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 was favorable compared to 2024 due to stable overall persistency and prior period sales. Net investment income was higher in 2025 compared to 2024 due to an increase in the level of invested assets and an increase in the yield on invested assets.

The benefit ratio, excluding the impacts of the reserve assumption updates, was less favorable relative to 2024 due primarily to less favorable benefit experience in the accident, sickness, and disability and cancer and critical illness product lines, partially offset by favorable benefit experience in the life product line.

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

Premium income was favorable compared to 2023 due to higher prior period sales and generally stable persistency. Net investment income was higher in 2024 compared to 2023 due primarily to an increase in the yield on invested assets as well as an increase in the level of invested assets.

The benefit ratio, excluding the impacts of the reserve assumption updates, was favorable relative to 2023 due primarily to favorable benefit experience in all product lines.

Commissions and the deferral of acquisition costs were higher compared to 2023 due to higher prior period sales. The amortization of deferred acquisition costs was higher compared to 2023 primarily due to growth in the level of the deferred asset. The other expense ratio was favorable relative to 2023 due primarily to our focus on expense management and operating efficiencies.

Sales

During 2025, we saw an increase in sales across all product lines relative to 2024. Commercial sector sales increased compared to 2024 driven by higher sales to new and existing customers in the core market, which we define as accounts with fewer than 1,000 employees, and in the large case market. Public sector sales also increased compared to 2024 due to higher sales to new and existing customers.

During 2024, we saw a decrease in sales in our accident, sickness and disability and life product lines relative to 2023, while sales in our cancer and critical illness product line remained consistent. Commercial sector sales decreased compared to 2023 driven by lower sales to new and existing customers in the core market, partially offset by higher sales to new and existing customers in the large case market. Public sector sales increased compared to 2023 due to higher sales to new customers.

We had goodwill of $27.7 million at December 31, 2025, none of which is currently believed to be at risk for future impairment.

We remain committed to providing employees and their families with simple, modern, and personal benefit solutions. By continuing to utilize our extensive distribution system of independent agents, benefit counselors and broker partnerships during 2026, we believe we will deliver business growth. We will also continue to invest in solutions and digital capabilities to expand our reach and effectiveness, which we believe will drive growth and improve productivity while enhancing the customer experience. In 2026, we will continue to bring an enhanced engagement and enrollment platform to market, which we believe will enable deeper connections with employees through the enrollment process and help us maintain stronger relationships throughout the customer lifecycle. We believe our distribution system, customer service capabilities, digital tools, and ability to serve all market sizes position us well for future growth.

In 2026, we expect growth in adjusted operating income for the full year with continued premium growth and stable claim experience. We continuously monitor key indicators to assess our risks and adjust our business plans accordingly.