Unum Group
For the period ended Sep 30, 2026. Filed Nov 4, 2026.
View on SEC.govAbout this filing
A company's report for each of its first three quarters. The financial statements are not audited. It shows how the business has moved since the last annual report, and what management says changed.
Sep 30, 2026 · Filed Nov 4, 2026
UNM$76.75+3.8%Stored close · as of Nov 6, 2026
What changed in Management’s Discussion and Analysis?
Read the current filingPrevious report: 10-Q
Period ended 2026-06-30; filed 2026-07-29.
0000005513-26-000075
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsExecutive SummaryReconciliation of Non-GAAP and Other Financial MeasuresCritical Accounting EstimatesAccounting DevelopmentsConsolidated Operating ResultsSegment ResultsUnum US SegmentUnum International SegmentColonial Life SegmentClosed Block SegmentCorporate SegmentInvestmentsLiquidity and Capital ResourcesCurrent report: 10-Q
Period ended 2026-09-30; filed 2026-11-04.
0000005513-26-000086
Item 2. Management's Discussion and Analysis of Financial Condition and Results of OperationsExecutive SummaryReconciliation of Non-GAAP and Other Financial MeasuresCritical Accounting EstimatesAccounting DevelopmentsConsolidated Operating ResultsSegment ResultsUnum US SegmentUnum International SegmentColonial Life SegmentClosed Block SegmentCorporate SegmentInvestmentsLiquidity and Capital ResourcesThe baseline is this issuer’s latest earlier reporting period of the same form that was filed before the current report. A previous 10-Q is a different quarter, not a year-over-year comparison. Amendments are excluded.
Compared 267 previous paragraphs and 292 current paragraphs.
150 unchanged; 88 reworded; 49 added; 24 removed; 5 previous and 5 current paragraphs rearranged.
Tables are not compared: 24 previous and 25 current tables excluded. Dates, whitespace, punctuation and numbering changes are ignored; changes to financial figures remain significant.
A changed paragraph is not evidence that risk increased or decreased. An unchanged paragraph does not establish that risk stayed the same.
Added paragraphs (49)
Current report
Included in our results for the third quarter of 2026 are:
Current report
•A net investment loss of $853.0 million before tax; and,
Current report
•Closed Block segment before-tax adjusted operating loss of $135.6 million.
Current report
The tax benefit on the items above was $207.9 million.
Current report
Included in our results for the first nine months of 2026 are:
Current report
•Closed Block segment before-tax adjusted operating loss of $356.3 million; and,
Current report
The tax benefit on the items above was$259.9 million.
Current report
Additionally, included in results for three and nine months ended September 30, 2026 is a net tax only benefit of $12.0 million, reflecting the effect of the release of an unrecognized tax benefit liability of $188.2 million, mostly offset by a deferred tax asset valuation allowance of $176.2 million.
Current report
•A net investment gain of $128.0 million before tax; and,
Current report
•Closed Block segment before-tax adjusted operating loss of $682.3 million.
Current report
The tax benefit on the items above was $114.6 million.
Current report
Included in our results for the first nine months of 2025 are:
Current report
•A net investment loss of $96.5 million before tax; and,
Current report
•Closed Block segment before-tax adjusted operating loss of $685.1 million.
Current report
The tax benefit on the items above was $157.6 million.
Current report
Included in after-tax adjusted operating income for the third quarter and first nine months of 2026 was the following notable item, an after-tax net reserve decrease in our core operating segments of $53.2 million in both periods, or $0.33 per diluted common share, comprised of an after-tax net reserve decrease related to assumption updates of $67.0 million, or $0.42 per diluted common share, and an after-tax reserve increase related to reserve refinements of $13.8 million, or $0.09 per diluted common share. Included in after-tax adjusted operating income for the third quarter and first nine months of 2025 was the following notable item, a net after-tax reserve decrease related to assumption updates in our core operating segments of $128.1 million in both periods, or $0.75 and $0.73 per diluted common share, respectively.
Current report
Unum US reported segment adjusted operating income of $315.3 million and $982.8 million in the third quarter and first nine months of 2026, respectively, compared to $486.8 million and $1,134.1 million in the same periods of 2025, due primarily to benefits experience, partially offset by higher premium income and net investment income. The benefit ratio for our Unum US segment was 62.0 percent and 60.9 percent in the third quarter and first nine months of 2026, respectively, compared to 51.1 percent and 57.2 percent in the same periods of 2025. Unum US sales decreased 8.5 percent in the third quarter and increased 8.6 percent in the first nine months of 2026, compared to the same periods of 2025.
Current report
During the third quarters of 2026 and 2025, we completed our annual cash flow assumption review and updated certain assumptions used to develop the liability for future policy benefits. For more information see "Critical Accounting Estimates" included herein in this Item 2.
Current report
During the third quarter of 2026, we recognized a tax benefit of $188.2 million from the release of unrecognized tax benefits related to a policyholder reserves position taken on our 2017 return following the completion of an Internal Revenue Service exam. The benefit reflects the release of the related unrecognized tax benefit liability of $112.9 million and accrued interest of $75.3 million.
Current report
During the third quarter of 2026, we established a valuation allowance that increased income tax expense by $176.2 million related to our deferred tax assets on capital losses, reflecting a change in our assessment of the realizability of these deferred tax assets. Based on expected capital losses associated with the 2026 Fortitude Re reinsurance transaction, we believe it is more likely than not that we will not be able to realize the benefit of these capital losses against future capital gains within the statutory carryforward period.
Current report
We no longer exclude reserve assumption updates from our adjusted operating results, and prior period financial information has been adjusted to conform to this updated presentation.
Current report
2026 and 2025 Cash Flow Assumption Review
Current report
During the third quarters of 2026 and 2025, we completed our annual cash flow assumption review which resulted in the following impacts to net income as a result of updating certain assumptions related to the liability for future policy benefits:
Current report
2026 Significant Cash Flow Assumption Updates:
Current report
The cash flow assumption updates in our Closed Block segment were primarily driven by the long-term care product line. The impact to income before income tax for this product line was $54.9 million. However, there were also updates to the assumptions for the portion of the long-term care product line which was included in the block ceded as a part of the 2025 Fortitude Re reinsurance transaction. We increased our liability for future policy benefits by $53.1 million as a result of the assumption updates related to the ceded block with a corresponding increase in our consolidated balance sheet as a reinsurance recoverable. The total cash flow assumption updates in the long-term care product line increased our liability for future policy benefits due primarily to higher expectations for claim incidence assumptions and lower expectations for mortality assumptions, partially offset by an increase to expected future premium rate approvals.
Current report
The cash flow assumption updates in our Colonial Life segment reduced our liability for future policy benefits by $42.5 million, due primarily to lower expectations for morbidity assumptions, increased policyholder lapse rates, and lower mortality assumptions.
Current report
The cash flow assumption updates in our Unum US group disability product line reduced our liability for future policy benefits by $36.6 million, due primarily to favorable social security benefit offsets and claim recovery trends, partially offset by higher claim incidence.
Current report
The cash flow assumption updates in our Unum International segment increased our liability for future policy benefits by $27.3 million, due primarily to higher claim incidence assumptions for our Unum UK group disability product line.
Current report
2025 Significant Cash Flow Assumption Updates:
Current report
The cash flow assumption updates in our Closed Block segment were primarily driven by the long-term care product line. The impact to income before income tax for this product line was $643.1 million. However, there were also updates to the assumptions for the portion of the long-term care product line which was included in the block ceded as a part of the 2025 Fortitude Re reinsurance transaction. We increased our liability for future policy benefits by $82.0 million as a result of the assumption updates related to the ceded block with a corresponding increase in our consolidated balance sheet as a reinsurance recoverable. The total cash flow assumption updates in the long-term care product line increased our liability for future policy benefits due primarily to the removal of the morbidity and mortality improvement assumptions. Also contributing were higher expectations for claim incidence assumptions, and the removal of future assumptions related to new enrollments on existing group cases, partially offset by an increase to expected future premium rate approvals and higher expectations for claim terminations.
Current report
The cash flow assumption updates in our Unum US group long-term disability product line reduced our liability for future policy benefits by $105.8 million, due primarily to claim resolution assumptions driven by favorable claim recovery trends as well as higher mortality expectations.
Current report
The cash flow assumption updates in our Unum US individual disability product line reduced our liability for future policy benefits by $27.7 million, due primarily to favorable claim incidence and recovery trends.
Current report
Commissions and the deferral of acquisition costs were higher during the third quarter and first nine months of 2026 compared to the same periods of 2025 due to sales. The amortization of deferred acquisition costs was higher in the third quarter and first nine months of 2026 compared to the same periods of 2025 due to growth in the level of the deferred asset.
Current report
Premium income increased in the third quarter and first nine months of 2026 compared to the same periods of 2025 due to higher persistency and sales. Net investment income was higher in the third quarter and first nine months of 2026 compared to the same periods of 2025 due to an increase in the allocation of net investment income on corporate owned excess assets as well as an increase in yield on invested assets.
Current report
The other expense ratio was lower in the third quarter and first nine months of 2026 compared to the same periods of 2025 due primarily to our focus on expense management and operating efficiencies.
Current report
Net investment income was higher during the third quarter of 2026 relative to the same period of 2025 primarily due to an increase in the yield on invested assets as well as higher miscellaneous investment income, primarily related to larger increases in the NAV on our private equity partnerships, partially offset by a decrease in the level of invested assets and a decrease in the allocation of net investment income from our corporate owned excess assets. Net investment income was lower during the first nine months of 2026 relative to the same period of 2025 primarily due to a decrease in the level of invested assets resulting from the Fortitude Re reinsurance transaction and a decrease in the allocation of net investment income from our corporate owned excess assets, partially offset by higher miscellaneous investment income, primarily related to larger increases in the NAV on our private equity partnerships.
Showing the first 40 of 49 passages. Open the source sections for the rest.
Removed paragraphs (24)
Previous report
Included in our results for the second quarter of 2026 are:
Previous report
•Closed Block segment before-tax adjusted operating loss of $75.4 million; and,
Previous report
The tax benefit on the items above was $22.2 million.
Previous report
Included in our results for the first six months of 2026 are:
Previous report
•Closed Block segment before-tax adjusted operating loss of $220.7 million; and,
Previous report
The tax benefit on the items above was$52.0 million.
Previous report
•A net investment loss of $17.7 million before tax; and,
Previous report
The tax benefit on the items above was $3.9 million.
Previous report
Included in our results for the first six months of 2025 are:
Previous report
•A net investment loss of $224.5 million before tax; and,
Previous report
•Closed Block segment before-tax adjusted operating loss of $2.8 million.
Previous report
The tax benefit on the items above was $43.0 million.
Previous report
Unum US reported segment adjusted operating income of $329.6 million and $667.5 million in the second quarter and first six months of 2026, respectively, compared to $318.2 million and $647.3 million in the same periods of 2025, due primarily to higher premium income. Also impacting the comparison of the first six months of 2026, compared to the same period of 2025, was higher net investment income. The benefit ratio for our Unum US segment was 61.1 percent and 60.3 percent in the second quarter and first six months of 2026, respectively, compared to 60.7 percent and 60.2 percent in the same periods of 2025. Unum US sales increased 7.4 percent and 14.3 percent in the second quarter and first six months of 2026, respectively, compared to the same periods of 2025.
Previous report
Anticipated 2026 Closed Block Long-Term Care Reinsurance Transaction
Previous report
During July 2026, we also entered into $1,082.0 million notional amount of Treasury forwards and $549.8 million notional amount of total return swaps to hedge interest rate and duration risk associated with assets that will be transferred upon closing of the anticipated 2026 Closed Block long-term care reinsurance transaction.
Previous report
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 report
Commissions and the deferral of acquisition costs were higher during the second quarter and first six months of 2026 compared to the same periods of 2025 due to sales in our principal operating segments. The amortization of deferred acquisition costs was higher in the second quarter and first six months of 2026 compared to the same periods of 2025 due to growth in the level of the deferred asset in our Colonial Life segment, 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 2025 Fortitude Re reinsurance transaction.
Previous report
The other expense ratio was lower in the second quarter and first six months of 2026 compared to the same periods of 2025 due primarily to our focus on expense management and operating efficiencies.
Previous report
Net investment income was lower during the second quarter and first six months of 2026 relative to the same periods of 2025 primarily driven by a decrease in the level of invested assets as a result of the 2025 Fortitude Re reinsurance transaction and a decrease in the allocation of net investment income from our corporate owned excess assets.
Previous report
Policy benefits including remeasurement loss were lower in the second quarter of 2026 compared to the same period of 2025 driven primarily by the impact of the 2025 Fortitude Re reinsurance transaction, partially offset by an increase in the current period benefit expense resulting from a higher net premium ratio and the impact of capped cohorts in the long-term care product line. Policy benefits including remeasurement loss were higher in the first six months of 2026 compared to the same period of
Previous report
The other expense ratio was higher in the second quarter and first six months of 2026 compared to the same periods of 2025 due primarily to an increase in the amortization of the cost of reinsurance as a result of the 2025 Fortitude Re reinsurance transaction.
Previous report
1 Includes credit-tranched securities collateralized by loan obligations, auto loans, and other asset types
Reworded paragraphs (88)
Previous wording
Unum Group, a Delaware general business corporation, and its insurance and non-insurance subsidiaries, which collectively with Unum Group we refer to as the Company, operate in the United States, the United Kingdom, Poland, and, to a limited extent, in certain other countries. The principal operating subsidiaries in the United States are Unum Life Insurance Company of America (Unum America), Provident Life and Accident Insurance Company (Provident), The Paul Revere Life Insurance Company, Colonial Life & Accident Insurance Company (Colonial Life & Accident), Unum Insurance Company, Starmount Life Insurance Company, in the United Kingdom, Unum Limited, and in Poland, Unum Zycie TUiR S.A. (Unum Poland). We are a leading provider of financial protection benefits in the United States and the United Kingdom. Our products include disability, life, accident, critical illness, dental and vision, and other related services. We market our products primarily through the workplace.
Current wording
Unum Group, a Delaware general business corporation, and its insurance and non-insurance subsidiaries, which collectively with Unum Group we refer to as the Company, operate in the United States, the United Kingdom, Poland, and, to a limited extent, in certain other countries. The principal operating subsidiaries in the United States are Unum Life Insurance Company of America (Unum America), Provident Life and Accident Insurance Company (Provident), The Paul Revere Life Insurance Company, Colonial Life & Accident Insurance Company (Colonial Life & Accident), Unum Insurance Company, in the United Kingdom, Unum Limited, and in Poland, Unum Zycie TUiR S.A. (Unum Poland). We are a leading provider of financial protection benefits in the United States and the United Kingdom. Our products include disability, life, accident, critical illness, dental and vision, and other related services. We market our products primarily through the workplace.
Previous wording
We have three principal operating segments: Unum US, Unum International, and Colonial Life. Our other operating segments are the Closed Block and Corporate segments. These segments are discussed more fully under "Segment Results" included herein in this Item 2.
Current wording
We have three core operating segments: Unum US, Unum International, and Colonial Life. Our other operating segments are the Closed Block and Corporate segments. These segments are discussed more fully under "Segment Results" included herein in this Item 2.
Previous wording
For the second quarter of 2026, we reported net income of $256.9 million, or $1.61 per diluted common share, compared to net income of $335.6 million, or $1.92 per diluted common share, in the second quarter of 2025. For the first six months of 2026, we reported net income of $488.9 million, or $3.01 per diluted common share, compared to net income of $524.7 million, or $2.97 per diluted common share in the same period of 2025.
Current wording
For the third quarter of 2026, we reported a net loss of $419.7 million, or $2.65 per diluted common share, compared to net income of $39.7 million, or $0.23 per diluted common share, in the third quarter of 2025. For the first nine months of 2026, we reported net income of $69.2 million, or $0.43 per diluted common share, compared to net income of $564.4 million, or $3.23 per diluted common share in the same period of 2025.
Previous wording
Included in our results for the second quarter of 2025 are the following reconciling items:
Current wording
Included in our results for the third quarter of 2025 are the following reconciling items:
Previous wording
Excluding these items, after-tax adjusted operating income for the second quarter of 2026 was $346.0 million, or $2.16 per diluted common share compared to $360.2 million, or $2.06 per diluted common share, for the same period of 2025. After-tax adjusted operating income was $698.5 million, or $4.31 per diluted common share, in the first six months of 2026, compared to $709.0 million, or $4.01 per diluted common share, in the first six months 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.
Current wording
Excluding these items, after-tax adjusted operating income for the third quarter of 2026 was $349.0 million, or $2.20 per diluted common share compared to $479.4 million, or $2.81 per diluted common share, for the same period of 2025. After-tax adjusted operating income was $1,047.5 million, or $6.56 per diluted common share, in the first nine months of 2026, compared to $1,188.4 million, or $6.81 per diluted common share, in the first nine months 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
Unum International reported segment adjusted operating income of $24.3 million and $55.2 million in the second quarter and first six months of 2026, respectively, compared to $41.6 million and $80.3 million in the same periods of 2025. Our Unum UK line of business reported segment adjusted operating income of £15.3 million and £35.7 million in the second quarter and first six months of 2026, respectively, compared to £29.4 million and £58.9 million in the same periods of 2025, primarily due to benefits experience. The benefit ratio for our Unum UK line of business was 82.2 percent and 77.6 percent in the second quarter and first six months of 2026, respectively, compared to 75.0 percent and 71.1 percent in the same periods of 2025. Unum International sales, as measured in U.S. dollars, decreased 19.4 percent and 7.3 percent in the second quarter and first six months of 2026, respectively, compared to the same periods of 2025. Unum UK sales, as measured in local currency, decreased 14.9 percent and 4.2 percent in the second quarter and first six months of 2026, respectively, compared to the same periods of 2025.
Current wording
Unum International reported segment adjusted operating income of $0.2 million and $55.4 million in the third quarter and first nine months of 2026, respectively, compared to $44.2 million and $124.5 million in the same periods of 2025. Our Unum UK line of business reported segment adjusted operating loss of £1.4 million in the third quarter of 2026 and reported segment adjusted operating income of £34.3 million in the first nine months of 2026, compared to income of £27.0 million and £85.9 million in the third quarter and first nine months of 2025, respectively, primarily due to benefits experience, partially offset by higher premium income. The benefit ratio for our Unum UK line of business was 91.0 percent and 82.1 percent in the third quarter and first nine months of 2026, respectively, compared to 73.4 percent and 71.9 percent in the same periods of 2025. Unum International sales, as measured in U.S. dollars, decreased 41.6 percent and 18.5 percent in the third quarter and first nine months of 2026, respectively, compared to the same periods of 2025. Unum UK sales, as measured in local currency, decreased 45.9 percent and 18.0 percent in the third quarter and first nine months of 2026, respectively, compared to the same periods of 2025.
Previous wording
Colonial Life reported segment adjusted operating income of $131.4 million and $259.2 million in the second quarter and first six months of 2026, respectively, compared to $117.4 million and $233.1 million in the same periods of 2025, primarily due to benefits experience, higher net investment income and higher premium income. The benefit ratio for Colonial Life was 46.7 percent and 46.3 percent in the second quarter and first six months of 2026, respectively, compared to 48.3 percent and 48.0 percent in the same periods of 2025. Colonial Life sales increased 6.0 percent and 3.7 percent in the second quarter and first six months of 2026, respectively, compared to the same periods of 2025.
Current wording
Colonial Life reported segment adjusted operating income of $169.4 million and $428.6 million in the third quarter and first nine months of 2026, respectively, compared to $125.5 million and $358.6 million in the same periods of 2025, primarily due to benefits experience, higher net investment income and higher premium income. The benefit ratio for Colonial Life was 38.0 percent and 43.6 percent in the third quarter and first nine months of 2026, respectively, compared to 46.3 percent and 47.4 percent in the same periods of 2025. Colonial Life sales increased 6.4 percent and 4.7 percent in the third quarter and first nine months of 2026, respectively, compared to the same periods of 2025.
Previous wording
Closed Block reported segment adjusted operating loss of $75.4 million and $220.7 million in the second quarter and first six months of 2026, respectively, compared to $10.8 million and $2.8 million in the same periods of 2025. The net premium ratio for long-term care increased to 97.8 percent at June 30, 2026 from 94.9 percent at June 30, 2025.
Current wording
Closed Block reported segment adjusted operating loss of $135.6 million and $356.3 million in the third quarter and first nine months of 2026, respectively, compared to a loss of $682.3 million and $685.1 million in the same periods of 2025. The net premium ratio for long-term care increased to 98.1 percent at September 30, 2026 from 97.6 percent at September 30, 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 June 30, 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 $2.1 billion at June 30, 2026, compared to $1.7 billion at December 31, 2025, with the increase due primarily to an increase in U.S. Treasury rates. The earned book yield on our investment portfolio was 4.23 percent for the first six months of 2026 compared to a yield of 4.35 percent for the full year ended December 31, 2025.
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 September 30, 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. During the third quarter of 2026, we recognized impairment losses totaling $754.4 million as a result of our intent to transfer certain fixed maturity securities related to the 2026 reinsurance transaction with Fortitude Reinsurance Company Ltd. (Fortitude Re). The net unrealized loss on our fixed maturity securities was $3.2 billion at September 30, 2026, compared to $1.7 billion at December 31, 2025, with the increase due primarily to an increase in U.S. Treasury rates, partially offset by investment losses recorded on certain fixed maturity securities related to the 2026 Fortitude Re reinsurance transaction. The earned book yield on our investment portfolio was 4.38 percent for the first nine months of 2026, compared to a yield of 4.35 percent for the full year ended December 31, 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 increase in U.S. Treasury rates during the first six months of 2026, resulted in a decrease to the liability for future policy benefits, net of reinsurance, of approximately $0.3 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 nine months of 2026, resulted in a decrease to the liability for future policy benefits, net of reinsurance, of approximately $2.5 billion.
Previous wording
We believe our capital and financial positions are strong. At June 30, 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 480 percent, which is above our long-term expectation. We repurchased 7.9 million shares and 7.1 million shares of Unum Group common stock under our share repurchase program, during the first six months of 2026 and 2025, respectively, at a cost of $604.5 million and $505.9 million, respectively, including commissions and excise tax. Our weighted average common shares outstanding, assuming dilution, equaled 160.0 million and 174.4 million for the second quarters of 2026 and 2025, respectively, and 162.2 million and 176.6 million for the first six months of 2026 and 2025, respectively. As of June 30, 2026, Unum Group and our intermediate holding companies had available holding company liquidity of $1,536.5 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 September 30, 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 485 percent, which is above our long-term expectation. We repurchased 10.0 million shares and 10.3 million shares of Unum Group common stock under our share repurchase program, during the first nine months of 2026 and 2025, respectively, at a cost of $806.5 million and $759.2 million, respectively, including commissions and excise tax. Our weighted average common shares outstanding, assuming dilution, equaled 158.6 million and 170.6 million for the third quarters of 2026 and 2025, respectively, and 159.7 million and 174.6 million for the first nine months of 2026 and 2025, respectively. As of September 30, 2026, Unum Group and our intermediate holding companies had available holding company liquidity of $1,383.4 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.
Previous wording
In July 2026, Unum America entered into a master transaction agreement with Fortitude Reinsurance Company Ltd. (Fortitude Re) which, subject to receipt of regulatory approvals and the satisfaction or waiver of other customary closing conditions, is expected to result in the execution of a coinsurance agreement during 2026.
Current wording
In July 2026, Unum America entered into a master transaction agreement with Fortitude Reinsurance Company Ltd. (Fortitude Re) which resulted in the execution of a coinsurance agreement in November 2026.
Previous wording
This anticipated reinsurance agreement reinsures a portion of our Closed Block individual long-term care policies on a coinsurance basis to Fortitude Re effective April 2026. The reinsurance agreement represents approximately 28 percent of total Closed Block long-term care future policy benefits. As part of the anticipated reinsurance transaction with Fortitude Re, we plan to transfer, upon closing the transaction, fixed maturity securities and cash with a fair value of $5,659.0 million, which is subject to adjustment prior to closing for changes in interest rates and certain interim cash flows related to the reinsured business. Fortitude Re intends to retrocede biometric risk on the reinsured block to a highly rated global reinsurer (the Retrocessionaire).
Current wording
This reinsurance agreement reinsures a portion of our Closed Block individual long-term care policies on a coinsurance basis to Fortitude Re effective April 2026. The reinsurance agreement represents approximately 28 percent of total Closed Block long-term care future policy benefits as of March 31, 2026. Upon closing the transaction in November 2026, we transferred fixed maturity securities and cash with a fair value of $5,500.7 million. A final settlement is expected prior to the end of the first quarter of 2027. Fortitude Re intends to retrocede biometric risk on the reinsured block to a highly rated global reinsurer (the Retrocessionaire).
Previous wording
Additionally, at the closing of the transaction, Provident will enter into an agreement with the Retrocessionaire whereby Provident will provide an experience volatility cover for the difference between actual and expected claim experience, subject to a maximum payment of $125.0 million (in net present value terms). Payment obligations will be settled every five years and will be secured by a trust account to be funded at all times with the remaining possible payment by Provident. Provident will provide the experience volatility cover in exchange for a payment from the Retrocessionaire of $5.0 million upon closing the anticipated reinsurance transaction. The experience volatility cover will be accounted for under the deposit method.
Current wording
Additionally, at the closing of the transaction, Provident entered into an agreement with the Retrocessionaire whereby Provident provides an experience volatility cover for the difference between actual and expected claim experience, subject to a maximum payment of $125.0 million (in net present value terms). Payment obligations will be settled every five years and are secured by a trust account to be funded at all times with the remaining possible payment by Provident. Provident provided the experience volatility cover in exchange for a payment from the Retrocessionaire of $5.0 million at the closing of the reinsurance transaction. The experience volatility cover is accounted for under the deposit method.
Previous wording
Immediately prior to entering into the anticipated reinsurance agreement with Fortitude Re, Unum America will recapture the Closed Block individual long-term care business from Fairwind Insurance Company (Fairwind), an affiliated captive reinsurer.
Current wording
Immediately prior to entering into the reinsurance agreement with Fortitude Re, Unum America recaptured the Closed Block individual long-term care business from Fairwind Insurance Company (Fairwind), an affiliated captive reinsurer.
Previous wording
In connection with our transition to an updated operating model, during the second quarter of 2026, we recognized expenses of $30.7 million. This included $18.0 million in real estate-related costs, including $16.3 million of depreciation expense associated with investment real estate which is reflected within net investment income in the consolidated statements of income. In addition, we incurred employee-related costs of $12.7 million, with $11.2 million reflected within compensation expense in the consolidated statements of income and we expect payments to occur through 2027. These costs were included within our Corporate segment.
Current wording
In connection with our transition to an updated operating model, during the second quarter of 2026, we recognized expenses of $30.7 million. This included $18.0 million in real estate-related costs, including $16.3 million of depreciation expense associated with investment real estate which is reflected within net investment income in the consolidated statements of operations. In addition, we incurred employee-related costs of $12.7 million, with $11.2 million reflected within compensation expense in the consolidated statements of operations and we expect payments to occur through 2027. These costs were included within our Corporate segment.
Previous 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.
Current wording
We expect after-tax adjusted operating income to be slightly lower in 2026 compared to 2025 due primarily to the change in reserve assumption updates. 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
As previously discussed, we anticipate entering into a reinsurance agreement with Fortitude Re to cede an additional portion of our long-term care business during 2026.
Current wording
As previously discussed, we entered into a reinsurance agreement with Fortitude Re to cede an additional portion of our long-term care business during November 2026.
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, 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.
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 statements of operations prepared in accordance with GAAP due to the exclusion of investment gains or losses, Closed Block segment after-tax adjusted operating income or loss, 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
See "Investments" contained herein in Item 2 and Notes 4 and 10 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 Notes 4, 10, and 14 of the "Notes to Consolidated Financial Statements" contained herein in Item 1 for further discussion regarding the items specified in the reconciliation below.
Previous 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.
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 operations due to the exclusion of investment gains and losses 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 "segment adjusted operating revenue" and income before income tax to "segment 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 (loss)" 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, fair value of investments, income taxes, and contingent liabilities. There have been no significant changes in our critical accounting estimates during the six months ended June 30, 2026.
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. The critical accounting estimates for which there were significant changes during the nine months ended September 30, 2026, 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, 2026, 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, 2025.
Previous wording
The weighted average pound/dollar exchange rate for our Unum UK line of business was 1.340 and 1.333 for the three months ended June 30, 2026 and 2025, and 1.342 and 1.299 for the six months ended June 30, 2026 and 2025, respectively. If the 2025 results for our U.K. operations had been translated at the weighted average exchange rates of 2026, our adjusted operating revenue would have been higher by approximately $1 million and $16 million, respectively, in the second quarter and first six months of 2025. Our adjusted operating income for the second quarter of 2025 would have been generally consistent and our adjusted operating income would have been higher by approximately $3 million for the first six months 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.
Current wording
The weighted average pound/dollar exchange rate for our Unum UK line of business was 1.344 and 1.348 for the three months ended September 30, 2026 and 2025, and 1.345 and 1.314 for the nine months ended September 30, 2026 and 2025, respectively. If the 2025 results for our U.K. operations had been translated at the weighted average exchange rates of 2026, our adjusted operating revenue would have been lower by approximately $1 million in the third quarter of 2025 and higher by approximately $16 million in the first nine months of 2025. Our adjusted operating income for the third quarter of 2025 would have been generally consistent and our adjusted operating income would have been higher by approximately $3 million for the first nine months 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 second quarter and first six months of 2026 compared to the same periods of 2025, primarily due to sales, partially offset by the impact of ceding a portion of the Unum US individual disability product line as a part of the 2025 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 2025 Fortitude Re reinsurance transaction.
Current wording
Premium income increased in each of our core operating segments in the third quarter and first nine months of 2026 compared to the same periods of 2025, primarily due to sales in the Unum US segment as well as higher persistency in the Unum US group product lines, partially offset by the expected run off in medical stop-loss premium and lower persistency in the Unum US supplemental and voluntary product lines. Also partially offsetting the increase in the first nine months of 2026 compared to 2025 is the impact of ceding a portion of Unum US individual disability product line as part of the 2025 Fortitude Re reinsurance transaction. Premium income continues to decline in our Closed Block segment, as expected, and, for the comparison of the first nine months of 2026 to the same period of 2025, this was accelerated by the impact of ceding a portion of the Closed Block long-term care product line as a part of the 2025 Fortitude Re reinsurance transaction.
Previous wording
Net investment income was lower in the second quarter and first six months of 2026 compared to the same periods of 2025 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 2025 Fortitude Re reinsurance transaction, depreciation expense associated with real estate previously held for sale reclassified to real estate held for the production of income, and lower income from inflation index-linked bonds held by Unum UK.
Current wording
Net investment income was higher in the third quarter compared to the same period of 2025 due primarily to an increase in the yield on invested assets and higher miscellaneous investment income. Net investment income was lower in the first nine months of 2026 compared to the same period of 2025 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 2025 Fortitude Re reinsurance transaction and depreciation expense associated with real estate previously held for sale reclassified to real estate held for the production of income, partially offset by higher yield on invested assets.
Previous wording
Our investment gains and losses on fixed maturity securities include net losses on sales of $7.5 million and $13.5 million in the second quarter of 2026 and 2025, respectively, and $8.0 million and $58.2 million in the first six months of 2026 and 2025, respectively. The net losses for the first six months of 2025 were primarily related to a realized loss of $23.5 million on sales of fixed maturity securities relating to the 2025 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 $3.0 million and $5.2 million during the second quarter and first six months of 2026. Credit and impairment losses on fixed maturity securities were $19.1 million and $172.5 million during the second quarter and first six months of 2025, respectively. Credit and impairment losses on fixed maturity securities for the first six months of 2025 is primarily comprised of the $160.9 million impairment loss based on the intent to transfer fixed-maturity securities relating to the 2025 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.
Current wording
Our investment gains and losses for the third quarter and first nine months of 2026 were driven primarily by the 2026 Fortitude Re reinsurance transaction which resulted in a net loss of $833.5 million in the third quarter and first nine months of 2026. This loss was primarily due to impairment losses based on the intent to transfer fixed maturity securities supporting the 2026 Fortitude Re reinsurance transaction. Our investment gains and losses for the third quarter and first nine months of 2025 were driven primarily by the 2025 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.
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 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 Unum US individual disability product line, in the second quarter and first six months of 2026, is the amortization of the deferred gain on reinsurance as a part of the 2025 Fortitude Re reinsurance transaction and, in the first six months of 2025, is a gain on the recapture of a previously ceded block of business.
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. Other income also includes the amortization of the deferred gain related to the 2025 Fortitude Re reinsurance transaction that began in the third quarter of 2025. Other income for the first nine months of 2025 primarily includes a gain on the recapture of a previously ceded block of business in the individual disability product line that occurred in the first quarter of 2025.
Previous wording
Overall benefits experience was favorable in the second quarter of 2026 relative to the same period of 2025. The consolidated benefit ratio, which includes the remeasurement gain or loss, was 71.0 percent and 71.9 percent in the second quarter of 2026 and 2025, respectively. Overall benefits experience was unfavorable in the first six months of 2026 relative to the same period of 2025. The consolidated benefit ratio, which includes the remeasurement gain or loss, was 71.4 percent and 70.6 percent in the first six months of 2026 and 2025, respectively. The underlying benefits experience for each of our operating segments is discussed more fully in "Segment Results" as follows.
Current wording
Overall benefits experience was favorable in the third quarter and first nine months of 2026 relative to the same periods of 2025. The consolidated benefit ratio, which includes the remeasurement gain or loss, was 74.1 percent and 72.3 percent in the third quarter and first nine months of 2026, respectively, compared to 86.5 percent and 75.8 percent for the same prior year periods. The underlying benefits experience for each of our operating segments is discussed more fully in "Segment Results" as follows.
Previous wording
Other expenses and compensation expense, on a combined basis, increased in the second quarter and first six months of 2026 compared to the same periods of 2025 due to an increase in the amortization of the cost of reinsurance as a result of the 2025 Fortitude Re reinsurance transaction, as well as employee-related costs.
Current wording
Other expenses and compensation expense, on a combined basis, in the third quarter of 2026 is generally consistent compared to the same period of 2025. Other expenses and compensation expense, on a combined basis, increased in the first nine months of 2026 compared to the same periods of 2025 due to an increase in the amortization of the cost of reinsurance as a result of the 2025 Fortitude Re reinsurance transaction.
Previous wording
Our effective income tax rates for the second quarter and first six months of 2026 were 22.0 percent and 22.7 percent of income before income tax, respectively, compared to 19.5 percent and 20.6 percent for the same prior year periods. Our effective income tax rate differed from the U.S. statutory rate of 21 percent for the second quarter and first six months of 2026 primarily due to interest on uncertain tax positions and Net Controlled Foreign Corporation Tested Income. Our effective tax rate differed from the U.S. statutory rate of 21 percent for the second quarter of 2025 primarily due to tax exempt income. Our effective income tax rate was generally consistent with the U.S. statutory rate of 21 percent in effect for the first six months of 2025.
Current wording
Our effective income tax rates for the third quarter and first nine months of 2026 were 23.6 percent and 16.4 percent of income before income tax, respectively, compared to 27.2 percent and 21.1 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 and first nine months of 2026 primarily due to the release of unrecognized tax benefits due to completion of an IRS exam partially offset by a valuation allowance related to our deferred tax assets on capital losses. Our effective 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 in effect for the first nine months of 2025, with interest on uncertain tax positions mostly offset by tax exempt income.
Previous wording
In describing our results, we may at times note certain items and exclude the impact on financial ratios and metrics to enhance the understanding and comparability of our operational performance and the underlying fundamentals, but this exclusion is not an indication that similar items may not recur. We also 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 and certain other items. 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. See "Reconciliation of Non-GAAP Financial Measures" contained herein in this Item 2.
Current wording
In describing our results, we may at times note certain items and exclude the impact on financial ratios and metrics to enhance the understanding and comparability of our operational performance and the underlying fundamentals, but this exclusion is not an indication that similar items may not recur. We also 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 operations due to the exclusion of investment gains and losses and certain other items. 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. See "Reconciliation of Non-GAAP Financial Measures" contained herein in this Item 2.
Previous wording
Premium income increased in the second quarter and first six months of 2026 compared to the same periods of 2025 due to sales and higher persistency. Net investment income was higher in the second quarter and first six months of 2026 compared to the same periods of 2025 due to an increase in the allocation of net investment income on corporate owned excess assets. Also impacting the increase in net investment income in first six months of 2026 compared to the same period of 2025 is an increase in the yield on invested assets.
Current wording
Premium income increased in the third quarter and first nine months of 2026 compared to the same periods of 2025 due to sales and higher persistency, partially offset by the expected run off in medical stop-loss premium. Net investment income was higher in the third 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 and higher miscellaneous investment income. Net investment income was higher in the first nine months 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 yield on invested assets, partially offset by a decrease in the level of invested assets.
Previous wording
Other income was higher in the second quarter and first six months of 2026 compared to the same periods of 2025 due to growth in our fee-based service products.
Current wording
Other income was higher in the third quarter and first nine months of 2026 compared to the same periods of 2025 due to growth in our fee-based service products.
Previous wording
The benefit ratio was higher in the second quarter and first six months of 2026 compared to the same periods of 2025 due to higher incidence in the short-term disability product line, primarily related to our paid family and medical leave products. Also contributing to the higher benefit ratio in both the second quarter and first six months of 2026 compared to the same periods of 2025 were prior period pricing actions.
Current wording
The benefit ratio was higher in the third quarter and first nine months of 2026 compared to the same periods of 2025 due to less favorable reserve assumption updates and refinements in the third quarter of 2026 compared to prior year, higher incidence, and prior period pricing actions. Also contributing to the higher benefit ratio in the third quarter of 2026 was higher average claim size in long-term disability.
Previous wording
Commissions and the deferral of acquisition costs were higher in the second quarter and first six months of 2026 compared to the same periods of 2025 due to sales. The amortization of deferred acquisition costs was higher in the second quarter and first six months of 2026 compared to the same periods 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 higher in the second quarter and first six months of 2026 compared to the same periods of 2025 due primarily to an increase in operational investments in our business.
Current wording
Commissions and the deferral of acquisition costs were higher in the third quarter and first nine months of 2026 compared to the same periods of 2025 due primarily to sales. The amortization of deferred acquisition costs was higher in the third quarter and first nine months of 2026 compared to the same periods 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 lower in the third quarter and first nine months of 2026 compared to the same periods of 2025 due primarily to our focus on expense management and operating efficiencies.
Previous wording
The benefit ratio was lower in the second quarter and first six months of 2026 compared to the same periods of 2025 due to lower claim incidence in the group life and accidental death and dismemberment product lines. Partially offsetting the comparison in the second quarter of 2026 compared to 2025 is higher average claim size in the accidental death and dismemberment product line.
Current wording
The benefit ratio was higher in the third quarter of 2026 compared to the same period in 2025 due to unfavorable waiver of premium benefits experience in the group life product line and higher average claim size in the accidental death and dismemberment product line. The benefit ratio was lower in the first nine months of 2026 compared to the same period of 2025 due to lower claim incidence in the group life and accidental death and dismemberment product lines, partially offset by less favorable waiver of premium benefits experience in the group life product line.
Previous wording
Commissions and the deferral of acquisition costs were higher in the second quarter and first six months of 2026 compared to the same periods of 2025 due primarily to sales. The amortization of deferred acquisition costs changed in the second quarter and first six months of 2026 compared to the same periods of 2025 driven by composition of lapses across cohorts. The other expense ratio was lower in the second quarter and first six months of 2026 compared to the same periods of 2025 due primarily to our focus on expense management and operating efficiencies.
Current wording
Commissions and the deferral of acquisition costs were higher in the third quarter and first nine months of 2026 compared to the same periods of 2025 due to sales. The amortization of deferred acquisition costs was higher in the third quarter and first nine months of 2026 compared to the same periods of 2025 due to growth in the level of the deferred asset and the composition of lapses across cohorts. The other expense ratio in the third quarter and first nine months of 2026 was generally consistent compared to the same periods of 2025.
Previous wording
Premium income was lower in the second quarter and first six months of 2026 compared to the same periods of 2025 due to the impact of ceding a portion of the individual disability product line as a part of the 2025 Fortitude Re reinsurance transaction and lower persistency across all product lines, partially offset by sales in all product lines. Net investment income was generally consistent in the second quarter and first six months of 2026 compared to the same periods of 2025.
Current wording
Premium income was higher in the third quarter and first nine months of 2026 compared to the same periods of 2025 due to prior period sales in the voluntary benefits and dental and vision product lines, partially offset by lower persistency across all product lines. Also impacting the first nine months of 2026 is the impact of ceding a portion of the individual disability product line as a part of the 2025 Fortitude Re reinsurance transaction. Net investment income was higher in the third quarter and first nine months of 2026 compared to the same periods of 2025 due to an increase in yield on invested assets and higher miscellaneous income, partially offset by a decrease in the level of invested assets.
Previous wording
Other income was higher in the second quarter of 2026 compared to the same period of 2025 due to the amortization of the deferred gain on reinsurance related to the 2025 Fortitude Re reinsurance transaction. Other income was lower in the first six months of 2026 compared to the same period of 2025 due to a gain on recapture of a previously ceded block of business in the individual disability product line in the first quarter of 2025, partially offset by the amortization of the deferred gain on reinsurance related to the 2025 Fortitude Re reinsurance transaction in the first six months of 2026.
Current wording
Other income for the first nine months of 2025 primarily includes a gain on the recapture of a previously ceded block of business in the individual disability product line that occurred in the first quarter of 2025. Other income also includes the amortization of the deferred gain related to the 2025 Fortitude Re reinsurance transaction that began in the third quarter of 2025.
Showing the first 40 of 88 pairs. Open the source sections for the rest.
Rearranged current paragraphs (5)
Current report — wording carried from elsewhere
See Notes 4, 5, 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.
Current report — wording carried from elsewhere
We believe our active client management, integrated customer experience across our product lines, and strong risk management, will enable us to continue to grow our market over the long-term.
Current report — wording carried from elsewhere
We will continue to execute on our well-defined strategy of implementing long-term care premium rate increases, efficient capital management, improved financial analysis, and operational effectiveness. In regard to capital management, we will continue to explore, and execute where appropriate, structural and reinsurance options to enhance financial flexibility.
Current report — wording carried from elsewhere
We continue to file requests with various state insurance departments for premium rate increases on certain of our individual and group long-term care policies which reflect assumptions as of the date of filings. In states for which a rate increase is submitted and approved, we routinely provide customers options for coverage changes or other approaches that might fit their current financial and insurance needs.
Current report — wording carried from elsewhere
As a result of the execution of previous reinsurance transactions related to our Closed Block individual disability and long-term care lines of business, we have ceded a significant portion of this business.
Rearranged previous paragraphs (5)
Previous report — wording carried elsewhere
•A strategic actions impact of $30.7 million before tax.
Previous report — wording carried elsewhere
See Note 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 report — wording carried elsewhere
For additional information, 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, 2025.
Previous report — wording carried elsewhere
Premium income increased in the second quarter and first six months of 2026 compared to the same periods of 2025 due to sales and higher persistency, partially offset by the expected run off in medical stop-loss premium. Net investment income was generally consistent in the second quarter and the first six months of 2026 relative to the same periods of 2025.
Previous report — wording carried elsewhere
At June 30, 2026, we held no below investment-grade fixed maturity securities with a gross unrealized loss greater than $10.0 million.