Equibles

8-K

Unum Group (UNM)

8-K 2022-11-01 For: 2022-11-01
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Added on April 12, 2026

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): November 1, 2022

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 class Trading Symbol(s) Name of each exchange on which registered
Common stock, $0.10 par value UNM New York Stock Exchange
6.250% Junior Subordinated Notes due 2058 UNMA New York Stock Exchange

Indicate by check mark whether the registrant is an emerging growth company 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 November 1, 2022, Unum Group (the "Company") issued a news release reporting its results for the third quarter of 2022, a copy of which is furnished herewith as Exhibit 99.1 and incorporated herein by reference.

Also on November 1, 2022, the Company posted on its website at www.unum.com the Statistical Supplement relating to its financial results for the third quarter of 2022. 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 the Company'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.

Exhibit No. Description
99.1 News release of Unum Group dated November 1, 2022, concerning earnings for the third quarter of 2022.
99.2 Statistical Supplement of Unum Group for the third quarter of 2022.
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: November 1, 2022 By: /s/ J. Paul Jullienne
Name: J. Paul Jullienne
Title: Vice President, Managing Counsel, and
Corporate Secretary

Document

Exhibit 99.1
1 Fountain Square<br>Chattanooga, TN 37402<br>www.unum.com
FOR IMMEDIATE RELEASE
Contacts
MEDIA Natalie Godwin <br>ngodwin@unum.com
INVESTORS Matt Royal 423-294-1037<br>mroyal@unum.com

Unum Group Reports Third Quarter 2022 Results

•Net income of $410.7 million ($2.04 per diluted common share) for the third quarter of 2022; after-tax adjusted operating income was $303.7 million ($1.51 per diluted common share).

•Results reflect continued strong operating performance, the shift towards endemic COVID impacts, and core business premium trends nearing our long-term growth expectations; core operations sales and premium growth on a constant currency basis of 14.1 percent and 3.9 percent, respectively.

•Strong balance sheet with holding company liquidity of $1.1 billion and weighted average risk-based capital ratio of approximately 415 percent, providing significant financial flexibility.

•Expanded hedging program to help mitigate interest rate risk in the long-term care block; notional amount entered into increased to $679.0 million through September 30, 2022.

•Completed our annual GAAP reserve adequacy study; sustained group long-term disability and group life wavier claim recovery trends drive GAAP reserve releases.

•Book value per common share of $43.49 declined 20.0 percent over the year-ago quarter; book value per common share excluding accumulated other comprehensive income (loss) (AOCI) grew 10.0 percent over the year-ago quarter to $59.23.

CHATTANOOGA, Tenn. (November 1, 2022) - Unum Group (NYSE: UNM) today reported net income of $410.7 million ($2.04 per diluted common share) for the third quarter of 2022, compared to net income of $328.6 million ($1.60 per diluted common share) for the third quarter of 2021.

Included in net income for the third quarter of 2022 are the after-tax reserve decreases related to reserve assumption updates of $122.5 million ($0.61 per diluted common share), the after-tax amortization of the cost of reinsurance of $12.1 million ($0.06 per diluted common share), and a net after-tax investment loss on the Company’s investment portfolio of $3.4 million ($0.02 per diluted common share). Included in net income for the third quarter of 2021 are a net after-tax reserve decrease related to reserve assumption updates of $143.3 million ($0.70 per diluted common share), an after-tax impairment loss on internal-use software of $9.6 million ($0.05 per diluted common share), the after-tax amortization of the cost of reinsurance of $15.5 million ($0.08 per diluted common share), as well as a net after-tax investment loss on the Company's investment portfolio of $0.1 million ($— per diluted common share). Excluding the items above, after-tax adjusted operating income was $303.7 million ($1.51 per diluted common share) in the third quarter of 2022, compared to $210.5 million ($1.03 per diluted common share) in the third quarter of 2021.

“Our business is performing well as we look toward the last quarter of the year. The current environment remains advantageous for us and is supported by strong capital and an engaged team who continues to deliver on our purpose,” said Richard P. McKenney, president and chief executive officer. “Our excellent third quarter results reflect the earnings power of our business lines and our continued favorable benefits experience, positioning us well for growth heading into next year.”

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

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 investment gains and losses, amortization of cost of reinsurance, and certain other items. Investment gains or losses primarily include realized investment gains or losses, expected investment credit losses, and gains or losses on derivatives. These performance measures are in accordance with U.S. generally accepted accounting principles (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 $275.0 million in the third quarter of 2022, an increase of 210.7 percent from $88.5 million in the third quarter of 2021, which exclude the reserve decreases related to reserve assumption updates during each period. Premium income increased 3.9 percent to $1,559.6 million in the third quarter of 2022, compared to $1,500.8 million in the third quarter of 2021. Net investment income decreased 3.2 percent to $170.6 million in the third quarter of 2022, compared to $176.2 million in the third quarter of 2021.

Within the Unum US operating segment, the group disability line of business reported a 228.6 percent increase in adjusted operating income to $129.8 million in the third quarter of 2022, compared to $39.5 million in the third quarter of 2021, which exclude the reserve decreases related to the reserve assumption updates of $121.0 million and $215.0 million during the third quarters of 2022 and 2021, respectively. Premium income for the group disability line of business increased 7.4 percent to $713.1 million in the third quarter of 2022, compared to $663.8 million in the third quarter of 2021 due primarily to in-force block growth and favorable persistency. Net investment income decreased 9.1 percent to $84.8 million in the third quarter of 2022, compared to $93.3 million in the third quarter of 2021, driven by lower miscellaneous investment income and a decrease in the yield on invested assets. Excluding the previously discussed reserve assumption updates, the benefit ratio for the third quarter of 2022 was 62.7 percent, compared to 78.9 percent in the third quarter of 2021, due primarily to lower claims incidence in both the group short-term and long-term disability product lines as well as favorable claim recoveries in the group long-term disability product line. Group long-term disability sales were $35.4 million in the third quarter of 2022, an increase of 35.1 percent from $26.2 million in the third quarter of 2021. Group short-term disability sales were $18.3 million in the third quarter of 2022, a decrease of 15.3 percent from $21.6 million in the third quarter of 2021. Persistency in the group long-term disability product line was 90.7 percent for the first nine months of 2022, compared to 89.8 percent for the first nine months of 2021. Persistency in the group short-term disability product line was 89.2 percent for the first nine months of 2022, compared to 87.1 percent for the first nine months of 2021.

The group life and accidental death and dismemberment line of business reported adjusted operating income of $30.9 million in the third quarter of 2022, which excludes the reserve decrease related to the reserve assumption update of $34.0 million, compared to an adjusted operating loss of $67.1 million in the third quarter of 2021. Premium income for this line of business increased 4.0 percent to $461.5 million in the third quarter of 2022, compared to $443.8 million in the third quarter of 2021 driven by in-force block growth, partially offset by lower persistency. Net investment income increased 4.1 percent to $25.3 million in the third quarter of 2022, compared to $24.3 million in the third quarter of 2021, due primarily to an increase in the yield on invested assets and an increase in the level of invested assets, partially offset by lower miscellaneous investment income. The benefit ratio in the third quarter of 2022 was 78.0 percent, which excludes the previously discussed reserve assumption update, compared to 100.6 percent in the third quarter of 2021, largely due to lower mortality in the group life product line, resulting primarily from lessening impacts of COVID-19 on our insured population. Sales of group life and accidental death and dismemberment products increased 1.1 percent in the third quarter of 2022 to $26.9 million, compared to $26.6 million in the third quarter of 2021. Persistency in the group life product line was 89.2 percent for the first nine months of 2022, compared to 89.9 percent for the first nine months of 2021. Persistency in the accidental death and dismemberment product line was 88.1 percent for the first nine months of 2022, compared to 89.3 percent for the first nine months of 2021.

The supplemental and voluntary line of business reported a decrease of 1.6 percent in adjusted operating income to $114.3 million in the third quarter of 2022, compared to $116.1 million in the third quarter of 2021. Premium income for the supplemental and voluntary line of business decreased 2.1 percent to $385.0 million in the third quarter of

UNUM IS A REGISTERED TRADEMARK AND MARKETING BRAND OF UNUM GROUP AND ITS INSURING SUBSIDIARIES. 2

2022, compared to $393.2 million in the third quarter of 2021, due primarily to lower persistency in both the voluntary benefits and dental and vision product lines, partially offset by higher sales in both the individual disability and voluntary benefits product lines. Net investment income increased 3.2 percent to $60.5 million in the third quarter of 2022, compared to $58.6 million in the third quarter of 2021, due to an increase in the yield on invested assets. The benefit ratio for the voluntary benefits product line was 42.6 percent in the third quarter of 2022, compared to 46.6 percent for the third quarter of 2021, due to favorable claims experience in all products. Favorability for our voluntary benefits life products is primarily due to lessening impacts of COVID-19 on our insured population. The benefit ratio for the individual disability product line was 40.0 percent for the third quarter of 2022, compared to 40.1 percent for the third quarter of 2021, due primarily to lower claims activity. The benefit ratio for the dental and vision product line was 74.5 percent for the third quarter of 2022, compared to 75.0 percent for the third quarter of 2021, due primarily to lower claims incidence. Relative to the third quarter of 2021, sales in the voluntary benefits product line increased 19.1 percent in the third quarter of 2022 to $40.5 million. Sales in the individual disability product line increased 23.9 percent in the third quarter of 2022 to $25.9 million. Sales in the dental and vision product line totaled $10.5 million for the third quarter of 2022, a decrease of 16.7 percent compared to the third quarter of 2021. Persistency in the voluntary benefits product line was 75.1 percent for the first nine months of 2022, compared to 75.4 percent for the first nine months of 2021. Persistency in the individual disability product line was 89.2 percent for the first nine months of 2022, compared to 88.4 percent for the first nine months of 2021. Persistency in the dental and vision product line was 81.4 percent for the first nine months of 2022, compared to 86.3 percent for the first nine months of 2021.

Unum International

The Unum International segment reported adjusted operating income of $29.9 million in the third quarter of 2022, an increase of 9.1 percent from $27.4 million in the third quarter of 2021. Premium income decreased 4.6 percent to $173.3 million in the third quarter of 2022, compared to $181.6 million in the third quarter of 2021. Net investment income increased 11.8 percent to $37.0 million in the third quarter of 2022, compared to $33.1 million in the third quarter of 2021. Sales increased 66.4 percent to $40.1 million in the third quarter of 2022, compared to $24.1 million in the third quarter of 2021. For the third quarter of 2022, Unum International results were unfavorably impacted by fluctuations in the British pound sterling to U.S. dollar exchange rate relative to the third quarter of 2021.

The Unum UK line of business reported adjusted operating income, in local currency, of £23.6 million in the third quarter of 2022, an increase of 28.3 percent from £18.4 million in the third quarter of 2021. Premium income was £129.4 million in the third quarter of 2022, an increase of 12.1 percent from £115.4 million in the third quarter of 2021, due to in-force block growth and sales in the group life product line. Net investment income was £29.9 million in the third quarter of 2022, an increase of 32.9 percent from £22.5 million in the third quarter of 2021, due primarily to higher investment income from inflation index-linked bonds. The benefit ratio in the third quarter of 2022 was 78.6 percent, compared to 79.2 percent in the third quarter of 2021, due primarily to inflation-linked experience for our group life and group long-term disability products, partially offset by higher claim incidence in our supplemental product line. Due to rising inflation, many of our claims reached the maximum annual inflation index-linked adjustment in the first half of 2022, resulting in a decrease in inflation-related benefit adjustments in the third quarter of 2022 compared to the same period of 2021. Sales increased 106.0 percent to £30.9 million in the third quarter of 2022, compared to £15.0 million in the third quarter of 2021. Persistency in the group long-term disability product line was 84.9 percent for the first nine months of 2022, compared to 88.9 percent for the first nine months of 2021. Persistency in the group life product line was 88.2 percent for the first nine months of 2022, compared to 86.0 percent for the first nine months of 2021. Persistency in the supplemental product line was 92.3 percent for the first nine months of 2022, compared to 89.9 percent for the first nine months of 2021.

Colonial Life Segment

Colonial Life reported a 12.9 percent increase in adjusted operating income to $90.4 million in the third quarter of 2022, compared to $80.1 million in the third quarter of 2021. Premium income increased 0.6 percent to $423.3 million in the third quarter of 2022, compared to $420.8 million in the third quarter of 2021, due to higher sales in prior periods, partially offset by lower overall persistency. Net investment income decreased 25.5 percent to $38.6 million in the third quarter of 2022, compared to the $51.8 million in the third quarter of 2021, due to lower miscellaneous

UNUM IS A REGISTERED TRADEMARK AND MARKETING BRAND OF UNUM GROUP AND ITS INSURING SUBSIDIARIES. 3

investment income and a decline in the yield on invested assets, partially offset by an increase in the level of invested assets. The benefit ratio was 46.8 percent in the third quarter of 2022, compared to 55.9 percent in the third quarter of 2021 driven by favorable experience across all products lines.

Sales increased 3.2 percent to $115.9 million in the third quarter of 2022, compared to $112.3 million in the third quarter of 2021. Persistency in Colonial Life was 78.3 percent for the first nine months of 2022, compared to 78.9 percent for the first nine months of 2021.

Closed Block Segment

The Closed Block segment reported adjusted operating income of $34.1 million in the third quarter of 2022, compared to $109.8 million in the third quarter of 2021. Excluded from adjusted operating income for the third quarter of 2022 and 2021 is the amortization of the cost of reinsurance related to the Closed Block individual disability reinsurance transaction of $15.2 million and $19.7 million, respectively. Also excluded from adjusted operating income for the third quarter of 2021 are the reserve increases related to reserve assumption updates of $33.6 million, primarily related to the closed group pension block. Premium income for this segment decreased 6.0 percent to $235.5 million in the third quarter of 2022, compared to $250.5 million in the third quarter of 2021, due to policy terminations and maturities, partially offset by rate increases. Net investment income decreased 11.7 percent to $251.4 million in the third quarter of 2022, compared to $284.6 million in the third quarter of 2021, due to lower miscellaneous investment income, partially related to smaller increases in net asset values on our private equity partnerships, and a decline in the yield on invested assets, partially offset by an increase in the level of invested assets.

The interest adjusted loss ratio for the long-term care line of business was 85.7 percent in the third quarter of 2022, compared to an interest adjusted loss ratio of 74.8 percent in the third quarter of 2021, excluding the reserve increase related to the assumption update in the third quarter of 2021, driven by higher submitted claims. The interest adjusted loss ratio for long-term care for the rolling twelve months ended September 30, 2022 was 81.0 percent which is below our long-term expected range. The interest adjusted loss ratio for the individual disability line of business was 77.5 percent in the third quarter of 2022, compared to 58.2 percent in the third quarter of 2021, excluding the reserve increase related to the assumption update in third quarter of 2021, due primarily to volatility as a result of the relatively small amount of business retained.

Corporate Segment

The Corporate segment reported an adjusted operating loss of $49.5 million in the third quarter of 2022, compared to an adjusted operating loss of $45.4 million in the third quarter of 2021, which excludes the before-tax impairment loss on internal-use software of $12.1 million.

UNUM IS A REGISTERED TRADEMARK AND MARKETING BRAND OF UNUM GROUP AND ITS INSURING SUBSIDIARIES. 4

OTHER INFORMATION

Shares Outstanding

The Company’s weighted average number of shares outstanding, assuming dilution, was 201.7 million for the third quarter of 2022, compared to 205.1 million for the third quarter of 2021. Shares outstanding totaled 199.1 million at September 30, 2022.

During the third quarter of 2022, the Company repurchased approximately 1.2 million shares in open market transactions at a cost of approximately $42.6 million. For the first nine months of 2022, the Company has repurchased approximately 4.2 million shares at a cost of $137.5 million.

Capital Management

At September 30, 2022, the weighted average risk-based capital ratio for the Company’s traditional U.S. insurance companies was approximately 415 percent, and the holding companies had available holding company liquidity of $1,079.0 million.

Book Value

Book value per common share as of September 30, 2022 was $43.49, compared to $54.39 at September 30, 2021. Book value per common share excluding AOCI as of September 30, 2022 was $59.23, compared to $53.84 at September 30, 2021.

Outlook

The Company expects positive operating trends in our core business during 2022, with solid premium growth and improving claim experience as impacts from COVID-19 lessen. The Company continues to anticipate an increase in after-tax adjusted operating income per share of 40 percent to 45 percent relative to full-year 2021.

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 investment gains or losses and the amortization of the cost of reinsurance as well as certain other items as specified in the reconciliations in the Financial Highlights section below.  Investment gains or losses primarily include realized investment gains or losses, expected investment credit losses, and gains or losses on derivatives. We believe after-tax adjusted operating income is a better performance measure and better indicator of the profitability and underlying trends in our business.

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 investment gains or losses.  Although we may experience 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 have exited a substantial portion of our Closed Block individual disability product line through the two phases of the reinsurance transaction that were executed in December 2020 and March 2021. As a result, we exclude the amortization of the cost of reinsurance that was recognized upon the exit of the business related to the ceded reserves for the cohort of

UNUM IS A REGISTERED TRADEMARK AND MARKETING BRAND OF UNUM GROUP AND ITS INSURING SUBSIDIARIES. 5

policies on claim status. We believe that the exclusion of the amortization of the cost of reinsurance provides a better view of our results from our ongoing businesses.

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, 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.

CONFERENCE CALL INFORMATION

Members of Unum Group senior management will host a conference call on Wednesday, November 2, at 8:00 a.m. (Eastern Time) to discuss the results of operations for the third 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 1-833-927-1758 for callers in the U.S. (access code 420516). For callers in Canada the dial-in is 1-833-950-0062 (access code 420516). For all other callers, the dial-in number is 1-929-526-1599 (access code 420516). 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 10 minutes prior to the start of the call. A replay of the webcast will be available on the Company's website, and will be available through Wednesday, November 9 by dialing 1-866-813-9403 (U.S.), 1-226-828-7578 (Canada), 0204-525-0658 (U.K. local), or +44-204-525-0658 (All Other Locations) - access code 966452.

In conjunction with today’s earnings announcement, the Company’s Statistical Supplement for the third quarter of 2022 is available on the Investors section of the Company’s website.

#

ABOUT UNUM GROUP

Unum Group (www.unum.com) an international provider of workplace benefits and services, has been helping workers and their families for more than 170 years. Through its Unum and Colonial Life brands, the company offers disability, life, accident, critical illness, dental, vision and stop-loss insurance; leave and absence management support and behavioral health services. In 2021, Unum reported revenues of $12.0 billion and paid $8.2 billion in benefits. The Fortune 250 company is one of the 2022 World's Most Ethical Companies, recognized by Ethisphere®.

For more information, connect with us on Facebook (www.facebook.com/unumbenefits), Twitter (www.twitter.com/unumnews) and LinkedIn (www.linkedin.com/company/unum).

UNUM IS A REGISTERED TRADEMARK AND MARKETING BRAND OF UNUM GROUP AND ITS INSURING SUBSIDIARIES. 6

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) the impact of COVID-19 on our business, financial position, results of operations, liquidity and capital resources, and overall business operations; (2) sustained periods of low interest rates; (3) 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 programs; (4) 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; (5) changes in, or interpretations or enforcement of laws and regulations; (6) our ability to hire and retain qualified employees; (7) a cyber attack or other security breach could result in the unauthorized acquisition of confidential data; (8) 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; (9) 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; (10) increased competition from other insurers and financial services companies due to industry consolidation, new entrants to our markets, or other factors; (11) changes in our financial strength and credit ratings; (12) our ability to develop digital capabilities or execute on our technology systems upgrades or replacements; (13) actual experience in the broad array of our products that deviates from our assumptions used in pricing, underwriting, and reserving; (14) availability of reinsurance in the market and the ability of our reinsurers to meet their obligations to us; (15) ability to generate sufficient internal liquidity and/or obtain external financing; (16) damage to our reputation due to, among other factors, regulatory investigations, legal proceedings, external events, and/or inadequate or failed internal controls and procedures; (17) recoverability and/or realization of the carrying value of our intangible assets, long-lived assets, and deferred tax assets; (18) effectiveness of our risk management program; (19) contingencies and the level and results of litigation; (20) 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; (21) fluctuation in foreign currency exchange rates; and (22) our ability to meet environment, social, and governance standards and expectations of investors, regulators, customers, and other stakeholders.

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, 2021. 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. 7

Unum Group

FINANCIAL HIGHLIGHTS

(Unaudited)

( in millions, except share data)
Nine Months Ended September 30
2021 2022 2021
Revenue
Premium Income 2,391.7 $ 2,353.7 $ 7,212.3 $ 7,106.4
Net Investment Income 550.2 1,597.8 1,662.4
Net Investment Gain (Loss) (0.1) (22.3) 85.4
Other Income 65.9 197.5 180.5
Total Revenue 2,969.7 8,985.3 9,034.7
Benefits and Expenses
Benefits and Change in Reserves for Future Benefits 1,753.9 5,181.3 5,659.2
Commissions 258.3 819.1 777.9
Interest and Debt Expense 44.7 141.3 134.4
Cost Related to Early Retirement of Debt — 4.2 67.3
Deferral of Acquisition Costs (128.6) (419.1) (388.9)
Amortization of Deferred Acquisition Costs 138.4 449.5 440.8
Other Expenses 493.1 1,538.5 1,472.7
Total Benefits and Expenses 2,559.8 7,714.8 8,163.4
Income Before Income Tax 409.9 1,270.5 871.3
Income Tax Expense 81.3 235.9 206.8
Net Income 410.7 $ 328.6 $ 1,034.6 $ 664.5
PER SHARE INFORMATION
Net Income Per Common Share
Basic 2.05 $ 1.61 $ 5.14 $ 3.25
Assuming Dilution 2.04 $ 1.60 $ 5.11 $ 3.24
Weighted Average Common Shares - Basic (000s) 204,645.8 201,262.3 204,429.6
Weighted Average Common Shares - Assuming Dilution (000s) 205,142.3 202,519.0 205,052.9
Outstanding Shares - (000s) 199,125.3 204,405.8

All values are in US Dollars.

UNUM IS A REGISTERED TRADEMARK AND MARKETING BRAND OF UNUM GROUP AND ITS INSURING SUBSIDIARIES. 8

Reconciliation of Non-GAAP Financial Measures

Three Months Ended September 30
2022 2021
(in millions) per share * (in millions) per share *
Net Income $ 410.7 $ 2.04 $ 328.6 $ 1.60
Excluding:
Net Investment Loss (net of tax benefit of $1.0; $—) (3.4) (0.02) (0.1) —
Amortization of the Cost of Reinsurance (net of tax benefit of $3.1; $4.2) (12.1) (0.06) (15.5) (0.08)
Net Reserve Decrease Related to Reserve Assumption Updates (net of tax expense of $32.5; $38.1) 122.5 0.61 143.3 0.70
Impairment Loss on Internal-Use Software (net of tax benefit of $—; $2.5) — — (9.6) (0.05)
After-tax Adjusted Operating Income $ 303.7 $ 1.51 $ 210.5 $ 1.03
* Assuming Dilution September 30
--- --- --- --- --- --- --- --- ---
2022 2021
(in millions) per share (in millions) per share
Total Stockholders' Equity (Book Value) $ 8,659.5 $ 43.49 $ 11,118.2 $ 54.39
Excluding:
Net Unrealized Gain (Loss) on Securities (2,329.3) (11.70) 836.0 4.09
Net Gain on Hedges 13.5 0.07 69.5 0.34
Subtotal 10,975.3 55.12 10,212.7 49.96
Excluding:
Foreign Currency Translation Adjustment (438.0) (2.20) (275.2) (1.35)
Subtotal 11,413.3 57.32 10,487.9 51.31
Excluding:
Unrecognized Pension and Postretirement Benefit Costs (380.9) (1.91) (516.4) (2.53)
Total Stockholders' Equity, Excluding Accumulated Other Comprehensive Income (Loss) $ 11,794.2 $ 59.23 $ 11,004.3 $ 53.84
UNUM IS A REGISTERED TRADEMARK AND MARKETING BRAND OF UNUM GROUP AND ITS INSURING SUBSIDIARIES. 9
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Document

cover3q22.jpg

Unum Group

Statistical Supplement Third Quarter 2022

TABLE OF CONTENTS

(in millions of dollars, except share data and where noted)

Interim Results are Unaudited

Page
Financial Highlights 1
Capital Metrics 2
Ratings 3
Consolidated Statements of Income 4
Sales Data by Segment 5
Consolidated Balance Sheets 6
Financial Results by Segment 7
Quarterly Historical Financial Results by Segment 8
Financial Results and Selected Statistics by Segment
Unum US 9
Unum International 10
Colonial Life 11
Closed Block 12
Corporate 13
Reserves 14
Investments 15
Appendix to Statistical Supplement 16
See "Appendix to Statistical Supplement" on page 16 for a summary of significant items and page 16.2 for a reconciliation of our non-GAAP financial measures.
N.M. = not a meaningful percentage

Unum Group Financial Highlights

Three Months Ended Nine Months Ended Year Ended
9/30/2022 9/30/2021 9/30/2022 9/30/2021 12/31/2021 12/31/2020
Consolidated U.S. GAAP Results¹
Premium Income $ 2,391.7 $ 2,353.7 $ 7,212.3 $ 7,106.4 $ 9,481.0 $ 9,378.1
Adjusted Operating Revenue $ 2,966.3 $ 2,969.8 $ 9,007.6 $ 8,949.3 $ 11,937.1 $ 11,963.0
Net Investment Gain (Loss) (4.4) (0.1) (22.3) 85.4 76.7 1,199.1
Revenue $ 2,961.9 $ 2,969.7 $ 8,985.3 $ 9,034.7 $ 12,013.8 $ 13,162.1
Net Income $ 410.7 $ 328.6 $ 1,034.6 $ 664.5 $ 824.2 $ 793.0
Net Income Per Common Share:
Basic $ 2.05 $ 1.61 $ 5.14 $ 3.25 $ 4.04 $ 3.89
Assuming Dilution $ 2.04 $ 1.60 $ 5.11 $ 3.24 $ 4.02 $ 3.89
Assets $ 60,866.7 $ 70,597.9 $ 70,115.6 $ 70,625.8
Stockholders' Equity $ 8,659.5 $ 11,118.2 $ 11,416.4 $ 10,871.0
Adjusted Operating Return on Equity
Unum US 18.6 % 6.2 % 16.7 % 8.9 % 8.2 % 14.6 %
Unum International 24.7 % 11.8 % 21.1 % 10.4 % 10.4 % 6.5 %
Colonial Life 18.1 % 16.1 % 19.3 % 16.4 % 16.4 % 16.7 %
Core Operating Segments 19.1 % 9.1 % 17.7 % 10.8 % 10.3 % 14.1 %
Consolidated 11.2 % 8.3 % 12.1 % 9.5 % 8.9 % 10.7 %
Traditional U.S. Life Insurance Companies' Statutory Results2
--- --- --- --- --- --- --- --- --- --- --- --- ---
Net Gain from Operations, After Tax $ 243.2 $ 117.1 $ 725.0 $ 431.3 $ 681.1 $ 726.2
Net Realized Capital Gain (Loss), After Tax (0.1) 68.9 (2.3) 87.3 98.4 (79.4)
Net Income $ 243.1 $ 186.0 $ 722.7 $ 518.6 $ 779.5 $ 646.8
Capital and Surplus $ 4,136.9 $ 3,830.9 $ 3,950.3 $ 3,875.0
Weighted Average Risk-based Capital Ratio ~ 415% ~ 380% ~ 395% ~ 365%

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.

Unum Group Capital Metrics

9/30/2022 9/30/2021 12/31/2021 12/31/2020
(in millions) per share (in millions) per share (in millions) per share (in millions) per share
Total Stockholders' Equity (Book Value) $ 8,659.5 $ 43.49 $ 11,118.2 $ 54.39 $ 11,416.4 $ 56.37 $ 10,871.0 $ 53.37
Excluding:
Net Unrealized Gain (Loss) on Securities (2,329.3) (11.70) 836.0 4.09 962.2 4.75 1,067.7 5.24
Net Gain on Hedges 13.5 0.07 69.5 0.34 61.8 0.30 97.8 0.48
Subtotal 10,975.3 55.12 10,212.7 49.96 10,392.4 51.32 9,705.5 47.65
Excluding:
Foreign Currency Translation Adjustment (438.0) (2.20) (275.2) (1.35) (273.9) (1.35) (261.3) (1.28)
Subtotal 11,413.3 57.32 10,487.9 51.31 10,666.3 52.67 9,966.8 48.93
Excluding:
Unrecognized Pension and Postretirement Benefit Costs (380.9) (1.91) (516.4) (2.53) (396.0) (1.96) (530.0) (2.61)
Total Stockholders' Equity, Excluding Accumulated Other Comprehensive Income (Loss) $ 11,794.2 $ 59.23 $ 11,004.3 $ 53.84 $ 11,062.3 $ 54.63 $ 10,496.8 $ 51.54
Dividends Paid $ 189.5 $ 0.93 $ 179.3 $ 0.87 $ 240.6 $ 1.17 $ 233.2 $ 1.14 Three Months Ended Nine Months Ended Year Ended
--- --- --- --- --- --- --- --- --- --- --- --- --- --- --- --- ---
9/30/2022 9/30/2021 9/30/2022 9/30/2021 12/31/2021 12/31/2020
Shares Repurchased (millions) 1.2 — 4.2 — 1.9 —
Cost of Shares Repurchased (millions)1 $ 42.6 $ — $ 137.5 $ — $ 50.0 $ —
Price (UNM closing price on last trading day of period) $ 38.80 $ 25.06 $ 24.57 $ 22.94
Leverage Ratio 24.2 % 25.7 % 25.3 % 26.2 %
Holding Company Liquidity $ 1,079 $ 1,638 $ 1,515 $ 1,512

1Includes a de minimis amount and $0.1 million of commissions for the three and nine months ended September 30, 2022.

Unum Group Ratings

AM Best Fitch Moody's S&P
Issuer Credit Ratings bbb BBB- Baa3 BBB
Financial Strength Ratings
Provident Life and Accident Insurance Company A A- A3 A
Provident Life and Casualty Insurance Company A A- NR NR
Unum Life Insurance Company of America A A- A3 A
First Unum Life Insurance Company A A- A3 A
Colonial Life & Accident Insurance Company A A- A3 A
The Paul Revere Life Insurance Company A A- A3 A
Starmount Life Insurance Company A NR NR NR
Unum Insurance Company A A- A3 NR
Unum Limited NR NR NR A-
Outlooks
Issuer Credit Rating Positive Stable Stable Stable
Financial Strength Rating Stable Stable Stable Stable

NR = not rated

Unum Group Consolidated Statements of Income

Three Months Ended Nine Months Ended Year Ended
9/30/2022 9/30/2021 9/30/2022 9/30/2021 12/31/2021 12/31/2020
Revenue
Premium Income $ 2,391.7 $ 2,353.7 $ 7,212.3 $ 7,106.4 $ 9,481.0 $ 9,378.1
Net Investment Income 511.6 550.2 1,597.8 1,662.4 2,213.2 2,360.7
Net Investment Gain (Loss) (4.4) (0.1) (22.3) 85.4 76.7 1,199.1
Other Income 63.0 65.9 197.5 180.5 242.9 224.2
Total Revenue 2,961.9 2,969.7 8,985.3 9,034.7 12,013.8 13,162.1
Benefits and Expenses
Benefits and Change in Reserves for Future Benefits 1,579.3 1,753.9 5,181.3 5,659.2 7,598.6 8,972.9
Commissions 271.5 258.3 819.1 777.9 1,038.1 1,057.3
Interest and Debt Expense - Non-recourse Debt — — — — — 3.1
Interest and Debt Expense - All Other Debt 47.0 44.7 141.3 134.4 185.0 185.1
Cost Related to Early Retirement of Debt 4.2 — 4.2 67.3 67.3 —
Deferral of Acquisition Costs (139.4) (128.6) (419.1) (388.9) (508.1) (576.2)
Amortization of Deferred Acquisition Costs 150.8 138.4 449.5 440.8 586.1 606.1
Other Expenses 533.2 493.1 1,538.5 1,472.7 1,983.8 1,949.8
Total Benefits and Expenses 2,446.6 2,559.8 7,714.8 8,163.4 10,950.8 12,198.1
Income Before Income Tax 515.3 409.9 1,270.5 871.3 1,063.0 964.0
Income Tax 104.6 81.3 235.9 206.8 238.8 171.0
Net Income $ 410.7 $ 328.6 $ 1,034.6 $ 664.5 $ 824.2 $ 793.0
Weighted Average Shares Outstanding
Basic 200.0 204.6 201.3 204.4 204.2 203.6
Assuming Dilution 201.7 205.1 202.5 205.1 204.8 203.8
Actual Number of Shares Outstanding 199.1 204.4 202.5 203.7

Unum Group Sales Data for Unum US Segment

Three Months Ended Nine Months Ended Year Ended
9/30/2022 9/30/2021 % Change 9/30/2022 9/30/2021 % Change 12/31/2021 12/31/2020
Sales by Product
Group Disability and Group Life and AD&D
Group Long-term Disability $ 35.4 $ 26.2 35.1 % $ 139.2 $ 99.3 40.2 % $ 206.6 $ 239.7
Group Short-term Disability 18.3 21.6 (15.3) 82.4 76.9 7.2 142.7 158.7
Group Life and AD&D 26.9 26.6 1.1 137.5 120.6 14.0 223.8 224.3
Subtotal 80.6 74.4 8.3 359.1 296.8 21.0 573.1 622.7
Supplemental and Voluntary
Voluntary Benefits 40.5 34.0 19.1 188.8 178.7 5.7 231.2 241.6
Individual Disability 25.9 20.9 23.9 64.9 52.8 22.9 75.0 71.4
Dental and Vision 10.5 12.6 (16.7) 32.6 33.6 (3.0) 62.4 63.9
Subtotal 76.9 67.5 13.9 286.3 265.1 8.0 368.6 376.9
Total Sales $ 157.5 $ 141.9 11.0 $ 645.4 $ 561.9 14.9 $ 941.7 $ 999.6
Sales by Market Sector
Group Disability and Group Life and AD&D
Core Market (< 2,000 employees) $ 58.7 $ 45.9 27.9 % $ 228.5 $ 187.5 21.9 % $ 371.5 $ 377.0
Large Case Market 21.9 28.5 (23.2) 130.6 109.3 19.5 201.6 245.7
Subtotal 80.6 74.4 8.3 359.1 296.8 21.0 573.1 622.7
Supplemental and Voluntary 76.9 67.5 13.9 286.3 265.1 8.0 368.6 376.9
Total Sales $ 157.5 $ 141.9 11.0 $ 645.4 $ 561.9 14.9 $ 941.7 $ 999.6

Unum Group Sales Data for Unum International Segment

Three Months Ended Nine Months Ended Year Ended
(in millions of dollars) 9/30/2022 9/30/2021 % Change 9/30/2022 9/30/2021 % Change 12/31/2021 12/31/2020
Sales by Product
Unum UK
Group Long-term Disability $ 6.4 $ 10.1 (36.6) % $ 35.2 $ 33.4 5.4 % $ 41.4 $ 37.7
Group Life 28.1 6.8 N.M. 49.0 22.9 114.0 31.3 20.6
Supplemental 2.2 3.7 (40.5) 14.5 13.6 6.6 17.0 18.9
Unum Poland 3.4 3.5 (2.9) 11.4 10.5 8.6 16.1 13.3
Total Sales $ 40.1 $ 24.1 66.4 $ 110.1 $ 80.4 36.9 $ 105.8 $ 90.5
Sales by Market Sector
Unum UK
Group Long-term Disability and Group Life
Core Market (< 500 employees) $ 9.3 $ 9.3 — % $ 32.8 $ 30.5 7.5 % $ 41.5 $ 36.2
Large Case Market 25.2 7.6 N.M. 51.4 25.8 99.2 31.2 22.1
Subtotal 34.5 16.9 104.1 84.2 56.3 49.6 72.7 58.3
Supplemental 2.2 3.7 (40.5) 14.5 13.6 6.6 17.0 18.9
Unum Poland 3.4 3.5 (2.9) 11.4 10.5 8.6 16.1 13.3
Total Sales $ 40.1 $ 24.1 66.4 $ 110.1 $ 80.4 36.9 $ 105.8 $ 90.5
(in millions of pounds)
Unum UK Sales by Product
Group Long-term Disability £ 5.5 £ 7.4 (25.7) % £ 27.6 £ 24.1 14.5 % £ 30.0 £ 29.5
Group Life 23.5 4.9 N.M. 39.7 16.5 140.6 22.8 16.1
Supplemental 1.9 2.7 (29.6) 11.3 9.9 14.1 12.3 14.9
Total Sales £ 30.9 £ 15.0 106.0 £ 78.6 £ 50.5 55.6 £ 65.1 £ 60.5
Unum UK Sales by Market Sector
Group Long-term Disability and Group Life
Core Market (< 500 employees) £ 7.9 £ 6.7 17.9 % £ 25.9 £ 22.0 17.7 % £ 30.2 £ 28.3
Large Case Market 21.1 5.6 N.M. 41.4 18.6 122.6 22.6 17.3
Subtotal 29.0 12.3 135.8 67.3 40.6 65.8 52.8 45.6
Supplemental 1.9 2.7 (29.6) 11.3 9.9 14.1 12.3 14.9
Total Sales £ 30.9 £ 15.0 106.0 £ 78.6 £ 50.5 55.6 £ 65.1 £ 60.5
  1. 1

Unum Group Sales Data for Colonial Life Segment

Three Months Ended Nine Months Ended Year Ended
9/30/2022 9/30/2021 % Change 9/30/2022 9/30/2021 % Change 12/31/2021 12/31/2020
Sales by Product
Accident, Sickness, and Disability $ 71.4 $ 69.8 2.3 % $ 210.0 $ 196.4 6.9 % $ 297.9 $ 261.5
Life 27.9 26.4 5.7 80.4 73.2 9.8 111.0 88.8
Cancer and Critical Illness 16.6 16.1 3.1 47.7 44.0 8.4 70.9 62.8
Total Sales $ 115.9 $ 112.3 3.2 $ 338.1 $ 313.6 7.8 $ 479.8 $ 413.1
Sales by Market Sector
Commercial
Core Market (< 1,000 employees) $ 73.4 $ 72.3 1.5 % $ 225.4 $ 207.2 8.8 % $ 313.2 $ 266.2
Large Case Market 10.7 14.3 (25.2) 36.3 43.4 (16.4) 68.5 57.4
Subtotal 84.1 86.6 (2.9) 261.7 250.6 4.4 381.7 323.6
Public Sector 31.8 25.7 23.7 76.4 63.0 21.3 98.1 89.5
Total Sales $ 115.9 $ 112.3 3.2 $ 338.1 $ 313.6 7.8 $ 479.8 $ 413.1
  1. 2

Unum Group Consolidated Balance Sheets

September 30 December 31
2022 2021
Assets
Investments
Fixed Maturity Securities $ 34,148.2 $ 43,336.0
Mortgage Loans 2,476.4 2,560.4
Policy Loans 3,640.8 3,662.9
Other Long-term Investments 1,430.4 1,203.0
Short-term Investments 1,183.2 1,388.0
Total Investments 42,879.0 52,150.3
Other Assets
Cash and Bank Deposits 143.3 75.0
Accounts and Premiums Receivable 1,475.4 1,519.9
Reinsurance Recoverable 10,289.7 10,919.3
Accrued Investment Income 717.2 602.7
Deferred Acquisition Costs 2,254.6 2,207.9
Goodwill 344.4 352.2
Property and Equipment 442.4 462.7
Deferred Income Tax 523.1 —
Other Assets 1,797.6 1,825.6
Total Assets $ 60,866.7 $ 70,115.6

Unum Group Consolidated Balance Sheets - Continued

September 30 December 31
2022 2021
Liabilities and Stockholders' Equity
Liabilities
Policy and Contract Benefits $ 1,771.4 $ 1,907.7
Reserves for Future Policy and Contract Benefits 42,108.7 48,007.5
Unearned Premiums 394.0 347.5
Other Policyholders’ Funds 1,756.0 1,790.9
Income Tax Payable 212.2 159.1
Deferred Income Tax 6.5 458.4
Long-term Debt 3,429.2 3,442.2
Other Liabilities 2,529.2 2,585.9
Total Liabilities 52,207.2 58,699.2
Stockholders’ Equity
Common Stock 30.8 30.7
Additional Paid-in Capital 2,432.3 2,408.1
Accumulated Other Comprehensive Income (Loss) (3,134.7) 354.1
Retained Earnings 12,698.3 11,853.2
Treasury Stock (3,367.2) (3,229.7)
Total Stockholders’ Equity 8,659.5 11,416.4
Total Liabilities and Stockholders’ Equity $ 60,866.7 $ 70,115.6
  1. 1

Unum Group Deferred Acquisition Costs by Segment

Unum US Unum International Colonial Life Consolidated
Balance at December 31, 2020 $ 1,168.7 $ 32.0 $ 1,071.9 $ 2,272.6
Capitalization 242.7 12.8 252.6 508.1
Amortization (319.0) (8.0) (259.1) (586.1)
Adjustment Related to Unrealized Investment Gains and Losses 3.8 — 10.9 14.7
Foreign Currency — (1.4) — (1.4)
Balance at December 31, 2021 1,096.2 35.4 1,076.3 2,207.9
Capitalization 199.4 9.3 210.4 419.1
Amortization (228.0) (5.8) (215.7) (449.5)
Adjustment Related to Unrealized Investment Gains and Losses 15.4 — 68.5 83.9
Foreign Currency — (6.8) — (6.8)
Balance at September 30, 2022 $ 1,083.0 $ 32.1 $ 1,139.5 $ 2,254.6
  1. 2

Unum Group Balance Sheets by Segment - September 30, 2022

Unum US
Group Disability Group Life and Accidental Death & Dismemberment Supplemental and Voluntary Total Unum US Unum International Colonial Life Closed Block Corporate Consolidated
Assets
Investments $ 7,129.9 $ 2,356.5 $ 4,500.0 $ 13,986.4 $ 2,518.6 $ 3,110.3 $ 21,679.3 $ 1,584.4 $ 42,879.0
Deferred Acquisition Costs 93.2 61.3 928.5 1,083.0 32.1 1,139.5 — — 2,254.6
Goodwill 8.9 — 271.1 280.0 36.7 27.7 — — 344.4
All Other 144.4 310.4 378.8 833.6 323.1 135.0 12,197.5 1,899.5 15,388.7
Total Assets $ 7,376.4 $ 2,728.2 $ 6,078.4 $ 16,183.0 $ 2,910.5 $ 4,412.5 $ 33,876.8 $ 3,483.9 $ 60,866.7
Liabilities
Reserves and Policyholder Benefits $ 5,599.9 $ 1,862.7 $ 3,857.1 $ 11,319.7 $ 2,213.8 $ 2,963.1 $ 29,533.5 $ — $ 46,030.1
Debt — — — — — — — 3,429.2 3,429.2
All Other 39.2 92.2 215.8 347.2 104.2 58.1 605.6 1,632.8 2,747.9
Total Liabilities 5,639.1 1,954.9 4,072.9 11,666.9 2,318.0 3,021.2 30,139.1 5,062.0 52,207.2
Allocated Stockholders' Equity
Other Allocated Stockholders' Equity 1,742.1 909.2 2,139.5 4,790.8 683.3 1,539.3 4,666.8 (704.9) 10,975.3
Net Unrealized Gain (Loss) on Securities and Net Gain on Hedges (4.8) (135.9) (134.0) (274.7) (90.8) (148.0) (929.1) (873.2) (2,315.8)
Total Allocated Stockholders' Equity 1,737.3 773.3 2,005.5 4,516.1 592.5 1,391.3 3,737.7 (1,578.1) 8,659.5
Total Liabilities and Allocated Stockholders' Equity $ 7,376.4 $ 2,728.2 $ 6,078.4 $ 16,183.0 $ 2,910.5 $ 4,412.5 $ 33,876.8 $ 3,483.9 $ 60,866.7

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 our target capital levels for regulatory and rating agency purposes. We modify this formula periodically to recognize changes in the views of capital requirements.

  1. 3

Unum Group Balance Sheets by Segment - December 31, 2021

Unum US
Group Disability Group Life and Accidental Death & Dismemberment Supplemental and Voluntary Total Unum US Unum International Colonial Life Closed Block Corporate Consolidated
Assets
Investments $ 8,260.2 $ 2,525.5 $ 5,301.1 $ 16,086.8 $ 3,740.2 $ 3,533.8 $ 25,968.2 $ 2,821.3 $ 52,150.3
Deferred Acquisition Costs 93.7 59.1 943.4 1,096.2 35.4 1,076.3 — — 2,207.9
Goodwill 8.9 — 271.1 280.0 44.5 27.7 — — 352.2
All Other 411.3 416.3 405.7 1,233.3 266.4 258.1 12,319.7 1,327.7 15,405.2
Total Assets $ 8,774.1 $ 3,000.9 $ 6,921.3 $ 18,696.3 $ 4,086.5 $ 4,895.9 $ 38,287.9 $ 4,149.0 $ 70,115.6
Liabilities
Reserves and Policyholder Benefits $ 6,913.6 $ 2,007.9 $ 4,289.8 $ 13,211.3 $ 3,136.4 $ 2,985.4 $ 32,720.5 $ — $ 52,053.6
Debt — — — — — — — 3,442.2 3,442.2
All Other 160.2 125.6 334.5 620.3 161.2 203.8 629.0 1,589.1 3,203.4
Total Liabilities 7,073.8 2,133.5 4,624.3 13,831.6 3,297.6 3,189.2 33,349.5 5,031.3 58,699.2
Allocated Stockholders' Equity
Other Allocated Stockholders' Equity 1,663.2 832.9 2,091.3 4,587.4 788.8 1,539.0 4,526.7 (1,049.5) 10,392.4
Net Unrealized Gain on Securities and Net Gain on Hedges 37.1 34.5 205.7 277.3 0.1 167.7 411.7 167.2 1,024.0
Total Allocated Stockholders' Equity 1,700.3 867.4 2,297.0 4,864.7 788.9 1,706.7 4,938.4 (882.3) 11,416.4
Total Liabilities and Allocated Stockholders' Equity $ 8,774.1 $ 3,000.9 $ 6,921.3 $ 18,696.3 $ 4,086.5 $ 4,895.9 $ 38,287.9 $ 4,149.0 $ 70,115.6
  1. 4

Unum Group Financial Results by Segment

We measure and analyze our segment performance on the basis of "adjusted operating revenue" and "adjusted operating income" or "adjusted operating loss", which differ from total revenue and income before income tax as presented in our consolidated statements of income due to the exclusion of investment gains and losses and amortization of the cost of reinsurance as well as certain other items as specified in the following pages. Investment gains or losses primarily include realized investment gains or losses, expected investment credit losses, and gains or losses on derivatives. These performance measures are in accordance with GAAP guidance for segment reporting, but they should not be viewed as a substitute for total revenue, income before income tax, or net income.

Three Months Ended Nine Months Ended
9/30/2022 9/30/2021 % Change 9/30/2022 9/30/2021 % Change
Premium Income
Unum US $ 1,559.6 $ 1,500.8 3.9 % $ 4,676.8 $ 4,548.7 2.8 %
Unum International 173.3 181.6 (4.6) 540.5 539.5 0.2
Colonial Life 423.3 420.8 0.6 1,281.6 1,266.9 1.2
Closed Block 235.5 250.5 (6.0) 713.4 751.3 (5.0)
2,391.7 2,353.7 1.6 7,212.3 7,106.4 1.5
Net Investment Income
Unum US 170.6 176.2 (3.2) 509.4 539.5 (5.6)
Unum International 37.0 33.1 11.8 122.3 94.8 29.0
Colonial Life 38.6 51.8 (25.5) 115.4 131.1 (12.0)
Closed Block 251.4 284.6 (11.7) 817.7 876.5 (6.7)
Corporate 14.0 4.5 N.M. 33.0 20.5 61.0
511.6 550.2 (7.0) 1,597.8 1,662.4 (3.9)
Other Income
Unum US 49.0 43.5 12.6 146.8 125.2 17.3
Unum International 0.2 0.4 (50.0) 0.7 0.6 16.7
Colonial Life 0.3 0.3 — 0.8 0.8 —
Closed Block 13.1 19.3 (32.1) 45.6 49.8 (8.4)
Corporate 0.4 2.4 (83.3) 3.6 4.1 (12.2)
63.0 65.9 (4.4) 197.5 180.5 9.4
Total Adjusted Operating Revenue
Unum US 1,779.2 1,720.5 3.4 5,333.0 5,213.4 2.3
Unum International 210.5 215.1 (2.1) 663.5 634.9 4.5
Colonial Life 462.2 472.9 (2.3) 1,397.8 1,398.8 (0.1)
Closed Block 500.0 554.4 (9.8) 1,576.7 1,677.6 (6.0)
Corporate 14.4 6.9 108.7 36.6 24.6 48.8
$ 2,966.3 $ 2,969.8 (0.1) $ 9,007.6 $ 8,949.3 0.7

Unum Group Financial Results by Segment - Continued

Three Months Ended Nine Months Ended
9/30/2022 9/30/2021 % Change 9/30/2022 9/30/2021 % Change
Benefits and Expenses
Unum US $ 1,349.2 $ 1,417.0 (4.8) % $ 4,436.0 $ 4,614.9 (3.9) %
Unum International 180.6 187.7 (3.8) 581.5 556.3 4.5
Colonial Life 371.8 392.8 (5.3) 1,116.2 1,149.6 (2.9)
Closed Block 481.1 497.9 (3.4) 1,417.7 1,591.9 (10.9)
Corporate 63.9 64.4 (0.8) 163.4 250.7 (34.8)
2,446.6 2,559.8 (4.4) 7,714.8 8,163.4 (5.5)
Income (Loss) Before Income Tax and Net Investment Gain (Loss)
Unum US 430.0 303.5 41.7 897.0 598.5 49.9
Unum International 29.9 27.4 9.1 82.0 78.6 4.3
Colonial Life 90.4 80.1 12.9 281.6 249.2 13.0
Closed Block 18.9 56.5 (66.5) 159.0 85.7 85.5
Corporate (49.5) (57.5) 13.9 (126.8) (226.1) 43.9
519.7 410.0 26.8 1,292.8 785.9 64.5
Income Tax 105.6 81.3 29.9 241.1 188.8 27.7
Income Before Net Investment Gain (Loss) 414.1 328.7 26.0 1,051.7 597.1 76.1
Net Investment Gain (Loss) (net of tax expense (benefit) of $(1.0); $—; $(5.2); $18.0) (3.4) (0.1) N.M. (17.1) 67.4 (125.4)
Net Income $ 410.7 $ 328.6 25.0 $ 1,034.6 $ 664.5 55.7
  1. 1

Unum Group Quarterly Historical Financial Results by Segment

9/30/22 6/30/22 3/31/22 12/31/21 9/30/21 6/30/21 3/31/21 12/31/20 9/30/20
Premium Income
Unum US $ 1,559.6 $ 1,572.3 $ 1,544.9 $ 1,529.3 $ 1,500.8 $ 1,522.1 $ 1,525.8 $ 1,485.1 $ 1,483.4
Unum International 173.3 179.4 187.8 177.5 181.6 183.5 174.4 165.7 165.4
Colonial Life 423.3 427.6 430.7 423.3 420.8 419.7 426.4 418.8 419.9
Closed Block 235.5 238.0 239.9 244.5 250.5 249.1 251.7 250.3 249.4
2,391.7 2,417.3 2,403.3 2,374.6 2,353.7 2,374.4 2,378.3 2,319.9 2,318.1
Net Investment Income
Unum US 170.6 167.8 171.0 182.1 176.2 183.6 179.7 173.1 190.7
Unum International 37.0 50.8 34.5 37.9 33.1 35.7 26.0 25.5 26.3
Colonial Life 38.6 38.7 38.1 40.9 51.8 41.6 37.7 37.5 43.7
Closed Block 251.4 291.5 274.8 282.5 284.6 294.7 297.2 356.7 351.2
Corporate 14.0 10.2 8.8 7.4 4.5 7.9 8.1 0.7 1.3
511.6 559.0 527.2 550.8 550.2 563.5 548.7 593.5 613.2
Other Income
Unum US 49.0 50.7 47.1 44.8 43.5 41.3 40.4 37.4 42.0
Unum International 0.2 0.3 0.2 — 0.4 0.1 0.1 0.1 0.2
Colonial Life 0.3 0.2 0.3 0.2 0.3 0.3 0.2 0.2 0.3
Closed Block 13.1 16.5 16.0 15.3 19.3 12.1 18.4 16.9 17.8
Corporate 0.4 1.0 2.2 2.1 2.4 0.4 1.3 0.6 0.3
63.0 68.7 65.8 62.4 65.9 54.2 60.4 55.2 60.6
Total Adjusted Operating Revenue
Unum US 1,779.2 1,790.8 1,763.0 1,756.2 1,720.5 1,747.0 1,745.9 1,695.6 1,716.1
Unum International 210.5 230.5 222.5 215.4 215.1 219.3 200.5 191.3 191.9
Colonial Life 462.2 466.5 469.1 464.4 472.9 461.6 464.3 456.5 463.9
Closed Block 500.0 546.0 530.7 542.3 554.4 555.9 567.3 623.9 618.4
Corporate 14.4 11.2 11.0 9.5 6.9 8.3 9.4 1.3 1.6
$ 2,966.3 $ 3,045.0 $ 2,996.3 $ 2,987.8 $ 2,969.8 $ 2,992.1 $ 2,987.4 $ 2,968.6 $ 2,991.9

Unum Group Quarterly Historical Financial Results by Segment - Continued

9/30/22 6/30/22 3/31/22 12/31/21 9/30/21 6/30/21 3/31/21 12/31/20 9/30/20
Benefits and Expenses
Unum US $ 1,349.2 $ 1,495.4 $ 1,591.4 $ 1,674.8 $ 1,417.0 $ 1,567.7 $ 1,630.2 $ 1,552.1 $ 1,527.9
Unum International 180.6 205.6 195.3 188.3 187.7 194.5 174.1 170.6 170.5
Colonial Life 371.8 365.4 379.0 384.4 392.8 365.8 391.0 385.3 371.7
Closed Block 481.1 483.3 453.3 485.3 497.9 464.4 629.6 1,996.8 547.6
Corporate 63.9 48.1 51.4 54.6 64.4 138.0 48.3 44.0 79.0
2,446.6 2,597.8 2,670.4 2,787.4 2,559.8 2,730.4 2,873.2 4,148.8 2,696.7
Income (Loss) Before Income Tax Expense (Benefit) and Net Investment Gain (Loss)
Unum US 430.0 295.4 171.6 81.4 303.5 179.3 115.7 143.5 188.2
Unum International 29.9 24.9 27.2 27.1 27.4 24.8 26.4 20.7 21.4
Colonial Life 90.4 101.1 90.1 80.0 80.1 95.8 73.3 71.2 92.2
Closed Block 18.9 62.7 77.4 57.0 56.5 91.5 (62.3) (1,372.9) 70.8
Corporate (49.5) (36.9) (40.4) (45.1) (57.5) (129.7) (38.9) (42.7) (77.4)
519.7 447.2 325.9 200.4 410.0 261.7 114.2 (1,180.2) 295.2
Income Tax Expense (Benefit) 105.6 73.7 61.8 33.9 81.3 79.4 28.1 (285.2) 67.9
Income (Loss) Before Net Investment Gain (Loss) 414.1 373.5 264.1 166.5 328.7 182.3 86.1 (895.0) 227.3
Net Investment Gain (Loss) (4.4) (4.1) (13.8) (8.7) (0.1) 0.9 84.6 1,304.9 4.4
Tax Expense (Benefit) on Net Investment Gain (Loss) (1.0) (1.0) (3.2) (1.9) — 0.3 17.7 274.5 0.6
Net Income $ 410.7 $ 370.4 $ 253.5 $ 159.7 $ 328.6 $ 182.9 $ 153.0 $ 135.4 $ 231.1
Net Income Per Common Share - Assuming Dilution $ 2.04 $ 1.83 $ 1.25 $ 0.78 $ 1.60 $ 0.89 $ 0.75 $ 0.66 $ 1.13
  1. 1

Unum Group Financial Results for Unum US Segment

Three Months Ended Nine Months Ended Year Ended
9/30/2022 9/30/2021 9/30/2022 9/30/2021 12/31/2021 12/31/2020
Adjusted Operating Revenue
Premium Income $ 1,559.6 $ 1,500.8 $ 4,676.8 $ 4,548.7 $ 6,078.0 $ 6,018.9
Net Investment Income 170.6 176.2 509.4 539.5 721.6 720.3
Other Income 49.0 43.5 146.8 125.2 170.0 154.9
Total 1,779.2 1,720.5 5,333.0 5,213.4 6,969.6 6,894.1
Benefits and Expenses
Benefits and Change in Reserves for Future Benefits 834.1 950.2 2,912.4 3,175.6 4,338.8 4,138.7
Commissions 151.3 143.5 458.6 439.0 583.4 594.9
Deferral of Acquisition Costs (66.2) (61.1) (199.4) (193.4) (242.7) (291.5)
Amortization of Deferred Acquisition Costs 75.3 71.1 228.0 243.7 319.0 341.0
Other Expenses 354.7 313.3 1,036.4 950.0 1,291.2 1,285.6
Total 1,349.2 1,417.0 4,436.0 4,614.9 6,289.7 6,068.7
Income Before Income Tax and Net Investment Gains and Losses 430.0 303.5 897.0 598.5 679.9 825.4
Reserve Assumption Updates (155.0) (215.0) (155.0) (215.0) (215.0) —
Adjusted Operating Income $ 275.0 $ 88.5 $ 742.0 $ 383.5 $ 464.9 $ 825.4
Operating Ratios (% of Premium Income):
Benefit Ratio1 63.4 % 77.6 % 65.6 % 74.5 % 74.9 % 68.8 %
Other Expense Ratio 22.7 % 20.9 % 22.2 % 20.9 % 21.2 % 21.4 %
Adjusted Operating Income Ratio 17.6 % 5.9 % 15.9 % 8.4 % 7.6 % 13.7 %

1Excludes the $155.0 million and $215.0 million reserve decreases during the third quarters and first nine months of 2022 and 2021, respectively, related to the assumption updates that occurred during each of the third quarters of 2022 and 2021.

Unum Group Financial Results for Unum US Group Disability

Three Months Ended Nine Months Ended Year Ended
9/30/2022 9/30/2021 9/30/2022 9/30/2021 12/31/2021 12/31/2020
Adjusted Operating Revenue
Premium Income
Group Long-term Disability $ 480.9 $ 451.4 $ 1,419.2 $ 1,367.7 $ 1,827.8 $ 1,828.5
Group Short-term Disability 232.2 212.4 685.9 641.2 864.0 799.2
Total Premium Income 713.1 663.8 2,105.1 2,008.9 2,691.8 2,627.7
Net Investment Income 84.8 93.3 262.6 284.7 379.6 388.8
Other Income 48.4 42.1 143.5 121.4 165.7 147.6
Total 846.3 799.2 2,511.2 2,415.0 3,237.1 3,164.1
Benefits and Expenses
Benefits and Change in Reserves for Future Benefits 326.0 308.6 1,301.3 1,314.3 1,849.2 1,921.9
Commissions 52.1 49.1 158.0 151.2 199.8 191.8
Deferral of Acquisition Costs (12.9) (12.3) (38.1) (37.4) (49.8) (49.3)
Amortization of Deferred Acquisition Costs 13.1 12.9 38.6 38.6 51.4 53.1
Other Expenses 217.2 186.4 630.5 569.8 773.9 756.6
Total 595.5 544.7 2,090.3 2,036.5 2,824.5 2,874.1
Income Before Income Tax and Net Investment Gains and Losses 250.8 254.5 420.9 378.5 412.6 290.0
Reserve Assumption Updates (121.0) (215.0) (121.0) (215.0) (215.0) —
Adjusted Operating Income $ 129.8 $ 39.5 $ 299.9 $ 163.5 $ 197.6 $ 290.0
Operating Ratios (% of Premium Income):
Benefit Ratio1 62.7 % 78.9 % 67.6 % 76.1 % 76.7 % 73.1 %
Other Expense Ratio 30.5 % 28.1 % 30.0 % 28.4 % 28.8 % 28.8 %
Adjusted Operating Income Ratio 18.2 % 6.0 % 14.2 % 8.1 % 7.3 % 11.0 %
Persistency:
Group Long-term Disability 90.7 % 89.8 % 89.6 % 90.8 %
Group Short-term Disability 89.2 % 87.1 % 87.4 % 88.7 %

1Excludes the $121.0 million and $215.0 million reserve decreases during the third quarters and first nine months of 2022 and 2021, respectively, related to the assumption updates that occurred during each of the third quarters of 2022 and 2021.

  1. 1

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

Three Months Ended Nine Months Ended Year Ended
9/30/2022 9/30/2021 9/30/2022 9/30/2021 12/31/2021 12/31/2020
Adjusted Operating Revenue
Premium Income
Group Life $ 417.7 $ 404.2 $ 1,249.9 $ 1,228.8 $ 1,641.9 $ 1,640.5
Accidental Death & Dismemberment 43.8 39.6 129.7 123.0 165.1 163.9
Total Premium Income 461.5 443.8 1,379.6 1,351.8 1,807.0 1,804.4
Net Investment Income 25.3 24.3 75.1 76.1 104.0 97.2
Other Income 0.4 0.5 1.2 1.3 1.7 2.4
Total 487.2 468.6 1,455.9 1,429.2 1,912.7 1,904.0
Benefits and Expenses
Benefits and Change in Reserves for Future Benefits 325.8 446.6 1,052.8 1,281.2 1,728.8 1,470.4
Commissions 38.8 36.4 113.7 109.1 144.7 143.2
Deferral of Acquisition Costs (9.0) (8.9) (26.9) (27.3) (21.0) (36.0)
Amortization of Deferred Acquisition Costs 8.3 9.5 24.8 28.7 38.3 39.3
Other Expenses 58.4 52.1 168.7 157.7 213.8 205.3
Total 422.3 535.7 1,333.1 1,549.4 2,104.6 1,822.2
Income (Loss) Before Income Tax and Net Investment Gains and Losses 64.9 (67.1) 122.8 (120.2) (191.9) 81.8
Reserve Assumption Update (34.0) — (34.0) — — —
Adjusted Operating Income (Loss) $ 30.9 $ (67.1) $ 88.8 $ (120.2) $ (191.9) $ 81.8
Operating Ratios (% of Premium Income):
Benefit Ratio1 78.0 % 100.6 % 78.8 % 94.8 % 95.7 % 81.5 %
Other Expense Ratio 12.7 % 11.7 % 12.2 % 11.7 % 11.8 % 11.4 %
Adjusted Operating Income (Loss) Ratio 6.7 % (15.1) % 6.4 % (8.9) % (10.6) % 4.5 %
Persistency:
Group Life 89.2 % 89.9 % 89.7 % 88.8 %
Accidental Death & Dismemberment 88.1 % 89.3 % 89.1 % 88.2 %

1Excludes the $34.0 million reserve decrease during the third quarter and first nine months of 2022 related to the assumption update that occurred during the third quarter of 2022.

  1. 2

Unum Group Financial Results for Unum US Supplemental and Voluntary

Three Months Ended Nine Months Ended Year Ended
9/30/2022 9/30/2021 9/30/2022 9/30/2021 12/31/2021 12/31/2020
Adjusted Operating Revenue
Premium Income
Voluntary Benefits $ 199.0 $ 209.6 $ 635.2 $ 640.4 $ 846.7 $ 875.2
Individual Disability 118.9 115.7 350.3 345.0 459.8 456.0
Dental and Vision 67.1 67.9 206.6 202.6 272.7 255.6
Total Premium Income 385.0 393.2 1,192.1 1,188.0 1,579.2 1,586.8
Net Investment Income 60.5 58.6 171.7 178.7 238.0 234.3
Other Income 0.2 0.9 2.1 2.5 2.6 4.9
Total 445.7 452.7 1,365.9 1,369.2 1,819.8 1,826.0
Benefits and Expenses
Benefits and Change in Reserves for Future Benefits 182.3 195.0 558.3 580.1 760.8 746.4
Commissions 60.4 58.0 186.9 178.7 238.9 259.9
Deferral of Acquisition Costs (44.3) (39.9) (134.4) (128.7) (171.9) (206.2)
Amortization of Deferred Acquisition Costs 53.9 48.7 164.6 176.4 229.3 248.6
Other Expenses 79.1 74.8 237.2 222.5 303.5 323.7
Total 331.4 336.6 1,012.6 1,029.0 1,360.6 1,372.4
Adjusted Operating Income $ 114.3 $ 116.1 $ 353.3 $ 340.2 $ 459.2 $ 453.6
Operating Ratios (% of Premium Income):
Benefit Ratios:
Voluntary Benefits 42.6 % 46.6 % 41.2 % 43.3 % 43.2 % 42.2 %
Individual Disability 40.0 % 40.1 % 41.3 % 43.6 % 42.8 % 48.8 %
Dental and Vision 74.5 % 75.0 % 73.6 % 75.1 % 72.6 % 60.6 %
Other Expense Ratio 20.5 % 19.0 % 19.9 % 18.7 % 19.2 % 20.4 %
Adjusted Operating Income Ratio 29.7 % 29.5 % 29.6 % 28.6 % 29.1 % 28.6 %
Persistency:
Voluntary Benefits 75.1 % 75.4 % 75.8 % 72.7 %
Individual Disability 89.2 % 88.4 % 89.7 % 89.5 %
Dental and Vision 81.4 % 86.3 % 86.0 % 85.0 %
  1. 3

Unum Group Financial Results for Unum International Segment

Three Months Ended Nine Months Ended Year Ended
9/30/2022 9/30/2021 9/30/2022 9/30/2021 12/31/2021 12/31/2020
Adjusted Operating Revenue
Premium Income
Unum UK
Group Long-term Disability $ 89.8 $ 101.6 $ 287.5 $ 303.8 $ 401.9 $ 364.9
Group Life 35.0 29.1 100.5 84.4 112.3 108.5
Supplemental 27.4 28.3 85.8 84.2 112.6 99.8
Unum Poland 21.1 22.6 66.7 67.1 90.2 79.6
Total Premium Income 173.3 181.6 540.5 539.5 717.0 652.8
Net Investment Income 37.0 33.1 122.3 94.8 132.7 104.6
Other Income 0.2 0.4 0.7 0.6 0.6 0.5
Total 210.5 215.1 663.5 634.9 850.3 757.9
Benefits and Expenses
Benefits and Change in Reserves for Future Benefits 131.1 139.6 432.8 416.6 556.2 500.9
Commissions 15.0 13.9 44.9 40.7 54.1 49.7
Deferral of Acquisition Costs (2.9) (3.3) (9.3) (9.6) (12.8) (12.1)
Amortization of Deferred Acquisition Costs 1.2 2.0 5.8 6.1 8.0 7.4
Other Expenses 36.2 35.5 107.3 102.5 139.1 135.4
Total 180.6 187.7 581.5 556.3 744.6 681.3
Adjusted Operating Income $ 29.9 $ 27.4 $ 82.0 $ 78.6 $ 105.7 $ 76.6

Unum Group Financial Results for Unum UK

Three Months Ended Nine Months Ended Year Ended
(in millions of pounds, except exchange rate) 9/30/2022 9/30/2021 9/30/2022 9/30/2021 12/31/2021 12/31/2020
Adjusted Operating Revenue
Premium Income
Group Long-term Disability £ 76.2 £ 73.7 £ 228.4 £ 219.3 £ 292.0 £ 284.2
Group Life 29.8 21.1 80.3 60.9 81.7 84.6
Supplemental 23.4 20.6 68.4 60.8 81.8 77.7
Total Premium Income 129.4 115.4 377.1 341.0 455.5 446.5
Net Investment Income 29.9 22.5 93.3 64.2 91.0 76.0
Other Income — 0.2 0.1 0.2 0.1 0.1
Total 159.3 138.1 470.5 405.4 546.6 522.6
Benefits and Expenses
Benefits and Change in Reserves for Future Benefits 101.7 91.4 312.8 269.6 362.8 352.5
Commissions 9.1 7.5 26.0 21.6 28.7 28.1
Deferral of Acquisition Costs (1.0) (1.2) (3.3) (3.2) (4.3) (4.2)
Amortization of Deferred Acquisition Costs 0.6 1.2 3.7 3.8 5.1 5.3
Other Expenses 25.3 20.8 69.2 59.8 81.8 86.5
Total 135.7 119.7 408.4 351.6 474.1 468.2
Adjusted Operating Income £ 23.6 £ 18.4 £ 62.1 £ 53.8 £ 72.5 £ 54.4
Weighted Average Pound/Dollar Exchange Rate 1.169 1.380 1.246 1.385 1.377 1.287
Operating Ratios (% of Premium Income):
Benefit Ratio 78.6 % 79.2 % 82.9 % 79.1 % 79.6 % 78.9 %
Other Expense Ratio 19.6 % 18.0 % 18.4 % 17.5 % 18.0 % 19.4 %
Adjusted Operating Income Ratio 18.2 % 15.9 % 16.5 % 15.8 % 15.9 % 12.2 %
Persistency:
Group Long-term Disability 84.9 % 88.9 % 89.3 % 88.2 %
Group Life 88.2 % 86.0 % 86.5 % 81.8 %
Supplemental 92.3 % 89.9 % 90.9 % 90.7 %
  1. 1

Unum Group Financial Results for Colonial Life Segment

Three Months Ended Nine Months Ended Year Ended
9/30/2022 9/30/2021 9/30/2022 9/30/2021 12/31/2021 12/31/2020
Adjusted Operating Revenue
Premium Income
Accident, Sickness, and Disability $ 236.1 $ 238.0 $ 714.0 $ 715.1 $ 953.3 $ 975.1
Life 100.2 94.6 303.2 287.3 384.7 376.4
Cancer and Critical Illness 87.0 88.2 264.4 264.5 352.2 360.5
Total Premium Income 423.3 420.8 1,281.6 1,266.9 1,690.2 1,712.0
Net Investment Income 38.6 51.8 115.4 131.1 172.0 155.7
Other Income 0.3 0.3 0.8 0.8 1.0 1.1
Total 462.2 472.9 1,397.8 1,398.8 1,863.2 1,868.8
Benefits and Expenses
Benefits and Change in Reserves for Future Benefits 198.0 235.2 613.8 688.2 910.4 906.5
Commissions 86.0 80.5 258.0 236.9 320.1 334.3
Deferral of Acquisition Costs (70.3) (64.2) (210.4) (185.9) (252.6) (272.6)
Amortization of Deferred Acquisition Costs 74.3 65.3 215.7 191.0 259.1 257.7
Other Expenses 83.8 76.0 239.1 219.4 297.0 307.5
Total 371.8 392.8 1,116.2 1,149.6 1,534.0 1,533.4
Adjusted Operating Income $ 90.4 $ 80.1 $ 281.6 $ 249.2 $ 329.2 $ 335.4
Operating Ratios (% of Premium Income):
Benefit Ratio 46.8 % 55.9 % 47.9 % 54.3 % 53.9 % 52.9 %
Other Expense Ratio 19.8 % 18.1 % 18.7 % 17.3 % 17.6 % 18.0 %
Adjusted Operating Income Ratio 21.4 % 19.0 % 22.0 % 19.7 % 19.5 % 19.6 %
Persistency:
Accident, Sickness, and Disability 73.8 % 75.6 % 75.4 % 74.3 %
Life 85.1 % 84.9 % 85.5 % 83.7 %
Cancer and Critical Illness 82.3 % 82.1 % 82.4 % 81.8 %

Unum Group Financial Results for Closed Block Segment

Three Months Ended Nine Months Ended Year Ended
9/30/2022 9/30/2021 9/30/2022 9/30/2021 12/31/2021 12/31/2020
Adjusted Operating Revenue
Premium Income
Long-term Care $ 174.5 $ 176.1 $ 523.0 $ 528.4 $ 704.3 $ 666.9
Individual Disability 59.5 72.3 185.3 216.8 284.0 319.6
All Other 1.5 2.1 5.1 6.1 7.5 7.9
Total Premium Income 235.5 250.5 713.4 751.3 995.8 994.4
Net Investment Income 251.4 284.6 817.7 876.5 1,159.0 1,370.3
Other Income 13.1 19.3 45.6 49.8 65.1 66.6
Total 500.0 554.4 1,576.7 1,677.6 2,219.9 2,431.3
Benefits and Expenses
Benefits and Change in Reserves for Future Benefits 416.1 428.9 1,222.3 1,378.8 1,793.2 3,426.8
Commissions 19.2 20.4 57.6 61.3 80.5 78.4
Interest and Debt Expense — — — — — 3.1
Other Expenses 45.8 48.6 137.8 151.8 203.5 158.7
Total 481.1 497.9 1,417.7 1,591.9 2,077.2 3,667.0
Income (Loss) Before Income Tax and Net Investment Gain and Losses 18.9 56.5 159.0 85.7 142.7 (1,235.7)
Long-term Care Reserve Assumption Update — 2.1 — 2.1 2.1 151.5
Individual Disability Reserve Assumption Update — 6.4 — 6.4 6.4 —
Group Pension Reserve Assumption Update — 25.1 — 25.1 25.1 17.5
Impacts from Closed Block Individual Disability Reinsurance Transaction — — — 139.3 139.3 1,305.5
Amortization of the Cost of Reinsurance 15.2 19.7 48.5 59.4 79.1 2.6
Adjusted Operating Income $ 34.1 $ 109.8 $ 207.5 $ 318.0 $ 394.7 $ 241.4
Interest Adjusted Loss Ratios:
Long-term Care1 85.7 % 74.8 % 80.6 % 75.7 % 77.3 % 68.9 %
Individual Disability2 77.5 % 58.2 % 78.6 % 65.6 % 67.9 % 85.1 %
Operating Ratios (% of Premium Income):
Other Expense Ratio3 13.0 % 11.5 % 12.5 % 11.5 % 11.9 % 13.6 %
Income (Loss) Ratio 8.0 % 22.6 % 22.3 % 11.4 % 14.3 % (124.3) %
Adjusted Operating Income Ratio 14.5 % 43.8 % 29.1 % 42.3 % 39.6 % 24.3 %
Persistency:
Long-term Care 95.4 % 95.5 % 95.6 % 94.8 %
Individual Disability 86.4 % 86.5 % 86.4 % 88.0 %

1Excludes the $2.1 million reserve increase from the third quarter and first nine months of 2021 related to the assumption update that occurred during the third quarter of 2021 and excludes $151.5 million during the twelve months ended December 31, 2020, related to the reserve assumption update that occurred during the fourth quarter of 2020. The interest-adjusted loss ratio for the rolling twelve months ended September 30, 2022 and September 30, 2021 was 81.0 percent and 71.8 percent, respectively.

2The interest-adjusted loss ratio for the nine months ended September 30, 2021 and the twelve months ended December 31 2021 excludes the $133.1 million reserve recognition related to the second phase of the reinsurance transaction that occurred during the first quarter of 2021. Also excluded from the third quarter and first nine months of 2021 is $6.4 million related to reserve assumption updates that occurred during the third quarter of 2021. The interest adjusted loss ratio for the twelve months ended December 31, 2020 excludes the reserve recognition of $1,284.5 million related to the first phase of the reinsurance transaction.

3Excludes $15.2 million, $19.7 million, $48.5 million, $59.4 million, $79.1 million, and $2.6 million of amortization of the cost of reinsurance during the third quarter of 2022, third quarter of 2021, nine months ended September 30, 2022, nine months ended September 30, 2021, twelve months ended December 31, 2021, and twelve months ended December 31, 2020, respectively. Excludes $21.0 million of transaction costs related to the first phase of the reinsurance transaction from the twelve months ended December 31, 2020. Also excludes $6.2 million of transaction costs related to the second phase of the reinsurance transaction from the nine months ended September 30, 2021 and twelve months ended December 31, 2021.

12.1

Unum Group Financial Results for Corporate Segment

Three Months Ended Nine Months Ended Year Ended
9/30/2022 9/30/2021 9/30/2022 9/30/2021 12/31/2021 12/31/2020
Adjusted Operating Revenue
Net Investment Income $ 14.0 $ 4.5 $ 33.0 $ 20.5 $ 27.9 $ 9.8
Other Income 0.4 2.4 3.6 4.1 6.2 1.1
Total 14.4 6.9 36.6 24.6 34.1 10.9
Interest, Debt, and Other Expenses 63.9 64.4 163.4 250.7 305.3 247.7
Loss Before Income Tax and Net Investment Gains and Losses (49.5) (57.5) (126.8) (226.1) (271.2) (236.8)
Impairment Loss on Internal-Use Software — 12.1 — 12.1 12.1 —
Cost Related to Early Retirement of Debt — — — 67.3 67.3 —
Impairment Loss on ROU Asset — — — 13.9 13.9 12.7
Costs Related to Organizational Design Update — — — — — 23.3
Adjusted Operating Loss $ (49.5) $ (45.4) $ (126.8) $ (132.8) $ (177.9) $ (200.8)

Unum Group Reserves

September 30, 2022
Gross Total Reinsurance Ceded
Policy Reserves Claim Reserves Total Net
% Incurred IBNR % Total
Group Disability $ — — % $ 5,059.1 $ 759.3 25.5 % $ 5,818.4 $ 46.9 $ 5,771.5
Group Life and Accidental Death & Dismemberment 54.9 0.3 668.0 239.8 4.0 962.7 5.9 956.8
Individual Disability 439.0 2.0 1,416.5 150.7 6.9 2,006.2 205.2 1,801.0
Voluntary Benefits 1,775.6 8.1 42.6 49.2 0.4 1,867.4 23.0 1,844.4
Dental and Vision — — 0.2 11.9 0.1 12.1 0.1 12.0
Unum US Segment 2,269.5 10.4 7,186.4 1,210.9 36.9 10,666.8 281.1 10,385.7
Unum International Segment 179.0 0.8 1,801.7 126.8 8.4 2,107.5 69.4 2,038.1
Colonial Life Segment 2,548.1 11.7 291.7 110.8 1.7 2,950.6 1.4 2,949.2
Individual Disability 116.8 0.5 9,006.6 109.5 40.0 9,232.9 7,890.5 1,342.4
Long-term Care 11,129.2 51.0 2,430.0 278.8 11.9 13,838.0 5.3 13,832.7
Other 5,602.4 25.6 144.8 101.4 1.1 5,848.6 4,924.3 924.3
Closed Block Segment 16,848.4 77.1 11,581.4 489.7 53.0 28,919.5 12,820.1 16,099.4
Subtotal $ 21,845.0 100.0 % $ 20,861.2 $ 1,938.2 100.0 % 44,644.4 13,172.0 31,472.4
Adjustment Related to Unrealized Investment Gains and Losses (764.3) (24.7) (739.6)
Consolidated $ 43,880.1 $ 13,147.3 $ 30,732.8

The adjustment related to unrealized investment gains and losses reflects the changes that would be necessary to policyholder liabilities if the unrealized investment gains and losses related to the corresponding available-for-sale securities had been realized. Changes in this adjustment are primarily due to movements in credit spreads and U.S. Treasury rates.

Unum Group Reserves

December 31, 2021
Gross Total Reinsurance Ceded
Policy Reserves Claim Reserves Total Net
% Incurred IBNR % Total
Group Disability $ — — % $ 5,350.2 $ 766.6 25.9 % $ 6,116.8 $ 52.3 $ 6,064.5
Group Life and Accidental Death & Dismemberment 56.7 0.3 715.8 281.0 4.2 1,053.5 4.4 1,049.1
Individual Disability 456.1 2.1 1,412.0 150.4 6.6 2,018.5 205.7 1,812.8
Voluntary Benefits 1,752.2 8.1 47.6 51.3 0.4 1,851.1 23.7 1,827.4
Dental and Vision — — 0.9 11.5 0.1 12.4 0.1 12.3
Unum US Segment 2,265.0 10.5 7,526.5 1,260.8 37.2 11,052.3 286.2 10,766.1
Unum International Segment 211.2 1.0 2,110.7 156.0 9.6 2,477.9 94.3 2,383.6
Colonial Life Segment 2,471.8 11.4 322.8 115.5 1.9 2,910.1 3.2 2,906.9
Individual Disability 148.6 0.7 9,210.0 123.6 39.4 9,482.2 8,145.4 1,336.8
Long-term Care 10,842.2 50.2 2,300.1 271.7 10.9 13,414.0 7.4 13,406.6
Other 5,652.2 26.2 153.2 113.8 1.0 5,919.2 4,950.1 969.1
Closed Block Segment 16,643.0 77.1 11,663.3 509.1 51.3 28,815.4 13,102.9 15,712.5
Subtotal $ 21,591.0 100.0 % $ 21,623.3 $ 2,041.4 100.0 % 45,255.7 13,486.6 31,769.1
Adjustment Related to Unrealized Investment Gains and Losses 4,659.5 132.1 4,527.4
Consolidated $ 49,915.2 $ 13,618.7 $ 36,296.5
  1. 1

Unum Group Investments

9/30/2022 9/30/2022 12/31/2021
Fixed Maturity Securities (Fair Value) Selected Statistics
Public $ 21,310.9 62.4 % Earned Book Yield 4.59 % 4.85 %
Mortgage-Backed/Asset-Backed Securities 530.3 1.6 Average Duration (in years) 7.70 8.35
Private Placements 5,379.3 15.8
High Yield 2,013.3 5.9
Government Securities 1,275.4 3.7
Municipal Securities 3,635.5 10.6
Redeemable Preferred Stocks 3.5 —
Total $ 34,148.2 100.0 %
Amortized Cost Fair Value
Quality Ratings of Fixed Maturity Securities Private Equity Partnerships 9/30/2022 12/31/2021
Aaa 5.0 % 5.1 % Private Credit Partnerships $ 275.4 $ 279.4
Aa 11.9 11.5 Private Equity Partnerships 446.9 384.6
A 26.8 27.4 Real Asset Partnerships 402.3 314.6
Baa 50.4 50.1 Total $ 1,124.6 $ 978.6
Below Baa 5.9 5.9
Total 100.0 % 100.0 %
Non-Current Investments $ 13.2 $ 19.8

Unum Group Investments at September 30, 2022

Fixed Maturity Securities - By Industry Classification - Unrealized Gain (Loss)
Classification Fair Value Net Unrealized Gain (Loss) Fair Value with Gross Unrealized Loss Gross Unrealized Loss Fair Value with Gross Unrealized Gain Gross Unrealized Gain
Basic Industry $ 2,528.8 $ (267.4) $ 2,030.1 $ 294.3 $ 498.7 $ 26.9
Capital Goods 3,192.3 (296.2) 2,306.7 356.3 885.6 60.1
Communications 2,134.2 (193.6) 1,452.3 262.2 681.9 68.6
Consumer Cyclical 1,350.3 (148.1) 1,093.9 164.5 256.4 16.4
Consumer Non-Cyclical 5,448.3 (590.1) 3,953.3 683.1 1,495.0 93.0
Energy 2,736.3 (131.2) 1,583.0 194.2 1,153.3 63.0
Financial Institutions 3,305.3 (527.4) 3,013.4 541.3 291.9 13.9
Mortgage/Asset-Backed 530.3 (24.7) 399.6 32.1 130.7 7.4
Sovereigns 809.1 (63.5) 263.8 99.8 545.3 36.3
Technology 1,554.8 (217.0) 1,428.6 223.7 126.2 6.7
Transportation 1,545.8 (198.2) 1,233.4 214.2 312.4 16.0
U.S. Government Agencies and Municipalities 4,101.8 (651.3) 2,665.0 754.8 1,436.8 103.5
Public Utilities 4,910.9 (259.9) 2,744.6 386.6 2,166.3 126.7
Total $ 34,148.2 $ (3,568.6) $ 24,167.7 $ 4,207.1 $ 9,980.5 $ 638.5
Gross Unrealized Loss on Fixed Maturity Securities by Length of Time in Unrealized Loss Position
Investment-Grade Below-Investment-Grade
Category Fair Value Gross Unrealized Loss Fair Value Gross Unrealized Loss
Less than 91 days $ 8,489.4 $ 523.7 $ 518.9 $ 27.1
91 through 180 days 6,065.1 901.3 522.7 58.5
181 through 270 days 5,364.2 1,509.6 604.0 108.8
271 days to 1 year 1,499.7 646.0 63.9 15.2
Greater than 1 year 980.0 392.9 59.8 24.0
Total $ 22,398.4 $ 3,973.5 $ 1,769.3 $ 233.6

15.1

Appendix to Statistical Supplement

2022 Significant Items

•Third quarter of 2022 reserve assumption updates resulting in reserve reductions of $121.0 million and $34.0 million before tax, or $95.6 million and $26.9 million after tax, in our Unum US group long-term disability and group life product lines, respectively.

2021 Significant Items

•Third quarter of 2021 reserve assumption updates resulting in a reserve reduction of $215.0 million before tax, or $169.9 million after tax, in our Unum US group long-term disability product line and reserve increases of $2.1 million, $6.4 million, and $25.1 million before tax, or $1.7 million, $5.1 million, and $19.8 million after tax, in our Closed Block long-term care, Closed Block individual disability, and Closed Block group pension product lines, respectively.

•Third quarter of 2021 impairment loss of $12.1 million before tax, or $9.6 million after tax, on previously capitalized internal-use software that we no longer plan to utilize.

•Second quarter of 2021 cost related to the early retirement of debt of $67.3 million before tax, or $53.2 million after tax.

•Second quarter of 2021 impairment loss of $13.9 million, or $11.0 million after tax, on a right-of-use (ROU) asset related to an operating lease for office space that we do not plan to continue using to support our general operations.

•Second quarter of 2021 U.K. tax rate increase from 19 percent to 25 percent, effective April 1, 2023, which resulted in $24.2 million of additional tax expense through continuing operations for the revaluation of our deferred tax assets and liabilities.

•In December 2020, we completed the first phase of a reinsurance transaction, pursuant to which Provident Life and Accident Insurance Company, The Paul Revere Life Insurance Company, and Unum Life Insurance Company of America, wholly-owned domestic insurance subsidiaries of Unum Group, and collectively referred to as "the ceding companies", each entered into separate reinsurance agreements with Commonwealth Annuity and Life Insurance Company (Commonwealth), to reinsure on a coinsurance basis effective as of July 1, 2020, approximately 75 percent of the Closed Block individual disability business, primarily direct business written by the ceding companies. On March 31, 2021, we completed the second phase of the reinsurance transaction, pursuant to which the ceding companies and Commonwealth amended and restated their respective reinsurance agreements to reinsure on a coinsurance and modified coinsurance basis effective as of January 1, 2021, a substantial portion of the remaining Closed Block individual disability business that was not ceded in December 2020, primarily business previously assumed by the ceding companies.

In December 2020, Provident Life and Casualty Insurance Company (PLC), also a wholly-owned domestic insurance subsidiary of Unum Group, entered into an agreement with Commonwealth whereby PLC will provide a 12-year volatility cover to Commonwealth for the active life cohort (ALR cohort). On March 31, 2021, PLC and Commonwealth amended and restated this agreement to incorporate the ALR cohort related to the additional business that was reinsured between the ceding companies and Commonwealth as part of the second phase of the transaction. As part of the amended and restated volatility cover, PLC received a payment from Commonwealth of approximately $18 million.

In connection with the second phase of the reinsurance transaction, Commonwealth paid a total ceding commission to the ceding companies of $18.2 million. The ceding companies transferred assets of $767.0 million, which consisted primarily of cash and fixed maturity securities. In addition, we recognized the following in the first quarter of 2021 related to the second phase:

•Net realized investment gains totaling $67.6 million, or $53.4 million after tax, related to the transfer of investments.

•Increase in benefits and change in reserves for future benefits of $133.1 million, or $105.1 million after tax, resulting from the realization of previously unrealized investment gains and losses recorded in accumulated other comprehensive income.

•Transaction costs totaling $6.2 million, or $5.0 million after tax.

•Reinsurance recoverable of $990.0 million related to the policies on claim status (DLR cohort).

•Payable of $307.2 million related to the portfolio of invested assets associated with the business ceded on a modified coinsurance basis.

Appendix to Statistical Supplement - Continued

•Cost of reinsurance, or prepaid reinsurance premium, of $43.1 million related to the DLR cohort.

•Deposit asset of $5.0 million related to the ALR cohort.

2020 Significant Items

•In connection with the first phase of the previously-mentioned reinsurance transaction, the ceding companies paid a total cash ceding commission to Commonwealth of approximately $438 million and transferred additional assets consisting primarily of fixed maturity securities and cash totaling $6,669.8 million. PLC received a payment of $62 million from Commonwealth related to the 12-year volatility cover for the business reinsured during the first phase of the transaction. In addition, we recognized the following in the fourth quarter of 2020 related to the first phase:

•Net realized investment gain of $1,302.3 million before tax, or $1,028.8 million after tax, related to the transfer of investments.

•Increase in benefits and change in reserves for future benefits of $1,284.5 million, or $1,014.7 million after tax, resulting from the realization of previously unrealized investment gains and losses recorded in accumulated other comprehensive income.

•Transaction costs totaling $21.0 million, or $16.6 million after tax.

•Net tax benefit of $36.5 million.

•Reinsurance recoverable of $6,141.5 million representing the ceded reserves related to the DLR cohort.

•Cost of reinsurance, or prepaid reinsurance premium, of $815.7 million related to the DLR cohort, of which we recognized amortization expense of $2.6 million, or $2.0 million after tax.

•Deposit asset of $88.2 million related to the ALR cohort.

•Fourth quarter of 2020 reserve assumption updates resulting in reserve increases of $151.5 million and $17.5 million before tax, or $119.7 million and $13.8 million after tax, in our Closed Block long-term care and Closed Block group pension product lines, respectively.

•In December 2020, Northwind Holdings redeemed the remaining $35.0 million of principal on the Northwind notes, and was released of any contractual collateral requirements.

•Third quarter of 2020 costs related to organizational design update of $23.3 million before tax and $18.6 million after tax.

•Second quarter of 2020 impairment loss of $12.7 million, or $10.0 million after tax, on a ROU asset related to an operating lease for office space that we do not plan to continue using to support our general operations.

•In June 2016, the Financial Accounting Standards Board (FASB) issued an update that amended the guidance on the impairment of financial instruments. This update added an impairment model known as the current expected credit loss model that is based on expected losses rather than incurred losses, and will generally result in earlier recognition of allowances for losses. This new model applies to financial instruments such as mortgage loans, fixed maturity securities classified as held-to-maturity, and certain receivables. This update also prospectively modified the other-than-temporary impairment model used for available-for-sale fixed maturity securities such that credit losses are recognized as an allowance rather than as a reduction in the amortized cost of the security. We adopted this update effective January 1, 2020 using a modified retrospective approach through a cumulative-effect adjustment as of January 1, 2020 which resulted in a decrease to retained earnings of $18.9 million, a decrease to mortgage loans of $8.3 million, a decrease in reinsurance recoverable of $1.8 million, a decrease in accounts and premiums receivable of $13.5 million, a decrease in deferred income tax liability of $5.0 million, and an increase to other liabilities of $0.3 million.

16.1

Appendix to Statistical Supplement - Continued

Non-GAAP Financial Measures

We analyze our performance using non-GAAP financial measures which exclude or include amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with GAAP. We believe the following non-GAAP financial measures are better performance measures and better indicators of the revenue and profitability and underlying trends in our business:

•Consolidated adjusted operating revenue, which excludes investment gains or losses;

•After-tax adjusted operating income or loss, which excludes investment gains or losses and amortization of the cost of reinsurance as well as certain other items, as applicable;

•Adjusted operating return on equity, which is calculated using after-tax adjusted operating income or loss and excludes from equity the unrealized gain or loss on securities and net gain on hedges;

•Leverage ratio, which excludes the unrealized gain or loss on securities and net gain on hedges; and

•Book value per common share, which is calculated excluding accumulated other comprehensive income (loss) (AOCI).

Investment gains or losses primarily include realized investment gains or losses, expected investment credit losses, and gains or losses on derivatives. Investment gains or losses and unrealized gains or losses on securities depend on market conditions and do not necessarily relate to decisions regarding the underlying business of our Company. Leverage ratio and book value per common share excluding certain components of AOCI, certain of which tend to fluctuate depending on market conditions and general economic trends, are important measures.

As previously discussed, we have exited a substantial portion of our Closed Block individual disability product line through the two phases of the reinsurance transaction that were executed in December 2020 and March 2021, respectively. As a result, we exclude the amortization of the cost of reinsurance that was recognized upon the exit of the business related to the DLR cohort of policies. We believe that the exclusion of the amortization of the cost of reinsurance provides a better view of our results from our ongoing businesses.

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, 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.

For a reconciliation of the most directly comparable GAAP measures to these non-GAAP financial measures, refer to the "Reconciliation of Non-GAAP Financial Measures" beginning on page 16.3, other than book value per common share, which is presented on page 2.

16.2

Reconciliation of Non-GAAP Financial Measures

Three Months Ended
September 30 June 30 March 31 December 31 September 30 June 30 March 31 December 31 September 30
2022 2021 2020
Total Revenue $ 2,961.9 $ 3,040.9 $ 2,982.5 $ 2,979.1 $ 2,969.7 $ 2,993.0 $ 3,072.0 $ 4,273.5 $ 2,996.3
Excluding:
Net Investment Gain (Loss) (4.4) (4.1) (13.8) (8.7) (0.1) 0.9 84.6 1,304.9 4.4
Adjusted Operating Revenue $ 2,966.3 $ 3,045.0 $ 2,996.3 $ 2,987.8 $ 2,969.8 $ 2,992.1 $ 2,987.4 $ 2,968.6 $ 2,991.9

16.3

Reconciliation of Non-GAAP Financial Measures - Continued

After-Tax Adjusted Operating Income (Loss) Average Allocated Equity1 Annualized Adjusted Operating Return on Equity
Three Months Ended September 30, 2022
Unum US $ 217.4 $ 4,678.5 18.6 %
Unum International 43.4 704.2 24.7 %
Colonial Life 71.3 1,572.4 18.1 %
Core Operating Segments 332.1 6,955.1 19.1 %
Closed Block 25.3 4,585.6
Corporate (53.7) (691.2)
Total $ 303.7 $ 10,849.5 11.2 %
Three Months Ended September 30, 2021
Unum US $ 70.2 $ 4,527.8 6.2 %
Unum International 23.7 803.9 11.8 %
Colonial Life 63.2 1,570.3 16.1 %
Core Operating Segments 157.1 6,902.0 9.1 %
Closed Block 25.8 4,114.0
Corporate 27.6 (930.3)
Total $ 210.5 $ 10,085.7 8.3 %

1 Excludes net unrealized gain (loss) on securities and net gain on hedges and is calculated using the stockholders' equity balances presented on page 16.7.

16.4

Reconciliation of Non-GAAP Financial Measures - Continued

After-Tax Adjusted Operating Income (Loss) Average Allocated Equity2 Annualized Adjusted Operating Return on Equity
Nine Months Ended September 30, 2022
Unum US $ 586.6 $ 4,689.3 16.7 %
Unum International 116.3 736.0 21.1 %
Colonial Life 222.3 1,539.2 19.3 %
Core Operating Segments 925.2 6,964.5 17.7 %
Closed Block 161.2 4,596.7
Corporate (118.8) (877.3)
Total $ 967.6 $ 10,683.9 12.1 %
Nine Months Ended September 30, 2021
Unum US $ 303.5 $ 4,523.9 8.9 %
Unum International 62.5 801.0 10.4 %
Colonial Life 196.7 1,597.9 16.4 %
Core Operating Segments 562.7 6,922.8 10.8 %
Closed Block 188.6 4,019.5
Corporate (42.6) (983.1)
Total $ 708.7 $ 9,959.2 9.5 %

2 Excludes unrealized gain (loss) on securities and net gain on hedges and is calculated using the stockholders' equity balances presented on page 16.7.

16.5

Reconciliation of Non-GAAP Financial Measures - Continued

After-Tax Adjusted Operating Income (Loss) Average Allocated Equity3 Adjusted Operating Return on Equity
Year Ended December 31, 2021
Unum US $ 367.8 $ 4,500.0 8.2 %
Unum International 84.1 806.1 10.4 %
Colonial Life 259.9 1,580.3 16.4 %
Core Operating Segments 711.8 6,886.4 10.3 %
Closed Block 248.6 4,208.6
Corporate (69.7) (1,046.0)
Total $ 890.7 $ 10,049.0 8.9 %
Year Ended December 31, 2020
Unum US $ 651.4 $ 4,458.2 14.6 %
Unum International 51.9 797.7 6.5 %
Colonial Life 264.5 1,584.1 16.7 %
Core Operating Segments 967.8 6,840.0 14.1 %
Closed Block 183.8 3,979.2
Corporate (146.2) (1,395.2)
Total $ 1,005.4 $ 9,424.0 10.7 %

3 Excludes unrealized gain (loss) on securities and net gain on hedges and is calculated using the stockholders' equity balances presented on page 16.7. Due to the implementation of a FASB update for which the beginning balances of 2020 for certain stockholders' equity line items were adjusted, we are computing the average allocated equity for 2020 using internally allocated equity that reflects the adjusted beginning balances at January 1, 2020. As a result, average equity for the year ended December 31, 2020 for certain of our segments will not compute using the historical allocated equity at December 31, 2019.

16.6

Reconciliation of Non-GAAP Financial Measures - Continued

Average allocated equity is computed as follows:

9/30/2022 6/30/2022 12/31/2021 9/30/2021 6/30/2021 12/31/2020 12/31/2019
Total Stockholders' Equity $ 8,659.5 $ 9,705.1 $ 11,416.4 $ 11,118.2 $ 10,947.5 $ 10,871.0 $ 9,965.0
Excluding:
Net Unrealized Gain (Loss) on Securities (2,329.3) (1,064.9) 962.2 836.0 911.4 1,067.7 615.9
Net Gain on Hedges 13.5 46.4 61.8 69.5 77.5 97.8 187.8
Total Adjusted Stockholders' Equity $ 10,975.3 $ 10,723.6 $ 10,392.4 $ 10,212.7 $ 9,958.6 $ 9,705.5 $ 9,161.3
Three Months Ended Nine Months Ended Twelve Months Ended Three Months Ended Nine Months Ended Twelve Months Ended
9/30/2022 12/31/2021 9/30/2021 12/31/2020
Average Adjusted Stockholders' Equity $ 10,849.5 $ 10,683.9 $ 10,049.0 $ 10,085.7 $ 9,959.2 $ 9,424.0

16.7

Reconciliation of Non-GAAP Financial Measures - Continued

Three Months Ended September 30 Nine Months Ended September 30
2022 2021 2022 2021
(in millions) per share* (in millions) per share* (in millions) per share* (in millions) per share*
Net Income $ 410.7 $ 2.04 $ 328.6 $ 1.60 $ 1,034.6 $ 5.11 $ 664.5 $ 3.24
Excluding:
Net Investment Gains and Losses
Net Realized Investment Gain Related to Reinsurance Transaction (net of tax expense of $—; $—; $—; $14.2) — — — — — — 53.4 0.26
Net Investment Gain (Loss) (net of tax expense (benefit) of $(1.0); $—; $(5.2); $3.8) (3.4) (0.02) (0.1) — (17.1) (0.09) 14.0 0.07
Total Net Investment Gain (Loss) (3.4) (0.02) (0.1) — (17.1) (0.09) 67.4 0.33
Items Related to Closed Block Individual Disability Reinsurance Transaction
Change in Benefit Reserves and Transaction Costs (net of tax benefit of $—; $—; $—; $29.2 ) — — — — — — (110.1) (0.53)
Amortization of the Cost of Reinsurance (net of tax benefit of $3.1; $4.2; $10.1; $12.6 ) (12.1) (0.06) (15.5) (0.08) (38.4) (0.19) (46.8) (0.24)
Total Items Related to Closed Block Individual Disability Reinsurance Transaction (12.1) (0.06) (15.5) (0.08) (38.4) (0.19) (156.9) (0.77)
Net Reserve Decrease Related to Reserve Assumption Updates (net of tax expense of $32.5; $38.1; $32.5; $38.1 ) 122.5 0.61 143.3 0.70 122.5 0.61 143.3 0.70
Impairment Loss on Internal-Use Software (net of tax benefit of $—; $2.5; $—; $2.5 ) — — (9.6) (0.05) — — (9.6) (0.05)
Cost Related to Early Retirement of Debt (net of tax benefit of $—; $—; $—; $14.1) — — — — — — (53.2) (0.26)
Impairment Loss on ROU Asset (net of tax benefit of $—; $—; $—; $2.9) — — — — — — (11.0) (0.05)
Impact of U.K. Tax Rate Increase — — — — — (24.2) (0.12)
After-tax Adjusted Operating Income $ 303.7 $ 1.51 $ 210.5 $ 1.03 $ 967.6 $ 4.78 $ 708.7 $ 3.46

*Assuming Dilution.

16.8

Reconciliation of Non-GAAP Financial Measures - Continued

Year Ended December 31
2021 2020
(in millions) per share * (in millions) per share *
Net Income $ 824.2 $ 4.02 $ 793.0 $ 3.89
Excluding:
Net Investment Gains and Losses
Net Realized Investment Gain Related to Reinsurance Transaction (net of tax expense of $14.2; $273.5) 53.4 0.26 1,028.8 5.05
Net Investment Gain (Loss), Other (net of tax expense (benefit) of $1.9; $(20.9)) 7.2 0.03 (82.3) (0.40)
Total Net Investment Gain 60.6 0.29 946.5 4.65
Items Related to Closed Block Individual Disability Reinsurance Transaction
Change in Benefit Reserves and Transaction Costs (net of tax benefit of $29.2; $274.2) (110.1) (0.53) (1,031.3) (5.06)
Amortization of the Cost of Reinsurance (net of tax benefit of $16.8; $0.6) (62.3) (0.31) (2.0) (0.01)
Net Tax Benefits of Reinsurance Transaction — — 36.5 0.18
Total Items Related to Closed Block Individual Disability Reinsurance Transaction (172.4) (0.84) (996.8) (4.89)
Net Reserve Change Related to Reserve Assumption Updates (net of tax expense (benefit) of $38.1; $(35.5)) 143.3 0.70 (133.5) (0.66)
Impairment Loss on Internal-Use Software (net of tax benefit of $2.5; $—) (9.6) (0.05) — —
Cost Related to Early Retirement of Debt (net of tax benefit of $14.1; $—) (53.2) (0.26) — —
Impairment Loss on ROU Asset (net of tax benefit of $2.9; $2.7) (11.0) (0.05) (10.0) (0.05)
Impact of U.K. Tax Rate Increase (24.2) (0.12) — —
Costs Related to Organizational Design Update (net of tax benefit of $—; $4.7) — — (18.6) (0.09)
After-tax Adjusted Operating Income $ 890.7 $ 4.35 $ 1,005.4 $ 4.93

*Assuming Dilution.

16.9

Reconciliation of Non-GAAP Financial Measures - Continued

After-Tax Adjusted Operating Income Average Allocated Equity Annualized Adjusted Operating Return on Equity
Three Months Ended September 30, 2022
Unum US Supplemental and Voluntary $ 90.2 $ 2,096.4 17.2 %

16.10

Reconciliation of Non-GAAP Financial Measures - Continued

Three Months Ended
September 30, 2022 September 30, 2021
Premium Income Premium Income, local currency1 Weighted Average Exchange Rate2 Premium Income in Constant Currency
Unum International
Unum UK $ 152.2 £ 115.4 1.176 $ 135.7
Unum Poland 21.1 zł 87.3 0.212 18.5
Total 173.3 154.2
Unum US 1,559.6 $ 1,500.8 1,500.8
Colonial Life 423.3 $ 420.8 420.8
Core Operations $ 2,156.2 $ 2,075.8
Three Months Ended
--- --- --- --- --- --- --- --- ---
June 30, 2022 June 30, 2021
Premium Income Premium Income, local currency1 Weighted Average Exchange Rate3 Premium Income in Constant Currency
Unum International
Unum UK $ 157.0 £ 115.1 1.256 $ 144.6
Unum Poland 22.4 zł 84.6 0.230 19.5
Total 179.4 164.1
Unum US 1,572.3 $ 1,522.1 1,522.1
Colonial Life 427.6 $ 419.7 419.7
Core Operations $ 2,179.3 $ 2,105.9

1Premium income shown in millions of pounds for Unum UK, millions of zlotys for Unum Poland, and U.S. dollars for Unum US and Colonial Life.

2Exchange rate calculated using the premium income in U.S. dollars for the three months ended September 30, 2022 divided by premium income in local currency for the three months ended September 30, 2022.

3Exchange rate calculated using the premium income in U.S. dollars for the three months ended June 30, 2022 divided by premium income in local currency for the three months ended June 30, 2022.

16.11

Reconciliation of Non-GAAP Financial Measures - Continued

September 30 December 31
2022 2021 2021 2020
Debt $ 3,429.2 $ 3,441.4 $ 3,442.2 $ 3,345.7
Including:
Lease Liability 69.8 87.3 82.6 105.9
Adjusted Debt and Lease Liability $ 3,499.0 $ 3,528.7 $ 3,524.8 $ 3,451.6
Total Stockholders' Equity $ 8,659.5 $ 11,118.2 $ 11,416.4 $ 10,871.0
Excluding:
Net Unrealized Gain on Securities and Net Gain on Hedges (2,315.8) 905.5 1,024.0 1,165.5
Equity, As Adjusted 10,975.3 10,212.7 10,392.4 9,705.5
Debt, As Adjusted and Lease Liability 3,499.0 3,528.7 3,524.8 3,451.6
Total Adjusted Capital $ 14,474.3 $ 13,741.4 $ 13,917.2 $ 13,157.1
Leverage Ratio 24.2 % 25.7 % 25.3 % 26.2 %

16.12

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