Unum 2015 Annual Report Download - page 47

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45
Unum 2015 Annual Report
Year Ended December 31, 2015 Compared with Year Ended December 31, 2014
Premium income increased in 2015 compared to 2014, driven by sales growth and premium rate increases, as well as favorable
persistency in the group long-term disability product line. Net investment income declined in 2015 relative to 2014 due to a decrease in the
level of invested assets and a decline in yields. Other income, which is comprised primarily of fees from administrative services products,
increased slightly in 2015 relative to 2014.
Benefits experience was favorable in 2015 compared to 2014 due to lower claim incidence rates and favorable claim recovery
experience in our group long-term disability product line, offset partially by the 50 basis point decrease in the discount rate which we
implemented during the fourth quarter of 2014 for group long-term disability new claim incurrals.
Commissions and the deferral of acquisition costs were higher in 2015 relative to 2014 due to sales growth and the corresponding
increase in deferrable expenses. The amortization of deferred acquisition costs increased in 2015 relative to 2014 due to growth in the
level of the deferred asset. The growth in premium income during 2015 more than offset the growth in other expenses related to
continued investment in the growth of our business, resulting in a decline in the other expense ratio compared to 2014.
Year Ended December 31, 2014 Compared with Year Ended December 31, 2013
Premium income increased in 2014 compared to 2013, driven by favorable persistency, premium rate increases, and sales growth for
both group long-term and group short-term disability. Net investment income declined in 2014 relative to 2013 due to a decrease in the
level of invested assets and a decline in yield. Other income declined in 2014 relative to 2013 due primarily to the 2013 gain of $4.0 million
on the purchase and retirement of the debt issued by Tailwind Holdings.
Benefits experience was favorable in 2014 compared to 2013 due primarily to favorable claim recovery experience, partially offset by
slightly higher claim incidence rates and the 50 basis point decrease in the discount rate which we implemented during the fourth quarter
of 2014 for group long-term disability new claim incurrals.
The deferral of acquisition costs was higher in 2014 relative to 2013 due to an increase in deferrable expenses related to sales growth.
The amortization of acquisition costs increased in 2014 compared to 2013 due to growth in the level of the deferred asset. The other
expense ratio for 2014 was higher compared to 2013 due to an increase in other expenses driven by technology and other growth-related
investments, a higher level of allocated retirement-related costs, and higher acquisition-related expenses resulting from the increased level
of sales.