Equibles

8-K

Unum Group (UNM)

8-K 2023-01-31 For: 2023-01-31
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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): January 31, 2023

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 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 January 31, 2023, Unum Group issued a news release reporting its results for the fourth quarter of 2022, a copy of which is furnished herewith as Exhibit 99.1 to this Current Report on Form 8-K and incorporated herein by reference.

Also on January 31, 2023, Unum Group posted on its website at www.unum.com the Statistical Supplement relating to its financial results for the fourth 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 Unum Group's filings under the Securities Act of 1933 or the Exchange Act, except as shall be expressly set forth by specific reference in such filing.

Item 9.01    Financial Statements and Exhibits.

(d) Exhibits.
Exhibit No. Description
99.1 News release of Unum Group dated January 31, 2023, concerning earnings for the fourth quarter of 2022.
99.2 Statistical Supplement of Unum Group for the fourth 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: January 31, 2023 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 Fourth Quarter 2022 Results

•Net income of $279.6 million ($1.39 per diluted common share) for the fourth quarter of 2022; after-tax adjusted operating income was $286.7 million ($1.43 per diluted common share).

•Results reflect strong operating performance and the continuation of favorable trends seen throughout 2022; growth in full year 2022 after-tax adjusted operating income per diluted common share of 42.8 percent.

•Strong core operations sales growth of 16.8 percent and stable persistency supporting premium growth of nearly 4 percent on a constant currency basis.

•Robust balance sheet and liquidity with holding company cash of $1.6 billion and weighted average risk-based capital ratio of approximately 420 percent.

•Book value per common share of $46.51 decreased 17.5 percent compared to the year-ago quarter; book value per common share excluding accumulated other comprehensive income (loss) (AOCI) grew 10.7 percent over the year-ago quarter to $60.45.

CHATTANOOGA, Tenn. (January 31, 2023) - Unum Group (NYSE: UNM) today reported net income of $279.6 million ($1.39 per diluted common share) for the fourth quarter of 2022, compared to net income of $159.7 million ($0.78 per diluted common share) for the fourth quarter of 2021.

Included in net income for the fourth quarter of 2022 is the after-tax amortization of the cost of reinsurance of $12.0 million ($0.06 per diluted common share), as well as a net after-tax investment gain on the Company’s investment portfolio of $4.9 million ($0.02 per diluted common share). Included in net income for the fourth quarter of 2021 is 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 $6.8 million ($0.03 per diluted common share).

“2022 was an excellent year for Unum, reflecting the fundamental strength of our business and our ongoing commitment to delivery for our customers,” said Richard P. McKenney, president and chief executive officer. “Our solid fourth quarter results were driven by higher premiums across our core segments and continued favorable trends in our Group Disability line. We enter 2023 with strong sales momentum and record levels of capital. This positions us well to execute on our strategy of growth while returning capital to our shareholders through dividends and share repurchase."

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 or 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 $228.7 million in the fourth quarter of 2022, an increase of 181.0 percent from $81.4 million in the fourth quarter of 2021. Premium income for the segment increased 3.4 percent to $1,581.5 million in the fourth quarter of 2022, compared to premium income of $1,529.3 million in the fourth quarter of 2021. Net investment income for the segment decreased 8.3 percent to $166.9 million in the fourth quarter of 2022, compared to $182.1 million in the fourth quarter of 2021.

Within the Unum US operating segment, the group disability line of business reported a 236.1 percent increase in adjusted operating income to $114.6 million in the fourth quarter of 2022, compared to $34.1 million in the fourth quarter of 2021. Premium income for the group disability line of business increased 7.3 percent to $732.9 million in the fourth quarter of 2022, compared to $682.9 million in the fourth quarter of 2021, driven by in-force block growth and favorable persistency. Net investment income decreased 8.9 percent to $86.5 million in the fourth quarter of 2022, compared to $94.9 million in the fourth quarter of 2021, driven by lower miscellaneous investment income and a lower level of invested assets. The benefit ratio for the fourth quarter of 2022 was 64.1 percent, compared to 78.3 percent in the fourth quarter of 2021, primarily due to lower claims incidence in both the group short-term and long-term disability product lines as well as favorable recoveries in the group long-term disability product line. Group long-term disability sales were $156.1 million in the fourth quarter of 2022, an increase of 45.5 percent from $107.3 million in the fourth quarter of 2021. Group short-term disability sales were $101.9 million in the fourth quarter of 2022, an increase of 54.9 percent from $65.8 million in the fourth quarter of 2021. Persistency in the group long-term disability product line was 90.7 percent for full year 2022, compared to 89.6 percent for full year 2021. Persistency in the group short-term disability product line was 88.9 percent for full year 2022, compared to 87.4 percent for full year 2021.

The group life and accidental death and dismemberment line of business reported adjusted operating income of $29.3 million in the fourth quarter of 2022, compared to an adjusted operating loss of $71.7 million in the fourth quarter of 2021. Premium income for this line of business increased 1.8 percent to $463.2 million in the fourth quarter of 2022, compared to $455.2 million in the fourth quarter of 2021, driven by in-force block growth, partially offset by lower persistency. Net investment income decreased 9.7 percent to $25.2 million in the fourth quarter of 2022, compared to $27.9 million in the fourth quarter of 2021, due primarily to lower miscellaneous investment income, partially offset by an increase in the yield on invested assets. The benefit ratio in the fourth quarter of 2022 was 78.2 percent, compared to 98.3 percent in the fourth quarter of 2021, 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 decreased 8.0 percent in the fourth quarter of 2022 to $94.9 million, compared to $103.2 million in the fourth quarter of 2021. Persistency in the group life product line was 88.9 percent for full year 2022, compared to 89.7 percent for full year 2021. Persistency in the accidental death and dismemberment product line was 87.9 percent for full year 2022, compared to 89.1 percent for full year 2021.

The supplemental and voluntary line of business reported a decrease of 28.7 percent in adjusted operating income to $84.8 million in the fourth quarter of 2022, compared to $119.0 million in the fourth quarter of 2021. Results were impacted from the recapture of a critical illness reinsurance treaty in the voluntary benefits product line. Premium income for the supplemental and voluntary line of business decreased to $385.4 million in the fourth quarter of 2022, compared to $391.2 million in the fourth quarter of 2021, due primarily to a change in estimate in the individual disability unearned premium reserve. Net investment income decreased 6.9 percent to $55.2 million in the fourth quarter of 2022, compared to $59.3 million in the fourth quarter of 2021, primarily due to lower miscellaneous investment income and a decrease in the yield on invested assets. The benefit ratio for the individual disability product line was 53.2 percent for the fourth quarter of 2022, compared to 40.2 percent for the fourth quarter of 2021, due to a change in estimate in the individual disability

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

unearned premium reserve as well as higher average benefit size. The benefit ratio for the voluntary benefits product line was 44.9 percent in the fourth quarter of 2022, compared to 42.9 percent for the fourth quarter of 2021, due to unfavorable experience in both the critical illness and accident product lines, partially offset by lower mortality in the life product line, resulting primarily from lessening impacts of COVID-19 on our insured population. The benefit ratio for the dental and vision product line was 65.9 percent in the fourth quarter of 2022, compared to 65.6 percent for the fourth quarter of 2021. Relative to the fourth quarter of 2021, sales in the individual disability product line increased 16.7 percent in the fourth quarter of 2022 to $25.9 million. Sales in the voluntary benefits product line decreased 5.0 percent in the fourth quarter of 2022 to $49.9 million. Sales in the dental and vision product line totaled $41.2 million for the fourth quarter of 2022, an increase of 43.1 percent compared to the fourth quarter of 2021. Persistency in the individual disability product line was 89.5 percent for full year 2022, compared to 89.7 percent for full year 2021. Persistency in the voluntary benefits product line was 75.8 percent for both full year 2022 and 2021. Persistency in the dental and vision product line was 79.9 percent for full year 2022, compared to 86.0 percent for full year 2021.

Unum International

The Unum International segment reported adjusted operating income of $45.0 million in the fourth quarter of 2022, an increase of 66.1 percent from $27.1 million in the fourth quarter of 2021. Premium income increased 0.5 percent to $178.3 million in the fourth quarter of 2022, compared to $177.5 million in the fourth quarter of 2021. Net investment income increased 26.1 percent to $47.8 million in the fourth quarter of 2022, compared to $37.9 million in the fourth quarter of 2021. Sales decreased 7.1 percent to $23.6 million in the fourth quarter of 2022, compared to $25.4 million in the fourth quarter of 2021. For the fourth 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 fourth quarter of 2021.

The Unum UK line of business reported adjusted operating income, in local currency, of £37.7 million in the fourth quarter of 2022, an increase of 101.6 percent from £18.7 million in the fourth quarter of 2021. Premium income was £132.1 million in the fourth quarter of 2022, an increase of 15.4 percent from £114.5 million in the fourth quarter of 2021, due to favorable sales and in-force block growth. Net investment income was £38.6 million in the fourth quarter of 2022, an increase of 44.0 percent from £26.8 million in the fourth quarter of 2021, due to higher investment income from inflation index-linked bonds. The benefit ratio in the fourth quarter of 2022 was 76.0 percent, compared to 81.4 percent in the fourth quarter of 2021, due to favorable experience in the group long-term disability product line driven by favorable recoveries. Sales increased 1.4 percent to £14.8 million in the fourth quarter of 2022, compared to £14.6 million in the fourth quarter of 2021. Persistency in the group long-term disability product line was 85.1 percent for full year 2022, compared to 89.3 percent for full year 2021. Persistency in the group life product line was 87.9 percent for full year 2022, compared to 86.5 percent for full year 2021. Persistency in the supplemental product line was 92.8 percent for full year 2022, compared to 90.9 percent for full year 2021.

Colonial Life Segment

Colonial Life reported a 16.3 percent increase in adjusted operating income to $93.0 million in the fourth quarter of 2022, compared to $80.0 million in the fourth quarter of 2021. Premium income decreased 0.7 percent to $420.4 million in the fourth quarter of 2022, compared to $423.3 million in the fourth quarter of 2021, primarily as a result of lower overall persistency, partially offset by higher prior period sales. Net investment income decreased 8.8 percent to $37.3 million in the fourth quarter of 2022, compared to $40.9 million in the fourth quarter of 2021, due to lower miscellaneous 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 45.0 percent in the fourth quarter of 2022, compared to the benefit ratio of 52.5 percent in the fourth quarter of 2021, driven by favorable claim experience across all product lines.

Sales increased 2.3 percent to $170.0 million in the fourth quarter of 2022, compared to $166.2 million in the fourth quarter of 2021. Persistency in Colonial Life was 78.0 percent for full year 2022, compared to 79.3 percent for full year 2021.

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

Closed Block Segment

The Closed Block segment reported adjusted operating income of $40.4 million in the fourth quarter of 2022, compared to $76.7 million in the fourth quarter of 2021. Excluded from the fourth quarters of 2022 and 2021 is the amortization of the cost of reinsurance related to the Closed Block individual disability reinsurance transaction of $15.3 million and $19.7 million, respectively. Premium income for this segment declined 5.6 percent to $230.9 million in the fourth quarter of 2022, compared to $244.5 million in the fourth quarter of 2021, due to policy terminations, partially offset by rate increases. Net investment income decreased 10.5 percent to $252.9 million in the fourth quarter of 2022, compared to $282.5 million in the fourth quarter of 2021, due to lower miscellaneous investment income, partially related to smaller increases in the net asset value on our private equity partnerships, and a decline in the yield on invested assets. These decreases were partially offset by an increase in the level of invested assets.

The interest adjusted loss ratio for the long-term care line of business increased to 86.3 percent in the fourth quarter of 2022, compared to 82.2 percent in the fourth quarter of 2021, driven primarily by higher incidence. The interest adjusted loss ratio for the long-term care line of business for full year 2022 was 82.0 percent which is below our long-term expected range.

Corporate Segment

The Corporate segment reported an adjusted operating loss of $37.5 million in the fourth quarter of 2022, compared to an adjusted operating loss of $45.1 million in the fourth quarter of 2021, due primarily to higher net investment income and lower interest and debt expenses, partially offset by higher operating expenses.

OTHER INFORMATION

Shares Outstanding

The Company’s weighted average number of shares outstanding, assuming dilution, was 200.9 million for the fourth quarter of 2022, compared to 204.2 million for the fourth quarter of 2021. Shares outstanding totaled 197.8 million at December 31, 2022. During the fourth quarter of 2022, the Company repurchased 1.5 million shares at a cost of $62.6 million.

Capital Management

At December 31, 2022, the weighted average risk-based capital ratio for the Company’s traditional U.S. insurance companies was approximately 420 percent, and cash and marketable securities in the holding companies equaled $1,571.0 million.

Book Value

Book value per common share as of December 31, 2022 was $46.51, compared to $56.37 at December 31, 2021. Book value per common share excluding AOCI as of December 31, 2022 was $60.45, compared to $54.63 at December 31, 2021.

Effective Tax Rate

Effective tax rate on adjusted operating earnings was 22.4 percent in the fourth quarter of 2022, and 19.4 percent for full year 2022.

Outlook

The Company will hold its 2023 outlook meeting on Thursday, February 23, 2023, at 8:30 a.m. Eastern time, in New York City. Additional information, including information on how to access a webcast of the meeting which will be simulcast in a listen-only mode, can be found on the “Investors” section of the Company’s website.

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

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. The non-GAAP measure "book value per common share excluding AOCI" differs from the GAAP measure due to the exclusion of AOCI. We believe these measures are better performance measures and better indicators 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 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.

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

CONFERENCE CALL INFORMATION

Members of Unum Group senior management will host a conference call on Wednesday, February 1, 2023, at 8:00 a.m. Eastern Time to discuss the results of operations for the fourth quarter of 2022. 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 1-844-200-6205 for callers in the U.S. (pass code 224848). For callers in Canada, the dial-in number is 1-833- 950-0062 (pass code 224848). For all other callers, the dial-in number is 1-929 526-1599 (pass code 224848). 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 February 7, 2022 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) - pass code 936552.

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

#

ABOUT UNUM GROUP

Unum Group (NYSE: UNM), an international provider of workplace benefits and services, has been helping workers and their families for 175 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 2022, Unum reported revenues of $12.0 billion and paid $7.9 billion in benefits. The Fortune 500 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).

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, 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,

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

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)
Year Ended December 31
2021 2022 2021
Revenue
Premium Income 2,411.1 $ 2,374.6 $ 9,623.4 $ 9,481.0
Net Investment Income 550.8 2,122.2 2,213.2
Net Investment Gain (Loss) (8.7) (15.7) 76.7
Other Income 62.4 261.1 242.9
Total Revenue 2,979.1 11,991.0 12,013.8
Benefits and Expenses
Benefits and Change in Reserves for Future Benefits 1,939.4 6,936.7 7,598.6
Commissions 260.2 1,086.4 1,038.1
Interest and Debt Expense 50.6 188.5 185.0
Cost Related to Early Retirement of Debt — 4.2 67.3
Deferral of Acquisition Costs (119.2) (556.9) (508.1)
Amortization of Deferred Acquisition Costs 145.3 591.0 586.1
Other Expenses 511.1 2,109.7 1,983.8
Total Benefits and Expenses 2,787.4 10,359.6 10,950.8
Income Before Income Tax 191.7 1,631.4 1,063.0
Income Tax 32.0 317.2 238.8
Net Income 279.6 $ 159.7 $ 1,314.2 $ 824.2
PER SHARE INFORMATION
Net Income Per Common Share
Basic 1.41 $ 0.78 $ 6.55 $ 4.04
Assuming Dilution 1.39 $ 0.78 $ 6.50 $ 4.02
Weighted Average Common Shares - Basic (000s) 203,653.1 200,647.2 204,232.9
Weighted Average Common Shares - Assuming Dilution (000s) 204,243.2 202,109.4 204,847.9
Outstanding Shares - (000s) 197,755.0 202,514.2

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 December 31
2022 2021
(in millions) per share * (in millions) per share *
Net Income $ 279.6 $ 1.39 $ 159.7 $ 0.78
Excluding:
Net Investment Gain (Loss) (net of tax expense (benefit) $1.7; $(1.9)) 4.9 0.02 (6.8) (0.03)
Amortization of the Cost of Reinsurance (net of tax benefit of $3.3; $4.2) (12.0) (0.06) (15.5) (0.08)
After-tax Adjusted Operating Income $ 286.7 $ 1.43 $ 182.0 $ 0.89
Year Ended December 31
--- --- --- --- --- --- --- --- ---
2022 2021
(in millions) per share * (in millions) per share *
Net Income $ 1,314.2 $ 6.50 $ 824.2 $ 4.02
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), Other (net of tax expense (benefit) of $(3.5); $1.9) (12.2) (0.07) 7.2 0.03
Total Net Investment Gain (12.2) (0.07) 60.6 0.29
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 $13.4; $16.8) (50.4) (0.25) (62.3) (0.31)
Total Items Related to Closed Block Individual Disability Reinsurance Transaction (50.4) (0.25) (172.4) (0.84)
Net Reserve Change 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)
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 $ 1,254.3 $ 6.21 $ 890.7 $ 4.35
* Assuming Dilution UNUM IS A REGISTERED TRADEMARK AND MARKETING BRAND OF UNUM GROUP AND ITS INSURING SUBSIDIARIES. 9
--- ---
December 31
--- --- --- --- --- --- --- --- ---
2022 2021
(in millions) per share (in millions) per share
Total Stockholders' Equity (Book Value) $ 9,197.5 $ 46.51 $ 11,416.4 $ 56.37
Excluding:
Net Unrealized Gain (Loss) on Securities (2,023.8) (10.23) 962.2 4.75
Net Gain (Loss) on Hedges (9.6) (0.05) 61.8 0.30
Subtotal 11,230.9 56.79 10,392.4 51.32
Excluding:
Foreign Currency Translation Adjustment (389.1) (1.97) (273.9) (1.35)
Subtotal 11,620.0 58.76 10,666.3 52.67
Excluding:
Unrecognized Pension and Postretirement Benefit Costs (334.1) (1.69) (396.0) (1.96)
Total Stockholders' Equity, Excluding Accumulated Other Comprehensive Income (Loss) $ 11,954.1 $ 60.45 $ 11,062.3 $ 54.63
Three Months Ended
--- --- --- --- --- --- --- ---
December 31, 2022 December 31, 2021
Premium Income Premium Income, Local Currency1 Weighted Average Exchange Rate2 Premium Income in Constant Currency
Unum International
Unum UK $ 155.3 £ 114.5 1.176 $ 134.7
Unum Poland 23.0 zł 93.4 0.217 20.2
Total 178.3 154.9
Unum US 1,581.5 $ 1,529.3 1,529.3
Colonial Life 420.4 $ 423.3 423.3
Core Operations $ 2,180.2 $ 2,107.5

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 is calculated using the average foreign currency exchange rates for the most recent period, applied to the comparable prior period.

UNUM IS A REGISTERED TRADEMARK AND MARKETING BRAND OF UNUM GROUP AND ITS INSURING SUBSIDIARIES. 10

Document

cover4q22.jpg

Unum Group

Statistical Supplement Fourth 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 16.3 for a reconciliation of our non-GAAP financial measures.
N.M. = not a meaningful percentage

Unum Group Financial Highlights

Three Months Ended Year Ended
12/31/2022 12/31/2021 12/31/2022 12/31/2021 12/31/2020
Consolidated U.S. GAAP Results¹
Premium Income $ 2,411.1 $ 2,374.6 $ 9,623.4 $ 9,481.0 $ 9,378.1
Adjusted Operating Revenue $ 2,999.1 $ 2,987.8 $ 12,006.7 $ 11,937.1 $ 11,963.0
Net Investment Gain (Loss) 6.6 (8.7) (15.7) 76.7 1,199.1
Revenue $ 3,005.7 $ 2,979.1 $ 11,991.0 $ 12,013.8 $ 13,162.1
Net Income $ 279.6 $ 159.7 $ 1,314.2 $ 824.2 $ 793.0
Net Income Per Common Share:
Basic $ 1.41 $ 0.78 $ 6.55 $ 4.04 $ 3.89
Assuming Dilution $ 1.39 $ 0.78 $ 6.50 $ 4.02 $ 3.89
Assets $ 61,434.9 $ 70,115.6 $ 70,625.8
Stockholders' Equity $ 9,197.5 $ 11,416.4 $ 10,871.0
Adjusted Operating Return on Equity
Unum US 15.0 % 5.6 % 16.3 % 8.2 % 14.6 %
Unum International 22.4 % 11.0 % 20.3 % 10.4 % 6.5 %
Colonial Life 19.0 % 16.2 % 19.1 % 16.4 % 16.7 %
Core Operating Segments 16.6 % 8.6 % 17.4 % 10.3 % 14.1 %
Consolidated 10.3 % 7.1 % 11.6 % 8.9 % 10.7 %
Traditional U.S. Life Insurance Companies' Statutory Results2
--- --- --- --- --- --- --- --- --- --- ---
Net Gain from Operations, After Tax $ 240.4 $ 249.8 $ 965.4 $ 681.1 $ 726.2
Net Realized Capital Gain (Loss), After Tax 2.3 11.1 — 98.4 (79.4)
Net Income $ 242.7 $ 260.9 $ 965.4 $ 779.5 $ 646.8
Capital and Surplus $ 3,816.3 $ 3,950.3 $ 3,875.0
Weighted Average Risk-based Capital Ratio ~ 420% ~ 395% ~ 365%

1 Generally Accepted Accounting Principles

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

Unum Group Capital Metrics

12/31/2022 12/31/2021 12/31/2020
(in millions) per share (in millions) per share (in millions) per share
Total Stockholders' Equity (Book Value) $ 9,197.5 $ 46.51 $ 11,416.4 $ 56.37 $ 10,871.0 $ 53.37
Excluding:
Net Unrealized Gain (Loss) on Securities (2,023.8) (10.23) 962.2 4.75 1,067.7 5.24
Net Gain (Loss) on Hedges (9.6) (0.05) 61.8 0.30 97.8 0.48
Subtotal 11,230.9 56.79 10,392.4 51.32 9,705.5 47.65
Excluding:
Foreign Currency Translation Adjustment (389.1) (1.97) (273.9) (1.35) (261.3) (1.28)
Subtotal 11,620.0 58.76 10,666.3 52.67 9,966.8 48.93
Excluding:
Unrecognized Pension and Postretirement Benefit Costs (334.1) (1.69) (396.0) (1.96) (530.0) (2.61)
Total Stockholders' Equity, Excluding Accumulated Other Comprehensive Income (Loss) $ 11,954.1 $ 60.45 $ 11,062.3 $ 54.63 $ 10,496.8 $ 51.54
Dividends Paid $ 255.3 $ 1.26 $ 240.6 $ 1.17 $ 233.2 $ 1.14 Three Months Ended Year Ended
--- --- --- --- --- --- --- --- --- --- --- --- --- ---
12/31/2022 12/31/2021 12/31/2022 12/31/2021 12/31/2020
Shares Repurchased (millions) 1.5 1.9 5.7 1.9 —
Cost of Shares Repurchased (millions)1 $ 62.6 $ 50.0 $ 200.1 $ 50.0 $ —
Price (UNM closing price on last trading day of period) $ 41.03 $ 24.57 $ 22.94
Leverage Ratio 23.7 % 25.3 % 26.2 %
Holding Company Cash and Marketable Securities $ 1,571 $ 1,515 $ 1,512

1 Includes commissions of $0.1 million for the year ended December 31, 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 Positive Stable Stable
Financial Strength Rating Stable Positive Stable Stable

NR = not rated

Unum Group Consolidated Statements of Income

Three Months Ended Year Ended
12/31/2022 12/31/2021 12/31/2022 12/31/2021 12/31/2020
Revenue
Premium Income $ 2,411.1 $ 2,374.6 $ 9,623.4 $ 9,481.0 $ 9,378.1
Net Investment Income 524.4 550.8 2,122.2 2,213.2 2,360.7
Net Investment Gain (Loss) 6.6 (8.7) (15.7) 76.7 1,199.1
Other Income 63.6 62.4 261.1 242.9 224.2
Total Revenue 3,005.7 2,979.1 11,991.0 12,013.8 13,162.1
Benefits and Expenses
Benefits and Change in Reserves for Future Benefits 1,755.4 1,939.4 6,936.7 7,598.6 8,972.9
Commissions 267.3 260.2 1,086.4 1,038.1 1,057.3
Interest and Debt Expense - Non-recourse Debt — — — — 3.1
Interest and Debt Expense - All Other Debt 47.2 50.6 188.5 185.0 185.1
Cost Related to Early Retirement of Debt — — 4.2 67.3 —
Deferral of Acquisition Costs (137.8) (119.2) (556.9) (508.1) (576.2)
Amortization of Deferred Acquisition Costs 141.5 145.3 591.0 586.1 606.1
Other Expenses 571.2 511.1 2,109.7 1,983.8 1,949.8
Total Benefits and Expenses 2,644.8 2,787.4 10,359.6 10,950.8 12,198.1
Income Before Income Tax 360.9 191.7 1,631.4 1,063.0 964.0
Income Tax Expense 81.3 32.0 317.2 238.8 171.0
Net Income $ 279.6 $ 159.7 $ 1,314.2 $ 824.2 $ 793.0
Weighted Average Shares Outstanding
Basic 198.8 203.7 200.6 204.2 203.6
Assuming Dilution 200.9 204.2 202.1 204.8 203.8
Actual Number of Shares Outstanding 197.8 202.5 203.7

Unum Group Sales Data for Unum US Segment

Three Months Ended Year Ended
12/31/2022 12/31/2021 % Change 12/31/2022 12/31/2021 12/31/2020
Sales by Product
Group Disability and Group Life and AD&D
Group Long-term Disability $ 156.1 $ 107.3 45.5 % $ 295.3 $ 206.6 $ 239.7
Group Short-term Disability 101.9 65.8 54.9 184.3 142.7 158.7
Group Life and AD&D 94.9 103.2 (8.0) 232.4 223.8 224.3
Subtotal 352.9 276.3 27.7 712.0 573.1 622.7
Supplemental and Voluntary
Voluntary Benefits 49.9 52.5 (5.0) 238.7 231.2 241.6
Individual Disability 25.9 22.2 16.7 90.8 75.0 71.4
Dental and Vision 41.2 28.8 43.1 73.8 62.4 63.9
Subtotal 117.0 103.5 13.0 403.3 368.6 376.9
Total Sales $ 469.9 $ 379.8 23.7 $ 1,115.3 $ 941.7 $ 999.6
Sales by Market Sector
Group Disability and Group Life and AD&D
Core Market (< 2,000 employees) $ 229.0 $ 184.0 24.5 % $ 457.5 $ 371.5 $ 377.0
Large Case Market 123.9 92.3 34.2 254.5 201.6 245.7
Subtotal 352.9 276.3 27.7 712.0 573.1 622.7
Supplemental and Voluntary 117.0 103.5 13.0 403.3 368.6 376.9
Total Sales $ 469.9 $ 379.8 23.7 $ 1,115.3 $ 941.7 $ 999.6

Unum Group Sales Data for Unum International Segment

Three Months Ended Year Ended
(in millions of dollars) 12/31/2022 12/31/2021 % Change 12/31/2022 12/31/2021 12/31/2020
Sales by Product
Unum UK
Group Long-term Disability $ 8.1 $ 8.0 1.3 % $ 43.3 $ 41.4 $ 37.7
Group Life 6.5 8.4 (22.6) 55.5 31.3 20.6
Supplemental 2.6 3.4 (23.5) 17.1 17.0 18.9
Unum Poland 6.4 5.6 14.3 17.8 16.1 13.3
Total Sales $ 23.6 $ 25.4 (7.1) $ 133.7 $ 105.8 $ 90.5
Sales by Market Sector
Unum UK
Group Long-term Disability and Group Life
Core Market (< 500 employees) $ 9.9 $ 11.0 (10.0) % $ 42.7 $ 41.5 $ 36.2
Large Case Market 4.7 5.4 (13.0) 56.1 31.2 22.1
Subtotal 14.6 16.4 (11.0) 98.8 72.7 58.3
Supplemental 2.6 3.4 (23.5) 17.1 17.0 18.9
Unum Poland 6.4 5.6 14.3 17.8 16.1 13.3
Total Sales $ 23.6 $ 25.4 (7.1) $ 133.7 $ 105.8 $ 90.5
(in millions of pounds)
Unum UK Sales by Product
Group Long-term Disability £ 6.9 £ 5.9 16.9 % £ 34.5 £ 30.0 £ 29.5
Group Life 5.7 6.3 (9.5) 45.4 22.8 16.1
Supplemental 2.2 2.4 (8.3) 13.5 12.3 14.9
Total Sales £ 14.8 £ 14.6 1.4 £ 93.4 £ 65.1 £ 60.5
Unum UK Sales by Market Sector
Group Long-term Disability and Group Life
Core Market (< 500 employees) £ 8.5 £ 8.2 3.7 % £ 34.4 £ 30.2 £ 28.3
Large Case Market 4.1 4.0 2.5 45.5 22.6 17.3
Subtotal 12.6 12.2 3.3 79.9 52.8 45.6
Supplemental 2.2 2.4 (8.3) 13.5 12.3 14.9
Total Sales £ 14.8 £ 14.6 1.4 £ 93.4 £ 65.1 £ 60.5
  1. 1

Unum Group Sales Data for Colonial Life Segment

Three Months Ended Year Ended
12/31/2022 12/31/2021 % Change 12/31/2022 12/31/2021 12/31/2020
Sales by Product
Accident, Sickness, and Disability $ 100.6 $ 101.5 (0.9) % $ 310.6 $ 297.9 $ 261.5
Life 41.1 37.8 8.7 121.5 111.0 88.8
Cancer and Critical Illness 28.3 26.9 5.2 76.0 70.9 62.8
Total Sales $ 170.0 $ 166.2 2.3 $ 508.1 $ 479.8 $ 413.1
Sales by Market Sector
Commercial
Core Market (< 1,000 employees) $ 107.0 $ 106.0 0.9 % $ 332.4 $ 313.2 $ 266.2
Large Case Market 21.8 25.1 (13.1) 58.1 68.5 57.4
Subtotal 128.8 131.1 (1.8) 390.5 381.7 323.6
Public Sector 41.2 35.1 17.4 117.6 98.1 89.5
Total Sales $ 170.0 $ 166.2 2.3 $ 508.1 $ 479.8 $ 413.1
  1. 2

Unum Group Consolidated Balance Sheets

December 31
2022 2021
Assets
Investments
Fixed Maturity Securities - at fair value $ 34,840.8 $ 43,336.0
Mortgage Loans 2,435.4 2,560.4
Policy Loans 3,601.2 3,662.9
Other Long-term Investments 1,440.1 1,203.0
Short-term Investments 1,394.8 1,388.0
Total Investments 43,712.3 52,150.3
Other Assets
Cash and Bank Deposits 119.2 75.0
Accounts and Premiums Receivable 1,482.1 1,519.9
Reinsurance Recoverable 10,218.6 10,919.3
Accrued Investment Income 615.0 602.7
Deferred Acquisition Costs 2,252.3 2,207.9
Goodwill 347.6 352.2
Property and Equipment 451.7 462.7
Deferred Income Tax 449.8 —
Other Assets 1,786.3 1,825.6
Total Assets $ 61,434.9 $ 70,115.6

Unum Group Consolidated Balance Sheets - Continued

December 31
2022 2021
Liabilities and Stockholders' Equity
Liabilities
Policy and Contract Benefits $ 1,839.8 $ 1,907.7
Reserves for Future Policy and Contract Benefits 42,330.2 48,007.5
Unearned Premiums 352.7 347.5
Other Policyholders’ Funds 1,750.4 1,790.9
Income Tax Payable 190.9 159.1
Deferred Income Tax 9.2 458.4
Short-term Debt 2.0 —
Long-term Debt 3,427.8 3,442.2
Other Liabilities 2,334.4 2,585.9
Total Liabilities 52,237.4 58,699.2
Stockholders’ Equity
Common Stock 30.8 30.7
Additional Paid-in Capital 2,441.0 2,408.1
Accumulated Other Comprehensive Income (Loss) (2,756.6) 354.1
Retained Earnings 12,912.1 11,853.2
Treasury Stock - at cost (3,429.8) (3,229.7)
Total Stockholders’ Equity 9,197.5 11,416.4
Total Liabilities and Stockholders’ Equity $ 61,434.9 $ 70,115.6
  1. 1

Unum Group Deferred Acquisition Costs by Segment

Unum US Unum International Colonial Life Consolidated
Balances at December 31, 2019 $ 1,223.0 $ 26.4 $ 1,074.6 $ 2,324.0
Capitalization 291.5 12.1 272.6 576.2
Amortization (341.0) (7.4) (257.7) (606.1)
Adjustment Related to Unrealized Investment Gains and Losses (4.8) — (17.6) (22.4)
Foreign Currency — 0.9 — 0.9
Balances 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)
Balances at December 31, 2021 1,096.2 35.4 1,076.3 2,207.9
Capitalization 273.1 12.0 271.8 556.9
Amortization (294.9) (7.6) (288.5) (591.0)
Adjustment Related to Unrealized Investment Gains and Losses 15.0 — 66.7 81.7
Foreign Currency — (3.2) — (3.2)
Balances at December 31, 2022 $ 1,089.4 $ 36.6 $ 1,126.3 $ 2,252.3
  1. 2

Unum Group Balance Sheets by Segment - December 31, 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 $ 7,139.5 $ 2,369.9 $ 4,516.6 $ 14,026.0 $ 2,677.2 $ 3,126.1 $ 22,028.9 $ 1,854.1 $ 43,712.3
Deferred Acquisition Costs 94.9 63.2 931.3 1,089.4 36.6 1,126.3 — — 2,252.3
Goodwill 8.9 — 271.1 280.0 39.9 27.7 — — 347.6
All Other 117.7 350.4 415.2 883.3 401.2 168.8 12,212.3 1,457.1 15,122.7
Total Assets $ 7,361.0 $ 2,783.5 $ 6,134.2 $ 16,278.7 $ 3,154.9 $ 4,448.9 $ 34,241.2 $ 3,311.2 $ 61,434.9
Liabilities
Reserves and Policyholder Benefits $ 5,596.0 $ 1,893.0 $ 3,906.7 $ 11,395.7 $ 2,416.2 $ 2,976.3 $ 29,484.9 $ — $ 46,273.1
Debt — — — — — — — 3,429.8 3,429.8
All Other 24.4 94.6 207.2 326.2 70.0 54.8 532.6 1,550.9 2,534.5
Total Liabilities 5,620.4 1,987.6 4,113.9 11,721.9 2,486.2 3,031.1 30,017.5 4,980.7 52,237.4
Allocated Stockholders' Equity
Other Allocated Stockholders' Equity 1,753.1 924.7 2,148.6 4,826.4 756.6 1,559.2 4,998.5 (909.8) 11,230.9
Net Unrealized Gain (Loss) on Securities and Net Gain (Loss) on Hedges (12.5) (128.8) (128.3) (269.6) (87.9) (141.4) (774.8) (759.7) (2,033.4)
Total Allocated Stockholders' Equity 1,740.6 795.9 2,020.3 4,556.8 668.7 1,417.8 4,223.7 (1,669.5) 9,197.5
Total Liabilities and Allocated Stockholders' Equity $ 7,361.0 $ 2,783.5 $ 6,134.2 $ 16,278.7 $ 3,154.9 $ 4,448.9 $ 34,241.2 $ 3,311.2 $ 61,434.9

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 or 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 Year Ended
12/31/2022 12/31/2021 % Change 12/31/2022 12/31/2021 % Change
Premium Income
Unum US $ 1,581.5 $ 1,529.3 3.4 % $ 6,258.3 $ 6,078.0 3.0 %
Unum International 178.3 177.5 0.5 718.8 717.0 0.3
Colonial Life 420.4 423.3 (0.7) 1,702.0 1,690.2 0.7
Closed Block 230.9 244.5 (5.6) 944.3 995.8 (5.2)
2,411.1 2,374.6 1.5 9,623.4 9,481.0 1.5
Net Investment Income
Unum US 166.9 182.1 (8.3) 676.3 721.6 (6.3)
Unum International 47.8 37.9 26.1 170.1 132.7 28.2
Colonial Life 37.3 40.9 (8.8) 152.7 172.0 (11.2)
Closed Block 252.9 282.5 (10.5) 1,070.6 1,159.0 (7.6)
Corporate 19.5 7.4 163.5 52.5 27.9 88.2
524.4 550.8 (4.8) 2,122.2 2,213.2 (4.1)
Other Income
Unum US 49.5 44.8 10.5 196.3 170.0 15.5
Unum International 0.2 — — 0.9 0.6 50.0
Colonial Life 0.3 0.2 50.0 1.1 1.0 10.0
Closed Block 12.4 15.3 (19.0) 58.0 65.1 (10.9)
Corporate 1.2 2.1 (42.9) 4.8 6.2 (22.6)
63.6 62.4 1.9 261.1 242.9 7.5
Total Adjusted Operating Revenue
Unum US 1,797.9 1,756.2 2.4 7,130.9 6,969.6 2.3
Unum International 226.3 215.4 5.1 889.8 850.3 4.6
Colonial Life 458.0 464.4 (1.4) 1,855.8 1,863.2 (0.4)
Closed Block 496.2 542.3 (8.5) 2,072.9 2,219.9 (6.6)
Corporate 20.7 9.5 117.9 57.3 34.1 68.0
$ 2,999.1 $ 2,987.8 0.4 $ 12,006.7 $ 11,937.1 0.6

Unum Group Financial Results by Segment - Continued

Three Months Ended Year Ended
12/31/2022 12/31/2021 % Change 12/31/2022 12/31/2021 % Change
Benefits and Expenses
Unum US $ 1,569.2 $ 1,674.8 (6.3) % $ 6,005.2 $ 6,289.7 (4.5) %
Unum International 181.3 188.3 (3.7) 762.8 744.6 2.4
Colonial Life 365.0 384.4 (5.0) 1,481.2 1,534.0 (3.4)
Closed Block 471.1 485.3 (2.9) 1,888.8 2,077.2 (9.1)
Corporate 58.2 54.6 6.6 221.6 305.3 (27.4)
2,644.8 2,787.4 (5.1) 10,359.6 10,950.8 (5.4)
Income (Loss) Before Income Tax Expense (Benefit) and Net Investment Gain (Loss)
Unum US 228.7 81.4 181.0 1,125.7 679.9 65.6
Unum International 45.0 27.1 66.1 127.0 105.7 20.2
Colonial Life 93.0 80.0 16.3 374.6 329.2 13.8
Closed Block 25.1 57.0 (56.0) 184.1 142.7 29.0
Corporate (37.5) (45.1) (16.9) (164.3) (271.2) (39.4)
354.3 200.4 76.8 1,647.1 986.3 67.0
Income Tax Expense 79.6 33.9 134.8 320.7 222.7 44.0
Income (Loss) Before Net Investment Gain (Loss) 274.7 166.5 65.0 1,326.4 763.6 73.7
Net Investment Gain (Loss) (net of tax expense (benefit) of $1.7; $(1.9); $(3.5); $16.1) 4.9 (6.8) (172.1) (12.2) 60.6 (120.1)
Net Income $ 279.6 $ 159.7 75.1 $ 1,314.2 $ 824.2 59.5
  1. 1

Unum Group Quarterly Historical Financial Results by Segment

12/31/22 9/30/22 6/30/22 3/31/22 12/31/21 9/30/21 6/30/21 3/31/21 12/31/20
Premium Income
Unum US $ 1,581.5 $ 1,559.6 $ 1,572.3 $ 1,544.9 $ 1,529.3 $ 1,500.8 $ 1,522.1 $ 1,525.8 $ 1,485.1
Unum International 178.3 173.3 179.4 187.8 177.5 181.6 183.5 174.4 165.7
Colonial Life 420.4 423.3 427.6 430.7 423.3 420.8 419.7 426.4 418.8
Closed Block 230.9 235.5 238.0 239.9 244.5 250.5 249.1 251.7 250.3
2,411.1 2,391.7 2,417.3 2,403.3 2,374.6 2,353.7 2,374.4 2,378.3 2,319.9
Net Investment Income
Unum US 166.9 170.6 167.8 171.0 182.1 176.2 183.6 179.7 173.1
Unum International 47.8 37.0 50.8 34.5 37.9 33.1 35.7 26.0 25.5
Colonial Life 37.3 38.6 38.7 38.1 40.9 51.8 41.6 37.7 37.5
Closed Block 252.9 251.4 291.5 274.8 282.5 284.6 294.7 297.2 356.7
Corporate 19.5 14.0 10.2 8.8 7.4 4.5 7.9 8.1 0.7
524.4 511.6 559.0 527.2 550.8 550.2 563.5 548.7 593.5
Other Income
Unum US 49.5 49.0 50.7 47.1 44.8 43.5 41.3 40.4 37.4
Unum International 0.2 0.2 0.3 0.2 — 0.4 0.1 0.1 0.1
Colonial Life 0.3 0.3 0.2 0.3 0.2 0.3 0.3 0.2 0.2
Closed Block 12.4 13.1 16.5 16.0 15.3 19.3 12.1 18.4 16.9
Corporate 1.2 0.4 1.0 2.2 2.1 2.4 0.4 1.3 0.6
63.6 63.0 68.7 65.8 62.4 65.9 54.2 60.4 55.2
Total Adjusted Operating Revenue
Unum US 1,797.9 1,779.2 1,790.8 1,763.0 1,756.2 1,720.5 1,747.0 1,745.9 1,695.6
Unum International 226.3 210.5 230.5 222.5 215.4 215.1 219.3 200.5 191.3
Colonial Life 458.0 462.2 466.5 469.1 464.4 472.9 461.6 464.3 456.5
Closed Block 496.2 500.0 546.0 530.7 542.3 554.4 555.9 567.3 623.9
Corporate 20.7 14.4 11.2 11.0 9.5 6.9 8.3 9.4 1.3
$ 2,999.1 $ 2,966.3 $ 3,045.0 $ 2,996.3 $ 2,987.8 $ 2,969.8 $ 2,992.1 $ 2,987.4 $ 2,968.6

Unum Group Quarterly Historical Financial Results by Segment - Continued

12/31/22 9/30/22 6/30/22 3/31/22 12/31/21 9/30/21 6/30/21 3/31/21 12/31/20
Benefits and Expenses
Unum US $ 1,569.2 $ 1,349.2 $ 1,495.4 $ 1,591.4 $ 1,674.8 $ 1,417.0 $ 1,567.7 $ 1,630.2 $ 1,552.1
Unum International 181.3 180.6 205.6 195.3 188.3 187.7 194.5 174.1 170.6
Colonial Life 365.0 371.8 365.4 379.0 384.4 392.8 365.8 391.0 385.3
Closed Block 471.1 481.1 483.3 453.3 485.3 497.9 464.4 629.6 1,996.8
Corporate 58.2 63.9 48.1 51.4 54.6 64.4 138.0 48.3 44.0
2,644.8 2,446.6 2,597.8 2,670.4 2,787.4 2,559.8 2,730.4 2,873.2 4,148.8
Income (Loss) Before Income Tax Expense (Benefit) and Net Investment Gain (Loss)
Unum US 228.7 430.0 295.4 171.6 81.4 303.5 179.3 115.7 143.5
Unum International 45.0 29.9 24.9 27.2 27.1 27.4 24.8 26.4 20.7
Colonial Life 93.0 90.4 101.1 90.1 80.0 80.1 95.8 73.3 71.2
Closed Block 25.1 18.9 62.7 77.4 57.0 56.5 91.5 (62.3) (1,372.9)
Corporate (37.5) (49.5) (36.9) (40.4) (45.1) (57.5) (129.7) (38.9) (42.7)
354.3 519.7 447.2 325.9 200.4 410.0 261.7 114.2 (1,180.2)
Income Tax Expense (Benefit) 79.6 105.6 73.7 61.8 33.9 81.3 79.4 28.1 (285.2)
Income (Loss) Before Net Investment Gain (Loss) 274.7 414.1 373.5 264.1 166.5 328.7 182.3 86.1 (895.0)
Net Investment Gain (Loss) 6.6 (4.4) (4.1) (13.8) (8.7) (0.1) 0.9 84.6 1,304.9
Tax Expense (Benefit) on Net Investment Gain (Loss) 1.7 (1.0) (1.0) (3.2) (1.9) — 0.3 17.7 274.5
Net Income $ 279.6 $ 410.7 $ 370.4 $ 253.5 $ 159.7 $ 328.6 $ 182.9 $ 153.0 $ 135.4
Net Income Per Common Share - Assuming Dilution $ 1.39 $ 2.04 $ 1.83 $ 1.25 $ 0.78 $ 1.60 $ 0.89 $ 0.75 $ 0.66
  1. 1

Unum Group Financial Results for Unum US Segment

Three Months Ended Year Ended
12/31/2022 12/31/2021 12/31/2022 12/31/2021 12/31/2020
Adjusted Operating Revenue
Premium Income $ 1,581.5 $ 1,529.3 $ 6,258.3 $ 6,078.0 $ 6,018.9
Net Investment Income 166.9 182.1 676.3 721.6 720.3
Other Income 49.5 44.8 196.3 170.0 154.9
Total 1,797.9 1,756.2 7,130.9 6,969.6 6,894.1
Benefits and Expenses
Benefits and Change in Reserves for Future Benefits 1,029.1 1,163.2 3,941.5 4,338.8 4,138.7
Commissions 155.8 144.4 614.4 583.4 594.9
Deferral of Acquisition Costs (73.7) (49.3) (273.1) (242.7) (291.5)
Amortization of Deferred Acquisition Costs 66.9 75.3 294.9 319.0 341.0
Other Expenses 391.1 341.2 1,427.5 1,291.2 1,285.6
Total 1,569.2 1,674.8 6,005.2 6,289.7 6,068.7
Income Before Income Tax and Net Investment Gains and Losses 228.7 81.4 1,125.7 679.9 825.4
Reserve Assumption Updates — — (155.0) (215.0) —
Adjusted Operating Income $ 228.7 $ 81.4 $ 970.7 $ 464.9 $ 825.4
Operating Ratios (% of Premium Income):
Benefit Ratio1 65.1 % 76.1 % 65.5 % 74.9 % 68.8 %
Other Expense Ratio2 24.0 % 21.7 % 22.1 % 20.7 % 20.8 %
Income Ratio 18.0 % 11.2 %
Adjusted Operating Income Ratio 14.5 % 5.3 % 15.5 % 7.6 % 13.7 %

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

2Ratio of Other Expenses to Premium Income plus Unum US Group Disability Other Income, which is primarily related to fee-based services.

Unum Group Financial Results for Unum US Group Disability

Three Months Ended Year Ended
12/31/2022 12/31/2021 12/31/2022 12/31/2021 12/31/2020
Adjusted Operating Revenue
Premium Income
Group Long-term Disability $ 492.5 $ 460.1 $ 1,911.7 $ 1,827.8 $ 1,828.5
Group Short-term Disability 240.4 222.8 926.3 864.0 799.2
Total Premium Income 732.9 682.9 2,838.0 2,691.8 2,627.7
Net Investment Income 86.5 94.9 349.1 379.6 388.8
Other Income 48.3 44.3 191.8 165.7 147.6
Total 867.7 822.1 3,378.9 3,237.1 3,164.1
Benefits and Expenses
Benefits and Change in Reserves for Future Benefits 469.8 534.9 1,771.1 1,849.2 1,921.9
Commissions 53.3 48.6 211.3 199.8 191.8
Deferral of Acquisition Costs (15.0) (12.4) (53.1) (49.8) (49.3)
Amortization of Deferred Acquisition Costs 13.2 12.8 51.8 51.4 53.1
Other Expenses 231.8 204.1 862.3 773.9 756.6
Total 753.1 788.0 2,843.4 2,824.5 2,874.1
Income Before Income Tax and Net Investment Gains and Losses 114.6 34.1 535.5 412.6 290.0
Reserve Assumption Update — — (121.0) (215.0) —
Adjusted Operating Income $ 114.6 $ 34.1 $ 414.5 $ 197.6 $ 290.0
Operating Ratios (% of Premium Income):
Benefit Ratio1 64.1 % 78.3 % 66.7 % 76.7 % 73.1 %
Other Expense Ratio2 29.7 % 28.1 % 28.5 % 27.1 % 27.3 %
Income Ratio 18.9 % 15.3 %
Adjusted Operating Income Ratio 15.6 % 5.0 % 14.6 % 7.3 % 11.0 %
Persistency:
Group Long-term Disability 90.7 % 89.6 % 90.8 %
Group Short-term Disability 88.9 % 87.4 % 88.7 %

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

2Ratio of Other Expenses to Premium Income plus Other Income, which is primarily related to fee-based services.

  1. 1

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

Year Ended
12/31/2021 12/31/2022 12/31/2021 12/31/2020
Adjusted Operating Revenue
Premium Income
Group Life 419.2 $ 413.1 $ 1,669.1 $ 1,641.9 $ 1,640.5
Accidental Death & Dismemberment 42.1 173.7 165.1 163.9
Total Premium Income 455.2 1,842.8 1,807.0 1,804.4
Net Investment Income 27.9 100.3 104.0 97.2
Other Income 0.4 1.6 1.7 2.4
Total 483.5 1,944.7 1,912.7 1,904.0
Benefits and Expenses
Benefits and Change in Reserves for Future Benefits 447.6 1,415.2 1,728.8 1,470.4
Commissions 35.6 150.4 144.7 143.2
Deferral of Acquisition Costs 6.3 (37.3) (21.0) (36.0)
Amortization of Deferred Acquisition Costs 9.6 33.2 38.3 39.3
Other Expenses 56.1 231.1 213.8 205.3
Total 555.2 1,792.6 2,104.6 1,822.2
Income Before Income Tax and Net Realized Investment Gains and Losses (71.7) 152.1 (191.9) 81.8
Reserve Assumption Update — (34.0) — —
Adjusted Operating Income (Loss) 29.3 $ (71.7) $ 118.1 $ (191.9) $ 81.8
Operating Ratios (% of Premium Income):
Benefit Ratio1 % 98.3 % 78.6 % 95.7 % 81.5 %
Other Expense Ratio % 12.3 % 12.5 % 11.8 % 11.4 %
Income (Loss) Ratio 8.3 %
Adjusted Operating Income (Loss) Ratio % (15.8) % 6.4 % (10.6) % 4.5 %
Persistency:
Group Life 88.9 % 89.7 % 88.8 %
Accidental Death & Dismemberment 87.9 % 89.1 % 88.2 %
1Excludes the 34.0 million reserve decrease related to the assumption update that occurred during the third quarter of 2022.

All values are in US Dollars.

  1. 2

Unum Group Financial Results for Unum US Supplemental and Voluntary

Three Months Ended Year Ended
12/31/2022 12/31/2021 12/31/2022 12/31/2021 12/31/2020
Adjusted Operating Revenue
Premium Income
Voluntary Benefits $ 205.4 $ 206.3 $ 840.6 $ 846.7 $ 875.2
Individual Disability 110.8 114.8 461.1 459.8 456.0
Dental and Vision 69.2 70.1 275.8 272.7 255.6
Total Premium Income 385.4 391.2 1,577.5 1,579.2 1,586.8
Net Investment Income 55.2 59.3 226.9 238.0 234.3
Other Income 0.8 0.1 2.9 2.6 4.9
Total 441.4 450.6 1,807.3 1,819.8 1,826.0
Benefits and Expenses
Benefits and Change in Reserves for Future Benefits 196.9 180.7 755.2 760.8 746.4
Commissions 65.8 60.2 252.7 238.9 259.9
Deferral of Acquisition Costs (48.3) (43.2) (182.7) (171.9) (206.2)
Amortization of Deferred Acquisition Costs 45.3 52.9 209.9 229.3 248.6
Other Expenses 96.9 81.0 334.1 303.5 323.7
Total 356.6 331.6 1,369.2 1,360.6 1,372.4
Adjusted Operating Income $ 84.8 $ 119.0 $ 438.1 $ 459.2 $ 453.6
Operating Ratios (% of Premium Income):
Benefit Ratios:
Voluntary Benefits 44.9 % 42.9 % 42.1 % 43.2 % 42.2 %
Individual Disability 53.2 % 40.2 % 44.1 % 42.8 % 48.8 %
Dental and Vision 65.9 % 65.6 % 71.6 % 72.6 % 60.6 %
Other Expense Ratio 25.1 % 20.7 % 21.2 % 19.2 % 20.4 %
Adjusted Operating Income Ratio 22.0 % 30.4 % 27.8 % 29.1 % 28.6 %
Persistency:
Voluntary Benefits 75.8 % 75.8 % 72.7 %
Individual Disability 89.5 % 89.7 % 89.5 %
Dental and Vision 79.9 % 86.0 % 85.0 %
  1. 3

Unum Group Financial Results for Unum International Segment

Three Months Ended Year Ended
12/31/2022 12/31/2021 12/31/2022 12/31/2021 12/31/2020
Adjusted Operating Revenue
Premium Income
Unum UK
Group Long-term Disability $ 89.4 $ 98.1 $ 376.9 $ 401.9 $ 364.9
Group Life 37.7 27.9 138.2 112.3 108.5
Supplemental 28.2 28.4 114.0 112.6 99.8
Unum Poland 23.0 23.1 89.7 90.2 79.6
Total Premium Income 178.3 177.5 718.8 717.0 652.8
Net Investment Income 47.8 37.9 170.1 132.7 104.6
Other Income 0.2 — 0.9 0.6 0.5
Total 226.3 215.4 889.8 850.3 757.9
Benefits and Expenses
Benefits and Change in Reserves for Future Benefits 132.0 139.6 564.8 556.2 500.9
Commissions 11.4 13.4 56.3 54.1 49.7
Deferral of Acquisition Costs (2.7) (3.2) (12.0) (12.8) (12.1)
Amortization of Deferred Acquisition Costs 1.8 1.9 7.6 8.0 7.4
Other Expenses 38.8 36.6 146.1 139.1 135.4
Total 181.3 188.3 762.8 744.6 681.3
Adjusted Operating Income $ 45.0 $ 27.1 $ 127.0 $ 105.7 $ 76.6

Unum Group Financial Results for Unum UK

Three Months Ended Year Ended
(in millions of pounds, except exchange rate) 12/31/2022 12/31/2021 12/31/2022 12/31/2021 12/31/2020
Adjusted Operating Revenue
Premium Income
Group Long-term Disability £ 76.2 £ 72.7 £ 304.6 £ 292.0 £ 284.2
Group Life 32.0 20.8 112.3 81.7 84.6
Supplemental 23.9 21.0 92.3 81.8 77.7
Total Premium Income 132.1 114.5 509.2 455.5 446.5
Net Investment Income 38.6 26.8 131.9 91.0 76.0
Other Income (Loss) — (0.1) 0.1 0.1 0.1
Total 170.7 141.2 641.2 546.6 522.6
Benefits and Expenses
Benefits and Change in Reserves for Future Benefits 100.4 93.2 413.2 362.8 352.5
Commissions 5.8 7.1 31.8 28.7 28.1
Deferral of Acquisition Costs (0.9) (1.1) (4.2) (4.3) (4.2)
Amortization of Deferred Acquisition Costs 1.3 1.3 5.0 5.1 5.3
Other Expenses 26.4 22.0 95.6 81.8 86.5
Total 133.0 122.5 541.4 474.1 468.2
Adjusted Operating Income £ 37.7 £ 18.7 £ 99.8 £ 72.5 £ 54.4
Weighted Average Pound/Dollar Exchange Rate 1.183 1.353 1.222 1.377 1.287
Operating Ratios (% of Premium Income):
Benefit Ratio 76.0 % 81.4 % 81.1 % 79.6 % 78.9 %
Other Expense Ratio 20.0 % 19.2 % 18.8 % 18.0 % 19.4 %
Adjusted Operating Income Ratio 28.5 % 16.3 % 19.6 % 15.9 % 12.2 %
Persistency:
Group Long-term Disability 85.1 % 89.3 % 88.2 %
Group Life 87.9 % 86.5 % 81.8 %
Supplemental 92.8 % 90.9 % 90.7 %
  1. 1

Unum Group Financial Results for Colonial Life Segment

Three Months Ended Year Ended
12/31/2022 12/31/2021 12/31/2022 12/31/2021 12/31/2020
Adjusted Operating Revenue
Premium Income
Accident, Sickness, and Disability $ 234.9 $ 238.2 $ 948.9 $ 953.3 $ 975.1
Life 97.9 97.4 401.1 384.7 376.4
Cancer and Critical Illness 87.6 87.7 352.0 352.2 360.5
Total Premium Income 420.4 423.3 1,702.0 1,690.2 1,712.0
Net Investment Income 37.3 40.9 152.7 172.0 155.7
Other Income 0.3 0.2 1.1 1.0 1.1
Total 458.0 464.4 1,855.8 1,863.2 1,868.8
Benefits and Expenses
Benefits and Change in Reserves for Future Benefits 189.3 222.2 803.1 910.4 906.5
Commissions 82.0 83.2 340.0 320.1 334.3
Deferral of Acquisition Costs (61.4) (66.7) (271.8) (252.6) (272.6)
Amortization of Deferred Acquisition Costs 72.8 68.1 288.5 259.1 257.7
Other Expenses 82.3 77.6 321.4 297.0 307.5
Total 365.0 384.4 1,481.2 1,534.0 1,533.4
Adjusted Operating Income $ 93.0 $ 80.0 $ 374.6 $ 329.2 $ 335.4
Operating Ratios (% of Premium Income):
Benefit Ratio 45.0 % 52.5 % 47.2 % 53.9 % 52.9 %
Other Expense Ratio 19.6 % 18.3 % 18.9 % 17.6 % 18.0 %
Adjusted Operating Income Ratio 22.1 % 18.9 % 22.0 % 19.5 % 19.6 %
Persistency:
Accident, Sickness, and Disability 73.3 % 75.4 % 74.3 %
Life 84.5 % 85.5 % 83.7 %
Cancer and Critical Illness 82.3 % 82.4 % 81.8 %

Unum Group Financial Results for Closed Block Segment

Three Months Ended Year Ended
12/31/2022 12/31/2021 12/31/2022 12/31/2021 12/31/2020
Adjusted Operating Revenue
Premium Income
Long-term Care $ 174.4 $ 175.9 $ 697.4 $ 704.3 $ 666.9
All Other 56.5 68.6 246.9 291.5 327.5
Total Premium Income 230.9 244.5 944.3 995.8 994.4
Net Investment Income 252.9 282.5 1,070.6 1,159.0 1,370.3
Other Income 12.4 15.3 58.0 65.1 66.6
Total 496.2 542.3 2,072.9 2,219.9 2,431.3
Benefits and Expenses
Benefits and Change in Reserves for Future Benefits 405.0 414.4 1,627.3 1,793.2 3,426.8
Commissions 18.1 19.2 75.7 80.5 78.4
Interest and Debt Expense — — — — 3.1
Other Expenses 48.0 51.7 185.8 203.5 158.7
Total 471.1 485.3 1,888.8 2,077.2 3,667.0
Income (Loss) Before Income Tax and Net Investment Gains and Losses 25.1 57.0 184.1 142.7 (1,235.7)
Long-term Care Reserve Increase — — — 2.1 151.5
Individual Disability Reserve Increase — — — 6.4 —
Group Pension Reserve Increase — — — 25.1 17.5
Impacts from Closed Block Individual Disability Reinsurance Transaction — — — 139.3 1,305.5
Amortization of the Cost of Reinsurance 15.3 19.7 63.8 79.1 2.6
Adjusted Operating Income $ 40.4 $ 76.7 $ 247.9 $ 394.7 $ 241.4
Interest Adjusted Loss Ratio:
Long-term Care1 86.3 % 82.2 % 82.0 % 77.3 % 68.9 %
Operating Ratios (% of Premium Income):
Other Expense Ratio2 14.2 % 13.1 % 12.9 % 11.9 % 13.6 %
Income (Loss) Ratio 10.9 % 23.3 % 19.5 % 14.3 % (124.3) %
Adjusted Operating Income Ratio 17.5 % 31.4 % 26.3 % 39.6 % 24.3 %
Persistency:
Long-term Care 95.7 % 95.6 % 94.8 %

1Excludes $2.1 million during the twelve months ended December 31, 2021, related to the reserve 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.

2Excludes amortization of the cost of reinsurance from the years ended 2022, 2021, and 2020. Also excludes $6.2 million and $21.0 million of transaction costs from 2021 and 2020, respectively, related to the two phases of the Closed Block individual disability reinsurance transaction that occurred during the first quarter of 2021 and the fourth quarter of 2020.

Unum Group Financial Results for Corporate Segment

Three Months Ended Year Ended
12/31/2022 12/31/2021 12/31/2022 12/31/2021 12/31/2020
Adjusted Operating Revenue
Net Investment Income $ 19.5 $ 7.4 $ 52.5 $ 27.9 $ 9.8
Other Income 1.2 2.1 4.8 6.2 1.1
Total 20.7 9.5 57.3 34.1 10.9
Interest, Debt, and Other Expenses 58.2 54.6 221.6 305.3 247.7
Loss Before Income Tax and Net Investment Gains and Losses (37.5) (45.1) (164.3) (271.2) (236.8)
Impairment Loss on Internal-Use Software — — — 12.1 —
Costs Related to Early Retirement of Debt — — — 67.3 —
Impairment Loss on ROU Asset — — — 13.9 12.7
Cost Related to Organizational Design Update — — — — 23.3
Adjusted Operating Loss $ (37.5) $ (45.1) $ (164.3) $ (177.9) $ (200.8)

Unum Group Reserves

December 31, 2022
Gross Total Reinsurance Ceded
Policy Reserves Claim Reserves Total Net
% Incurred IBNR % Total
Group Disability $ — — % $ 5,003.0 $ 747.6 25.2 % $ 5,750.6 $ 46.4 $ 5,704.2
Group Life and Accidental Death & Dismemberment 54.5 0.2 678.1 260.0 4.1 992.6 7.5 985.1
Individual Disability 435.0 2.0 1,427.8 154.1 6.9 2,016.9 208.8 1,808.1
Voluntary Benefits 1,791.0 8.2 44.8 50.3 0.4 1,886.1 13.2 1,872.9
Dental and Vision — — 0.2 10.7 0.1 10.9 0.1 10.8
Unum US Segment 2,280.5 10.4 7,153.9 1,222.7 36.7 10,657.1 276.0 10,381.1
Unum International Segment 206.1 0.9 1,925.4 164.8 9.2 2,296.3 74.2 2,222.1
Colonial Life Segment 2,575.9 11.8 276.5 106.5 1.7 2,958.9 1.3 2,957.6
Long-term Care 11,220.7 51.2 2,477.5 283.0 12.1 13,981.2 5.7 13,975.5
All Other 5,620.7 25.7 9,021.5 201.0 40.3 14,843.2 12,602.8 2,240.4
Closed Block Segment 16,841.4 76.9 11,499.0 484.0 52.4 28,824.4 12,608.5 16,215.9
Subtotal $ 21,903.9 100.0 % $ 20,854.8 $ 1,978.0 100.0 % 44,736.7 12,960.0 31,776.7
Adjustment Related to Unrealized Investment Gains and Losses (566.7) (18.1) (548.6)
Consolidated $ 44,170.0 $ 12,941.9 $ 31,228.1

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
Long-term Care 10,842.2 50.2 2,300.1 271.7 10.9 13,414.0 7.4 13,406.6
All Other 5,800.8 26.9 9,363.2 237.4 40.4 15,401.4 13,095.5 2,305.9
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

12/31/2022 12/31/2022 12/31/2021
Fixed Maturity Securities (Fair Value) Selected Statistics
Public $ 22,060.8 63.4 % Earned Book Yield 4.57 % 4.85 %
Mortgage-Backed/Asset-Backed Securities 573.3 1.6 Average Duration (in years) 7.75 8.35
Private Placements 5,430.9 15.6
High Yield 1,989.8 5.7
Government Securities 1,325.3 3.8
Municipal Securities 3,457.2 9.9
Redeemable Preferred Stocks 3.5 —
Total $ 34,840.8 100.0 %
Amortized Cost Fair Value Private Equity Partnerships 12/31/2022 12/31/2021
Quality Ratings of Fixed Maturity Securities Private Credit Partnerships $ 275.0 $ 279.4
Aaa 5.2 % 5.3 % Private Equity Partnerships 485.3 384.6
Aa 11.9 11.4 Real Asset Partnerships 434.0 314.6
A 27.1 27.6 Total $ 1,194.3 $ 978.6
Baa 50.1 50.0
Below Baa 5.7 5.7
Total 100.0 % 100.0 % Non-Current Investments $ — $ 19.8

Unum Group Investments at December 31, 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 $ 2,554.5 $ (212.6) $ 1,975.5 $ 245.8 $ 579.0 $ 33.2
Capital Goods 3,193.6 (224.2) 2,227.7 294.8 965.9 70.6
Communications 2,182.4 (156.6) 1,365.8 236.5 816.6 79.9
Consumer Cyclical 1,402.6 (127.2) 1,146.2 147.3 256.4 20.1
Consumer Non-Cyclical 5,763.3 (537.5) 4,097.5 654.6 1,665.8 117.1
Energy 2,770.0 (72.1) 1,467.1 155.0 1,302.9 82.9
Financial Institutions 3,473.9 (443.7) 3,075.4 464.3 398.5 20.6
Mortgage/Asset-Backed 573.3 (18.8) 386.7 27.0 186.6 8.2
Sovereigns 827.1 (81.0) 337.0 115.9 490.1 34.9
Technology 1,567.5 (177.8) 1,438.5 186.9 129.0 9.1
Transportation 1,620.3 (164.5) 1,269.5 183.1 350.8 18.6
U.S. Government Agencies and Municipalities 3,955.4 (554.4) 2,525.5 661.8 1,429.9 107.4
Public Utilities 4,956.9 (214.0) 2,497.4 355.0 2,459.5 141.0
Total $ 34,840.8 $ (2,984.4) $ 23,809.8 $ 3,728.0 $ 11,031.0 $ 743.6
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 $ 2,313.9 $ 73.6 $ 151.7 $ 1.8
91 through 180 days 5,523.4 316.6 312.3 12.6
181 through 270 days 5,377.7 643.0 470.4 39.1
271 days to 1 year 6,010.3 1,446.8 665.0 92.3
Greater than 1 year 2,852.1 1,065.5 133.0 36.7
Total $ 22,077.4 $ 3,545.5 $ 1,732.4 $ 182.5
  1. 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 or loss on hedges;

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

•Book value per common share 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
December 31 September 30 June 30 March 31 December 31 September 30 June 30 March 31 December 31
2022 2021 2020
Total Revenue $ 3,005.7 $ 2,961.9 $ 3,040.9 $ 2,982.5 $ 2,979.1 $ 2,969.7 $ 2,993.0 $ 3,072.0 $ 4,273.5
Excluding:
Net Investment Gain (Loss) 6.6 (4.4) (4.1) (13.8) (8.7) (0.1) 0.9 84.6 1,304.9
Adjusted Operating Revenue $ 2,999.1 $ 2,966.3 $ 3,045.0 $ 2,996.3 $ 2,987.8 $ 2,969.8 $ 2,992.1 $ 2,987.4 $ 2,968.6

16.3

Reconciliation of Non-GAAP Financial Measures - Continued

After-Tax Adjusted Operating Income (Loss) Average Allocated Equity1 Adjusted Operating Return on Equity
Year Ended December 31, 2022
Unum US $ 767.2 $ 4,706.9 16.3 %
Unum International 156.7 772.7 20.3 %
Colonial Life 295.7 1,549.1 19.1 %
Core Operating Segments 1,219.6 7,028.7 17.4 %
Closed Block 190.9 4,762.6
Corporate (156.2) (979.6)
Total $ 1,254.3 $ 10,811.7 11.6 %
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 %

1Excludes unrealized gain (loss) on securities and net gain (loss) on hedges and is calculated using the stockholders' equity balances presented on page 16.5. 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.

16.4

Reconciliation of Non-GAAP Financial Measures - Continued

After-Tax Adjusted Operating Income (Loss) Average Allocated Equity2 Annualized Adjusted Operating Return on Equity
Three Months Ended December 31, 2022
Unum US $ 180.6 $ 4,808.7 15.0 %
Unum International 40.4 720.0 22.4 %
Colonial Life 73.4 1,549.3 19.0 %
Core Operating Segments 294.4 7,078.0 16.6 %
Closed Block 29.7 4,832.6
Corporate (37.4) (807.5)
Total $ 286.7 $ 11,103.1 10.3 %
Three Months Ended December 31, 2021
Unum US $ 64.3 $ 4,611.4 5.6 %
Unum International 21.6 783.5 11.0 %
Colonial Life 63.2 1,556.6 16.2 %
Core Operating Segments 149.1 6,951.5 8.6 %
Closed Block 60.0 4,337.7
Corporate (27.1) (986.6)
Total $ 182.0 $ 10,302.6 7.1 %

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

Average allocated equity is computed as follows:

12/31/2022 9/30/2022 12/31/2021 9/30/2021 12/31/2020 12/31/2019
Total Stockholders' Equity $ 9,197.5 $ 8,659.5 $ 11,416.4 $ 11,118.2 $ 10,871.0 $ 9,965.0
Excluding:
Net Unrealized Gain (Loss) on Securities (2,023.8) (2,329.3) 962.2 836.0 1,067.7 615.9
Net Gain (Loss) on Hedges (9.6) 13.5 61.8 69.5 97.8 187.8
Total Adjusted Stockholders' Equity $ 11,230.9 $ 10,975.3 $ 10,392.4 $ 10,212.7 $ 9,705.5 $ 9,161.3
Three Months Ended Twelve Months Ended Three Months Ended Twelve Months Ended Twelve Months Ended
12/31/2022 12/31/2021 12/31/2020
Average Adjusted Stockholders' Equity $ 11,103.1 $ 10,811.7 $ 10,302.6 $ 10,049.0 $ 9,424.0

16.5

Reconciliation of Non-GAAP Financial Measures - Continued

Three Months Ended
December 31 December 31
2022 2021
(in millions) per share* (in millions) per share*
Net Income $ 279.6 $ 1.39 $ 159.7 $ 0.78
Excluding:
Net Investment Gain (Loss), Other (net of tax expense (benefit) of $1.7; $(1.9)) 4.9 0.02 (6.8) (0.03)
Amortization of the Cost of Reinsurance (net of tax benefit of $3.3; $4.2) (12.0) (0.06) (15.5) (0.08)
After-tax Adjusted Operating Income $ 286.7 $ 1.43 $ 182.0 $ 0.89
*Assuming Dilution.

16.6

Reconciliation of Non-GAAP Financial Measures - Continued

Year Ended December 31
2022 2021 2020
(in millions) per share * (in millions) per share * (in millions) per share *
Net Income $ 1,314.2 $ 6.50 $ 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 $(3.5); $1.9; $(20.9)) (12.2) (0.07) 7.2 0.03 (82.3) (0.40)
Total Net Investment Gain (Loss) (12.2) (0.07) 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 $13.4; $16.8; $0.6) (50.4) (0.25) (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 (50.4) (0.25) (172.4) (0.84) (996.8) (4.89)
Net Reserve Change Related to Reserve Assumption Updates (net of tax expense (benefit) of $32.5; $38.1; $(35.5)) 122.5 0.61 143.3 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 $ 1,254.3 $ 6.21 $ 890.7 $ 4.35 $ 1,005.4 $ 4.93
*Assuming Dilution.

16.7

Reconciliation of Non-GAAP Financial Measures - Continued

December 31
2022 2021 2020
Debt $ 3,429.8 $ 3,442.2 $ 3,345.7
Including:
Lease Liability 67.9 82.6 105.9
Excluding:
Adjusted Debt and Lease Liability $ 3,497.7 $ 3,524.8 $ 3,451.6
Total Stockholders' Equity $ 9,197.5 $ 11,416.4 $ 10,871.0
Excluding:
Net Unrealized Gain (Loss) on Securities and Net Gain (Loss) on Hedges (2,033.4) 1,024.0 1,165.5
Equity, As Adjusted 11,230.9 10,392.4 9,705.5
Debt, As Adjusted and Lease Liability 3,497.7 3,524.8 3,451.6
Total Adjusted Capital $ 14,728.6 $ 13,917.2 $ 13,157.1
Leverage Ratio 23.7 % 25.3 % 26.2 % Three Months Ended
--- --- --- --- --- --- --- ---
December 31, 2022 December 31, 2021
Premium Income Premium Income in Local Currency1 Weighted Average Exchange Rate2 Premium Income in Constant Currency
Unum International
Unum UK $ 155.3 £ 114.5 1.176 $ 134.7
Unum Poland 23.0 zł 93.4 0.217 20.2
Total 178.3 154.9
Unum US 1,581.5 $ 1,529.3 1,529.3
Colonial Life 420.4 $ 423.3 423.3
Core Operations $ 2,180.2 $ 2,107.5

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 is calculated using the average foreign currency exchange rates for the most recent period, applied to the comparable prior period.

16.8

Reconciliation of Non-GAAP Financial Measures - Continued

Twelve Months Ended
December 31, 2022 December 31, 2021
Premium Income $ 9,623.4 $ 9,481.0
Operating Expenses $ 2,109.7 $ 1,983.8
Excluding:
Amortization of the Cost of Reinsurance (63.8) (79.1)
Transaction Costs Related to Closed Block Individual Disability Reinsurance Transaction — (6.2)
Impairment Loss on Internal-Use Software — (12.1)
Impairment Loss on ROU Asset — (13.9)
Adjusted Operating Expenses $ 2,045.9 $ 1,872.5
Operating Expense Ratio 21.9 % 20.9 %
Adjusted Operating Expense Ratio 21.3 % 19.8 %
Three Months Ended
--- --- --- --- ---
December 31, 2022 December 31, 2021
Unum US Premium Income $ 1,581.5 $ 1,529.3
Change in Estimate Related to Unearned Premium Reserve 9.3 —
Adjusted Unum US Premium Income $ 1,590.8 $ 1,529.3

16.9

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