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Management’s Discussion and Analysis of
Financial Condition and Results of Operations
70 Unum 2007 Annual Report
Fixed Maturity Securities
Fixed maturity securities at December 31, 2007, included $35.3 billion, or 98.9 percent, of bonds and derivative instruments and
$384.8 million, or 1.1 percent, of redeemable preferred stocks. The following table shows the fair value composition by internal industry
classification of the fixed maturity bond portfolio and the associated unrealized gains and losses.
Fixed Maturity Bonds — By Industry Classification
As of December 31, 2007
(in millions of dollars)
Fair Value Fair Value
of Bonds of Bonds
Net with Gross Gross with Gross Gross
Unrealized Unrealized Unrealized Unrealized Unrealized
Classification Fair Value Gain (Loss) Loss Loss Gain Gain
Basic Industry $ 2,281.4 $ 47.5 $ 913.8 $ 50.6 $ 1,367.6 $ 98.1
Canadian 290.0 60.2 — — 290.0 60.2
Capital Goods 2,674.6 105.3 968.3 54.0 1,706.3 159.3
Communications 2,395.9 111.6 841.2 53.6 1,554.7 165.2
Consumer Cyclical 1,348.6 (3.9) 699.6 58.3 649.0 54.4
Consumer Non-Cyclical 4,193.8 91.5 1,723.0 82.7 2,470.8 174.2
Derivatives Hedging Available-for-Sale (91.1) (92.2) (232.6) 232.6 141.5 140.4
Energy (Oil & Gas) 2,455.5 204.2 449.4 16.8 2,006.1 221.0
Financial Institutions 3,536.1 (92.2) 2,563.0 149.1 973.1 56.9
Mortgage/Asset-Backed 4,237.5 230.7 488.8 6.9 3,748.7 237.6
Sovereigns 1,070.4 50.5 558.9 7.5 511.5 58.0
Technology 571.5 8.1 279.9 15.2 291.6 23.3
Transportation 981.1 57.1 322.2 13.0 658.9 70.1
U.S. Government Agencies and Municipalities 2,462.5 149.8 840.9 28.7 1,621.6 178.5
Utilities 6,930.9 179.7 3,169.2 144.3 3,761.7 324.0
Total $35,338.7 $1,107.9 $13,585.6 $913.3 $21,753.1 $2,021.2
The above chart excludes DIG Issue B36 embedded derivatives, which at December 31, 2007 had a fair value of $(68.8) million.