Unum 2013 Annual Report Download - page 49

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UNUM 2013 ANNUAL REPORT / 47
Year Ended December 31, 2013 Compared with Year Ended December 31, 2012
Premium income increased in 2013 compared to 2012 primarily due to growth in the inforce block of business as a result of sales and
rate increases, partially offset by a decline in persistency. Net investment income was lower in 2013 compared to 2012 primarily due to a
decrease in the yield on invested assets and lower income from bond call premiums, partially offset by an increase in investment income
attributable to tax credit partnerships and the level of invested assets.
Risk results were favorable compared to 2012 primarily as a result of the previously discussed reserve reduction for group life waiver of
premium benefits, partially offset by the reserve increase for unclaimed death benefits charge. Excluding these reserve adjustments, risk results
were favorable in 2013 compared to 2012 due primarily to more favorable experience related to the group life waiver of premium benefits.
The deferral and amortization of acquisition costs were both higher in 2013 relative to the prior year due to an increase in deferrable
expenses and the resulting continued growth in the level of the deferred asset. The other expense ratio in 2013 was consistent with the
prior year.
Year Ended December 31, 2012 Compared with Year Ended December 31, 2011
Premium income was higher in 2012 compared to 2011 due primarily to higher sales and favorable persistency. Net investment
income was higher in 2012 compared to 2011 due primarily to an increase in income from bond call premiums, an increase in the level of
invested assets, and an increase in the level of prepayment income on mortgage-backed securities, partially offset by a decline in yield
on invested assets.
Risk results were unfavorable in 2012 compared to 2011 due primarily to a higher average claim size and a higher claim incidence rate.
Commissions and the deferral of acquisition costs were higher in 2012 compared to 2011 due primarily to higher sales. The amortization
of deferred acquisition costs was lower in 2012 compared to 2011 due primarily to a decrease in amortization related to internal replacement
transactions. The other expense ratio was lower in 2012 compared to 2011 due to our focus on operating effectiveness and expense
management relative to our premium income levels.