Unum 2012 Annual Report Download - page 158

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Notes To Consolidated Financial Statements
156 UNUM 2012 ANNUAL REPORT
In December 2012, State of West Virginia ex rel. John D. Perdue v. Provident Life and Accident Insurance Company and State of
West Virginia ex rel. John D. Perdue v. Colonial Life & Accident Insurance Company were filed in the Circuit Court of Putnam County,
West Virginia. These two separate complaints allege violations of the West Virginia Uniform Unclaimed Property Act by failing to identify
and report all unclaimed insurance policy proceeds due to be escheated to West Virginia. The complaints seek to examine company records
and assess penalties and costs in an undetermined amount.
Summary
Various lawsuits against us, in addition to those discussed above, have arisen in the normal course of business. Further, state insurance
regulatory authorities and other federal and state authorities regularly make inquiries and conduct investigations concerning our
compliance with applicable insurance and other laws and regulations.
Given the complexity and scope of our litigation and regulatory matters, it is not possible to predict the ultimate outcome of all
pending investigations or legal proceedings or provide reasonable estimates of potential losses, except if noted in connection with specific
matters. It is possible that our results of operations or cash flows in a particular period could be materially affected by an ultimate
unfavorable outcome of pending litigation or regulatory matters depending, in part, on our results of operations or cash flows for the
particular period. We believe, however, that the ultimate outcome of all pending litigation and regulatory matters, after consideration of
applicable reserves and rights to indemnification, should not have a material adverse effect on our financial position.
Note 14. Statutory Financial Information
Statutory Net Income, Capital and Surplus, and Dividends
Statutory net income for U.S. life insurance companies is reported in conformity with statutory accounting principles prescribed
by the National Association of Insurance Commissioners (NAIC) and adopted by applicable domiciliary state laws. The commissioners of the
states of domicile have the right to permit other specific practices that may deviate from prescribed practices. For the years ended
December 31, 2012, 2011, or 2010, none of the states of domicile for our U.S. insurance subsidiaries had adopted accounting practices that
differed materially from statutory accounting principles prescribed by the NAIC.
The statutory operating results of our traditional U.S. insurance subsidiaries, which exclude Tailwind Re and Northwind Re, as well as
the statutory results for these two special purpose financial captive U.S. insurance subsidiaries, are as follows:
Year Ended December 31
(in millions of dollars) 2012 2011 2010
Combined Net Income
Traditional U.S. Insurance Subsidiaries $624.5 $642.9 $628.8
Tailwind Re and Northwind Re $ 69.7 $ 80.0 $ 79.1
Combined Net Gain from Operations
Traditional U.S. Insurance Subsidiaries $649.8 $664.0 $645.7
Tailwind Re and Northwind Re $ 69.3 $ 80.4 $ 79.2