Unum 2009 Annual Report Download - page 153

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151
Unum 2009 Annual Report
Restrictions under applicable state insurance laws limit the amount of ordinary dividends that can be paid to a parent company
from its insurance subsidiaries without prior approval by regulatory authorities. For life insurance companies domiciled in the United States,
that limitation typically equals, depending on the state of domicile, either ten percent of an insurer’s statutory surplus with respect to
policyholders as of the preceding year end or the statutory net gain from operations, excluding realized investment gains and losses, of the
preceding year. The payment of ordinary dividends to a parent company from its insurance subsidiaries is further limited to the amount of
statutory surplus as it relates to policyholders. Based on the restrictions under current law, $719.7 million is available for the payment of
ordinary dividends from our U.S. insurance subsidiaries, excluding Tailwind Re and Northwind Re, during 2010. The ability of Tailwind Re and
Northwind Re to pay dividends to their parent companies, Tailwind Holdings and Northwind Holdings, wholly-owned subsidiaries of Unum
Group, will depend on their satisfaction of applicable regulatory requirements and on the performance of the business reinsured by Tailwind
Re and Northwind Re.
We also have the ability to draw a dividend from our United Kingdom insurance subsidiary, Unum Limited. Such dividends are limited
based on insurance company legislation in the United Kingdom, which requires a minimum solvency margin. The amount available under
current law for payment of dividends from Unum Limited during 2010 is approximately £198.5 million, subject to regulatory approval.
Regulatory restrictions do not limit the amount of dividends available for distribution from our non-insurance subsidiaries. The payment of
dividends to the parent company from any of our subsidiaries requires the approval of the individual subsidiary’s board of directors.
Deposits
At December 31, 2009 and 2008, our U.S. insurance subsidiaries had on deposit with U.S. regulatory authorities securities with a book
value of $292.1 million and $293.7 million held for the protection of policyholders.