Unum Group — Third Quarter 2026 Earnings Summary

Financial Performance:

• Reported a net loss of $419.7 million ($2.65 per diluted common share) for the third quarter of 2026, compared to net income of $39.7 million ($0.23 per diluted common share) in the third quarter of 2025.
• After-tax adjusted operating income was $349.0 million ($2.20 per diluted common share) for the third quarter of 2026, down from $479.4 million ($2.81 per diluted common share) in the third quarter of 2025.
• Total revenue was $2,547.5 million for the third quarter of 2026, compared to $3,378.4 million in the third quarter of 2025.
• Premium income increased 4.7% on a constant currency basis to $2,800.7 million for the third quarter of 2026, compared to $2,688.0 million in the third quarter of 2025.
• Net investment loss was $853.0 million for the third quarter of 2026, primarily driven by impairment losses related to the Fortitude Re reinsurance transaction, compared to a net investment gain of $128.0 million in the third quarter of 2025.
• Annual GAAP reserve assumption updates increased net income by $23.5 million in the third quarter of 2026, reflecting a decrease in reserves driven by favorable trends in Unum US and Colonial Life.
• Adjusted operating return on equity for core operating segments was 21.3% in the third quarter of 2026.
• Traditional U.S. life insurance company statutory operating earnings were approximately $300 million for the third quarter of 2026, adjusting for the anticipated closing of the external reinsurance transaction.
• Book value per common share was $68.90 as of September 30, 2026, a 6.7% increase from $64.56 in the prior year quarter.
• Book value per common share excluding accumulated other comprehensive income (AOCI) was $76.73 as of September 30, 2026, a 0.9% decrease from $77.39 in the prior year quarter.
• Holding company liquidity was $1.4 billion (specifically $1,383.4 million) as of September 30, 2026.
• The weighted average risk-based capital ratio for traditional U.S. insurance companies was approximately 485% as of September 30, 2026.
• Effective income tax rate for after-tax adjusted operating income was 20.5% in the third quarter of 2026, compared to 21.3% in the third quarter of 2025.

Guidance and Future Outlook:

• Full-year 2026 after-tax adjusted operating income per share is expected to be $8.30 to $8.50, incorporating the annual assumption review and refinements.
• The revised definition of after-tax adjusted operating income now includes the impact of annual reserve assumption updates and refinements.
• Management expects to drive long-term growth and value for shareholders by executing against strategic priorities, leveraging a diversified business model and strong capital position.

Business Segments and Product Lines:

• Unum US Segment: Segment adjusted operating income decreased 35.2% to $315.3 million in the third quarter of 2026 from $486.8 million in the prior year quarter. Premium income increased 5.2% to $1,846.6 million.
  • Group Disability: Segment adjusted operating income decreased 60.4% to $94.8 million; premium income increased 4.0% to $816.6 million; benefit ratio was 67.1% compared to 47.8% in the prior year quarter.
  • Group Life and AD&D: Segment adjusted operating income decreased 14.3% to $78.2 million; premium income increased 6.6% to $551.4 million; benefit ratio was 68.8% compared to 65.4% in the prior year quarter.
  • Supplemental and Voluntary: Segment adjusted operating income decreased 9.0% to $142.3 million; premium income increased 5.7% to $478.6 million; benefit ratio was 45.4% compared to 40.3% in the prior year quarter.
• Unum International Segment: Segment adjusted operating income decreased 99.5% to $0.2 million in the third quarter of 2026 from $44.2 million in the prior year quarter. Premium income increased 3.7% to $291.6 million.
  • Unum UK: Reported a segment adjusted operating loss of £1.4 million in the third quarter of 2026, compared to income of £27.0 million in the prior year quarter; benefit ratio was 91.0% compared to 73.4% in the prior year quarter.
• Colonial Life Segment: Segment adjusted operating income increased 35.0% to $169.4 million in the third quarter of 2026 from $125.5 million in the prior year quarter. Premium income increased 3.0% to $470.0 million; benefit ratio improved to 38.0% from 46.3% in the prior year quarter.
• Corporate Segment: Reported a segment adjusted operating loss of $45.7 million in the third quarter of 2026, an improvement from a loss of $47.7 million in the prior year quarter.
• Closed Block Segment: Reported a segment adjusted operating loss of $135.6 million in the third quarter of 2026, compared to a loss of $682.3 million in the prior year quarter, driven by less unfavorable reserve assumption updates.

Market and Competitive Landscape:

• Core operations top-line trends remained strong with premium growth of 4.7% on a constant currency basis.
• Customer retention across the employee benefits portfolio remained strong.
• Voluntary benefits businesses performed very well, offsetting elevated claim submissions in group disability.
• The company continues to see high returns across its franchise.

Risks and Challenges:

• Elevated claim submissions in the group disability line of business impacted earnings.
• Less favorable reserve assumption updates and refinements in the third quarter of 2026 compared to the prior year contributed to higher benefit ratios in several lines.
• Unfavorable waiver of premium experience and higher average claim size in the accidental death and dismemberment product line affected Group Life results.
• Lower persistency across all product lines in the Supplemental and Voluntary segment.
• Unfavorable reserve assumption updates and higher incidence in the Unum UK group long-term disability product line.
• Significant before-tax net investment loss of $853.0 million related to asset impairments for the Fortitude Re transaction.

Management Commentary and Tone:

• Richard P. McKenney, President and CEO, stated that the third quarter reflected continued good premium growth and strong customer retention, though underlying earnings fell short of expectations due to elevated claims in group disability offset by strong voluntary benefits performance.
• Management expressed confidence in the company's diversified business model, deep expertise, and strong capital position to address current trends and drive long-term growth.

Other Key Points:

• Capital return continued at a consistent pace with approximately $200 million of shares repurchased and $80.1 million of common stock dividends in the third quarter of 2026, bringing year-to-date capital return to $1,038.5 million.
• The company repurchased 2.1 million shares at a total cost of $202.0 million during the third quarter of 2026.
• Shares outstanding totaled 156.2 million at September 30, 2026, down from 170.6 million in the third quarter of 2025.
• The anticipated closing of the 2026 Fortitude Re reinsurance transaction is expected to result in robust protections at the Fairwind entity, with estimated statutory reserves and excess capital above best estimate reserves of approximately $2 billion.
• Risk management actions included approximately 25% achievement of the current premium rate approval program.
• The definition of after-tax adjusted operating income was revised to include the impact of annual reserve assumption updates and refinements following discussions with the SEC.
• A net tax benefit of $12.0 million was recognized in the third quarter of 2026, reflecting 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.