Unum Group

The Colonial Life segment includes insurance for accident, sickness, and disability products, which includes dental and vision products, life products, and cancer and critical illness products. These products are marketed to employees, on both a group and an individual basis, at the workplace through an independent contractor agent sales force and brokers.

Shown below are financial results and key performance indicators for the Colonial Life segment.

Premium income increased in the first quarter of 2024 compared to the same period of 2023 due to higher prior period sales and favorable persistency. Net investment income was higher in the first quarter of 2024 compared to the same period of 2023 due to an increase in the yield on invested assets and an increase in the level of invested assets.

The benefit ratio in the first quarter of 2024 was favorable relative to the same period of 2023 primarily due to favorable benefit experience in the cancer and critical illness and accident, sickness, and disability product lines.

Commissions and the deferral of acquisition costs were higher in the first quarter of 2024 relative to the same period of 2023 due to higher prior period sales. The amortization of deferred acquisition costs in the first quarter of 2024 was higher relative to the same period of 2023 due to growth in the level of the deferred asset. The other expense ratio was higher in the first quarter of 2024 relative to the same period of 2023 due primarily to an increase in employee-related costs and an increase in operational investments in our business.

Sales

Commercial market sales decreased during the first quarter of 2024 compared to the same period of 2023 due to lower sales to existing customers in the core market and to new customers in the large case market, which we define as accounts with more than 1,000 employees, partially offset by higher sales to new customers in the core market. Public sector market sales decreased in the first quarter of 2024 compared to the same period of 2023 due to lower sales to new and existing customers.

We remain committed to providing employees and their families with simple, modern, and personal benefit solutions. During 2024, we will continue to utilize our strong distribution system of independent agents, benefit counselors and broker partnerships. We will also continue to invest in solutions and digital capabilities to expand our reach and effectiveness, driving growth and improving productivity while enhancing the customer experience. In 2024, we will continue to bring an enhanced engagement and enrollment platform to market, enabling deeper connections with employees through the enrollment process as well as maintaining stronger relationships throughout the customer lifecycle. We believe our distribution system, customer service capabilities, digital and virtual tools, and ability to serve all market sizes position us well for future growth.

In 2024, we expect strong growth in adjusted operating income for the full year with sales and premium growth increasing from the prior year. We expect improved claim experience in 2024 but could continue to experience some level of claims volatility. While we believe our underlying profitability will remain strong, current economic conditions and increasing competition in the voluntary workplace market are risks to achievement of our business plans. We continuously monitor key indicators to assess our risks and adjust our business plans accordingly.