Unum Group

Previous wording

For the third quarter of 2025, we reported net income of $39.7 million, or $0.23 per diluted common share, compared to net income of $645.7 million, or $3.46 per diluted common share, in the third quarter of 2024. For the first nine months of 2025, we reported net income of $564.4 million, or $3.23 per diluted common share, compared to net income of $1,430.4 million, or $7.52 per diluted common share in the same period of 2024.

Current wording

For the first quarter of 2026, we reported net income of $232.0 million, or $1.41 per diluted common share, compared to net income of $189.1 million, or $1.06 per diluted common share, in the first quarter of 2025.

Previous wording

Included in our results for the third quarter of 2025 are:

Current wording

Included in our results for the first quarter of 2026 are:

Previous wording

•Non-contemporaneous reinsurance of $6.0 million before tax and $4.8 million after tax, or $0.03 per diluted common share;

Current wording

•A net investment loss of $4.0 million after tax, or $0.03 per diluted common share; and,

Previous wording

Excluding these items, after-tax adjusted operating income for the third quarter of 2025 was $357.1 million, or $2.09 per diluted common share compared to $398.0 million, or $2.13 per diluted common share, for the same period of 2024. After-tax adjusted operating income was $1,083.7 million, or $6.21 per diluted common share, in the first nine months of 2025, compared to $1,219.3 million, or $6.41 per diluted common share, in the first nine months of 2024. See "Closed Block Long-Term Care and Unum US Individual Disability Reinsurance Transaction", "Loss on Legal Settlement", and "Reconciliation of Non-GAAP and Other Financial Measures" contained herein in this Item 2 and Note 14 of the "Notes to Consolidated Financial Statements" contained herein in Item 1 for further discussion and a reconciliation of these items.

Current wording

Excluding these items, after-tax adjusted operating income for the first quarter of 2026 was $352.5 million, or $2.14 per diluted common share compared to $348.8 million, or $1.95 per diluted common share, for the first quarter of 2025. See "Reconciliation of Non-GAAP and Other Financial Measures" contained herein in this Item 2 for further discussion and a reconciliation of these items.

Previous wording

Other income, excluding the impact of the amortization of the deferred gain on reinsurance, was generally consistent in the third quarter of 2025 compared to the same period of 2024. Other income, excluding the impact of the amortization of the deferred gain on reinsurance, was higher in the first nine months of 2025 compared to the same period of 2024 due primarily to a gain on the recapture of a previously ceded block of business in the individual disability product line in the first quarter of 2025.

Current wording

Unum US reported segment adjusted operating income of $337.9 million in the first quarter of 2026 compared to $329.1 million the same period of 2025, due primarily to favorable benefits experience and higher net investment income, partially offset by the gain on the recapture of a previously ceded block of business in the Unum US individual disability product line.in the first quarter of 2025. The benefit ratio for our Unum US segment was 59.5 percent in the first quarter of 2026, compared to 59.7 percent in first quarter of 2025. Unum US sales increased 20.8 percent in the first quarter of 2026 compared to the same period of 2025.

Previous wording

Our Unum International segment reported income before income tax and net investment gains and losses of $44.2 million and $124.5 million in the third quarter and first nine months of 2025, respectively, compared to $32.8 million and $112.7 million in the same periods of 2024, which includes the reserve assumption updates during the third quarters of 2025 and 2024. Excluding these items, our Unum International segment reported adjusted operating income of $38.8 million and $119.1 million in the third quarter and first nine months of 2025, respectively, compared to $40.3 million and $120.2 million in the same periods of 2024. Our Unum UK line of business reported adjusted operating income, which excludes the reserve assumption updates, of £26.3 million and £85.2 million in the third quarter and first nine months of 2025, respectively, compared to £29.5 million and £90.2 million in the same periods of 2024, due to unfavorable benefits experience, partially offset by higher premium income and net investment income. The benefit ratio for our Unum UK line of business, excluding the reserve assumption updates, was 73.8 percent and 72.0 percent in the third quarter and first nine months of 2025, respectively, compared to 69.5 percent and 69.0 percent in the same periods of 2024. Unum International sales, as measured in U.S. dollars, increased 30.1 percent and 2.4 percent in the third quarter and first nine months of 2025, respectively, compared to the same periods of 2024. Unum UK sales, as measured in local currency, increased 27.3 percent and decreased 8.2 percent in the third quarter and first nine months of 2025, respectively, compared to the same periods of 2024.

Current wording

Unum International reported segment adjusted operating income of $30.9 million in the first quarter of 2026 compared to $38.7 million the same period of 2025. Our Unum UK line of business reported adjusted operating income of £20.4 million in the first quarter of 2026 compared to £29.5 million the same period of 2025 due primarily to unfavorable benefits experience. The benefit ratio for our Unum UK line of business was 72.9 percent in the first quarter of 2026, compared to 67.1 percent in the same period of 2025. Unum International sales, as measured in U.S. dollars, increased 14.1 percent in the first quarter of 2026 compared to the same period of 2025. Unum UK sales, as measured in local currency, increased 15.0 percent in the first quarter of 2026 compared to the same period of 2025.

Previous wording

A rising interest rate environment could positively impact our yields on new investments, but could also increase unrealized losses in our current holdings. Alternatively, a declining interest rate environment could negatively impact our yields on new investments, but could also reduce unrealized losses in our current holdings. As of September 30, 2025, we do not hold any securities with a decline in fair value below amortized cost which we intend to sell nor any securities for which it is more likely than not that we will be required to sell before recovery in amortized cost for which an impairment loss was not recorded. The net unrealized loss on our fixed maturity securities was $1.7 billion at September 30, 2025, compared to $2.6 billion at December 31, 2024, with the decrease due primarily to a decrease in U.S. Treasury rates. The earned book yield on our investment portfolio was 4.44 percent for the first nine months of 2025 as well as for the full year ended December 31, 2024.

Current wording

A rising interest rate environment could positively impact our yields on new investments, but could also increase unrealized losses in our current holdings. Alternatively, a declining interest rate environment could negatively impact our yields on new investments, but could also reduce unrealized losses in our current holdings. As of March 31, 2026, we do not hold any securities with a decline in fair value below amortized cost which we intend to sell nor any securities for which it is more likely than not that we will be required to sell before recovery in amortized cost for which an impairment loss was not recorded. The net unrealized loss on our fixed maturity securities was $2.2 billion at March 31, 2026, compared to $1.7 billion at December 31, 2025, with the increase due primarily to an increase in U.S. Treasury rates and credit spreads. The earned book yield on our investment portfolio was 4.29 percent for the first three months of 2026 compared to a yield of 4.35 percent for full year 2025.

Previous wording

Additionally, a rising interest rate environment could result in reserve decreases while a declining interest rate environment could result in reserve increases, specific to our liability for future policy benefits, as the reserve discount rate assumptions used in the calculation of our liability are updated at each reporting date using a yield that is reflective of an upper-medium grade fixed income instrument, which is generally equivalent to a single-A interest rate matched to the duration of certain of our insurance liabilities. The change in discount rate assumptions on the liability for future policy benefits, net of reinsurance, due primarily to the decrease in U.S. Treasury rates during the first nine months of 2025, resulted in an increase to the liability for future policy benefits, net of reinsurance, of approximately $0.7 billion.

Current wording

Additionally, a rising interest rate environment could result in reserve decreases while a declining interest rate environment could result in reserve increases, specific to our liability for future policy benefits, as the reserve discount rate assumptions used in the calculation of our liability are updated at each reporting date using a yield that is reflective of an upper-medium grade fixed income instrument, which is generally equivalent to a single-A interest rate matched to the duration of certain of our insurance liabilities. The change in discount rate assumptions on the liability for future policy benefits, net of reinsurance, due primarily to the increase in U.S. Treasury rates during the first quarter of 2026, resulted in a decrease to the liability for future policy benefits, net of reinsurance, of approximately $0.6 billion.

Previous wording

We believe our capital and financial positions are strong. At September 30, 2025, the risk-based capital (RBC) ratio for our traditional U.S. insurance subsidiaries, calculated on a weighted average basis using the NAIC Company Action Level formula, was approximately 455 percent, which is above our long-term expectation. We repurchased 10.3 million shares and 9.7 million shares of Unum Group common stock under our share repurchase program, during the first nine months of 2025 and 2024, respectively, at a cost of $759.2 million and $504.8 million, respectively, including commissions and excise tax. Our weighted average common shares outstanding, assuming dilution, equaled 170.6 million and 186.9 million for the third quarters of 2025 and 2024, respectively, and 174.6 million and 190.2 million for the first nine months of 2025 and 2024, respectively. As of September 30, 2025, Unum Group and our intermediate holding companies had available holding company liquidity of $1,982.4 million that was held primarily in bank deposits, commercial paper, money market funds, corporate bonds, municipal bonds and asset backed securities. See Note 12 of the "Notes to Consolidated Financial Statements" contained herein in Item 1.

Current wording

We believe our capital and financial positions are strong. At March 31, 2026, the risk-based capital (RBC) ratio for our traditional U.S. insurance subsidiaries, calculated on a weighted average basis using the NAIC Company Action Level formula, was approximately 460 percent, which is in line with our expectation. We repurchased 5.4 million shares and 3.3 million shares of Unum Group common stock under our share repurchase program during the first quarter of 2026 and 2025, respectively, at a cost of $402.4 million and $202.6 million, respectively, including commissions and excise tax. Our weighted average common shares outstanding, assuming dilution, equaled 164.4 million and 178.9 million for the first quarter of 2026 and 2025, respectively. As of March 31, 2026, Unum Group and our intermediate holding companies had available holding company liquidity of $1,726.1 million that was held primarily in bank deposits, commercial paper, money market funds, corporate bonds, municipal bonds, and asset backed securities. See Note 12 of the "Notes to Consolidated Financial Statements" contained herein in Item 1.

Previous wording

In February 2025, Unum America entered into a master transaction agreement with Fortitude Reinsurance Company Ltd. (Fortitude Re) which resulted in the execution of a coinsurance agreement during July 2025 (Fortitude Re Reinsurance transaction). This reinsurance agreement reinsures a portion of our Closed Block long-term care business and a portion of our Unum US individual disability business on a coinsurance basis to Fortitude Re effective January 2025. The reinsurance agreement represents approximately 21 percent of total Closed Block long-term care future policy benefits and approximately 15 percent of Unum US individual disability future policy benefits as of December 31, 2024.

Current wording

In February 2025, Unum Life Insurance Company of America (Unum America) entered into a master transaction agreement with Fortitude Re which resulted in the execution of a coinsurance agreement (reinsurance agreement) during July 2025. This reinsurance agreement reinsures a portion of our Closed Block long-term care business and a portion of our Unum US individual disability business on a coinsurance basis to Fortitude Re effective January 2025. The reinsurance agreement represented approximately 21 percent of total Closed Block long-term care future policy benefits and approximately 15 percent of Unum US individual disability future policy benefits as of December 31, 2024.

Previous wording

Upon closing the transaction in July 2025, we transferred to Fortitude Re $953.5 million of cash, which included an initial estimated ceding commission of $461.7 million, as well as fixed maturity securities with a fair value totaling $3,230.1 million and accrued investment income of $47.1 million. A final settlement, including the final ceding commission adjustment, is expected prior to the end of 2025. Fortitude Re established and will maintain a collateralized trust account for the benefit of Unum America to secure its obligations under the reinsurance agreement. During the first nine months of 2025, we recognized a net realized investment loss totaling $46.8 million related to the Fortitude Re reinsurance transaction. Although we transferred a significant portion of our fixed maturity securities portfolio during the third quarter of 2025 as a part of this transaction, the overall credit profile of our remaining portfolio did not change.

Current wording

Upon closing the transaction in July 2025, we transferred to Fortitude Re $953.5 million of cash as well as fixed maturity securities with a fair value totaling $3,230.1 million and accrued investment income of $47.1 million. After consideration of the final settlement, the final ceding commission related to this transaction was $442.3 million. Fortitude Re has an A rating by A.M. Best Company and has established a collateralized trust account for the benefit of Unum America to secure its obligations under the reinsurance agreement.

Previous wording

•Cost of reinsurance of $846.5 million related to the Closed Block long-term care product line and a deferred gain on reinsurance related to the Unum US individual disability product line of $148.2 million

Current wording

•Cost of reinsurance of $848.2 million related to the Closed Block long-term care product line and a deferred gain on reinsurance related to the Unum US individual disability product line of $145.9 million.

Previous wording

See Notes 4 and 14 in the "Notes to Consolidated Financial Statements" contained herein in Item 1 and "Investments" and "Liquidity and Capital Resources" contained herein in this Item 2 for further information.

Current wording

See Notes 4 and 14 in the "Notes to Consolidated Financial Statements" contained herein in Item 1 and "Investments" contained herein in this Item 2 for further information.

Previous wording

The Organization for Economic Co-operation and Development (OECD) has established model rules to ensure a minimum level of tax of 15 percent (Pillar Two) for multinational companies. Several jurisdictions, including the United Kingdom, Ireland, and Poland have adopted Pillar Two beginning on or after December 31, 2023. We have not recorded Pillar Two taxes as of September 30, 2025, and we do not expect material impacts in 2025. We will continue to monitor legislative developments and refine our estimates as necessary.

Current wording

The Organization for Economic Co-operation and Development (OECD) has established model rules to ensure a minimum level of tax of 15 percent (Pillar Two) for multinational companies. Several jurisdictions, including the United Kingdom, Ireland, and Poland have adopted Pillar Two beginning on or after December 31, 2023. We have not recorded material Pillar Two taxes as of March 31, 2026. We will continue to monitor legislative developments.

Previous wording

We believe our strategy of providing financial protection products at the workplace puts us in a position of strength. We continue to fulfill our corporate purpose of helping the working world thrive throughout life’s moments by providing excellent service to people at their time of need. Our strategy remains centered on growing our core businesses, through investing and transforming our operations and technology to anticipate and respond to the changing needs of our customers, expanding into new adjacent markets through meaningful partnerships and effective deployment of our capital across our portfolio.

Current wording

We believe our strategy of providing financial protection products at the workplace puts us in a position of strength. We continue to fulfill our corporate purpose of helping the working world thrive throughout life’s moments by providing an excellent experience centered on service, expertise and empathy to people at their time of need. Our strategy remains centered on growing our core businesses, through investing and transforming our operations and technology to anticipate and respond to the changing needs of our customers, expanding into new adjacent markets through meaningful partnerships and effective deployment of our capital across our portfolio.

Previous wording

In 2024, we experienced increased earnings driven by the underlying strength of our business and expect positive operating trends in our core businesses to continue in 2025. The products and services we provide deliver significant value to employers, employees and their families, and we believe this will help drive premium growth in 2025.

Current wording

We expect earnings growth in our core operations in 2026. The products and services we provide deliver significant value to employers, employees and their families, and we believe this will help drive strong premium growth in 2026.

Previous wording

A rising interest rate environment could positively impact our yields on new investments, but could also increase unrealized losses in our current holdings. Alternatively, a declining interest rate environment could negatively impact our yields on new investments, but could also reduce unrealized losses in our current holdings. We also may continue to experience further volatility in miscellaneous investment income primarily related to changes in partnership net asset values as well as bond calls.

Current wording

A rising interest rate environment could positively impact our yields on new investments, but could also increase unrealized losses in our current holdings. Alternatively, a declining interest rate environment could negatively impact our yields on new investments, but could also reduce unrealized losses in our current holdings. We may also continue to experience further volatility in miscellaneous investment income primarily related to changes in partnership net asset values as well as bond calls.

Previous wording

We analyze our performance using non-GAAP financial measures. A non-GAAP financial measure is a numerical measure of a company's performance, financial position, or cash flows that excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with U.S. generally accepted accounting principles (GAAP). The non-GAAP financial measure of "after-tax adjusted operating income" differs from net income as presented in our consolidated operating results and income statements prepared in accordance with GAAP due to the exclusion of investment gains or losses, certain impacts from reinsurance transactions, reserve assumption updates and certain other items as specified in the reconciliations below. We believe after-tax adjusted operating income is a better performance measure and better indicator of the profitability and underlying trends in our business.

Current wording

We analyze our performance using non-GAAP financial measures. A non-GAAP financial measure is a numerical measure of a company's performance, financial position, or cash flows that excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with U.S generally accepted accounting principles (GAAP). The non-GAAP financial measure of "after-tax adjusted operating income" differs from net income as presented in our consolidated operating results and income statements prepared in accordance with GAAP due to the exclusion of investment gains or losses, Closed Block segment after-tax adjusted operating income or loss, reserve assumption updates and certain other items. The excluded items impacting the periods presented herein are specified in the reconciliations below. We believe after-tax adjusted operating income is a better performance measure and better indicator of the profitability and underlying trends in our business.

Previous wording

Cash flow assumptions used to calculate our liability for future policy benefits are reviewed at least annually and updated, as needed, with the resulting impact reflected in net income. While the effects of these assumption updates are recorded in the reporting period in which the review is completed, these updates reflect experience emergence and changes to expectations spanning multiple periods. We believe that by excluding the impact of reserve assumption updates we are providing a more comparable and consistent view of our results.

Current wording

Cash flow assumptions used to calculate our liability for future policy benefits are reviewed at least annually and updated, as needed, with the resulting impact reflected in net income. While the effects of these assumption updates are recorded in the reporting period in which the review is completed, these updates reflect experience emergence and changes to expectations spanning multiple periods. We believe that by excluding the impact of reserve assumption updates we are providing a more comparable and consistent view of our quarterly results.

Previous wording

See "Executive Summary," and "Investments," and "Critical Accounting Estimates" contained herein in Item 2 and Note 4, Note 7, and Note 14 of the "Notes to Consolidated Financial Statements" contained herein in Item 1 for further discussion regarding the items specified in the reconciliation below.

Current wording

See "Investments" contained herein in Item 2 and Note 4 of the "Notes to Consolidated Financial Statements" contained herein in Item 1 for further discussion regarding the net investment loss.

Previous wording

We measure and analyze our segment performance on the basis of "adjusted operating revenue" and "adjusted operating income" or "adjusted operating loss", which differ from total revenue and income before income tax as presented in our consolidated statements of income due to the exclusion of investment gains and losses, certain impacts from reinsurance transactions, reserve assumption updates and certain other items specified in the reconciliations below. These performance measures are in accordance with GAAP guidance for segment reporting, but they should not be viewed as a substitute for total revenue, income before income tax, or net income.

Current wording

We measure and analyze our segment performance on the basis of "segment adjusted operating revenue" and "segment adjusted operating income" or "segment adjusted operating loss", which differ from total revenue and income before income tax as presented in our consolidated statements of income due to the exclusion of investment gains and losses, reserve assumption updates, and certain other items. The excluded items impacting the periods presented herein are specified in the reconciliations below. These performance measures are in accordance with GAAP guidance for segment reporting, but they should not be viewed as a substitute for total revenue, income before income tax, or net income.

Previous wording

A reconciliation of total revenue to "adjusted operating revenue" and income before income tax to "adjusted operating income" is as follows:

Current wording

A reconciliation of total revenue to "segment adjusted operating revenue" and income before income tax to "segment adjusted operating income" is as follows:

Previous wording

The accounting estimates deemed to be most critical to our financial position and results of operations are those related to the liability for future policy benefits, valuation of investments, pension and postretirement benefit plans, income taxes, and contingent liabilities. The critical accounting estimates for which there were significant changes during the nine months ended September 30, 2025, are included below. For additional information on the accounting estimates for which there was not a significant change during the nine months ended September 30, 2025, refer to our significant accounting policies in Note 1 of the "Notes to Consolidated Financial Statements" in Part II, Item 8, and "Critical Accounting Estimates" in Part II, Item 7 of our annual report on Form 10-K for the year ended December 31, 2024.

Current wording

The accounting estimates deemed to be most critical to our financial position and results of operations are those related to the liability for future policy benefits, valuation of investments, income taxes, and contingent liabilities. There have been no significant changes in our critical accounting estimates during the three months ended March 31, 2026.

Previous wording

The weighted average pound/dollar exchange rate for our Unum UK line of business was 1.348 and 1.312 for the three months ended September 30, 2025 and 2024, and 1.314 and 1.278 for the nine months ended September 30, 2025 and 2024, respectively. If the 2024 results for our U.K. operations had been translated at the weighted average exchange rates of 2025, our adjusted operating revenue would have been higher by approximately $9 million and $20 million, respectively, in the third quarter and first nine months of 2024 and our adjusted operating income would have been higher by approximately $1 million and $3 million, respectively for the third quarter and first nine months of 2024. However, it is important to distinguish between translating and converting foreign currency. Except for a limited number of transactions, we do not actually convert pounds into dollars. As a result, we view foreign currency translation as a financial reporting item and not a reflection of operations or profitability in the U.K.

Current wording

The weighted average pound/dollar exchange rate for our Unum UK line of business was 1.343 and 1.264 for the three months ended March 31, 2026 and 2025, respectively. If the first quarter 2025 results for our U.K. operations had been translated at the higher exchange rate of 2026, our segment adjusted operating revenue and segment adjusted operating income would have both been higher by approximately $15 million and $2 million, respectively, in the first quarter of 2025. Except for a limited number of transactions, we do not actually convert pounds into dollars. As a result, we view foreign currency translation as a financial reporting item and not a reflection of operations or profitability in the U.K.

Previous wording

Premium income increased in each of our principal operating segments in the third quarter and first nine months of 2025 compared to the same periods of 2024, primarily due to higher sales, in-force block growth, and the impacts from the recapture of a previously ceded block of business in our Unum US individual disability product line that occurred in the first quarter of 2025, partially offset by the expected run off in medical stop-loss in our Unum US segment. Also offsetting the premium income increase in our principal operating segments in the third quarter and first nine months of 2025 compared to the same periods of 2024, was the impact of ceding a portion of the Unum US individual disability product line as a part of the Fortitude Re reinsurance transaction. Premium income continues to decline in our Closed Block segment, as expected, accelerated in the third quarter and first nine months of 2025 compared to the same periods of 2024 due to the impact of ceding a portion of the Closed Block long-term care product line as a part of the Fortitude Re reinsurance transaction.

Current wording

Premium income increased in the first quarter of 2026 relative to the same period of 2025 in each of our principal operating business segments, primarily due to favorable persistency and sales, partially offset by the impact of ceding a portion of the individual disability product line as a part of the Fortitude Re reinsurance transaction, as well as the expected run off in medical stop-loss premium. Premium income continues to decline in our Closed Block segment, as expected, and this was accelerated by the impact of ceding a portion of the Closed Block long-term care product line as a part of the Fortitude Re reinsurance transaction in 2025.

Previous wording

Net investment income was lower in the third quarter and first nine months of 2025 compared to the same periods of 2024 due primarily to a decrease in the level of invested assets supporting the Closed Block long-term care product line as a result of the Fortitude Re reinsurance transaction and a decrease in the yield on invested assets, partially offset by higher investment income from inflation index-linked bonds held by Unum UK.

Current wording

Net investment income was lower in the first quarter of 2026 compared to the same period of 2025 primarily related to a decrease in the level of invested assets supporting the Closed Block long-term care product line as a result of the Fortitude Re reinsurance transaction, partially offset by an increase in the yield on invested assets as well as an increase in miscellaneous investment income, primarily related to larger increases in the NAV on our private equity partnerships.

Previous wording

Our investment gains and losses on fixed maturity securities for the third quarter and first nine months of 2025 were driven primarily by the Fortitude Re reinsurance transaction which resulted in a net gain of $137.6 million in the third quarter of 2025 and a net loss of $46.8 million in the first nine months of 2025. In addition, we realized a $19.1 million loss on sales of fixed maturity securities relating to funding of a dividend from one of our subsidiaries in the first nine months of 2025. See Note 4 in the "Notes to Consolidated Financial Statements" contained herein in Item 1 and "Investments" contained herein in this Item 2 for further information.

Current wording

Our investment gains and losses on fixed maturity securities include net losses on sales of $0.5 million and $44.7 million in the first quarter of 2026 and 2025, respectively. The net losses for the first quarter of 2025 were primarily related to a realized loss of $23.5 million on sales of fixed maturity securities relating to the Fortitude Re reinsurance transaction as well as a $19.1 million realized loss on sales of fixed maturity securities relating to funding of a dividend from one of our subsidiaries. Credit and impairment losses on fixed maturity securities were $2.2 million during first quarter of 2026. We recognized $153.4 million of credit and impairment losses on fixed maturity securities during the first quarter of 2025 which was primarily comprised of the $152.4 million impairment loss based on the intent to transfer fixed-maturity securities related to the Fortitude Re reinsurance transaction. See Note 4 in the "Notes to Consolidated Financial Statements" contained herein in Item 1 and "Investments" contained herein in this Item 2 for further information.

Previous wording

Other income is primarily comprised of fee-based service products in the Unum US segment, which include leave management services and administrative services only business, the underlying results and associated net investment income of certain assumed blocks of reinsured business in the Closed Block segment and the amortization of the deferred gain on reinsurance related to the Unum US individual disability product line as a part of the Fortitude Re reinsurance transaction. Also included within other income for the first nine months of 2025 is a gain on the recapture of a previously ceded block of business in the Unum US individual disability product line.

Current wording

Other income is primarily comprised of fee-based service products in the Unum US segment, which include leave management services and administrative services only business, and the underlying results and associated net investment income of certain assumed blocks of reinsured business in the Closed Block segment. Also included within other income, in the first quarter of 2026, is the amortization of the deferred gain on reinsurance related to the Unum US individual disability product line as a part of the Fortitude Re reinsurance transaction. Also included within other income, in the first quarter of 2025, is a gain on the recapture of a previously ceded block of business in the Unum US individual disability product line.

Previous wording

Overall benefits experience was unfavorable in the third quarter and first nine months of 2025 relative to the same periods of 2024. The consolidated benefit ratio, which includes the remeasurement gain or loss, was 86.5 percent and 75.8 percent in the third quarter and first nine months of 2025, respectively, compared to 55.6 percent and 64.3 percent for the same prior year periods. Excluding the impact of the reserve assumption updates and non-contemporaneous reinsurance, the consolidated benefit ratio was 68.4 percent and 69.7 percent in the third quarter and first nine months of 2025, respectively, compared to 69.0 percent and 68.6 percent for the same prior year periods. The benefit ratio, which includes the remeasurement gain or loss, for each of our operating business segments is discussed more fully in "Segment Results" as follows.

Current wording

Overall benefits experience in the first quarter of 2026 was unfavorable relative to the same period of 2025 with a consolidated benefit ratio, which includes the remeasurement gain (loss), of 71.7 percent and 69.2 percent, respectively. The underlying benefits experience for each of our operating segments is discussed more fully in "Segment Results" as follows.

Previous wording

Commissions were higher during the third quarter and first nine months of 2025 compared to the same periods of 2024 primarily due to the continued impacts from the recapture of a previously ceded block of business in our Unum US individual disability product line that occurred in the first quarter of 2025 as well as prior period sales in our principal operating business segments, partially offset by the impacts from the Fortitude Re reinsurance transaction for our Unum US individual disability product line. The deferral of acquisition costs was higher during the third quarter and first nine months of 2025 compared to the same periods of 2024 primarily due to an increase in commissions and other sales-related costs in our Colonial Life segment. The amortization of deferred acquisition costs was generally consistent in the third quarter and first nine months of 2025 compared to the same periods of 2024.

Current wording

Commissions and the deferral of acquisition costs were higher during the first quarter of 2026 compared to the same period of 2025 due to sales in our core operating segments. The amortization of deferred acquisition costs was higher in the first quarter of 2026 compared to the same period of 2025 primarily due to growth in the level of the deferred asset in our Colonial Life and Unum US group disability product lines, partially offset by a decrease in the level of the deferred asset in our Unum US individual disability product line as a result of the Fortitude Re reinsurance transaction.

Previous wording

Other expenses and compensation expense, on a combined basis, increased in the third quarter and first nine months of 2025 compared to the same periods of 2024 due to an increase in the amortization of the cost of reinsurance as a result of the Fortitude Re reinsurance transaction, an increase in operational investments in our business, and impacts from the recapture of a previously ceded block of business in our Unum US individual disability product line that occurred in the first quarter of 2025.

Current wording

Other expenses and compensation expense, on a combined basis, increased in the first quarter of 2026 compared to the same period of 2025 due primarily to an increase in the amortization of the cost of reinsurance as a result of the Fortitude Re reinsurance transaction, as well as an increase in employee-related costs.

Previous wording

Our effective income tax rates for the third quarter and first nine months of 2025 were 27.2 percent and 21.1 percent of income before income tax, respectively, compared to 20.7 percent and 20.8 percent for the same prior year periods. Our effective income tax rate differed from the U.S. statutory rate of 21 percent for the third quarter of 2025 primarily due to global intangible low taxed income tax and interest on uncertain tax positions, partially offset by tax exempt income and prior year tax return true up. Our effective income tax rate was generally consistent with the U.S. statutory rate of 21 percent for the first nine months of 2025, with interest on uncertain tax positions mostly offset by tax exempt income. Our effective income tax rates were generally consistent with the U.S. statutory rate of 21 percent for the third quarter and first nine months of 2024.

Current wording

Our effective income tax rate for the first quarter of 2026 was 23.4 percent, compared to 22.4 percent for the same prior year period. Our effective income tax rate differed from the U.S. statutory rate of 21 percent for the first quarter of 2026 primarily due to non-deductible compensation. Our effective income tax rate differed from the U.S. statutory rate of 21 percent for the first quarter of 2025 primarily due to interest on uncertain tax positions.

Previous wording

The Unum US segment is comprised of the group disability, group life and accidental death and dismemberment, and supplemental and voluntary lines of business. The group disability line of business includes long-term and short-term disability, medical stop-loss, and fee-based service products. The supplemental and voluntary line of business includes voluntary benefits, individual disability, and dental and vision products. These products, excluding medical stop-loss which is no longer actively marketed as of the third quarter of 2024, are marketed through our field sales personnel who work in conjunction with independent brokers and consultants.

Current wording

The Unum US segment is comprised of the group disability, group life and accidental death and dismemberment, and supplemental and voluntary lines of business. The group disability line of business includes long-term disability, short-term disability and our fee-based service products. Long-term disability includes medical stop-loss products, and short-term disability includes paid family and medical leave products. The supplemental and voluntary line of business includes voluntary benefits, individual disability, and dental and vision products. These products, excluding medical stop-loss which is no longer actively marketed as of the third quarter of 2024, are marketed through our field sales personnel who work in conjunction with independent brokers and consultants.

Previous wording

Premium income decreased in the third quarter and first nine months of 2025 compared to the same periods of 2024 due to the expected run off in medical stop-loss premium and lower persistency, partially offset by an increase in premium income due to sales. Net investment income was lower in the third quarter and first nine months of 2025 compared to the same periods of 2024 due to a decrease in the level of invested assets. Other income, which primarily relates to fee-based service products, was generally consistent in the third quarter and first nine months of 2025 compared to the same periods of 2024.

Current wording

Premium income was higher in the first quarter of 2026 compared to the same period of 2025 due primarily to favorable persistency and prior period sales, partially offset by the expected run off in medical stop-loss premium. Net investment income was generally consistent in the first quarter of 2026 relative to the same period of 2025. Other income was higher in the first quarter of 2026 compared to the same period of 2025 due to growth in our fee-based service products.

Previous wording

Commissions were higher in the third quarter and first nine months of 2025 compared to the same periods of 2024 due primarily to sales. The deferral of acquisition costs in the third quarter and first nine months of 2025 compared to the same periods of 2024 were generally consistent. The amortization of deferred acquisition costs decreased in the third quarter and first nine months of 2025 compared to the same periods of 2024 due to the composition of lapses across cohorts. The other expense ratio, which includes other income that is primarily related to fee-based service products, was generally consistent in the third quarter and first nine months of 2025 compared to the same periods of 2024.

Current wording

Commissions were higher in the first quarter of 2026 compared to the same period of 2025 due primarily to sales. The deferral of acquisition costs was generally consistent in the first quarter of 2026 compared to the same period of 2025. The amortization of deferred acquisition costs increased in the first quarter of 2026 compared to the same period of 2025 primarily due to composition of lapses across cohorts. The other expense ratio, which includes other income that is primarily related to fee-based service products, decreased in the first quarter of 2026 compared to the same period of 2025 due primarily to our focus on expense management and operating efficiencies.

Previous wording

Premium income in the third quarter and first nine months of 2025 was higher compared to the same periods of 2024 due to favorable overall persistency and prior period sales. Net investment income increased during the third quarter and first nine months of 2025 relative to the same periods of 2024 due to an increase in the level of invested assets and an increase in the yield on invested assets.

Current wording

Premium income was higher in the first quarter of 2026 compared to the same period of 2025 due to favorable persistency and prior period sales. Net investment income was higher in the first quarter of 2026 relative to the same period of 2025 due to an increase in the allocation of net investment income on corporate owned excess assets as well as an increase in the yield on invested assets.

Previous wording

Commissions and the deferral of acquisition costs were higher in the third quarter and first nine months of 2025 compared to the same periods of 2024 due to sales. The amortization of deferred acquisition costs changed in the third quarter and the first nine months of 2025 compared to the same periods of 2024 due to the composition of lapses across cohorts. The other expense ratio was generally consistent in the third quarter and first nine months of 2025 compared to the same periods of 2024.

Current wording

Commissions and deferral of acquisition costs were higher in the first quarter of 2026 compared to the same period of 2025 due to sales. The amortization of deferred acquisition costs in the first quarter of 2026 increased compared to the same period of 2025 due to growth in the level of the deferred asset as well as the composition of lapses across cohorts. The other expense ratio was unfavorable in the first quarter of 2026 compared to the same period of 2025 due to an increase in operational investments in our business.

Previous wording

Premium income was higher in the third quarter and first nine months of 2025 compared to the same periods of 2024 due to the continued impacts from the recapture of a previously ceded block of business in the individual disability product line, higher prior period sales in the voluntary benefits product line, and favorable persistency in the voluntary benefits and dental and vision product lines, partially offset by the impact of ceding a portion of the individual disability product line as a part of the Fortitude Re reinsurance transaction. Net investment income was lower in the third quarter and first nine months of 2025 compared to the same periods of 2024 primarily due to a lower level of invested assets and a decrease in the yield on invested assets.

Current wording

Premium income was slightly lower in the first quarter of 2026 compared to the same period of 2025 due to the impact of ceding a portion of the individual disability product line as a part of the Fortitude Re reinsurance transaction and lower persistency across all product lines, mostly offset by sales in the voluntary benefits and individual disability product lines. Net investment income was generally consistent in the first quarter of 2026 compared to the same period of 2025. Other income was lower in the first quarter of 2026 compared to the same period of 2025 due primarily to a gain on the recapture of a previously ceded block of business in the individual disability product line in the first quarter of 2025. Other income for the first quarter of 2026 includes the amortization of the deferred gain on reinsurance related to the Fortitude Re reinsurance transaction.

Previous wording

Commissions were higher in the third quarter and first nine months of 2025 compared to the same periods of 2024 due primarily to the continued impacts from the recapture of a previously ceded block of business in the individual disability product line, partially offset by the impacts from the Fortitude Re reinsurance transaction. The deferral of acquisition costs was higher in the third quarter and first nine months of 2025 compared to the same periods of 2024 due primarily to higher sales in the individual disability product line. The amortization of deferred acquisition costs was lower in the third quarter and first nine months of 2025 compared to the same periods of 2024 due primarily to a reduction in the level of the deferred asset as a result of the Fortitude Re reinsurance transaction. The other expense ratio was unfavorable in the third quarter and first nine months of 2025 compared to the same periods of 2024 primarily due to the Fortitude Re reinsurance transaction.

Current wording

Commissions and the deferral of acquisition costs were higher for the first quarter of 2026 compared to the same periods of 2025 due primarily to sales. The amortization of deferred acquisition costs was lower in the first quarter of 2026 compared to the same period of 2025 due to a decrease in the level of the deferred asset as a result of the Fortitude Re reinsurance transaction. The other expense ratio was generally consistent in the first quarter of 2026 relative to the same period of 2025.

Previous wording

Group sales increased during the third quarter of 2025 compared to the same period of 2024 due primarily to higher sales to new customers in the large case market, which we define as employee groups with greater than 2,000 employees. Group sales decreased during the first nine months of 2025 compared to the same period of 2024 due to the impact of no sales of our medical stop-loss product in the first nine months of 2025 as it was no longer actively marketed as of the third quarter of 2024, as well as lower sales to existing customers in the large case market and lower sales to new and existing customers in the core market, partially offset by higher sales to new customers in the large case market. The sales mix in the group market sector for the first nine months of 2025 was approximately 59 percent core market and 41 percent large case market.

Current wording

Group sales increased during the first quarter of 2026 compared to the same period of 2025 due primarily to higher sales to new customers in the core market, which we define as employee groups with less than 2,000 employees, and higher sales to new customers in the large case market. The sales mix in the group disability and group life and accidental death and dismemberment product lines for the first three months of 2026 was approximately 64 percent in the core market and 36 percent in the large case market.