
14. 2
 


Reconciliation to Unum Life Insurance Company of America - Statutory Basis
Schedule H Part 3 for Group Accident and Health

 
 
2012
 
2011
 
2010
Paid on Prior Year Existing Claims - Full Year
 
$
1,315.3

 
$
1,338.5

 
$
1,285.4

(Agrees to Schedule H Part 3 Line 1.1 Column 2)
 
 
 
 
 
 
 
 
 
 
 
 
 
Incurred on Prior Year Claims - Full Year
 
$
(411.3
)
 
$
(390.6
)
 
$
(382.6
)
Interest Earned on Reserves - Full Year
 
375.9

 
406.1

 
423.3

Incurred on Prior Year Claims - Full Year, Excluding Interest Earned
 
$
(35.4
)
 
$
15.5

 
$
40.7

(Agrees to Schedule H Part 3 Line 3.3 Column 2)
 
 
 
 
 
 
 
 
 
 
 
 
 
Note: Group A&H for Unum Life Insurance Company of America includes group long- and short-term disability, group accidental death & dismemberment, and group voluntary disability, cancer, and critical illness products reported in our Unum US segment as well as the reinsurance pools reported in our Closed Block segment.

Amounts shown are preliminary estimates and may change prior to the regulatory filing of each subsidiary's financial information.



 
14. 3
 


Notes to Statistical Supplement

Non-GAAP Financial Measures
We analyze our Company's performance using non-GAAP financial measures which exclude certain items and the related tax thereon from net income. We believe operating revenue, which excludes realized investment gains or losses, and operating income or loss, which excludes realized investment gains or losses and non-operating retirement-related gains or losses, both of which are recurring, are better performance measures and better indicators of the profitability and underlying trends in our business. Both realized investment gains or losses and non-operating retirement-related gains or losses depend on market conditions and do not necessarily relate to decisions regarding the underlying business of our Company. The exclusion of these items from our performance does not replace revenue and net income or net loss as measures of our overall profitability. We also believe book value per common share excluding the components of Accumulated Other Comprehensive Income, certain of which tend to fluctuate depending on market conditions and general economic trends, is an important measure.

2013 Significant Transactions and Events

Financing

In January 2013, we purchased and retired the outstanding principal of $62.5 million on our senior secured notes issued by Tailwind Holdings, LLC, resulting in a before-tax gain of $4.0 million.

Share Repurchase Program

During the first six months of 2013, we repurchased 7.3 million shares at a cost of $193.5 million, including commissions, under the July 2012 share repurchase program. The dollar value of shares remaining under the repurchase program was $356.6 million at June 30, 2013.

Retirement Benefit Plan Changes

In June 2013, we announced plan amendments which freeze participation and benefit accruals in our U.S. qualified and non-qualified defined benefit pension plans, effective December 31, 2013. Because the amendments eliminate all future service accruals subsequent to December 31, 2013 for active employees in these plans, we were required to remeasure the benefit obligations of our U.S. plans during the second quarter of 2013, which decreased our net pension liability by $327.4 million, with a corresponding increase in other comprehensive income, less applicable income tax of $114.6 million.

As a result of these plan amendments, during the second quarter of 2013 we recognized a $0.7 million curtailment loss, with a corresponding reduction in the prior service cost included in accumulated other comprehensive income and associated with years of service no longer expected to be rendered. In addition, because all participants in the U.S. plans are considered inactive as a result of these amendments, we are required to amortize the net actuarial loss for these plans over the average remaining life expectancy of the plan participants, which is approximately 30 years. The net actuarial loss was previously amortized over the average future working life of pension plan participants, or approximately 11 years.

In June 2013, we also communicated plans to amend the defined benefit pension plan for employees in our U.K. operation to freeze participation and benefit accruals effective December 31, 2013. Consistent with U.K. regulatory requirements, this communication initiated a formal 60 day consultation process with U.K. plan participants. If approved, we will remeasure the benefit obligation for our U.K. operation's plan and will record the effect of the remeasurement in the third quarter of 2013.

The unrecognized net actuarial loss and prior service cost included in accumulated other comprehensive income and expected to be amortized and included in net periodic pension cost during 2013 is approximately $33.3 million before tax and $21.9 million after tax. These amounts may change if the benefit obligation for our U.K. operation's plan is remeasured during the third quarter of 2013. The quarterly amortization of our net actuarial loss will be approximately $2.7 million before tax during the remainder of 2013.

(continued on next page)
15
 


2012 Significant Transactions and Events

Accounting Standards Codification (ASC) 944 "Financial Services - Insurance”

In October 2010, the Financial Accounting Standards Board (FASB) issued an update to address the diversity in practice regarding the interpretation of which costs relating to the acquisition of new or renewal insurance contracts qualify as deferred acquisition costs.  The amendments in the update require that only incremental direct costs associated with the successful acquisition of a new or renewal insurance contract can be capitalized. All other costs are to be expensed as incurred. We adopted this update effective January 1, 2012 and applied the amendments retrospectively.

Financing

In August 2012, we issued $250.0 million of unsecured senior notes in a public offering. These notes, due in 2042, bear interest at a fixed rate of 5.75% and are payable semi-annually. The notes are callable at or above par and rank equally in right of payment with all of our other unsecured and unsubordinated debt.

Share Repurchase Program

In July 2012, our board of directors authorized a $750.0 million share repurchase program with an expiration date of January 2014. This program superseded and replaced the February 2011 $1.0 billion share repurchase program. During 2012, we repurchased 23.6 million shares on the open market at a cost of $500.6 million, including commissions of $0.6 million.

2011 Significant Transactions and Events

Long-term Care Strategic Review

Following a comprehensive and strategic review of our long-term care business, in February 2012 we announced that we would discontinue selling group long-term care. We discontinued selling individual long-term care during 2009. Because both group and individual long-term care are considered closed blocks of business, effective December 31, 2011, we reclassified our long-term care products from the Unum US segment to the Closed Block segment.  We also reclassified our other insurance products not actively marketed, including individual life and corporate-owned life insurance, reinsurance pools and management operations, group pension, health insurance, and individual annuities, which were previously reported in the Corporate and Other segment to the Closed Block segment. The inclusion of all closed blocks of business into one operating segment aligns with our reporting and monitoring of our closed blocks of business within a discrete segment and is consistent with our separation of these blocks of business from the lines of business which actively market new products.  Prior period segment results have been restated to reflect these changes in our reporting classifications.

As part of the strategic review, and as is typical in the fourth quarter of each year, we analyzed our reserve assumptions for long-term care in conjunction with our annual loss recognition testing. We generally perform loss recognition tests on our deferred acquisition costs and policy reserves in the fourth quarter of each year, but more frequently if appropriate, using best estimate assumptions as of the date of the test. Included in the analysis was a review of our reserve discount rate assumptions and mortality and morbidity assumptions. Our analysis of reserve discount rate assumptions considered the significant decline in long-term interest rates which occurred late in the third quarter of 2011 due to the European Union debt crisis and the Federal Reserve Board's actions, including the announcement of "Operation Twist." We also considered an updated industry study for long-term care experience which was made available mid-year 2011 from the Society of Actuaries. Our analysis of this study, which was completed during the fourth quarter of 2011, showed that lower termination rates than we had previously assumed were beginning to emerge in industry and in our own company experience. Based on our analysis, as of December 31, 2011 we lowered the discount rate assumption to reflect the low interest rate environment and our expectation of future investment portfolio yield rates. We also changed our mortality assumptions to reflect emerging experience due to an increase in life expectancies which increases the ultimate number of people who will utilize long-term care benefits and also lengthens the amount of time a claimant receives long-term care benefits. We changed our morbidity assumptions to reflect emerging industry experience as well as our own company experience. While our morbidity experience is still emerging

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and is not fully credible, we modified our assumptions to align more closely with the recently published industry study. Using our revised best estimate assumptions, as of December 31, 2011 we determined that deferred acquisition costs of $196.0 million, as adjusted for the January 1, 2012 retrospective adoption of the accounting standards update related to deferred acquisition costs, were not recoverable and that our policy and claim reserves should be increased by $573.6 million to reflect our current estimate of future benefit obligations. These charges decreased our 2011 net income by $500.3 million. The increase in reserves represented a 10.5 percent increase in long-term care policy and claim reserves as of December 31, 2011, which equaled $5.4 billion subsequent to the charge. 

Claim Reserve Increase for Individual Disability Closed Block Business

Claim reserves supporting our individual disability closed block of business are calculated using assumptions based on actual experience believed to be currently appropriate. Claim reserves are subject to revision as current claim experience emerges and alters our view of future expectations. Claim resolution rates, which measure the resolution of claims from recovery, deaths, settlements, and benefit expirations, are very sensitive to operational and environmental changes and can be volatile. Our claim resolution rate assumption used in determining reserves is our expectation of the resolution rate we will experience over the life of the block of business. We are now able, with a higher degree of confidence, to assess our own experience for older ages in our long duration lifetime claim block as our data has become credible. There is very little industry experience for lifetime disability benefits, as our insurance companies were the primary disability companies in the insurance industry at the time lifetime disability benefits were offered. These benefits were offered during the 1980s and 1990s, recent enough such that claimants are just reaching the older ages and providing us with data to build our claim experience base. Emerging experience indicates a longer life expectancy for our older age, longer duration disabled claimants, which lengthens the time a claimant receives disability benefits. As a result of this experience, as of December 31, 2011 we adjusted our mortality assumption within our claim resolution rate assumption and, as a result, increased our claim reserves for our individual disability closed block of business by $183.5 million and decreased net income by $119.3 million. The increase in reserves represented a 1.5 percent increase in individual disability policy and claim reserves as of December 31, 2011, which equaled $11.9 billion subsequent to the charge. 

Share Repurchase Program

In February 2011, our board of directors authorized the repurchase of up to $1.0 billion of Unum Group's common stock, in addition to the amount that remained to be repurchased under the May 2010 $500.0 million authorization. The $1.0 billion share repurchase program had an expiration date of August 2012.

During February 2011, we repurchased 7.1 million shares, at a cost of $200.0 million, using an accelerated repurchase agreement with a financial counterparty. Under the terms of the repurchase agreement, we received a price adjustment based on the volume weighted average price of our common stock during the term of the agreement. The price adjustment resulted in the delivery to us of 0.6 million additional shares. In total, we repurchased 7.7 million shares of our common stock under this agreement, which completed the May 2010 $500.0 million repurchase authorization and initiated the $1.0 billion repurchase program.

In addition to these repurchases, during 2011, we repurchased an additional 17.7 million shares on the open market at a cost of $419.9 million for a total repurchase of 25.4 million shares. Pursuant to these repurchase programs, we retired 7.7 million shares during 2011. All other repurchased shares were classified as treasury stock and accounted for using the cost method.

Income Tax

Our income tax for 2011 includes a reduction in federal income taxes of $41.3 million due to a final settlement with the IRS with respect to our appeal of audit adjustments for the tax years 1996 to 2004. Our income tax for 2011 was unfavorably impacted by an $18.6 million tax charge related to the repatriation of £150.0 million of dividends from our U.K. subsidiaries.
Financing

During 2011, the remaining $225.1 million of our 7.625% senior notes due March 2011 matured.

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2010 Significant Transactions and Events

Share Repurchase Program

In May 2010, our board of directors authorized the repurchase of up to $500.0 million of Unum Group's common stock. During 2010, we repurchased 16.4 million shares, at a cost of $356.0 million under this share repurchase program.

Financing

In 2010, we issued $400.0 million of unsecured senior notes in a public offering.  These notes, due in 2020, bear interest at a fixed rate of 5.625% and are payable semi-annually. We also purchased and retired $10.0 million of our 7.08% medium-term notes due 2024.

Tax Law Change

In March 2010, the Patient Protection and Affordable Care Act and the Health Care and Education Reconciliation Act of 2010 were signed into law.  Among other things, the new legislation reduced the tax benefits available to an employer that receives a postretirement prescription drug coverage subsidy from the federal government under the Medicare Prescription Drug, Improvement and Modernization Act of 2003.  Under the new legislation, to the extent our future postretirement prescription drug coverage expenses are reimbursed under the subsidy program, the expenses covered by the subsidy will no longer be tax deductible after 2012.  Employers that receive the subsidy must recognize the deferred tax effects relating to the future postretirement prescription drug coverage in the period the legislation was enacted.  Our income tax expense for 2010 included a non-cash tax charge of $10.2 million to reflect the impact of the tax law change.

 
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