This Day On The Street
Continue to site right-arrow
ADVERTISEMENT
This account is pending registration confirmation. Please click on the link within the confirmation email previously sent you to complete registration.
Need a new registration confirmation email? Click here
Stocks Under $10 with 50-100% upside potential - 14 days FREE!

A.M. Best Affirms Ratings Of Unum Group And Its Core U.S. Subsidiaries

Stocks in this article: UNM

A.M. Best Co. has affirmed the financial strength rating (FSR) of A (Excellent) and issuer credit ratings (ICR) of “a” of the core U.S. life/health insurance subsidiaries of Unum Group (Unum) (headquartered in Chattanooga, TN) [NYSE: UNM]. Concurrently, A.M. Best has affirmed the ICR of “bbb” of Unum as well as all existing debt securities issued by the organization. The outlook for all ratings is stable. (See below for a complete listing of the companies and ratings.)

The rating affirmations reflect Unum’s strong franchise, solid capitalization, diversified earnings sources and favorable operating performance. In a challenging economic environment for employee benefits companies, Unum has reported premium growth across most of its core markets, driven by the Unum U.S. segment. The organization continues to generate consistent earnings with an emphasis on underwriting discipline and expense management, and its returns have historically exceeded industry medians.

Unum is well recognized in the United States as having a leading position in the group disability market, supplemented by its top-three rankings in group life and voluntary benefits. Over the last several quarters, Unum U.S.’ core group disability segment reported loss ratios in the 84%-85% range, evidencing a lack of volatility that some of its competitors have recently experienced. However, Unum U.K. and Colonial Life have recently reported less favorable sales trends as well as volatility in key metrics for certain product lines. For example, Unum U.K.’s life business recently experienced a noteworthy increase in average claims size, leading to deteriorating profitability for this line of business. A.M. Best notes that persistency within all of Unum’s segments continues to be generally favorable, reflecting the group’s ability to retain quality business.

Over the past several years, Unum has maintained its consolidated risk-adjusted capitalization primarily through healthy operating results. While the capital cushion at some of its subsidiaries fluctuates periodically as it is deployed through share repurchase or other means, A.M. Best believes the group’s prospective risk-adjusted capital position will remain appropriate for its ratings. Moreover, with total debt-to-capital at roughly 25%, strong interest coverage and just under $800 million of holding company cash and marketable securities, Unum has excellent financial flexibility. Additionally, the organization has approximately $7 billion of net unrealized capital gains in its bond portfolio, with modest exposure to structured securities and real estate-related investments.

1 of 3

Select the service that is right for you!

COMPARE ALL SERVICES
Action Alerts PLUS
Try it NOW

Jim Cramer and Stephanie Link actively manage a real portfolio and reveal their money management tactics while giving advanced notice before every trade.

Product Features:
  • $2.5+ million portfolio
  • Large-cap and dividend focus
  • Intraday trade alerts from Cramer
  • Weekly roundups
TheStreet Quant Ratings
Try it NOW
Only $49.95/yr

Access the tool that DOMINATES the Russell 2000 and the S&P 500.

Product Features:
  • Buy, hold, or sell recommendations for over 4,300 stocks
  • Unlimited research reports on your favorite stocks
  • A custom stock screener
  • Upgrade/downgrade alerts
Stocks Under $10
Try it NOW

David Peltier, uncovers low dollar stocks with extraordinary upside potential that are flying under Wall Street's radar.

Product Features:
  • Model portfolio
  • Stocks trading below $10
  • Intraday trade alerts
  • Weekly roundups
Dividend Stock Advisor
Try it NOW

Jim Cramer's protege, David Peltier, identifies the best of breed dividend stocks that will pay a reliable AND significant income stream.

Product Features:
  • Diversified model portfolio of dividend stocks
  • Alerts when market news affect the portfolio
  • Bi-weekly updates with exact steps to take - BUY, HOLD, SELL
Real Money Pro
Try it NOW

All of Real Money, plus 15 more of Wall Street's sharpest minds delivering actionable trading ideas, a comprehensive look at the market, and fundamental and technical analysis.

Product Features:
  • Real Money + Doug Kass Plus 15 more Wall Street Pros
  • Intraday commentary & news
  • Ultra-actionable trading ideas
Options Profits
Try it NOW

Our options trading pros provide daily market commentary and over 100 monthly option trading ideas and strategies to help you become a well-seasoned trader.

Product Features:
  • 100+ monthly options trading ideas
  • Actionable options commentary & news
  • Real-time trading community
  • Options TV
To begin commenting right away, you can log in below using your Disqus, Facebook, Twitter, OpenID or Yahoo login credentials. Alternatively, you can post a comment as a "guest" just by entering an email address. Your use of the commenting tool is subject to multiple terms of service/use and privacy policies - see here for more details.
Submit an article to us!

Markets

DOW 17,778.15 +421.28 2.43%
S&P 500 2,061.23 +48.34 2.40%
NASDAQ 4,748.3960 +104.0840 2.24%

Brokerage Partners

Rates from Bankrate.com

  • Mortgage
  • Credit Cards
  • Auto

Free Newsletters from TheStreet

My Subscriptions:

After the Bell

Before the Bell

Booyah! Newsletter

Midday Bell

TheStreet Top 10 Stories

Winners & Losers

Register for Newsletters
Top Rated Stocks Top Rated Funds Top Rated ETFs