Unum 2011 Annual Report Download - page 49
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Unum 2011 Annual Report
Unum
2011
47
Year Ended December 31, 2010 Compared with Year Ended December 31, 2009
Premium income for group life and accidental death and dismemberment increased in 2010 relative to 2009 due primarily to favorable
premium and case persistency. Premium and case persistency for the group life product line increased in both the core and large case
market segments. Net investment income was higher in 2010 compared to 2009 due primarily to an increase in the level of assets
supporting this line of business.
The benefit ratio for 2010 was consistent with 2009. Commissions were higher due to an increase in supplemental payments. The
deferral of acquisition costs increased in 2010 compared to 2009 due primarily to the increase in commission expense. The amortization of
acquisition costs in 2010 was lower than 2009 due primarily to a decrease in amortization related to internal replacement transactions. The
other expense ratio decreased in 2010 in comparison to 2009 due to our continued focus on expense management.
Unum US Supplemental and Voluntary Operating Results
Shown below are financial results and key performance indicators for Unum US supplemental and voluntary product lines.
Year Ended December 31
(in millions of dollars, except ratios) 2011 % Change 2010 % Change 2009
Operating Revenue
Premium Income
Individual Disability — Recently Issued $ 464.7 1.5% $ 457.9 (1.3)% $ 463.7
Voluntary Benefits 580.0 9.3 530.8 7.8 492.4
Total Premium Income 1,044.7 5.7 988.7 3.4 956.1
Net Investment Income 210.9 6.9 197.3 10.6 178.4
Other Income 30.0 (11.0) 33.7 20.4 28.0
Total 1,285.6 5.4 1,219.7 4.9 1,162.5
Benefits and Expenses
Benefits and Change in Reserves for Future Benefits 536.8 — 536.7 4.5 513.8
Commissions 219.0 3.5 211.6 5.4 200.7
Deferral of Acquisition Costs (220.9) 2.8 (214.9) 1.8 (211.0)
Amortization of Deferred Acquisition Costs 195.7 (2.7) 201.1 11.4 180.6
Other Expenses 249.5 4.2 239.5 4.5 229.1
Total 980.1 0.6 974.0 6.7 913.2
Operating Income Before Income Tax and Net
Realized Investment Gains and Losses $ 305.5 24.3 $ 245.7 (1.4) $ 249.3
Operating Ratios (% of Premium Income):
Benefit Ratios:
Individual Disability — Recently Issued 52.2% 53.3% 51.4%
Voluntary Benefits 50.7% 55.1% 56.0%
Other Expense Ratio 23.9% 24.2% 24.0%
Before-tax Operating Income Ratio 29.2% 24.9% 26.1%
Interest Adjusted Loss Ratio:
Individual Disability — Recently Issued 30.8% 32.5% 32.5%
Premium Persistency:
Individual Disability — Recently Issued 89.3% 90.7% 89.6%
Voluntary Benefits 80.5% 80.1% 79.9%