Profile: Unum Group (UNM)

UNM on New York Consolidated

35.38USD
26 Dec 2014
Price Change (% chg)

$0.08 (+0.21%)
Prev Close
$35.30
Open
$35.33
Day's High
$35.62
Day's Low
$35.32
Volume
467,209
Avg. Vol
2,007,261
52-wk High
$37.15
52-wk Low
$30.66

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Unum Group, incorporated on March 22, 1995, is a provider of disability insurance products in the United States and the United Kingdom. The Company also provides a portfolio of other insurance products, including employer- and employee-paid group benefits, life insurance, and other related services. The Company operates in five segments: Unum US, Unum UK, Colonial Life, Closed Block and Corporate. The principal operating subsidiaries in the United States are Unum Life Insurance Company of America (Unum America), Provident Life and Accident Insurance Company (Provident), The Paul Revere Life Insurance Company (Paul Revere Life), and Colonial Life & Accident Insurance Company, and in the United Kingdom, Unum Limited.

Unum US Segment

The Unum US segment includes group long-term and short-term disability insurance, group life and accidental death and dismemberment products, and supplemental and voluntary lines of business. The supplemental and voluntary lines of business are comprised of individual disability. These products are issued primarily by Unum America, Provident, and Paul Revere Life. Group long-term and short-term disability products contributed approximately 47.4 percent of the Unum US segment premium income during the year ended December, 31, 2011. The Company sells group long-term and short-term disability products to employers for the benefit of employees. Group long-term disability provides employees with insurance coverage for loss of income in the event of extended work absences due to sickness or injury. It offers services to employers and insured to encourage and facilitate rehabilitation, retraining, and re-employment. Most policies begin providing benefits following 90 or 180 day waiting periods and continue providing benefits until the employee reaches a certain age, generally between 65 and 70. Group short-term disability insurance generally provides coverage from loss of income due to injury or sickness.

Group life and accidental death and dismemberment products contributed approximately 28.3% of the Unum US segment premium income in 2011. Group life and accidental death and dismemberment products are sold to employers as employee benefit products. Group life consists primarily of renewable term life insurance with the coverages frequently linked to employees' wages and includes a provision for waiver of premium, if disabled. Accidental death and dismemberment consists primarily of an additional benefit amount payable if death or severe injury is attributable to an accident.

Individual disability issued products generated approximately 10.8% of the Unum US segment premium income in 2011. Individual disability is offered primarily to multi-life employer groups and may be funded by the employer, but the policy is owned by the employee and is portable should the employee change employers. Individual disability insurance provides the insured with a portion of earned income lost as a result of sickness or injury. Under an individual disability policy, monthly benefits generally are fixed at the time the policy is written. The benefits typically range from 30% to 75% of the insured's monthly earned income. The Company provides various options with respect to length of benefit periods and waiting periods before benefit payments begin, which permits tailoring of the policy to a specific policyholder's needs. It also markets individual disability policies which include payments for the transfer of business ownership between partners and payments for business overhead expenses. Individual disability products do not provide for the accumulation of cash values. Voluntary benefits products generated approximately 13.5% of the Unum US segment premium income in 2011. Voluntary benefits products are sold to groups of employees through payroll deduction at the workplace and include individual universal life and interest-sensitive life, individual disability, group and individual critical illness, and individual cancer products.

Unum UK Segment

The Unum UK segment includes insurance for group long-term disability, group life, and supplemental and voluntary lines of business. The supplemental and voluntary lines of business are comprised of individual disability, critical illness, and voluntary benefits products. Unum UK's products are issued primarily by Unum Limited and are sold in the United Kingdom through field sales personnel and independent brokers and consultants. Group long-term disability products contributed approximately 61% of the Unum UK segment premium income in 2011. Group long-term disability products are sold to employers for the benefit of employees. Group long-term disability provides employees with insurance coverage for loss of income in the event of extended work absences due to sickness or injury. Services are offered to employers and insured’s to encourage and facilitate rehabilitation, retraining, and re-employment. Most policies begin providing benefits following 90 or 180 day waiting periods and continue providing benefits until the employee reaches a certain age, generally between 60 and 67. The benefits are limited to specified maximums as a percentage of income.

Group life products contributed approximately 29.6% of the Unum UK segment premium income in 2011. Group life products are sold to employers as employee benefit products. Group life consists of two types of products, a renewable term life insurance product providing a lump sum benefit to the beneficiary on death of an employee and a group dependent life product which provides an annuity to the beneficiary on death of an employee. Both coverages are frequently linked to employees' wages. Premiums for group life are generally based on expected claims of a pool of similar risks plus provisions for administrative expenses, investment income, and profit. Underwriting and rate guarantees are similar to those utilized for group long-term disability products.

Individual disability products generated approximately 5.3% of the Unum UK segment premium income in 2011. Individual disability is offered primarily to individual retail customers. Individual disability insurance provides the insured with a portion of earned income lost as a result of sickness or injury. Under an individual disability policy, monthly benefits generally are fixed at the time the policy is written. The benefits typically range from 30% to 50% of the insured's monthly earned income. Various options with respect to length of benefit periods and waiting periods before payment begins are available and permit tailoring of the policy to a specific policyholder's needs. Individual disability products do not provide for the accumulation of cash values.

Critical illness products generated approximately 4.1%of the Unum UK segment premium income in 2011. Group critical illness products are sold to groups of employees. Individual critical illness products are offered to individual retail customers. Critical illness products provide a lump-sum benefit on the occurrence of a covered critical illness event. Unum UK is in the early stages of establishing its voluntary benefits product offering in the UK marketplace. The product offering includes group disability, group life, and group critical illness products. These products are sold to groups of employees through payroll deduction at the workplace.

Colonial Life Segment

The Colonial Life segment includes insurance for accident, sickness, and disability products, life products, and cancer and critical illness products issued primarily by Colonial Life & Accident Insurance Company and marketed to employees at the workplace through an independent contractor agency sales force and brokers. The accident, sickness, and disability product line, which generated approximately 61.2% of the Colonial Life segment premium income in 2011, consists of short-term disability plans, as well as accident-only plans providing benefits for injuries on a specified loss basis. It also includes accident and health plans covering hospital admissions, confinement, and surgeries on an indemnity basis and group limited benefit medical plans which provide limited indemnity benefits for basic healthcare expenses.

Group and individual life products contributed approximately 16.8% of the Colonial Life segment premium income in 2011 and are primarily comprised of universal life, whole life, level term life, and a small block of group term life policies. Cancer and critical illness policies generated approximately 22% of the Colonial Life segment premium income in 2011. Cancer policies provide various benefits for the treatment of cancer including hospitalization, surgery, radiation, and chemotherapy. Critical illness policies provide a lump-sum benefit on the occurrence of a covered critical illness event.

Closed Block Segment

The Closed Block segment consists of individual disability, group and individual long-term care, and other insurance products no longer actively marketed. Individual disability policies generated approximately 56.4% of the Closed Block segment premium income in 2011. The Company has reinsurance agreements which effectively provide approximately 51% reinsurance coverage for its overall consolidated risk above a specified retention limit.

Long-term care policies generated approximately 43.6% of the Closed Block segment premium income in 2011. The Company announced in February 2012, that it would discontinue selling group long-term care, which was previously offered to employers for the benefit of employees. Other insurance products not actively marketed include individual life and corporate-owned life insurance, reinsurance pools and management operations, group pension, health insurance, and individual annuities. The majority of these products have been reinsured, with approximately 78% of reserves at December 31, 2011, ceded to other insurance companies. These products contributed less than 0.1% of the Closed Block segment premium income in 2011.

Corporate Segment

The Corporate and Other segment includes investment income on corporate assets not specifically allocated to a line of business, interest expense on corporate debt other than non-recourse debt, and certain other corporate income and expense not allocated to a line of business. The Corporate and Other segment also includes results from certain Unum US 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.

Company Address

Unum Group

1 Fountain Sq
CHATTANOOGA   TN   37402-1307
P: +1423.2941011
F: +1302.6365454

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