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52 UNUM • 2014 ANNUAL REPORT
Management’s Discussion and Analysis
of Financial Condition and Results of Operations
Unum UK Segment
The Unum UK segment includes insurance for group long-term disability, group life, and supplemental lines of business which
include individual disability and critical illness. Unum UK’s products are sold primarily in the United Kingdom through field sales personnel
and independent brokers and consultants.
Operating Results
Shown below are financial results and key performance indicators for the Unum UK segment.
Year Ended December 31
(in millions of dollars, except ratios) 2014 % Change 2013 % Change 2012
Operating Revenue
Premium Income
Group Long-term Disability $418.9 7.4% $389.9 (4.8)% $409.7
Group Life 133.2 25.2 106.4 (51.9) 221.3
Supplemental 55.1 (8.6) 60.3 (5.2) 63.6
Total Premium Income 607.2 9.1 556.6 (19.9) 694.6
Net Investment Income 151.0 1.7 148.5 (13.1) 170.8
Other Income — (100.0) 0.1 — 0.1
Total 758.2 7.5 705.2 (18.5) 865.5
Benefits and Expenses
Benefits and Change in Reserves for Future Benefits 431.0 4.3 413.3 (23.7) 541.4
Commissions 42.8 12.6 38.0 (10.8) 42.6
Deferral of Acquisition Costs (10.5) 7.1 (9.8) (16.9) (11.8)
Amortization of Deferred Acquisition Costs 12.5 (15.0) 14.7 (6.4) 15.7
Other Expenses 134.6 15.0 117.0 (20.0) 146.3
Total 610.4 6.5 573.2 (21.9) 734.2
Operating Income $147.8 12.0 $132.0 0.5 $131.3
Operating Ratios (% of Premium Income):
Benefit Ratio 71.0% 74.3% 77.9%
Other Expense Ratio 22.2% 21.0% 21.1%
Operating Income Ratio 24.3% 23.7% 18.9%
Persistency:
Group Long-term Disability 90.1% 82.2% 84.0%
Group Life 76.0% 66.7% 82.5%
Supplemental 86.6% 78.8% 84.6%