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Section 1: 8-K (8-K)

unm-20200204
0000005513FALSE00000055132020-02-042020-02-040000005513exch:XNYSus-gaap:CommonClassAMember2020-02-042020-02-040000005513unm:A6250JuniorSubordinatedNotesDue2058Memberexch:XNYS2020-02-042020-02-04

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 8-K

Current Report
Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934

Date of Report (Date of earliest event reported): February 4, 2020
UNUM GROUP
(Exact name of registrant as specified in its charter)
Delaware
001-11294
62-1598430 
(State or other jurisdiction of incorporation) (Commission File Number)(IRS Employer Identification No.)

1 Fountain Square
Chattanooga, Tennessee 37402
(Address of principal executive offices) (Zip Code)

(423) 294-1011
(Registrant's telephone number, including area code)

Not Applicable
(Former name or former address, if changed since last report)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):

Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)

Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)

Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))

Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))

Securities registered pursuant to Section 12(b) of the Act:

Title of each classTrading SymbolName of each exchange on which registered
Common stock, $0.10 par valueUNMNew York Stock Exchange
6.250% Junior Subordinated Notes due 2058UNMANew York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company as defined in as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).

Emerging growth company

☐ If an emerging growth company, indicate by check mark if the registrant has elected not to use the extended transition period for complying with any new or revised financial accounting standards provided pursuant to Section 13(a) of the Exchange Act.



Item 2.02 Results of Operations and Financial Condition.
On February 4, 2020, Unum Group issued a news release reporting its results for the fourth quarter of 2019, a copy of which is furnished herewith as Exhibit 99.1 to this Current Report on Form 8-K and incorporated herein by reference.
Also on February 4, 2020, Unum Group posted on its website at www.unum.com the Statistical Supplement relating to its financial results for the fourth quarter of 2019. A copy of the Statistical Supplement is furnished herewith as Exhibit 99.2 and incorporated herein by reference.
In accordance with General Instruction B.2 of Form 8-K, the information in this report, including Exhibits 99.1 and 99.2, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934 (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall it be deemed to be incorporated by reference into any of Unum Group's filings under the Securities Act of 1933 or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
The following exhibits are furnished (but not filed) with this report:
99.1  
99.2  
104  Cover Page Interactive Data File (embedded within the Inline XBRL document).



SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

Unum Group
(Registrant)
Date: February 4, 2020
By: /s/ J. Paul Jullienne
Name:J. Paul Jullienne
Title:Vice President, Managing Counsel, and
Corporate Secretary



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Section 2: EX-99.1 (EX-99.1)

Document
Exhibit 99.1
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1 Fountain Square
Chattanooga, TN 37402
www.unum.com
FOR IMMEDIATE RELEASE
Contacts

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MEDIABrad Carmony 901-568-3088
bcarmony@unum.com
INVESTORSTom White 423-294-8996
tawhite@unum.com

Unum Group Reports Fourth Quarter 2019 Results

CHATTANOOGA, Tenn. (February 4, 2020) - Unum Group (NYSE: UNM) today reported net income of $296.2 million ($1.44 per diluted common share) for the fourth quarter of 2019, compared to net income of $249.1 million ($1.15 per diluted common share) for the fourth quarter of 2018.
Included in net income for the fourth quarter of 2019 are after-tax costs related to the early retirement of debt of $1.7 million ($0.01 per diluted common share), as well as a net after-tax realized investment gain on the Company’s investment portfolio of $7.2 million ($0.04 per diluted common share). Included in net income for the fourth quarter of 2018 is a net after-tax realized investment loss on the Company's investment portfolio of $32.6 million ($0.15 per diluted common share). Excluding the items above, after-tax adjusted operating income was $290.7 million ($1.41 per diluted common share) in the fourth quarter of 2019, compared to $281.7 million ($1.30 per diluted common share) in the fourth quarter of 2018.
“Unum wrapped up 2019 on a positive note with solid results in the fourth quarter. Healthy profit margins were driven by a mix of steady premium growth, stable benefits experience, and focus on expense management,” said Richard P. McKenney, president and chief executive officer. “Looking forward, we will remain focused on accelerating growth to meet the growing need for our products in the marketplace and to position Unum for ongoing success.”



UNUM IS A REGISTERED TRADEMARK AND MARKETING BRAND OF UNUM GROUP AND ITS INSURING SUBSIDIARIES.


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RESULTS BY SEGMENT
We measure and analyze our segment performance on the basis of "adjusted operating income" or "adjusted operating loss", which differ from income before income tax as presented in our consolidated statements of income due to the exclusion of net realized investment gains and losses and certain other items. These performance measures are in accordance with GAAP guidance for segment reporting, but they should not be viewed as a substitute for income before income tax or net income. 
Unum US Segment 
Unum US reported adjusted operating income of $263.1 million in the fourth quarter of 2019, an increase of 5.8 percent from $248.7 million in the fourth quarter of 2018. Premium income for the segment increased 5.1 percent to $1,508.3 million in the fourth quarter of 2019, compared to premium income of $1,435.1 million in the fourth quarter of 2018. Net investment income for the segment increased 0.7 percent to $189.0 million in the fourth quarter of 2019, compared to $187.7 million in the fourth quarter of 2018.
Within the Unum US operating segment, the group disability line of business reported a 2.9 percent increase in adjusted operating income to $83.0 million in the fourth quarter of 2019, compared to $80.7 million in the fourth quarter of 2018. Premium income for the group disability line of business increased 5.7 percent to $657.5 million in the fourth quarter of 2019, compared to $622.1 million in the fourth quarter of 2018, driven by prior period sales growth in both product lines and higher persistency in the group short-term disability product line. Net investment income was $103.1 million in the fourth quarter of 2019, which was generally consistent with the $102.7 million of net investment income in the fourth quarter of 2018. The benefit ratio for the fourth quarter of 2019 was 74.0 percent, compared to 76.2 percent in the fourth quarter of 2018, due primarily to favorable claim recovery experience in the group long-term disability product line, partially offset by higher claims incidence. Group long-term disability sales were $132.1 million in the fourth quarter of 2019, a decrease of 10.3 percent from $147.3 million in the fourth quarter of 2018. Group short-term disability sales were $81.2 million in the fourth quarter of 2019, compared to $80.9 million in the fourth quarter of 2018. Persistency in the group long-term disability product line was 90.7 percent for full year 2019, compared to 90.9 percent for full year 2018. Persistency in the group short-term disability product line was 89.8 percent for full year 2019, compared to 87.2 percent for full year 2018.
The group life and accidental death and dismemberment line of business reported adjusted operating income of $68.2 million in the fourth quarter of 2019, an increase of 6.1 percent from $64.3 million in the fourth quarter of 2018. Premium income for this line of business increased 4.8 percent to $454.1 million in the fourth quarter of 2019, compared to $433.5 million in the fourth quarter of 2018, due primarily to prior period sales growth. Net investment income increased 6.5 percent to $27.8 million in the fourth quarter of 2019, compared to $26.1 million in the fourth quarter of 2018, due primarily to a higher level of invested assets and higher miscellaneous investment income, partially offset by a decline in yield on invested assets. The benefit ratio in the fourth quarter of 2019 was 71.7 percent, compared to 71.6 percent in the fourth quarter of 2018. Sales of group life and accidental death and dismemberment products decreased 13.6 percent in the fourth
UNUM IS A REGISTERED TRADEMARK AND MARKETING BRAND OF UNUM GROUP AND ITS INSURING SUBSIDIARIES.
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quarter of 2019 to $133.0 million, compared to $153.9 million in the fourth quarter of 2018. Persistency in the group life product line was 90.6 percent for full year 2019, compared to 91.2 percent for full year 2018. Persistency in the accidental death and dismemberment product line was 89.9 percent for both full year 2019 and full year 2018.
The supplemental and voluntary line of business reported an increase of 7.9 percent in adjusted operating income to $111.9 million in the fourth quarter of 2019, compared to $103.7 million in the fourth quarter of 2018. Premium income for the supplemental and voluntary line of business increased 4.5 percent to $396.7 million in the fourth quarter of 2019, compared to $379.5 million in the fourth quarter of 2018. This increase was driven primarily by prior period sales growth and the continued expansion of our dental and vision product line, partially offset by unfavorable persistency across all business lines. Net investment income decreased 1.4 percent to $58.1 million in the fourth quarter of 2019, compared to $58.9 million in the fourth quarter of 2018, due to a decline in yield on invested assets, partially offset by growth in the level of invested assets. The benefit ratio for the individual disability product line was 50.6 percent for the fourth quarter of 2019, compared to 51.2 percent for the fourth quarter of 2018, due to a lower average claim size and favorable claim recoveries. The benefit ratio for the voluntary benefits product line was 45.6 percent in the fourth quarter of 2019, compared to 43.6 percent for the fourth quarter of 2018, due to unfavorable claims experience across all product lines. The benefit ratio for the dental and vision product line was 71.1 percent for the fourth quarter of 2019, compared to 67.3 percent for the fourth quarter of 2018, due to higher utilization. Relative to the fourth quarter of 2018, sales in the individual disability product line decreased 4.9 percent in the fourth quarter of 2019 to $19.3 million. Sales in the voluntary benefits product line declined 12.0 percent in the fourth quarter of 2019 to $47.6 million. Sales in the dental and vision product line totaled $35.2 million for the fourth quarter of 2019, an increase of 6.3 percent compared to the fourth quarter of 2018. Persistency in the individual disability product line was 89.8 percent for full year 2019, compared to 90.3 percent for full year 2018. Persistency in the voluntary benefits product line was 73.2 percent for full year 2019, compared to 75.9 percent for full year 2018. Persistency in the dental and vision product line was 82.6 percent for full year 2019, compared to 84.5 percent for full year 2018.
Unum International
The Unum International segment reported adjusted operating income of $23.9 million in the fourth quarter of 2019, a decrease of 21.4 percent from $30.4 million in the fourth quarter of 2018.
Premium income increased 8.7 percent to $165.6 million in the fourth quarter of 2019, compared to $152.3 million in the fourth quarter of 2018. Net investment income was $28.6 million in the fourth quarter of 2019, compared to $31.1 million in the fourth quarter of 2018.
Sales increased 13.8 percent to $28.1 million in the fourth quarter of 2019, compared to $24.7 million in the fourth quarter of 2018.
The Unum UK line of business reported adjusted operating income, in local currency, of £17.4 million in the fourth quarter of 2019, a decrease of 21.6 percent from £22.2 million in the fourth quarter of 2018.
UNUM IS A REGISTERED TRADEMARK AND MARKETING BRAND OF UNUM GROUP AND ITS INSURING SUBSIDIARIES.
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Premium income was £113.9 million in the fourth quarter of 2019, an increase of 8.6 percent from £104.9 million in the fourth quarter of 2018, driven by higher overall persistency, sales growth, and the impact of rate increases in the group long-term disability product line. Net investment income was £20.9 million in the fourth quarter of 2019, a decrease of 8.7 percent from £22.9 million in the fourth quarter of 2018, due to lower investment income from inflation index-linked bonds, which we invest in to support the claim reserves associated with certain of our group policies that provide for inflation-linked increases in benefits, and a lower yield on fixed-rate bonds, partially offset by a higher level of invested assets. The benefit ratio in the fourth quarter of 2019 was 77.3 percent, compared to 74.6 percent in the fourth quarter of 2018, due to unfavorable claims experience in both the group long-term disability and group life product lines partially offset by lower inflation-linked increases in benefits. Sales increased 13.9 percent to £18.9 million in the fourth quarter of 2019, compared to £16.6 million in the fourth quarter of 2018. Persistency in the group long-term disability product line was 89.9 percent for full year 2019, compared to 87.8 percent for full year 2018. Persistency in the group life product line was 89.0 percent for full year 2019, compared to 88.5 percent for full year 2018. Persistency in the supplemental product line was 89.9 percent for full year 2019, compared to 93.1 percent for full year 2018.
Colonial Life Segment
Colonial Life reported a 2.7 percent increase in adjusted operating income to $87.7 million in the fourth quarter of 2019, compared to $85.4 million in the fourth quarter of 2018. Premium income increased 3.6 percent to $424.9 million in the fourth quarter of 2019, compared to $410.1 million in the fourth quarter of 2018, driven primarily by prior period sales growth, which includes the continued expansion of our dental and vision products, partially offset by a lower level of persistency. Net investment income totaled $37.0 million in the fourth quarter of 2019, which was consistent with the fourth quarter of 2018. The benefit ratio was 51.5 percent in the fourth quarter of 2019, which was generally consistent with the benefit ratio of 51.6 percent in the fourth quarter of 2018.
Sales totaled $209.7 million in the fourth quarter of 2019, compared to $204.4 million in the fourth quarter of 2018. Persistency in Colonial Life was 77.0 percent for full year 2019, compared to 78.1 percent for full year 2018.
Closed Block Segment
The Closed Block segment reported adjusted operating income of $46.1 million in the fourth quarter of 2019, compared to $34.8 million in the fourth quarter of 2018.
Premium income for this segment declined 4.5 percent in the fourth quarter of 2019, compared to the fourth quarter of 2018, due primarily to policy terminations and maturities, partially offset by premium rate increases on certain in-force business in the long-term care line of business. Net investment income increased 3.1 percent to $356.6 million in the fourth quarter of 2019, compared to $345.8 million in the fourth quarter of 2018, driven primarily by an increase in the level of invested assets in the long-term care line of business, partially offset by a lower yield. The interest adjusted loss ratio for the long-term care line of business was 86.7
UNUM IS A REGISTERED TRADEMARK AND MARKETING BRAND OF UNUM GROUP AND ITS INSURING SUBSIDIARIES.
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percent in the fourth quarter of 2019, compared to an interest adjusted loss ratio of 83.2 percent in the fourth quarter of 2018, driven primarily by favorable claims incidence in the fourth quarter of 2018. The interest adjusted loss ratio for the long-term care line of business for full year 2019 was 88.1 percent, which remains within our expected range. The interest adjusted loss ratio for the individual disability line of business was 74.7 percent in the fourth quarter of 2019, compared to 81.2 percent in the fourth quarter of 2018, driven primarily by overall favorable claims activity.
Corporate Segment
The Corporate segment reported an adjusted operating loss of $50.5 million in the fourth quarter of 2019, which excludes the cost related to the early retirement of debt of $2.1 million, compared to an adjusted operating loss of $48.2 million in the fourth quarter of 2018.
OTHER INFORMATION
Shares Outstanding
The Company’s weighted average number of shares outstanding, assuming dilution, was 205.7 million for the fourth quarter of 2019, compared to 217.4 million for the fourth quarter of 2018. Shares outstanding totaled 202.9 million at December 31, 2019. During the fourth quarter of 2019, the Company repurchased 3.3 million shares at a cost of $100.1 million.
Capital Management
At December 31, 2019, the weighted average risk-based capital ratio for the Company’s traditional U.S. insurance companies was approximately 365 percent, and cash and marketable securities in the holding companies equaled $863.0 million.
Book Value
Book value per common share as of December 31, 2019 was $49.10, compared to $40.19 at December 31, 2018.
Outlook
The Company expects after-tax adjusted operating income growth per share for full-year 2020 to be within the range of 4 percent to 7 percent.
NON-GAAP FINANCIAL MEASURES
We analyze our performance using non-GAAP financial measures.  A non-GAAP financial measure is a numerical measure of a company's performance, financial position, or cash flows that excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with GAAP.  The non-GAAP financial measure of "after-tax adjusted operating income" differs from net income as presented in our consolidated operating results and income statements prepared in accordance with GAAP due to the exclusion of net realized investment gains and losses and certain other items as specified in the reconciliations in the
UNUM IS A REGISTERED TRADEMARK AND MARKETING BRAND OF UNUM GROUP AND ITS INSURING SUBSIDIARIES.
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Financial Highlights section below.  We believe after-tax adjusted operating income is a better performance measure and better indicator of the profitability and underlying trends in our business.
Realized investment gains or losses depend on market conditions and do not necessarily relate to decisions regarding the underlying business of our segments.  Our investment focus is on investment income to support our insurance liabilities as opposed to the generation of realized investment gains or losses.  Although we may experience realized investment gains or losses which will affect future earnings levels, a long-term focus is necessary to maintain profitability over the life of the business since our underlying business is long-term in nature, and we need to earn the interest rates assumed in calculating our liabilities.
We may at other times exclude certain other items from our discussion of financial ratios and metrics in order to enhance the understanding and comparability of our operational performance and the underlying fundamentals. We exclude these items as we believe them to be infrequent or unusual in nature, but this exclusion is not an indication that similar items may not recur and does not replace net income or net loss as a measure of our overall profitability.
Information reconciling the Company’s outlook on after-tax adjusted operating income growth per share to the comparable GAAP financial measure is not provided. The only amounts excluded from after-tax adjusted operating income are those described in the preceding paragraphs. The Company is unable to predict with reasonable certainty realized investment gains and losses, which are affected by overall market conditions and also by factors such as an economic or political change in the country of the issuer, a regulatory change pertaining to the issuer’s industry, a significant improvement or deterioration in the cash flows of the issuer, unforeseen accounting irregularities or fraud committed by an issuer, movement in credit spreads, ratings upgrades or downgrades, a change in the issuer’s marketplace or business prospects, or any other event that significantly affects the issuers of the fixed maturity securities which the Company holds in its investment portfolio.
UNUM IS A REGISTERED TRADEMARK AND MARKETING BRAND OF UNUM GROUP AND ITS INSURING SUBSIDIARIES.
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CONFERENCE CALL INFORMATION
Members of Unum Group senior management will host a conference call on Wednesday, February 5, at 8:00 a.m. (Eastern Time) to discuss the results of operations for the fourth quarter. Topics may include forward-looking information, such as the Company’s outlook on future results, trends in operations, and other material information.
The dial-in number for the conference call is (800) 458-4148 for U.S. and Canada (pass code 7566685). For international, the dial-in number is (323) 794-2597 (pass code 7566685). A live webcast of the call will also be available at www.investors.unum.com in a listen-only mode. It is recommended that webcast viewers access the “Investors” section of the Company’s website and opt-in to the webcast approximately 5-10 minutes prior to the start of the call. The Company will maintain a replay of the webcast on its website. A replay of the call will also be available through February 12 by dialing (888) 203-1112 (U.S. and Canada) or (719) 457-0820 (International) - pass code 7566685.
In conjunction with today’s earnings announcement, the Company’s Statistical Supplement for the fourth quarter of 2019 is available on the “Investors” section of the Company’s website.
# # #
ABOUT UNUM GROUP
Unum Group (www.unum.com) provides a broad portfolio of financial protection benefits and services through the workplace, and is a leading provider of disability income protection worldwide. Through its Unum US, Unum UK, Unum Poland, and Colonial Life businesses, the company provides disability, life, accident, critical illness, dental and vision benefits that protect millions of working people and their families. Unum also provides leave and absence management services that streamline the leave experience for employers and employees, and stop-loss coverage to help self-insured employers protect against medical costs. Unum reported revenues of $11.6 billion in 2018 and provided $7.2 billion in benefits.
For more information, connect with us on Facebook (www.facebook.com/unumbenefits), Twitter (www.twitter.com/unumnews) and LinkedIn (www.linkedin.com/company/unum).
SAFE HARBOR STATEMENT
Certain information in this news release constitutes "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are those not based on historical information, but rather relate to our outlook, future operations, strategies, financial results, or other developments and speak only as of the date made. These forward-looking statements, including statements about anticipated growth in after-tax adjusted operating income per share, are subject to numerous assumptions, risks, and uncertainties, many of which are beyond our control. The following factors, in addition to other factors mentioned from time to time, may cause actual results to differ materially from those contemplated by the forward-looking statements: (1) sustained periods of low interest rates; (2) fluctuation in insurance reserve liabilities and claim payments due to changes in claim incidence, recovery rates, mortality and morbidity rates, and policy benefit offsets due to, among other factors, the rate of unemployment and consumer confidence, the emergence of new diseases, epidemics, or pandemics, new trends and developments in medical treatments, the effectiveness of our claims operational processes, and changes in governmental
UNUM IS A REGISTERED TRADEMARK AND MARKETING BRAND OF UNUM GROUP AND ITS INSURING SUBSIDIARIES.
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programs; (3) unfavorable economic or business conditions, both domestic and foreign, that may result in decreases in sales, premiums, or persistency, as well as unfavorable claims activity; (4) changes in or interpretations of laws and regulations, including tax laws and regulations; (5) a cyber attack or other security breach could result in the unauthorized acquisition of confidential data; (6) the failure of our business recovery and incident management processes to resume our business operations in the event of a natural catastrophe, cyber attack, or other event; (7) investment results, including, but not limited to, changes in interest rates, defaults, changes in credit spreads, impairments, and the lack of appropriate investments in the market which can be acquired to match our liabilities; (8) increased competition from other insurers and financial services companies due to industry consolidation, new entrants to our markets, or other factors; (9) changes in our financial strength and credit ratings; (10) our ability to execute on our technology systems upgrades or replacements; (11) damage to our reputation due to, among other factors, regulatory investigations, legal proceedings, external events, and/or inadequate or failed internal controls and procedures; (12) actual experience in the broad array of our products that deviates from our assumptions used in pricing, underwriting, and reserving; (13) changes in accounting standards, practices, or policies; (14) effectiveness of our risk management program; (15) contingencies and the level and results of litigation; (16) availability of reinsurance in the market and the ability of our reinsurers to meet their obligations to us; (17) ineffectiveness of our derivatives hedging programs due to changes in the economic environment, counterparty risk, ratings downgrades, capital market volatility, changes in interest rates, and/or regulation; (18) fluctuation in foreign currency exchange rates; (19) ability to generate sufficient internal liquidity and/or obtain external financing; (20) recoverability and/or realization of the carrying value of our intangible assets, long-lived assets, and deferred tax assets; and (21) terrorism, both within the U.S. and abroad, ongoing military actions, and heightened security measures in response to these types of threats.
For further discussion of risks and uncertainties which could cause actual results to differ from those contained in the forward-looking statements, see Part 1, Item 1A “Risk Factors” of our annual report on Form 10-K for the year ended December 31, 2018 and our subsequently filed quarterly reports on Form 10-Q. The forward-looking statements in this news release are being made as of the date of this news release, and we expressly disclaim any obligation to update or revise any forward-looking statement contained herein, even if made available on our website or otherwise.

UNUM IS A REGISTERED TRADEMARK AND MARKETING BRAND OF UNUM GROUP AND ITS INSURING SUBSIDIARIES.
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Unum Group
FINANCIAL HIGHLIGHTS
(Unaudited)

($ in millions, except share data)
 Three Months Ended December 31Year Ended December 31
 2019201820192018
Revenue
Premium Income$2,352.6  $2,263.3  $9,365.6  $8,986.1  
Net Investment Income616.3  608.6  2,435.3  2,453.7  
Net Realized Investment Gain (Loss)9.2  (41.4) (23.2) (39.5) 
Other Income56.5  50.3  221.2  198.2  
Total Revenue3,034.6  2,880.8  11,998.9  11,598.5  
Benefits and Expenses
Benefits and Change in Reserves for Future Benefits1,881.3  1,829.5  7,496.2  8,020.4  
Commissions270.3  275.8  1,122.7  1,108.4  
Interest and Debt Expense46.6  42.0  177.4  167.3  
Cost Related to Early Retirement of Debt2.1  —  27.3  —  
Deferral of Acquisition Costs(154.0) (166.2) (658.6) (668.0) 
Amortization of Deferred Acquisition Costs141.4  136.9  609.9  565.5  
Other Expenses469.5  453.1  1,841.9  1,777.1  
Total Benefits and Expenses2,657.2  2,571.1  10,616.8  10,970.7  
Income Before Income Tax377.4  309.7  1,382.1  627.8  
Income Tax81.2  60.6  281.8  104.4  
Net Income$296.2  $249.1  $1,100.3  $523.4  
PER SHARE INFORMATION
Net Income Per Common Share  
Basic$1.44  $1.15  $5.25  $2.38  
Assuming Dilution$1.44  $1.15  $5.24  $2.38  
Weighted Average Common Shares - Basic (000s)205,565.5  217,049.3  209,728.9  219,635.6  
Weighted Average Common Shares - Assuming Dilution (000s)205,690.5  217,441.5  209,854.4  220,058.6  
Outstanding Shares - (000s)202,936.8  214,553.0  

UNUM IS A REGISTERED TRADEMARK AND MARKETING BRAND OF UNUM GROUP AND ITS INSURING SUBSIDIARIES.
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Reconciliation of Non-GAAP Financial Measures
Three Months Ended December 31
20192018
 (in millions)per share *(in millions)per share *
Net Income  $296.2  $1.44  $249.1  $1.15  
Excluding:
Net Realized Investment Gain (Loss) (net of tax expense (benefit) of $2.0; $(8.8))7.2  0.04  (32.6) (0.15) 
Cost Related to Early Retirement of Debt (net of tax benefit of $0.4;$-)(1.7) (0.01) —  —  
After-tax Adjusted Operating Income$290.7  $1.41  $281.7  $1.30  

Year Ended December 31
20192018
(in millions)per share *(in millions)per share *
Net Income  $1,100.3  $5.24  $523.4  $2.38  
Excluding:
Net Realized Investment Loss (net of tax benefit of $4.5; $11.0)(18.7) (0.09) (28.5) (0.12) 
Cost Related to Early Retirement of Debt (net of tax benefit of $5.7; $-)(21.6) (0.11) —  —  
Long-term Care Reserve Increase (net of tax benefit of $-; $157.7)—  —  (593.1) (2.70) 
After-tax Adjusted Operating Income$1,140.6  $5.44  $1,145.0  $5.20  
* Assuming Dilution
December 31
20192018
(in millions)per share(in millions)per share
Total Stockholders' Equity (Book Value)$9,965.0  $49.10  $8,621.8  $40.19  
Excluding:
Net Unrealized Gain (Loss) on Securities 615.9  3.03  (312.4) (1.46) 
Net Gain on Hedges  187.8  0.93  250.6  1.17  
Subtotal9,161.3  45.14  8,683.6  40.48  
Excluding:
Foreign Currency Translation Adjustment(281.6) (1.39) (305.2) (1.42) 
Subtotal9,442.9  46.53  8,988.8  41.90  
Excluding:
Unrecognized Pension and Postretirement Benefit Costs(484.8) (2.39) (447.2) (2.08) 
Total Stockholders' Equity, Excluding Accumulated Other Comprehensive Income (Loss)$9,927.7  $48.92  $9,436.0  $43.98  

UNUM IS A REGISTERED TRADEMARK AND MARKETING BRAND OF UNUM GROUP AND ITS INSURING SUBSIDIARIES.
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Section 3: EX-99.2 (EX-99.2)

Document

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Unum Group
Statistical Supplement Fourth Quarter 2019

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

Page  




See "Appendix to Statistical Supplement" on page 16 for a summary of significant items and page 16.1 for a reconciliation of our non-GAAP financial measures.




N.M. = not a meaningful percentage




Unum Group Financial Highlights
Three Months EndedYear Ended
12/31/201912/31/201812/31/201912/31/201812/31/2017
Consolidated U.S. GAAP Results¹
Premium Income$2,352.6  $2,263.3  $9,365.6  $8,986.1  $8,597.1  
Adjusted Operating Revenue$3,025.4  $2,922.2  $12,022.1  $11,638.0  $11,246.5  
Net Realized Investment Gain (Loss) 9.2  (41.4) (23.2) (39.5) 40.3  
Revenue$3,034.6  $2,880.8  $11,998.9  $11,598.5  $11,286.8  
Net Income$296.2  $249.1  $1,100.3  $523.4  $994.2  
Net Income Per Common Share:
Basic $1.44  $1.15  $5.25  $2.38  $4.39  
Assuming Dilution $1.44  $1.15  $5.24  $2.38  $4.37  
Assets$67,013.4  $61,875.6  $64,013.1  
Stockholders' Equity$9,965.0  $8,621.8  $9,574.9  
Adjusted Operating Return on Equity
Unum US18.4 %17.8 %18.0 %18.4 %15.9 %
Unum International8.2 %14.9 %11.7 %13.4 %15.2 %
Colonial Life17.9 %17.7 %17.5 %18.0 %16.2 %
Core Operating Segments17.2 %17.5 %17.2 %17.8 %15.9 %
Consolidated12.8 %13.0 %12.8 %13.2 %11.6 %

Traditional U.S. Life Insurance Companies' Statutory Results2
Net Gain from Operations, After Tax$265.6  $215.2  $1,027.2  $959.8  $812.4  
Net Realized Investment Gain (Loss), After Tax(2.8) (15.5) (45.1) (6.8) (5.0) 
Net Income$262.8  $199.7  $982.1  $953.0  $807.4  
Capital and Surplus$3,644.4  $3,572.7  $3,448.3  
Weighted Average Risk-based Capital Ratio~ 365%   ~ 370%  ~ 390%  

1 Generally Accepted Accounting Principles
2 Our traditional U.S. life insurance companies are Provident Life and Accident Insurance Company, Unum Life Insurance Company of America, The Paul Revere Life Insurance Company, Colonial Life & Accident Insurance Company, Provident Life and Casualty Insurance Company, First Unum Life Insurance Company, Unum Insurance Company, and Starmount Life Insurance Company.
1


Unum Group Capital Metrics

12/31/201912/31/201812/31/2017
(in millions)per share(in millions)per share(in millions)per share
Total Stockholders' Equity (Book Value)$9,965.0  $49.10  $8,621.8  $40.19  $9,574.9  $43.02  
Excluding:
Net Unrealized Gain (Loss) on Securities 615.9  3.03  (312.4) (1.46) 607.8  2.73  
Net Gain on Hedges  187.8  0.93  250.6  1.17  282.3  1.27  
Subtotal9,161.3  45.14  8,683.6  40.48  8,684.8  39.02  
Excluding:
Foreign Currency Translation Adjustment(281.6) (1.39) (305.2) (1.42) (254.5) (1.15) 
Subtotal9,442.9  46.53  8,988.8  41.90  8,939.3  40.17  
Excluding:
Unrecognized Pension and Postretirement Benefit Costs(484.8) (2.39) (447.2) (2.08) (508.1) (2.28) 
Total Stockholders' Equity, Excluding Accumulated Other Comprehensive Income (Loss)$9,927.7  $48.92  $9,436.0  $43.98  $9,447.4  $42.45  
Dividends Paid$231.3  $1.09  $217.0  $0.98  $196.0  $0.86  

Three Months EndedYear Ended
12/31/201912/31/201812/31/201912/31/201812/31/2017
Shares Repurchased (millions)3.3  4.3  12.3  8.7  8.2  
Cost of Shares Repurchased (millions)(1)
$100.1  $150.4  $400.4  $350.7  $400.4  
Price (UNM closing price on last trading day of period)$29.16  $29.38  $54.89  
Leverage Ratio29.1 %26.8 %26.1 %
Holding Company Cash and Marketable Securities$863  $602  $864  

(1) Includes commissions of $0.4 million, $0.7 million, and $0.3 million for the years ended December 31, 2019, 2018, and 2017, respectively, $0.1 million for the three months ended December 31, 2019, and $0.5 million for the three months ended December 31, 2018.


2


Unum Group Ratings


AM BestFitchMoody'sS&P
OutlookStableNegativeStableStable
Issuer Credit RatingsbbbBBBBaa2BBB
Financial Strength Ratings
Provident Life and Accident Insurance CompanyAAA2A
Unum Life Insurance Company of AmericaAAA2A
Colonial Life & Accident Insurance CompanyAAA2A
The Paul Revere Life Insurance CompanyAAA2A
Starmount Life Insurance CompanyA-NRNRNR
Unum Insurance CompanyA-AA2NR
Unum LimitedNRNRNRA-

NR = not rated


3


Unum Group Consolidated Statements of Income

Three Months EndedYear Ended
12/31/201912/31/201812/31/201912/31/201812/31/2017
Revenue
Premium Income$2,352.6  $2,263.3  $9,365.6  $8,986.1  $8,597.1  
Net Investment Income616.3  608.6  2,435.3  2,453.7  2,451.7  
Net Realized Investment Gain (Loss)9.2  (41.4) (23.2) (39.5) 40.3  
Other Income56.5  50.3  221.2  198.2  197.7  
Total Revenue3,034.6  2,880.8  11,998.9  11,598.5  11,286.8  
Benefits and Expenses
Benefits and Change in Reserves for Future Benefits1,881.3  1,829.5  7,496.2  8,020.4  7,055.7  
Commissions270.3  275.8  1,122.7  1,108.4  1,060.8  
Interest and Debt Expense - Non-recourse Debt1.1  1.7  5.3  6.9  6.7  
Interest and Debt Expense - All Other Debt45.5  40.3  172.1  160.4  153.2  
Cost Related to Early Retirement of Debt2.1  —  27.3  —  —  
Deferral of Acquisition Costs(154.0) (166.2) (658.6) (668.0) (628.0) 
Amortization of Deferred Acquisition Costs141.4  136.9  609.9  565.5  527.1  
Other Expenses469.5  453.1  1,841.9  1,777.1  1,707.3  
Total Benefits and Expenses2,657.2  2,571.1  10,616.8  10,970.7  9,882.8  
Income Before Income Tax377.4  309.7  1,382.1  627.8  1,404.0  
Income Tax81.2  60.6  281.8  104.4  409.8  
Net Income$296.2  $249.1  $1,100.3  $523.4  $994.2  
Weighted Average Shares Outstanding
Basic205.6  217.0  209.7  219.6  226.5  
Assuming Dilution205.7  217.4  209.9  220.1  227.3  
Actual Number of Shares Outstanding202.9  214.6  222.5  


4


Unum Group Sales Data for Unum US Segment

Three Months EndedYear Ended
12/31/201912/31/2018% Change12/31/201912/31/201812/31/2017
Sales by Product
Group Disability and Group Life and AD&D
Group Long-term Disability$132.1  $147.3  (10.3)%$241.5  $243.8  $240.8  
Group Short-term Disability81.2  80.9  0.4  159.2  138.7  162.5  
Group Life and AD&D133.0  153.9  (13.6) 258.3  282.4  310.5  
Subtotal346.3  382.1  (9.4) 659.0  664.9  713.8  
Supplemental and Voluntary
Individual Disability19.3  20.3  (4.9) 75.9  77.2  67.9  
Voluntary Benefits47.6  54.1  (12.0) 300.6  303.1  292.5  
Dental and Vision35.2  33.1  6.3  74.6  69.4  54.8  
Subtotal102.1  107.5  (5.0) 451.1  449.7  415.2  
Total Sales$448.4  $489.6  (8.4) $1,110.1  $1,114.6  $1,129.0  
Sales by Market Sector
Group Disability and Group Life and AD&D
Core Market (< 2,000 employees)$183.7  $203.4  (9.7)%$370.8  $395.1  $416.9  
Large Case Market162.6  178.7  (9.0) 288.2  269.8  296.9  
Subtotal346.3  382.1  (9.4) 659.0  664.9  713.8  
Supplemental and Voluntary102.1  107.5  (5.0) 451.1  449.7  415.2  
Total Sales$448.4  $489.6  (8.4) $1,110.1  $1,114.6  $1,129.0  


5


Unum Group Sales Data for Unum International Segment

Three Months EndedYear Ended
(in millions of dollars)12/31/201912/31/2018% Change12/31/201912/31/201812/31/2017
Sales by Product
Unum UK
Group Long-term Disability$14.7  $12.2  20.5 %$43.2  $44.7  $47.1  
Group Life6.4  5.7  12.3  24.3  21.5  24.4  
Supplemental3.3  3.4  (2.9) 19.5  17.4  14.4  
Unum Poland3.7  3.4  8.8  13.0  3.4  —  
Total Sales$28.1  $24.7  13.8  $100.0  $87.0  $85.9  
Sales by Market Sector
Unum UK
Group Long-term Disability and Group Life
Core Market (< 500 employees)$11.0  $10.3  6.8 %$38.2  $36.6  $30.4  
Large Case Market10.1  7.6  32.9  29.3  29.6  41.1  
Subtotal21.1  17.9  17.9  67.5  66.2  71.5  
Supplemental3.3  3.4  (2.9) 19.5  17.4  14.4  
Unum Poland3.7  3.4  8.8  13.0  3.4  —  
Total Sales$28.1  $24.7  13.8  $100.0  $87.0  $85.9  
(in millions of pounds)
Unum UK Sales by Product
Group Long-term Disability£11.4  £9.5  20.0 %£33.7  £33.5  £36.6  
Group Life5.0  4.5  11.1  19.0  16.2  18.9  
Supplemental2.5  2.6  (3.8) 15.1  12.8  11.3  
Total Sales£18.9  £16.6  13.9  £67.8  £62.5  £66.8  
Unum UK Sales by Market Sector
Group Long-term Disability and Group Life  
Core Market (< 500 employees)£8.6  £8.1  6.2 %£29.9  £27.6  £23.6  
Large Case Market7.8  5.9  32.2  22.8  22.1  31.9  
Subtotal16.4  14.0  17.1  52.7  49.7  55.5  
Supplemental2.5  2.6  (3.8) 15.1  12.8  11.3  
Total Sales£18.9  £16.6  13.9  £67.8  £62.5  £66.8  

Certain prior year and prior period amounts in the table above were reclassified to conform to current year presentation.
5. 1


Unum Group Sales Data for Colonial Life Segment

Three Months EndedYear Ended
12/31/201912/31/2018% Change12/31/201912/31/201812/31/2017
Sales by Product
Accident, Sickness, and Disability  $122.4  $127.7  (4.2)%$354.4  $355.0  $323.2  
Life  53.3  38.8  37.4  122.7  111.9  107.7  
Cancer and Critical Illness  34.0  37.9  (10.3) 88.9  94.4  88.8  
Total Sales  $209.7  $204.4  2.6  $566.0  $561.3  $519.7  
Sales by Market Sector
Commercial
Core Market (< 1,000 employees)$119.1  $119.0  0.1 %$345.7  $349.0  $313.5  
Large Case Market30.5  42.9  (28.9) 81.4  95.5  90.9  
Subtotal149.6  161.9  (7.6) 427.1  444.5  404.4  
Public Sector60.1  42.5  41.4  138.9  116.8  115.3  
Total Sales$209.7  $204.4  2.6  $566.0  $561.3  $519.7  



5. 2


Unum Group Consolidated Balance Sheets
December 31
20192018
Assets
Investments
Fixed Maturity Securities$47,443.7  $43,011.7  
Mortgage Loans2,397.0  2,295.0  
Policy Loans3,779.5  3,729.9  
Other Long-term Investments844.2  702.9  
Short-term Investments1,294.5  968.1  
Total Investments55,758.9  50,707.6  
Other Assets
Cash and Bank Deposits84.1  94.0  
Accounts and Premiums Receivable1,602.9  1,615.5  
Reinsurance Recoverable4,780.7  4,662.4  
Accrued Investment Income693.0  690.6  
Deferred Acquisition Costs2,324.0  2,309.4  
Goodwill351.7  350.3  
Property and Equipment534.1  546.9  
Deferred Income Tax—  109.9  
Other Assets884.0  789.0  
Total Assets$67,013.4  $61,875.6  

6


Unum Group Consolidated Balance Sheets - Continued
December 31
20192018
Liabilities and Stockholders' Equity
Liabilities
Policy and Contract Benefits$1,745.5  $1,695.7  
Reserves for Future Policy and Contract Benefits47,780.1  44,841.9  
Unearned Premiums363.9  363.3  
Other Policyholders’ Funds1,599.7  1,594.8  
Income Tax Payable256.7  24.0  
Deferred Income Tax95.4  —  
Short-term Debt399.7  —  
Long-term Debt - Non-recourse78.1  137.1  
Long-term Debt - All Other2,848.8  2,834.2  
Other Liabilities1,880.5  1,762.8  
Total Liabilities57,048.4  53,253.8  
Stockholders’ Equity
Common Stock30.6  30.5  
Additional Paid-in Capital2,348.1  2,321.7  
Accumulated Other Comprehensive Income (Loss)37.3  (814.2) 
Retained Earnings10,728.7  9,863.1  
Treasury Stock(3,179.7) (2,779.3) 
Total Stockholders’ Equity9,965.0  8,621.8  
Total Liabilities and Stockholders’ Equity$67,013.4  $61,875.6  

6. 1


Unum Group Deferred Acquisition Costs by Segment

Unum USUnum InternationalColonial Life