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46 UNUM • 2014 ANNUAL REPORT
Management’s Discussion and Analysis
of Financial Condition and Results of Operations
Unum US Group Life and Accidental Death and Dismemberment Operating Results
Shown below are financial results and key performance indicators for Unum US group life and accidental death and dismemberment.
Year Ended December 31
(in millions of dollars, except ratios) 2014 % Change 2013 % Change 2012
Operating Revenue
Premium Income
Group Life $1,262.3 4.0% $1,213.9 2.7% $1,182.1
Accidental Death & Dismemberment 125.9 3.5 121.6 5.5 115.3
Total Premium Income 1,388.2 3.9 1,335.5 2.9 1,297.4
Net Investment Income 139.2 (2.4) 142.6 (2.9) 146.9
Other Income 1.4 (22.2) 1.8 (5.3) 1.9
Total 1,528.8 3.3 1,479.9 2.3 1,446.2
Benefits and Expenses
Benefits and Change in Reserves for Future Benefits 975.8 7.2 909.9 (2.8) 936.4
Commissions 113.3 4.0 108.9 4.1 104.6
Deferral of Acquisition Costs (31.3) 26.7 (24.7) 10.3 (22.4)
Amortization of Deferred Acquisition Costs 21.4 37.2 15.6 14.7 13.6
Other Expenses 205.2 3.5 198.2 2.6 193.1
Total 1,284.4 6.3 1,207.9 (1.4) 1,225.3
Income Before Income Tax and Net Realized
Investment Gains and Losses 244.4 (10.1) 272.0 23.1 220.9
Unclaimed Death Benefits (UDB) Reserve Increase — — 49.1 — —
Group Life Waiver of Premium Benefit (Waiver)
Reserve Reduction — — (85.0) — —
Operating Income $ 244.4 3.5 $ 236.1 6.9 $ 220.9
Operating Ratios (% of Premium Income):
Benefit Ratio 70.3% 68.1% 72.2%
Benefit Ratio Excluding the UDB and
Waiver Reserve Adjustments 70.8%
Other Expense Ratio 14.8% 14.8% 14.9%
Income Ratio 17.6% 20.4% 17.0%
Operating Income Ratio 17.6% 17.7% 17.0%
Persistency:
Group Life 90.8% 88.1% 90.6%
Accidental Death & Dismemberment 91.1% 88.8% 90.0%