This document provides financial highlights and statistical data for Unum Group for the first quarter of 2007. Some key details include:
- Premium income was $1.944 billion for the first quarter of 2007, down slightly from $1.970 billion in the same period of 2006.
- Net income was $178.3 million for the first quarter of 2007, up significantly from $73.4 million for the first quarter of 2006.
- Total assets as of March 31, 2007 were $52.324 billion, up slightly from $50.471 billion as of March 31, 2006.
- The document provides segmented financial results and statistics for Unum US, Unum UK, Colonial, Individual
2. Unum Group
Statistical Supplement First Quarter 2007
TABLE OF CONTENTS
(dollars in millions, except share data)
Interim Results are Unaudited
Page
Financial Highlights 1
Consolidated Statements of Operations 2
Sales Data 3
Consolidated Balance Sheets 4
Financial Results by Segment 5
Quarterly Historical Financial Results by Segment 6
Financial Results and Selected Statistics by Segment
Unum US 7
Unum UK 8
Colonial 9
Individual Income Protection - Closed Block 10
Other 11
Corporate 12
Reserves 13
Investment Fact Sheets 14
Statutory-Basis Financial Information 15
Notes to Statistical Supplement 16
Throughout this supplement, segment operating results exclude income taxes and realized investment gains
and losses.
See quot;Notes to Statistical Supplementquot; on page 16 for a discussion of non-GAAP financial measures.
N.M. = not a meaningful percentage
3. Unum Group Financial Highlights
Three Months Ended Year Ended
3/31/2007 3/31/2006 12/31/2006 12/31/2005 12/31/2004
Financial Results
Premium Income $ 1,944.0 $ 1,970.0 $ 7,948.2 $ 7,815.6 $ 7,839.6
Segment Operating Revenue $ 2,604.3 $ 2,597.6 $ 10,533.1 $ 10,266.0 $ 10,258.6
Net Realized Investment Gain (Loss) (3.7) 2.5 2.2 (6.7) 29.2
Revenue $ 2,600.6 $ 2,600.1 $ 10,535.3 $ 10,259.3 $ 10,287.8
Income (Loss) from Continuing Operations $ 171.4 $ 71.4 $ 403.6 $ 504.0 $ (201.4)
Income (Loss) from Discontinued Operations, net of tax 6.9 2.0 7.4 9.6 (51.6)
Net Income (Loss) $ 178.3 $ 73.4 $ 411.0 $ 513.6 $ (253.0)
Assets $ 52,324.8 $ 50,471.3 $ 52,823.3 $ 51,866.8 $ 50,832.3
Stockholders' Equity $ 7,376.6 $ 6,568.0 $ 7,718.8 $ 7,363.9 $ 7,224.1
2006
• First quarter results include a claim reassessment charge of $86.0 million before tax, or $55.9 million after tax, and full year 2006 results include
claim reassessment charges of $411.4 million before tax, or $267.4 million after tax.
• First quarter 2006 results include costs related to early retirement of debt of $5.3 million before tax, or $3.4 million after tax, and full year 2006
results include $25.8 million before tax, or $16.9 million after tax.
• Full year 2006 results include broker compensation settlement expenses of $18.5 million before tax, or $12.7 million after tax.
• Full year 2006 results include income of $2.6 million before tax, or $3.9 million after tax, attributable to the receipt of interest and tax refunds on
prior year tax items in excess of what was previously provided.
• Full year 2006 results include an income tax benefit of approximately $91.9 million primarily as the result of group relief benefits obtained from the
use of net operating losses in a foreign jurisdiction in which our businesses operate.
2005
• Full year 2005 results include a charge of $75.0 million before tax, or $51.6 million after tax, related to the settlement agreement with the California
Department of Insurance and related matters.
• Full year 2005 results include a gain on the sale of the U.K. Netherlands branch of $5.7 million before tax, or $4.0 million after tax.
• Full year 2005 results include an income tax benefit of $42.8 million related to the reduction of income tax liabilities.
2004
• Full year 2004 results include a charge of $127.0 million before tax, or $87.8 million after tax, related to the settlement of the multistate market
conduct examination.
• Full year 2004 results include a charge of $967.0 million before tax, or $701.0 million after tax, related to the restructuring of the individual income
protection - closed block business.
See quot;Notes to Statistical Supplementquot; on page 16 for additional information.
1
4. Unum Group Financial Highlights
Three Months Ended Year Ended
3/31/2007 3/31/2006 12/31/2006 12/31/2005 12/31/2004
Per Common Share Information
Assuming Dilution:
Income (Loss) from Continuing Operations $ 0.49 $ 0.22 $ 1.21 $ 1.61 $ (0.68)
Income (Loss) from Discontinued Operations, net of tax 0.02 0.01 0.02 0.03 (0.18)
Net Income (Loss) $ 0.51 $ 0.23 $ 1.23 $ 1.64 $ (0.86)
Basic:
Income (Loss) from Continuing Operations $ 0.50 $ 0.24 $ 1.25 $ 1.71 $ (0.68)
Income (Loss) from Discontinued Operations, net of tax 0.02 0.01 0.02 0.03 (0.18)
Net Income (Loss) $ 0.52 $ 0.25 $ 1.27 $ 1.74 $ (0.86)
Dividends Paid $ 0.075 $ 0.075 $ 0.300 $ 0.300 $ 0.300
Book Value $ 21.52 $ 21.94 $ 22.53 $ 24.66 $ 24.36
Price (UNM closing price on last trading day of period) $ 23.03 $ 20.48 $ 20.78 $ 22.75 $ 17.94
1.1
5. Unum Group Consolidated Statements of Operations
Three Months Ended Year Ended
3/31/2007 3/31/2006 12/31/2006 12/31/2005 12/31/2004
Revenue
Premium Income $ 1,944.0 $ 1,970.0 $ 7,948.2 $ 7,815.6 $ 7,839.6
Net Investment Income 589.5 563.8 2,320.6 2,188.3 2,158.7
Net Realized Investment Gain (Loss) (3.7) 2.5 2.2 (6.7) 29.2
Other Income 70.8 63.8 264.3 262.1 260.3
Total Revenue 2,600.6 2,600.1 10,535.3 10,259.3 10,287.8
Benefits and Expenses
Benefits and Change in Reserves for Future Benefits 1,729.3 1,867.5 7,577.2 7,083.2 7,248.4
Commissions 213.0 210.9 819.0 804.7 842.3
Interest and Debt Expense - Non-recourse Debt 2.0 - 1.3 - -
Interest and Debt Expense - All Other Debt 43.9 53.1 190.5 208.0 207.1
Cost Related to Early Retirement of Debt 2.4 5.3 25.8 - -
Deferral of Acquisition Costs (138.1) (135.9) (528.2) (519.4) (557.3)
Amortization of Deferred Acquisition Costs 116.6 119.8 478.6 463.7 436.7
Impairment of Intangible Assets - - - - 856.4
Other Expenses 371.6 371.8 1,505.7 1,525.2 1,529.9
Total Benefits and Expenses 2,340.7 2,492.5 10,069.9 9,565.4 10,563.5
Income (Loss) from Continuing Operations Before
Income Taxes 259.9 107.6 465.4 693.9 (275.7)
Income Taxes (Benefit) 88.5 36.2 61.8 189.9 (74.3)
Income (Loss) from Continuing Operations 171.4 71.4 403.6 504.0 (201.4)
Income (Loss) from Discontinued
Operations, net of tax 6.9 2.0 7.4 9.6 (51.6)
Net Income (Loss) $ 178.3 $ 73.4 $ 411.0 $ 513.6 $ (253.0)
Average Number of Shares Outstanding
Basic 341,207,999 296,560,376 324,654,923 295,776,405 295,224,305
Dilutive Securities:
Purchase Contracts 3,787,038 20,349,227 8,153,001 14,297,834 -
Options and Other Dilutive Securities 1,385,222 2,727,230 1,553,820 2,438,404 -
Assuming Dilution 346,380,259 319,636,833 334,361,744 312,512,643 295,224,305
Actual Number of Shares Outstanding 342,802,960 299,417,651 342,627,521 298,557,764 296,545,913
2
6. Unum Group Sales Data
Three Months Ended Year Ended
3/31/2007 3/31/2006 % Change 12/31/2006 12/31/2005 12/31/2004
Unum US Segment
Fully Insured Products
Group Long-term Income Protection $ 25.5 $ 43.1 (40.8) % $ 208.5 $ 180.4 $ 180.4
Group Short-term Income Protection 15.2 12.0 26.7 74.1 74.8 79.5
Group Life 20.1 33.2 (39.5) 149.8 157.8 166.5
Accidental Death & Dismemberment 2.0 2.8 (28.6) 13.7 14.7 12.8
Individual Income Protection - Recently Issued 14.5 12.3 17.9 55.4 53.8 61.6
Group Long-term Care 6.1 3.9 56.4 25.1 21.1 18.7
Individual Long-term Care 2.1 2.7 (22.2) 11.0 13.0 19.5
Voluntary Workplace Benefits 49.4 54.7 (9.7) 134.2 130.2 114.1
Total Fully Insured Products 134.9 164.7 (18.1) 671.8 645.8 653.1
Administrative Services Only (ASO) Products
Group Long-term Income Protection - - - 3.7 1.8 1.1
Group Short-term Income Protection 0.7 1.3 (46.2) 10.0 5.8 7.3
Total ASO Products 0.7 1.3 (46.2) 13.7 7.6 8.4
Unum US Segment 135.6 166.0 (18.3) 685.5 653.4 661.5
Unum UK Segment
Group Long-term Income Protection 16.3 7.2 126.4 79.1 91.2 103.3
Group Life 2.8 3.1 (9.7) 16.5 33.0 68.1
Individual Income Protection 1.7 1.4 21.4 5.5 8.1 11.1
Unum UK Segment 20.8 11.7 77.8 101.1 132.3 182.5
Colonial Segment
Income Protection 42.8 42.0 1.9 194.4 176.8 172.5
Life 14.3 14.3 - 66.6 60.6 58.6
Cancer and Critical Illness 10.5 10.9 (3.7) 54.1 49.0 47.4
Colonial Segment 67.6 67.2 0.6 315.1 286.4 278.5
Individual Income Protection - Closed Block Segment 0.9 1.4 (35.7) 4.4 6.5 7.8
Total Sales from Continuing Operations 224.9 246.3 (8.7) 1,106.1 1,078.6 1,130.3
Sales from Discontinued Operations - - - - - 10.1
Total Sales $ 224.9 $ 246.3 (8.7) $ 1,106.1 $ 1,078.6 $ 1,140.4
3
7. Unum Group Consolidated Balance Sheets
March 31, December 31,
2007 2006 2005
Assets
Investments
$ 35,001.5 $ 34,856.8
Fixed Maturity Securities $ 35,251.8
Mortgage Loans 1,006.2 944.0 739.4
Real Estate 17.9 17.9 18.2
Policy Loans 3,431.5 3,429.5 3,201.4
Other Long-term Investments 106.0 122.0 122.8
Short-term Investments 620.7 648.4 417.9
Total Investments 40,434.1 40,163.3 39,356.5
Cash and Bank Deposits 135.5 121.3 67.1
Accounts and Premiums Receivable 1,991.9 2,057.1 1,951.6
Reinsurance Receivable 5,558.1 5,512.2 5,609.2
Accrued Investment Income 660.0 646.8 618.7
Deferred Acquisition Costs 2,326.8 2,983.1 2,913.3
Goodwill 204.2 204.1 202.4
Other Assets 993.3 994.6 1,011.1
Other Assets - Discontinued Operations - 112.3 107.3
Separate Account Assets 20.9 28.5 29.6
Total Assets $ 52,324.8 $ 52,823.3 $ 51,866.8
Liabilities
Policy and Contract Benefits $ 2,083.3 $ 2,220.4 $ 2,063.4
Reserves for Future Policy and Contract Benefits 36,040.3 35,689.4 34,041.5
Unearned Premiums 529.7 520.1 481.8
Other Policyholders' Funds 2,004.4 2,019.1 2,235.5
Income Tax 377.9 611.7 1,002.3
Long-term Debt - Non-recourse 120.0 130.0 -
Long-term Debt - All Other 2,379.7 2,529.6 3,261.6
Other Liabilities 1,392.0 1,326.7 1,360.3
Other Liabilities - Discontinued Operations - 29.0 26.9
Separate Account Liabilities 20.9 28.5 29.6
Total Liabilities 44,948.2 45,104.5 44,502.9
Stockholders' Equity
Common Stock 34.5 34.4 30.1
Additional Paid-in Capital 2,196.6 2,200.0 1,627.9
Accumulated Other Comprehensive Income 543.7 612.8 1,163.5
Retained Earnings 4,656.0 4,925.8 4,610.4
Treasury Stock (54.2) (54.2) (54.2)
Deferred Compensation - - (13.8)
Total Stockholders' Equity 7,376.6 7,718.8 7,363.9
Total Liabilities and Stockholders' Equity $ 52,324.8 $ 52,823.3 $ 51,866.8
4
8. Unum Group Deferred Acquisition Costs by Segment
Unum US Unum UK Colonial Other Consolidated
Balances at December 31, 2004 $ 2,196.2 $ 154.9 $ 530.9 $ 0.5 $ 2,882.5
Capitalized 311.9 34.1 173.4 - 519.4
Amortized (306.9) (21.6) (134.7) (0.5) (463.7)
Foreign Currency and Other - (24.9) - - (24.9)
Balances at December 31, 2005 2,201.2 142.5 569.6 - 2,913.3
Capitalized 306.2 34.4 187.6 - 528.2
Amortized (302.2) (32.0) (144.4) - (478.6)
Foreign Currency and Other - 20.2 - - 20.2
Balances at December 31, 2006 2,205.2 165.1 612.8 - 2,983.1
Capitalized 76.5 9.3 52.3 - 138.1
Amortized (66.4) (11.9) (38.3) - (116.6)
Cumulative Effect of SOP 05-1 (589.8) (88.3) - - (678.1)
Foreign Currency and Other - 0.3 - - 0.3
Balances at March 31, 2007 $ 1,625.5 $ 74.5 $ 626.8 $ - $ 2,326.8
4.1
9. Unum Group Balance Sheets by Segment - March 31, 2007
Unum US
Group Life Individual
Group and Accidental Supplemental Income
Income Death & and Total Protection - Corporate
Protection Dismemberment Voluntary Unum US Unum UK Colonial Closed Block and Other Consolidated
Assets
Investments $ 10,009.5 $ 2,223.1 $ 5,266.8 $ 17,499.4 $ 3,270.4 $ 1,585.2 $ 12,071.8 $ 6,007.3 $ 40,434.1
Deferred Acquisition Costs 150.4 103.5 1,371.6 1,625.5 74.5 626.8 - - 2,326.8
Goodwill 2.5 - 187.5 190.0 14.2 - - - 204.2
All Other 525.9 154.9 406.9 1,087.7 512.0 204.0 3,553.0 4,003.0 9,359.7
Total Assets $ 10,688.3 $ 2,481.5 $ 7,232.8 $ 20,402.6 $ 3,871.1 $ 2,416.0 $ 15,624.8 $ 10,010.3 $ 52,324.8
Liabilities
Reserves and Policyholder Benefits $ 8,709.2 $ 1,547.5 $ 4,687.2 $ 14,943.9 $ 2,764.9 $ 1,403.9 $ 12,763.8 $ 8,781.2 $ 40,657.7
Debt - - - - - - - 2,499.7 2,499.7
All Other 240.8 26.5 400.4 667.7 148.7 166.5 26.3 781.6 1,790.8
Total Liabilities 8,950.0 1,574.0 5,087.6 15,611.6 2,913.6 1,570.4 12,790.1 12,062.5 44,948.2
Other Allocated Stockholders' Equity 1,688.3 875.5 1,843.1 4,406.9 890.8 811.9 2,654.4 (2,058.2) 6,705.8
Unrealized Gain on Securities 50.0 32.0 302.1 384.1 66.7 33.7 180.3 6.0 670.8
Total Allocated Stockholders'
Equity 1,738.3 907.5 2,145.2 4,791.0 957.5 845.6 2,834.7 (2,052.2) 7,376.6
Total Liabilities and Allocated
Stockholders' Equity $ 10,688.3 $ 2,481.5 $ 7,232.8 $ 20,402.6 $ 3,871.1 $ 2,416.0 $ 15,624.8 $ 10,010.3 $ 52,324.8
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
10. Unum Group Balance Sheets by Segment - December 31, 2006
Unum US
Group Life Individual Corporate,
Group and Accidental Supplemental Income Other, and
Income Death & and Total Protection - Discontinued
Protection Dismemberment Voluntary Unum US Unum UK Colonial Closed Block Operations Consolidated
Assets
Investments $ 9,618.2 $ 2,272.1 $ 5,093.6 $ 16,983.9 $ 3,216.9 $ 1,524.8 $ 12,244.8 $ 6,192.9 $ 40,163.3
Deferred Acquisition Costs 571.9 273.1 1,360.2 2,205.2 165.1 612.8 - - 2,983.1
Goodwill 2.5 - 187.5 190.0 14.1 - - - 204.1
All Other 968.4 104.6 448.7 1,521.7 508.1 217.4 3,364.7 3,860.9 9,472.8
Total Assets $ 11,161.0 $ 2,649.8 $ 7,090.0 $ 20,900.8 $ 3,904.2 $ 2,355.0 $ 15,609.5 $ 10,053.8 $ 52,823.3
Liabilities
Reserves and Policyholder Benefits $ 8,756.5 $ 1,564.8 $ 4,548.5 $ 14,869.8 $ 2,750.9 $ 1,382.5 $ 12,684.3 $ 8,761.5 $ 40,449.0
Debt - - - - - - - 2,659.6 2,659.6
All Other 365.3 82.3 398.4 846.0 179.5 147.5 26.2 796.7 1,995.9
Total Liabilities 9,121.8 1,647.1 4,946.9 15,715.8 2,930.4 1,530.0 12,710.5 12,217.8 45,104.5
Other Allocated Stockholders' Equity 2,012.3 973.6 1,834.5 4,820.4 899.6 791.5 2,640.0 (2,161.7) 6,989.8
Unrealized Gain on Securities 26.9 29.1 308.6 364.6 74.2 33.5 259.0 (2.3) 729.0
Total Allocated Stockholders'
Equity 2,039.2 1,002.7 2,143.1 5,185.0 973.8 825.0 2,899.0 (2,164.0) 7,718.8
Total Liabilities and Allocated
Stockholders' Equity $ 11,161.0 $ 2,649.8 $ 7,090.0 $ 20,900.8 $ 3,904.2 $ 2,355.0 $ 15,609.5 $ 10,053.8 $ 52,823.3
4.3
11. Unum Group Financial Results by Segment
Three Months Ended Year Ended
3/31/2007 3/31/2006 % Change 12/31/2006 12/31/2005 % Change
Premium Income
Unum US $ 1,244.9 $ 1,303.8 (4.5) % $ 5,196.0 $ 5,229.0 (0.6) %
Unum UK 222.3 191.4 16.1 842.8 785.3 7.3
Colonial 223.4 202.6 10.3 842.1 787.0 7.0
Individual Income Protection - Closed Block 252.3 271.0 (6.9) 1,062.8 1,011.7 5.1
Other 1.1 1.2 (8.3) 4.5 2.6 73.1
1,944.0 1,970.0 (1.3) 7,948.2 7,815.6 1.7
Net Investment Income
Unum US 276.9 257.7 7.5 1,063.1 998.2 6.5
Unum UK 45.8 38.0 20.5 174.6 154.2 13.2
Colonial 24.4 22.6 8.0 93.6 96.0 (2.5)
Individual Income Protection - Closed Block 204.6 202.2 1.2 828.7 770.0 7.6
Other 28.1 28.7 (2.1) 113.2 120.5 (6.1)
Corporate 9.7 14.6 (33.6) 47.4 49.4 (4.0)
589.5 563.8 4.6 2,320.6 2,188.3 6.0
Other Income
Unum US 34.7 25.4 36.6 108.5 108.6 (0.1)
Unum UK 1.7 0.1 N.M. 0.1 6.1 (98.4)
Colonial 0.3 0.3 - 1.1 4.4 (75.0)
Individual Income Protection - Closed Block 25.3 26.3 (3.8) 105.1 95.2 10.4
Other 8.2 8.3 (1.2) 33.8 36.0 (6.1)
Corporate 0.6 3.4 (82.4) 15.7 11.8 33.1
70.8 63.8 11.0 264.3 262.1 0.8
Total Operating Revenue
Unum US 1,556.5 1,586.9 (1.9) 6,367.6 6,335.8 0.5
Unum UK 269.8 229.5 17.6 1,017.5 945.6 7.6
Colonial 248.1 225.5 10.0 936.8 887.4 5.6
Individual Income Protection - Closed Block 482.2 499.5 (3.5) 1,996.6 1,876.9 6.4
Other 37.4 38.2 (2.1) 151.5 159.1 (4.8)
Corporate 10.3 18.0 (42.8) 63.1 61.2 3.1
2,604.3 2,597.6 0.3 10,533.1 10,266.0 2.6
5
12. Unum Group Financial Results by Segment
Three Months Ended Year Ended
3/31/2007 3/31/2006 % Change 12/31/2006 12/31/2005 % Change
Benefits and Expenses
Unum US $ 1,414.1 $ 1,558.4 (9.3) % $ 6,271.9 $ 5,948.1 5.4 %
Unum UK 194.7 175.1 11.2 759.7 757.9 0.2
Colonial 188.5 179.3 5.1 738.1 719.3 2.6
Individual Income Protection - Closed Block 459.7 484.8 (5.2) 1,925.3 1,797.0 7.1
Other 33.8 33.4 1.2 127.1 129.1 (1.5)
Corporate 49.9 61.5 (18.9) 247.8 214.0 15.8
2,340.7 2,492.5 (6.1) 10,069.9 9,565.4 5.3
Income (Loss) from Continuing Operations
Before Income Taxes and Net Realized
Investment Gain (Loss)
Unum US 142.4 28.5 N.M. 95.7 387.7 (75.3)
Unum UK 75.1 54.4 38.1 257.8 187.7 37.3
Colonial 59.6 46.2 29.0 198.7 168.1 18.2
Individual Income Protection - Closed Block 22.5 14.7 53.1 71.3 79.9 (10.8)
Other 3.6 4.8 (25.0) 24.4 30.0 (18.7)
Corporate (39.6) (43.5) 9.0 (184.7) (152.8) (20.9)
263.6 105.1 150.8 463.2 700.6 (33.9)
Income Taxes 89.0 35.2 152.8 61.1 192.3 (68.2)
Income from Continuing Operations
Before Net Realized Investment Gain (Loss) 174.6 69.9 149.8 402.1 508.3 (20.9)
Net Realized Investment Gain (Loss) (3.7) 2.5 (248.0) 2.2 (6.7) 132.8
Tax Expense (Benefit) on Net Realized
Investment Gain (Loss) (0.5) 1.0 (150.0) 0.7 (2.4) 129.2
Income from Discontinued
Operations, net of tax 6.9 2.0 245.0 7.4 9.6 (22.9)
Net Income $ 178.3 $ 73.4 142.9 $ 411.0 $ 513.6 (20.0)
Note: See quot;Notes to Statistical Supplementquot; on page 16 for additional information.
5.1
14. Unum Group Quarterly Historical Financial Results by Segment
3/31/07 12/31/06 9/30/06 6/30/06 3/31/06 12/31/05 9/30/05 6/30/05 3/31/05
Benefits and Expenses
Unum US $ 1,414.1 $ 1,478.4 $ 1,741.0 $ 1,494.1 $ 1,558.4 $ 1,489.1 $ 1,497.8 $ 1,481.5 $ 1,479.7
Unum UK 194.7 200.2 200.0 184.4 175.1 186.6 199.1 191.3 180.9
Colonial 188.5 190.9 184.5 183.4 179.3 187.0 180.1 176.3 175.9
Individual Income Protection - Closed Block 459.7 476.0 495.6 468.9 484.8 478.1 480.8 414.6 423.5
Other 33.8 32.5 28.6 32.6 33.4 36.4 28.6 31.5 32.6
Corporate 49.9 52.5 65.1 68.7 61.5 53.3 49.9 54.2 56.6
2,340.7 2,430.5 2,714.8 2,432.1 2,492.5 2,430.5 2,436.3 2,349.4 2,349.2
Income (Loss) from Continuing
Operations Before Income Taxes and
Net Realized Investment Gain (Loss)
Unum US 142.4 135.9 (173.2) 104.5 28.5 103.9 71.9 111.4 100.5
Unum UK 75.1 81.8 65.5 56.1 54.4 49.3 49.8 41.3 47.3
Colonial 59.6 50.5 52.1 49.9 46.2 38.7 42.0 43.6 43.8
Individual Income Protection - Closed Block 22.5 28.7 (5.3) 33.2 14.7 33.7 (4.6) 27.7 23.1
Other 3.6 6.4 7.8 5.4 4.8 4.7 8.7 10.5 6.1
Corporate (39.6) (38.4) (49.1) (53.7) (43.5) (43.0) (33.0) (37.6) (39.2)
263.6 264.9 (102.2) 195.4 105.1 187.3 134.8 196.9 181.6
Income Taxes (Benefit) 89.0 (8.8) (33.8) 68.5 35.2 54.0 38.8 70.2 29.3
Income (Loss) from Continuing
Operations Before Net Realized
Investment Gain (Loss) 174.6 273.7 (68.4) 126.9 69.9 133.3 96.0 126.7 152.3
Net Realized Investment Gain (Loss) (3.7) 0.7 4.8 (5.8) 2.5 2.4 (71.4) 65.5 (3.2)
Tax Expense (Benefit) on Net Realized
Investment Gain (Loss) (0.5) 0.2 1.7 (2.2) 1.0 0.9 (25.1) 22.9 (1.1)
Income from Discontinued
Operations, net of tax 6.9 1.9 1.6 1.9 2.0 2.7 2.9 2.0 2.0
Net Income (Loss) $ 178.3 $ 276.1 $ (63.7) $ 125.2 $ 73.4 $ 137.5 $ 52.6 $ 171.3 $ 152.2
Per Common Share - Assuming Dilution
Income (Loss) from Continuing Operations $ 0.49 $ 0.79 $ (0.19) $ 0.37 $ 0.22 $ 0.42 $ 0.16 $ 0.55 $ 0.49
Income from Discontinued Operations,
net of tax 0.02 0.01 - 0.01 0.01 0.01 0.01 - -
Net Income (Loss) $ 0.51 $ 0.80 $ (0.19) $ 0.38 $ 0.23 $ 0.43 $ 0.17 $ 0.55 $ 0.49
Note: See quot;Notes to Statistical Supplementquot; on page 16 for additional information.
6.1
15. Unum Group Financial Results for Unum US Segment
Three Months Ended Year Ended
3/31/2007 3/31/2006 12/31/2006 12/31/2005 12/31/2004
Operating Revenue
Premium Income $ 1,244.9 $ 1,303.8 $ 5,196.0 $ 5,229.0 $ 5,421.6
Net Investment Income 276.9 257.7 1,063.1 998.2 965.8
Other Income 34.7 25.4 108.5 108.6 89.8
Total Operating Revenue 1,556.5 1,586.9 6,367.6 6,335.8 6,477.2
Benefits and Expenses
Benefits and Change in Reserves for Future Benefits 1,046.0 1,171.1 4,752.1 4,419.3 4,614.4
Commissions 129.5 134.4 505.2 501.6 538.3
Deferral of Acquisition Costs (76.5) (81.6) (306.2) (311.9) (346.0)
Amortization of Deferred Acquisition Costs 66.4 79.0 302.2 306.9 286.3
Other Expenses 248.7 255.5 1,018.6 1,032.2 1,048.7
Total Benefits and Expenses 1,414.1 1,558.4 6,271.9 5,948.1 6,141.7
Operating Income Before Income Taxes and
Net Realized Investment Gains and Losses $ 142.4 $ 28.5 $ 95.7 $ 387.7 $ 335.5
Operating Ratios
Benefit Ratio 84.0 % 89.8 % 91.5 % 84.5 % 85.1 %
Other Expense Ratio 20.0 % 19.6 % 19.6 % 19.7 % 19.3 %
Before-tax Profit Margin 11.4 % 2.2 % 1.8 % 7.4 % 6.2 %
Operating Income Before Income Taxes and
Net Realized Investment Gains and Losses,
as Reported $ 142.4 $ 28.5 $ 95.7 $ 387.7 $ 335.5
Settlement Agreements Claim Reassessment -
Reserve Charge - (72.8) (349.2) (29.6) (80.8)
Settlement Agreements Claim Reassessment -
Other Expense Charge - - (15.0) (11.1) (37.6)
Operating Income Before Income Taxes and
Net Realized Investment Gains and Losses,
as Adjusted $ 142.4 $ 101.3 $ 459.9 $ 428.4 $ 453.9
Operating Ratios, as Adjusted
Benefit Ratio 84.0 % 84.2 % 84.7 % 83.9 % 83.6 %
Other Expense Ratio 20.0 % 19.6 % 19.3 % 19.5 % 18.6 %
Before-tax Profit Margin 11.4 % 7.8 % 8.9 % 8.2 % 8.4 %
See quot;Notes to Statistical Supplementquot; on page 16 for additional information.
7
16. Unum Group Financial Results for Unum US Group Income Protection
Three Months Ended Year Ended
3/31/2007 3/31/2006 12/31/2006 12/31/2005 12/31/2004
Operating Revenue
Premium Income
Group Long-term Income Protection $ 471.4 $ 485.3 $ 1,953.3 $ 1,961.6 $ 2,028.6
Group Short-term Income Protection 118.7 134.5 530.2 566.3 616.1
Total Premium Income 590.1 619.8 2,483.5 2,527.9 2,644.7
Net Investment Income 155.3 153.3 621.9 605.7 595.8
Other Income 24.7 19.5 82.3 80.3 69.6
Total Operating Revenue 770.1 792.6 3,187.7 3,213.9 3,310.1
Benefits and Expenses
Benefits and Change in Reserves for Future Benefits 551.1 664.4 2,702.5 2,397.7 2,533.1
Commissions 45.4 46.6 175.8 175.1 199.0
Deferral of Acquisition Costs (15.5) (17.8) (64.5) (64.6) (77.1)
Amortization of Deferred Acquisition Costs 16.6 22.0 86.4 92.2 93.5
Other Expenses 143.8 149.0 588.6 582.5 619.6
Total Benefits and Expenses 741.4 864.2 3,488.8 3,182.9 3,368.1
Operating Income (Loss) Before Income Taxes
and Net Realized Investment Gains and Losses $ 28.7 $ (71.6) $ (301.1) $ 31.0 $ (58.0)
Operating Ratios
Benefit Ratio 93.4 % 107.2 % 108.8 % 94.8 % 95.8 %
Other Expense Ratio 24.4 % 24.0 % 23.7 % 23.0 % 23.4 %
Before-tax Profit (Loss) Margin 4.9 % (11.6)% (12.1)% 1.2 % (2.2)%
Premium Persistency:
Group Long-term Income Protection 84.6 % 86.6 % 87.8 % 84.8 % 84.8 %
Group Short-term Income Protection 75.1 % 81.9 % 85.6 % 79.6 % 80.6 %
Case Persistency:
Group Long-term Income Protection 87.6 % 87.5 % 87.4 % 87.2 % 86.3 %
Group Short-term Income Protection 85.8 % 85.7 % 86.2 % 85.6 % 84.3 %
7.1
17. Unum Group Financial Results for Unum US Group Income Protection - Continued
Three Months Ended Year Ended
3/31/2007 3/31/2006 12/31/2006 12/31/2005 12/31/2004
Operating Income (Loss) Before Income Taxes
and Net Realized Investment Gains and Losses,
as Reported $ 28.7 $ (71.6) $ (301.1) $ 31.0 $ (58.0)
Settlement Agreements Claim Reassessment -
Reserve Charge - (72.8) (349.2) (27.3) (80.2)
Settlement Agreements Claim Reassessment -
Other Expense Charge - - (15.0) (10.1) (36.5)
Operating Income Before Income Taxes and
Net Realized Investment Gains and Losses,
as Adjusted $ 28.7 $ 1.2 $ 63.1 $ 68.4 $ 58.7
Operating Ratios, as Adjusted
Benefit Ratio 93.4 % 95.5 % 94.8 % 93.8 % 92.7 %
Other Expense Ratio 24.4 % 24.0 % 23.1 % 22.6 % 22.0 %
Before-tax Profit Margin 4.9 % 0.2 % 2.5 % 2.7 % 2.2 %
See quot;Notes to Statistical Supplementquot; on page 16 for additional information.
7.2
18. Unum Group Financial Results for Unum US Group Life and Accidental Death and Dismemberment
Three Months Ended Year Ended
3/31/2007 3/31/2006 12/31/2006 12/31/2005 12/31/2004
Operating Revenue
Premium Income
Group Life $ 280.8 $ 320.1 $ 1,248.1 $ 1,306.8 $ 1,441.0
Accidental Death & Dismemberment 32.4 38.7 151.6 156.4 182.4
Total Premium Income 313.2 358.8 1,399.7 1,463.2 1,623.4
Net Investment Income 34.4 35.1 141.3 151.9 147.9
Other Income (Loss) 0.6 - - 2.0 (0.6)
Total Operating Revenue 348.2 393.9 1,541.0 1,617.1 1,770.7
Benefits and Expenses
Benefits and Change in Reserves for Future Benefits 235.4 274.8 1,067.3 1,111.9 1,244.3
Commissions 22.6 23.0 90.1 97.8 106.2
Deferral of Acquisition Costs (9.1) (9.8) (37.7) (42.7) (47.0)
Amortization of Deferred Acquisition Costs 9.3 16.4 65.0 73.0 67.0
Other Expenses 40.6 45.6 178.3 188.3 186.8
Total Benefits and Expenses 298.8 350.0 1,363.0 1,428.3 1,557.3
Operating Income Before Income Taxes and
Net Realized Investment Gains and Losses $ 49.4 $ 43.9 $ 178.0 $ 188.8 $ 213.4
Operating Ratios
Benefit Ratio 75.2 % 76.6 % 76.3 % 76.0 % 76.6 %
Other Expense Ratio 13.0 % 12.7 % 12.7 % 12.9 % 11.5 %
Before-tax Profit Margin 15.8 % 12.2 % 12.7 % 12.9 % 13.1 %
Premium Persistency:
Group Life 78.1 % 79.1 % 81.2 % 78.3 % 84.0 %
Accidental Death & Dismemberment 78.7 % 80.3 % 82.8 % 76.9 % 80.3 %
Case Persistency:
Group Life 85.7 % 86.4 % 86.9 % 86.3 % 84.7 %
Accidental Death & Dismemberment 86.5 % 86.8 % 87.0 % 86.4 % 84.8 %
7.3
19. Unum Group Financial Results for Unum US Supplemental and Voluntary
Three Months Ended Year Ended
3/31/2007 3/31/2006 12/31/2006 12/31/2005 12/31/2004
Operating Revenue
Premium Income
Individual Income Protection - Recently Issued $ 113.7 $ 110.2 $ 438.5 $ 425.1 $ 415.6
Long-term Care 128.7 120.6 492.4 473.2 444.5
Voluntary Workplace Benefits 99.2 94.4 381.9 339.6 293.4
Total Premium Income 341.6 325.2 1,312.8 1,237.9 1,153.5
Net Investment Income 87.2 69.3 299.9 240.6 222.1
Other Income 9.4 5.9 26.2 26.3 20.8
Total Operating Revenue 438.2 400.4 1,638.9 1,504.8 1,396.4
Benefits and Expenses
Benefits and Change in Reserves for Future Benefits 259.5 231.9 982.3 909.7 837.0
Commissions 61.5 64.8 239.3 228.7 233.1
Deferral of Acquisition Costs (51.9) (54.0) (204.0) (204.6) (221.9)
Amortization of Deferred Acquisition Costs 40.5 40.6 150.8 141.7 125.8
Other Expenses 64.3 60.9 251.7 261.4 242.3
Total Benefits and Expenses 373.9 344.2 1,420.1 1,336.9 1,216.3
Operating Income Before Income Taxes and
Net Realized Investment Gains and Losses $ 64.3 $ 56.2 $ 218.8 $ 167.9 $ 180.1
Operating Ratios
Benefit Ratios
Individual Income Protection - Recently Issued 57.2 % 55.6 % 58.0 % 57.5 % 57.7 %
Long-term Care 104.7 % 93.0 % 99.2 % 93.0 % 88.8 %
Voluntary Workplace Benefits 60.3 % 61.9 % 62.7 % 66.3 % 69.0 %
Other Expense Ratio 18.8 % 18.7 % 19.2 % 21.1 % 21.0 %
Before-tax Profit Margin 18.8 % 17.3 % 16.7 % 13.6 % 15.6 %
Interest Adjusted Loss Ratios
Individual Income Protection - Recently Issued 42.1 % 41.8 % 43.5 % 44.4 % 46.1 %
Long-term Care 76.6 % 68.6 % 73.1 % 70.9 % 70.8 %
7.4
20. Unum Group Financial Results for Unum US Supplemental and Voluntary - Continued
Three Months Ended Year Ended
3/31/2007 3/31/2006 12/31/2006 12/31/2005 12/31/2004
Premium Persistency:
Individual Income Protection - Recently Issued 90.8 % 89.0 % 90.5 % 89.6 % 90.7 %
Long-term Care 95.0 % 95.5 % 95.3 % 95.8 % 95.5 %
Voluntary Workplace Benefits 78.9 % 81.4 % 80.9 % 81.1 % 81.0 %
Operating Income Before Income Taxes and
Net Realized Investment Gains and Losses,
as Reported $ 64.3 $ 56.2 $ 218.8 $ 167.9 $ 180.1
Settlement Agreements Claim Reassessment -
Reserve Charge - - - (2.3) (0.6)
Settlement Agreements Claim Reassessment -
Other Expense Charge - - - (1.0) (1.1)
Operating Income Before Income Taxes and
Net Realized Investment Gains and Losses,
as Adjusted $ 64.3 $ 56.2 $ 218.8 $ 171.2 $ 181.8
Operating Ratios, as Adjusted
Benefit Ratios
Individual Income Protection - Recently Issued 57.2 % 55.6 % 58.0 % 57.0 % 57.6 %
Long-term Care 104.7 % 93.0 % 99.2 % 93.0 % 88.8 %
Voluntary Workplace Benefits 60.3 % 61.9 % 62.7 % 66.3 % 69.0 %
Other Expense Ratio 18.8 % 18.7 % 19.2 % 21.0 % 20.9 %
Before-tax Profit Margin 18.8 % 17.3 % 16.7 % 13.8 % 15.8 %
Interest Adjusted Loss Ratios, as Adjusted
Individual Income Protection - Recently Issued 42.1 % 41.8 % 43.5 % 43.8 % 46.0 %
Long-term Care 76.6 % 68.6 % 73.1 % 70.9 % 70.8 %
See quot;Notes to Statistical Supplementquot; on page 16 for additional information.
7.5
21. Unum Group Financial Results for Unum UK Segment
Three Months Ended Year Ended
3/31/2007 3/31/2006 12/31/2006 12/31/2005 12/31/2004
Operating Revenue
Premium Income
Group Long-term Income Protection $ 174.6 $ 147.3 $ 638.9 $ 582.9 $ 501.8
Group Life 38.7 36.7 171.0 164.1 117.9
Individual Income Protection 9.0 7.4 32.9 38.3 39.4
Total Premium Income 222.3 191.4 842.8 785.3 659.1
Net Investment Income 45.8 38.0 174.6 154.2 139.6
Other Income 1.7 0.1 0.1 6.1 3.1
Total Operating Revenue 269.8 229.5 1,017.5 945.6 801.8
Benefits and Expenses
Benefits and Change in Reserves for Future Benefits 135.8 129.1 553.5 545.8 464.5
Commissions 15.4 11.9 49.7 56.4 48.9
Deferral of Acquisition Costs (9.3) (8.2) (34.4) (34.1) (37.7)
Amortization of Deferred Acquisition Costs 11.9 5.3 32.0 21.6 19.2
Other Expenses 40.9 37.0 158.9 168.2 155.6
Total Benefits and Expenses 194.7 175.1 759.7 757.9 650.5
Operating Income Before Income Taxes and
Net Realized Investment Gains and Losses $ 75.1 $ 54.4 $ 257.8 $ 187.7 $ 151.3
Operating Ratios
Benefit Ratio 61.1 % 67.5 % 65.7 % 69.5 % 70.5 %
Other Expense Ratio 18.4 % 19.3 % 18.9 % 21.4 % 23.6 %
Before-tax Profit Margin 33.8 % 28.4 % 30.6 % 23.9 % 23.0 %
Premium Persistency:
Group Long-term Income Protection 89.6 % 91.2 % 90.4 % 94.2 % 92.1 %
Group Life 72.6 % 82.0 % 69.1 % 86.3 % 83.0 %
Individual Income Protection 90.1 % 86.6 % 88.2 % 88.4 % 86.7 %
Operating Income Before Income Taxes and
Net Realized Investment Gains and Losses,
as Reported $ 75.1 $ 54.4 $ 257.8 $ 187.7 $ 151.3
Gain on Sale of Netherlands Branch - - - 5.7 -
Operating Income Before Income Taxes and
Net Realized Investment Gains and Losses,
as Adjusted $ 75.1 $ 54.4 $ 257.8 $ 182.0 $ 151.3
Operating Ratio, as Adjusted
Before-tax Profit Margin 33.8 % 28.4 % 30.6 % 23.2 % 23.0 %
See quot;Notes to Statistical Supplementquot; on page 16 for additional information.
8
22. Unum Group Financial Results for Colonial Segment
Three Months Ended Year Ended
3/31/2007 3/31/2006 12/31/2006 12/31/2005 12/31/2004
Operating Revenue
Premium Income
Income Protection $ 139.7 $ 129.8 $ 533.3 $ 508.9 $ 486.2
Life 35.6 30.0 130.5 114.0 106.9
Cancer and Critical Illness 48.1 42.8 178.3 164.1 147.9
Total Premium Income 223.4 202.6 842.1 787.0 741.0
Net Investment Income 24.4 22.6 93.6 96.0 94.5
Other Income 0.3 0.3 1.1 4.4 2.3
Total Operating Revenue 248.1 225.5 936.8 887.4 837.8
Benefits and Expenses
Benefits and Change in Reserves for Future Benefits 110.0 105.5 441.4 433.2 408.3
Commissions 49.4 43.7 184.9 170.7 173.9
Deferral of Acquisition Costs (52.3) (46.1) (187.6) (173.4) (173.7)
Amortization of Deferred Acquisition Costs 38.3 35.5 144.4 134.7 131.2
Other Expenses 43.1 40.7 155.0 154.1 142.5
Total Benefits and Expenses 188.5 179.3 738.1 719.3 682.2
Operating Income Before Income Taxes and
Net Realized Investment Gains and Losses $ 59.6 $ 46.2 $ 198.7 $ 168.1 $ 155.6
Operating Ratios
Benefit Ratio 49.2 % 52.1 % 52.4 % 55.0 % 55.1 %
Other Expense Ratio 19.3 % 20.1 % 18.4 % 19.6 % 19.2 %
Before-tax Profit Margin 26.7 % 22.8 % 23.6 % 21.4 % 21.0 %
Premium Persistency:
Income Protection 75.6 % 74.4 % 74.9 % 75.3 % 75.6 %
Life 83.2 % 84.2 % 84.2 % 84.1 % 84.1 %
Cancer and Critical Illness 83.6 % 82.0 % 82.3 % 83.2 % 82.6 %
9
23. Unum Group Financial Results for Individual Income Protection - Closed Block Segment
Three Months Ended Year Ended
3/31/2007 3/31/2006 12/31/2006 12/31/2005 12/31/2004
Operating Revenue
Premium Income $ 252.3 $ 271.0 $ 1,062.8 $ 1,011.7 $ 986.6
Net Investment Income 204.6 202.2 828.7 770.0 799.1
Other Income 25.3 26.3 105.1 95.2 100.3
Total Operating Revenue 482.2 499.5 1,996.6 1,876.9 1,886.0
Benefits and Expenses
Benefits and Change in Reserves for Future Benefits 405.9 430.4 1,709.7 1,562.7 1,618.9
Commissions 18.0 20.5 76.2 74.9 76.3
Impairment of Intangible Assets - - - - 856.4
Other Expenses 35.8 33.9 139.4 159.4 157.2
Total Benefits and Expenses 459.7 484.8 1,925.3 1,797.0 2,708.8
Operating Income (Loss) Before Income Taxes
and Net Realized Investment Gains and Losses $ 22.5 $ 14.7 $ 71.3 $ 79.9 $ (822.8)
Operating Ratios
Interest Adjusted Loss Ratio 93.9 % 96.5 % 97.3 % 89.3 % 93.4 %
Premium Persistency 94.5 % 94.3 % 94.4 % 94.5 % 94.5 %
Operating Income (Loss) Before Income Taxes
and Net Realized Investment Gains and Losses,
as Reported $ 22.5 $ 14.7 $ 71.3 $ 79.9 $ (822.8)
Settlement Agreements Claim Reassessment -
Reserve Charge - (13.2) (47.2) (23.1) (3.7)
Settlement Agreements Claim Reassessment -
Other Expense Charge - - - (11.2) (4.9)
Individual Income Protection - Closed Block
Restructuring - Reserve Charge - - - - (110.6)
Individual Income Protection - Closed Block
Restructuring - Intangible Asset Impairment Charge - - - - (856.4)
Operating Income Before Income Taxes and
Net Realized Investment Gains and Losses,
as Adjusted $ 22.5 $ 27.9 $ 118.5 $ 114.2 $ 152.8
Interest Adjusted Loss Ratio, as Adjusted 93.9 % 91.6 % 92.9 % 87.3 % 87.5 %
See quot;Notes to Statistical Supplementquot; on page 16 for additional information.
10
24. Unum Group Financial Results for Other Segment
Three Months Ended Year Ended
3/31/2007 3/31/2006 12/31/2006 12/31/2005 12/31/2004
Operating Revenue
Premium Income $ 1.1 $ 1.2 $ 4.5 $ 2.6 $ 31.3
Net Investment Income 28.1 28.7 113.2 120.5 127.3
Other Income 8.2 8.3 33.8 36.0 31.2
Total Operating Revenue 37.4 38.2 151.5 159.1 189.8
Benefits and Expenses
Benefits and Change in Reserves for Future Benefits 31.6 31.4 120.5 122.2 142.3
Commissions 0.7 0.4 3.0 1.1 4.9
Deferral of Acquisition Costs - - - - 0.1
Amortization of Deferred Acquisition Costs - - - 0.5 -
Other Expenses 1.5 1.6 3.6 5.3 13.3
Total Benefits and Expenses 33.8 33.4 127.1 129.1 160.6
Operating Income Before Income Taxes and
Net Realized Investment Gains and Losses $ 3.6 $ 4.8 $ 24.4 $ 30.0 $ 29.2
11
25. Unum Group Financial Results for Corporate Segment
Three Months Ended Year Ended
3/31/2007 3/31/2006 12/31/2006 12/31/2005 12/31/2004
Operating Revenue
Net Investment Income $ 9.7 $ 14.6 $ 47.4 $ 49.4 $ 32.4
Other Income 0.6 3.4 15.7 11.8 33.6
Total Operating Revenue 10.3 18.0 63.1 61.2 66.0
Benefits and Expenses
Interest and Debt Expense - Non-recourse Debt 2.0 - 1.3 - -
Interest and Debt Expense - All Other Debt 43.9 53.1 190.5 208.0 207.1
Cost Related to Early Retirement of Debt 2.4 5.3 25.8 - -
Unallocated Expenses 1.6 3.1 30.2 6.0 12.6
Total Benefits and Expenses 49.9 61.5 247.8 214.0 219.7
Operating Loss Before Income Taxes and
Net Realized Investment Gains and Losses $ (39.6) $ (43.5) $ (184.7) $ (152.8) $ (153.7)
Operating Loss Before Income Taxes and
Net Realized Investment Gains and Losses,
as Reported $ (39.6) $ (43.5) $ (184.7) $ (152.8) $ (153.7)
Broker Compensation Settlement - - (18.5) - -
Interest on Federal Income Tax Refund - - 2.6 - -
Cost Related to Early Retirement of Debt - (5.3) (25.8) - -
Operating Loss Before Income Taxes and
Net Realized Investment Gains and Losses,
as Adjusted $ (39.6) $ (38.2) $ (143.0) $ (152.8) $ (153.7)
See quot;Notes to Statistical Supplementquot; on page 16 for additional information.
12
26. Unum Group Reserves
March 31, 2007
Gross Total
Policy Claim Reserves Reinsurance Total
Reserves % % Ceded Net
Incurred IBNR Total
Group Income Protection $ - - % $ 7,615.4 $ 706.5 34.2 % $ 8,321.9 $ 100.2 $ 8,221.7
Group Life and Accidental Death & Dismemberment 62.8 0.5 736.3 194.0 3.8 993.1 3.1 990.0
Individual Income Protection - Recently Issued 439.4 3.4 746.1 70.9 3.4 1,256.4 77.3 1,179.1
Long-term Care 2,168.3 16.9 203.8 31.7 1.0 2,403.8 54.8 2,349.0
Voluntary Workplace Benefits 802.9 6.3 18.8 38.2 0.2 859.9 13.9 846.0
Unum US Segment 3,473.4 27.1 9,320.4 1,041.3 42.6 13,835.1 249.3 13,585.8
Unum UK Segment 30.4 0.2 2,276.2 287.8 10.5 2,594.4 135.2 2,459.2
Colonial Segment 1,038.1 8.1 234.4 103.3 1.4 1,375.8 35.4 1,340.4
Individual Income Protection - Closed Block Segment 1,754.8 13.7 9,820.9 433.1 42.1 12,008.8 1,517.9 10,490.9
Other Segment 6,524.5 50.9 544.6 284.0 3.4 7,353.1 5,756.2 1,596.9
Subtotal, Excluding Unrealized Adjustment $ 12,821.2 100.0 % $ 22,196.5 $ 2,149.5 100.0 % $ 37,167.2 $ 7,694.0 29,473.2
Unrealized Adjustment to Reserves for Unrealized
Investment Gains 956.4
Consolidated $ 30,429.6
The decrease in the Unum US segment and Individual Income Protection - Closed Block segment IBNR from December 31, 2006 is due to the release
of reserves to cover costs for the multistate market conduct examination settlement agreements and the California settlement agreement and related
matters and a slight decline in insured lives in the group income protection, group life, and accidental death and dismemberment lines of business.
The increase in Unum US Policy and Claim Reserves Incurred from December 31, 2006 is due to growth in the disabled life reserves in the Unum US group
income protection line of business and growth in the active life reserves for the Unum US long-term care and individual income protection -
recently issued lines of business.
13
27. Unum Group Reserves
December 31, 2006
Gross Total
Policy Claim Reserves Reinsurance Total
Reserves % % Ceded Net
Incurred IBNR Total
Group Income Protection $ - - % $ 7,563.0 $ 790.3 34.3 % $ 8,353.3 $ 101.5 $ 8,251.8
Group Life and Accidental Death & Dismemberment 63.1 0.5 736.5 202.2 3.9 1,001.8 2.7 999.1
Individual Income Protection - Recently Issued 431.8 3.4 718.9 71.5 3.3 1,222.2 76.7 1,145.5
Long-term Care 2,067.2 16.4 195.0 31.6 0.9 2,293.8 57.1 2,236.7
Voluntary Workplace Benefits 787.9 6.2 22.3 36.3 0.2 846.5 13.3 833.2
Unum US Segment 3,350.0 26.5 9,235.7 1,131.9 42.6 13,717.6 251.3 13,466.3
Unum UK Segment 28.9 0.2 2,252.8 286.4 10.4 2,568.1 142.4 2,425.7
Colonial Segment 1,021.3 8.1 234.5 100.8 1.4 1,356.6 36.7 1,319.9
Individual Income Protection - Closed Block Segment 1,777.8 14.1 9,794.9 443.9 42.1 12,016.6 1,498.7 10,517.9
Other Segment 6,444.3 51.1 561.4 282.1 3.5 7,287.8 5,686.4 1,601.4
Subtotal, Excluding Unrealized Adjustment $ 12,622.3 100.0 % $ 22,079.3 $ 2,245.1 100.0 % $ 36,946.7 $ 7,615.5 29,331.2
Unrealized Adjustment to Reserves for Unrealized
Investment Gains 963.1
Consolidated $ 30,294.3
13.1
28. Unum Group Investment Fact Sheet at March 31, 2007
Bonds (Fair Value) 3/31/2007 Selected Statistics 3/31/07 12/31/06
Public $ 21,336.7 61.3 % Portfolio Yield (2) 6.72 % 6.73 %
Mortgage-backed Securities 4,253.1 12.2 Average Duration 8.74 8.83
Private Placements 3,894.1 11.2 Average Credit Quality A A
High Yield 2,103.1 6.0
Government Securities 3,272.9 9.4
Municipal Securities 46.3 0.1
Derivatives Hedging
Available-for-Sale (66.3) (0.2)
Total (1) $ 34,839.9 100.0 %
Quality Ratings of Bonds Book Value Fair Value Schedule BA and Non-Current
Aaa 23.7 % 23.4 % Total Non-Current Investments $ 14.9 $ 12.5
Aa 8.0 7.8 Total Schedule BA Assets $ 103.9 $ 108.4
A 25.2 25.4
Baa 36.9 37.4
Below Baa 6.2 6.0
Total 100.0 % 100.0 %
(1) Excludes DIG Issue B36 embedded derivatives, which at March 31, 2007 had a fair value of $(14.9) million.
(2) Bond equivalent yield is a book value and duration weighted average of the yield on the fixed income securities in the portfolio.
14
29. Unum Group Investment Fact Sheet at March 31, 2007
Fixed Maturity Bonds - By Industry Classification - Unrealized Gain/Loss
Fair Value Fair Value
of Bonds of Bonds
Net with Gross Gross with Gross Gross
Fair Value Unrealized Unrealized Unrealized Unrealized Unrealized
(1) Gain (Loss) Loss Loss Gain Gain
Classification
Basic Industry $ 2,335.0 $ 92.8 $ 792.3 $ 26.6 $ 1,542.7 $ 119.4
Canadian 268.1 55.7 - - 268.1 55.7
Capital Goods 2,636.1 164.5 749.2 27.4 1,886.9 191.9
Communications 2,500.1 142.2 841.6 43.0 1,658.5 185.2
Consumer Cyclical 1,456.5 37.4 562.6 29.6 893.9 67.0
Consumer Non-Cyclical 4,082.6 114.8 1,691.7 71.6 2,390.9 186.4
Derivatives Hedging Available-
for-Sale (66.3) (68.3) (165.6) 165.6 99.3 97.3
Energy (Oil & Gas) 2,267.1 226.1 328.4 13.1 1,938.7 239.2
Financial Institutions 3,642.9 (0.6) 2,454.6 84.0 1,188.3 83.4
Mortgage/Asset-Backed 4,253.1 223.9 754.1 9.9 3,499.0 233.8
Sovereigns 885.0 29.3 614.8 19.7 270.2 49.0
Technology 510.0 20.6 164.0 6.8 346.0 27.4
Transportation 970.9 80.6 201.5 5.4 769.4 86.0
U.S. Government Agencies
and Municipalities 2,476.0 42.8 1,374.4 73.8 1,101.6 116.6
Utilities 6,622.8 312.8 2,383.0 87.2 4,239.8 400.0
Total $ 34,839.9 $ 1,474.6 $ 12,746.6 $ 663.7 $ 22,093.3 $ 2,138.3
Gross Unrealized Loss on Fixed Maturity Bonds By Length of Time in Unrealized Loss Position
Investment-Grade Below-Investment-Grade
Gross Gross
Unrealized Unrealized
Loss Loss
Category Fair Value Fair Value
Less than 91 days $ 1,311.0 $ 10.1 $ 81.8 $ 1.7
91 through 180 days 1,398.7 21.8 37.8 1.1
181 through 270 days 267.8 4.9 - -
271 days to 1 year 565.1 12.4 44.9 1.0
Greater than 1 year 8,555.3 566.3 484.2 44.4
Total $ 12,097.9 $ 615.5 $ 648.7 $ 48.2
(1) Excludes DIG Issue B36 embedded derivatives, which at March 31, 2007 had a fair value of $(14.9) million.
14.1
30. Unum Group Statutory Capital and Surplus
As of
As of March 31, 2007 December 31, 2006
Capital and Capital and Capital and
Surplus AVR Surplus + AVR Surplus + AVR
Provident Life and Accident $ 1,112.1 $ 70.6 $ 1,182.7 $ 1,189.8
Unum Life of America 1,608.1 109.3 1,717.4 1,682.4
Paul Revere Life (1) 1,044.4 39.2 1,083.6 1,070.5
Colonial Life & Accident 370.8 13.3 384.1 382.8
Provident Life and Casualty 103.8 2.1 105.9 102.2
First Unum Life 185.8 6.6 192.4 188.8
Paul Revere Variable (1) 110.7 1.0 111.7 110.4
(1) Capital and Surplus of Paul Revere Variable is included in Paul Revere Life
15
31. Unum Group Statutory Operating Results
Three Months Ended March 31
Net Realized Investment
Net Gain from Gains (Losses) After Tax
Operations After Tax and Transfers to IMR Net Income (Loss)
2007 2006 2007 2006
Before Claim Before Claim
Infrequent or Reassessment Infrequent or Reassessment
Total Unusual Items Charge Total 2007 2006 Total Unusual Items Charge Total
Provident Life and Accident $ 28.8 $ 22.5 $ (2.1) $ 20.4 $ (3.2) $ (1.2) $ 25.6 $ 21.3 $ (2.1) $ 19.2
Unum Life of America 57.3 65.2 (60.3) 4.9 (48.8) (5.2) 8.5 60.0 (60.3) (0.3)
Paul Revere Life 25.8 25.0 (3.2) 21.8 2.5 4.5 28.3 29.5 (3.2) 26.3
Colonial Life & Accident 20.4 17.6 - 17.6 (0.1) 0.7 20.3 18.3 - 18.3
Provident Life and Casualty 4.0 3.1 - 3.1 - (1.1) 4.0 2.0 - 2.0
First Unum Life 5.3 4.8 (2.1) 2.7 (0.2) (0.4) 5.1 4.4 (2.1) 2.3
Paul Revere Variable 1.8 2.0 - 2.0 - - 1.8 2.0 - 2.0
Total $ 143.4 $ 140.2 $ (67.7) $ 72.5 $ (49.8) $ (2.7) $ 93.6 $ 137.5 $ (67.7) $ 69.8
Note: Statutory results are reported in conformity with statutory accounting principles as prescribed by the National Association of Insurance Commissioners and adopted by the applicable state laws.
15.1
32. 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
2007 2006 2005 2004
Reserve Balance from Prior Year End $ 6,686.6 $ 5,192.8 $ 5,146.1 $ 4,983.5
Reserves Ceded Each January 1 for Prior Year Incurrals - - (453.4) (429.0)
Reinsurance Recapture - 891.4 - -
Other Adjustments to Beginning Balance (see Schedule H) 20.3 15.9 (5.7) 17.6
Reserve Balance January 1 (a) 6,706.9 6,100.1 4,687.0 4,572.1
Paid on Prior Year Claims (437.4) (395.9) (356.0) (362.4)
Interest Earned on Reserves 108.3 102.1 78.7 77.7
Incurred on Prior Year Claims 8.7 45.6 49.8 (16.2)
Reserve Charges Incurred for Settlement Agreements - 68.4 - -
Reserve Balance March 31 $ 6,386.5 $ 5,920.3 $ 4,459.5 $ 4,271.2
Reserve Balance March 31 $ 5,920.3 $ 4,459.5 $ 4,271.2
Paid on Prior Year Claims (348.3) (298.7) (291.5)
Interest Earned on Reserves 99.3 74.6 73.3
Incurred on Prior Year Claims 51.4 1.0 (24.0)
Reserve Balance June 30 $ 5,722.7 $ 4,236.4 $ 4,029.0
Reserve Balance June 30 $ 5,722.7 $ 4,236.4 $ 4,029.0
Paid on Prior Year Claims (350.6) (261.5) (260.7)
Interest Earned on Reserves 97.6 71.5 69.4
Incurred on Prior Year Claims (11.9) (17.1) (32.7)
Reserve Charges Incurred for Settlement Agreements 246.0 13.7 -
Reserve Balance September 30 $ 5,703.8 $ 4,043.0 $ 3,805.0
Reserve Balance September 30 $ 5,703.8 $ 4,043.0 $ 3,805.0
Paid on Prior Year Claims (314.5) (229.8) (223.2)
Interest Earned on Reserves 94.5 68.9 68.9
Incurred on Prior Year Claims 2.7 0.3 (31.3)
Reserve Charges Incurred for Settlement Agreements - - 71.1
Reserve Balance December 31 on Prior Year Claims 5,486.5 3,882.4 3,690.5
Reserve Balance December 31 on Current Year Claims 1,200.1 1,310.4 1,455.6
Reserve Balance December 31 on Total Claims Incurred (b) $ 6,686.6 $ 5,192.8 $ 5,146.1
(a) balances to Schedule H Part 3 Line 3.2 Column 2
(b) balances to Schedule H Part 2 Line C.1 Column 2
15.2