Unum Group (NYSE: UNM) doesn't operate in a hypergrowth sector, nor is it making moonshot bets on unproven technology. Instead, it produces steady income from the health, disability, and benefits coverage corner of the insurance market. That stability and predictability have helped lift the stock price by 180% over the past five years, which was more than double the 75% return of the S&P 500 over the same period. Will AI create the world's first trillionaire? Our team just released a report on the one lit ...

Table of Contents UNITED STATES SECURITIES AND EXCHANGE COMMISSION WASHINGTON, D. C. 20549 FORM 10-K (Mark One) ☒ Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the fiscal year ended December 31, 2025 ☐ Transition Report Pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934 For the transition period from to Commission file number 001-11294 Unum Group (Exact name of registrant as specified in its charter) Delaware 62-1598430 (State or other jurisdict ...

Core Viewpoint - The company is optimistic about its growth trajectory heading into 2026, with expectations for premium growth and earnings per share increases. Group 1: Financial Performance - The company anticipates premium growth in the range of 4% to 7% off a $10 billion base, indicating strong growth potential across various lines [2] - This premium growth is expected to translate into earnings per share growth of 8% to 12% for the year 2026, reflecting good margins [2] Group 2: Strategic Outlook - The company is focused on maintaining its growth momentum and is pleased with its current trajectory as it looks ahead to 2026 [2]

Unum Group 2026 Conference Call Summary Company Overview - **Company**: Unum Group (NYSE: UNM) - **Date**: February 09, 2026 - **Speakers**: Rick McKenney (CEO), Steve Zabel (CFO) Key Points 2026 Outlook - Unum expects top-line growth in premium between **4%-7%** off a **$10 billion** base, leading to an **earnings per share (EPS)** growth of **8%-12%** [2][3] - The company plans to return approximately **100%** of its earnings to shareholders through dividends and share repurchases [3][4] Group Disability Business - The group disability market is competitive but rational in pricing, with Unum's strong positioning due to investments in employer HRIS systems [6][7] - The benefit ratio for group disability was **62.5%** in 2025, with expectations to adjust prices leading to a target range of **62%-64%** for 2026 [9][10] - Historical benefit ratios were in the low **70s** pre-pandemic, with normalization expected around **65%** over the next **2-3 years** [11][12] Closed Block Strategy - Unum has fully closed its Closed Block, which will now be reported below the line as a special item, isolating core business performance [15][20] - The company maintains a **$2.2 billion** protection behind the Closed Block, with no additional capital planned for this segment [22][24] Leave Management - Unum has invested in leave management platforms, managing over **2 million** people on its leave platform, which integrates well with short-term and long-term disability offerings [35][36] - The proliferation of new leave types has created a demand for effective leave management solutions, positioning Unum favorably in the market [33][34] Technology and AI Integration - Unum has developed various technologies, including HR Connect and Agent Assist, to enhance customer experience and operational efficiency [39][40] - AI is being utilized to improve customer interactions and internal efficiencies, with ongoing investments in AI solutions [50][51] Capital Deployment - In 2025, Unum repurchased **$1 billion** in shares and paid **$300 million** in dividends, with plans for similar capital deployment in 2026 [71][72] - The company ended 2025 with a **440 RBC** and **$2.2 billion** in cash, indicating a strong capital position [73][78] Market Sentiment and Economic Outlook - Unum's growth is expected to continue despite potential economic headwinds, with a focus on maintaining a strong benefits package for employees [62][63] - The company anticipates a **4%-7%** top-line growth rate, driven by wage inflation and payroll growth [57][58] Competitive Dynamics - The competitive landscape in group life and AD&D remains stable, with Unum focusing on delivering comprehensive packages that include leave management and voluntary benefits [91][92] Future Growth Opportunities - Unum is exploring inorganic growth opportunities, particularly in the UK and Poland, to expand its scale and capabilities [90][87] - The company aims to leverage technology and services to enhance customer experience and drive growth [88][89] Conclusion Unum Group is positioned for steady growth in 2026, with a strong focus on capital return to shareholders, strategic investments in technology, and a commitment to enhancing its core business offerings. The company remains optimistic about its market position and growth potential despite economic uncertainties.

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Core Insights - Unum Group's fourth-quarter 2025 operating net income of $1.92 per share missed the Zacks Consensus Estimate by 9% and decreased 5.4% year over year [2] - The company's total operating revenues were $3.2 billion, nearly flat year over year, and missed the Zacks Consensus Estimate by 1.1% [3] Operational Update - Premiums increased by 2% year over year to $2.7 billion, matching estimates, while total benefits and expenses rose 8% year over year to $3 billion, primarily due to higher policy benefits and commissions [3] - The benefit ratio, excluding reserve assumption updates, was 77.9%, deteriorating by 580 basis points due to unfavorable experiences in group long-term disability products [6][9] Quarterly Segment Update - Unum U.S. reported premium income of $1.7 billion, up 1.6% year over year, but adjusted operating income declined 13.1% to $289.7 million, missing estimates [4] - Unum International's premium income increased by 17.1% year over year to $283.9 million, but adjusted operating income fell by 11.7% to $37.6 million [5] Full-Year Highlights - For the full year, operating net income was $8.13 per share, missing the Zacks Consensus Estimate of $8.31, while revenues increased by 2% to $13.2 billion, in line with estimates [12] Capital Management - As of December 31, 2025, the weighted average risk-based capital ratio for Unum Group's traditional U.S. insurance companies was approximately 440%, with holding company liquidity at $2.3 billion [13] - Book value per share grew by 9.3% year over year to $67.11, and the company repurchased shares worth $1 billion [13] 2026 Outlook - Premium growth is expected to be between 4% and 7%, with adjusted operating income per share projected to be between $8.60 and $8.90, indicating growth of about 8% to 12% [14]

Financial Data and Key Metrics Changes - For the full year 2025, adjusted EPS was $8.13, down year-over-year and below expectations [6] - Adjusted operating income for Unum US was $289.7 million in Q4, a decrease of 13.1% year-over-year, and full-year adjusted operating income decreased 11.6% to $1.3 billion [20] - After-tax adjusted operating earnings for Q4 were $322.3 million, or $1.92 per share, and for the full year, it was $1.4 billion, or $8.83 per share [18] Business Line Data and Key Metrics Changes - Core operations premium grew nearly 4.5% for the year, with Colonial Life growing 3.1% and International growing 10% [8] - Group Disability reported a Benefit Ratio of 64.2% in Q4 and 62.4% for the full year, reflecting a normalization from a historically low Benefit Ratio of 59% in 2024 [20] - Colonial Life's adjusted operating income decreased 7.2% in Q4 to $113.9 million, while full-year adjusted operating income declined 0.7% to $463.6 million [24] Market Data and Key Metrics Changes - Persistency in US Group was reported at 90.2%, indicating strong customer retention [16] - International segment saw double-digit premium growth, with Q4 premiums growing 11.5% to $283.9 million and full-year premium increasing 10% to $1.1 billion [24] Company Strategy and Development Direction - The company is focused on digital capabilities to enhance customer experience and operational efficiency, with over one-third of core premium associated with digital tools [9] - The strategy includes organic growth and small acquisitions, with a commitment to return value to shareholders through dividends and share buybacks [11] - The company aims for top-line growth in the range of 4%-7% for 2026, supported by strong persistency and new sales [15] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism for 2026, expecting adjusted EPS growth of 8%-12% and a stable Benefit Ratio of 62%-64% for Group Disability [35] - The company is positioned to capitalize on opportunities with strong capital levels and a focus on reducing legacy exposures [13] - Management highlighted the importance of maintaining a disciplined approach to pricing and risk management in a competitive market [50] Other Important Information - The company completed a significant reinsurance transaction that ceded roughly 20% of long-term care reserves, reducing potential capital volatility [12] - The company plans to exclude Closed Block earnings from Adjusted Operating Earnings starting in Q1 2026, aiming for clearer financial reporting [29] Q&A Session Summary Question: Drivers of Group's Disability loss ratio and outlook for 2026 - Management discussed the favorable market conditions and pricing discipline that support confidence in maintaining strong loss ratios [50][51] Question: 2026 EPS outlook on an apples-to-apples basis - Management indicated expectations for higher top-line growth and consistent Benefit Ratio levels, leading to an 8%-12% EPS growth rate [60][61] Question: Competition in the market and pricing dynamics - Management acknowledged competitive pressures but emphasized their pricing discipline and strong market position [87]

Financial Data and Key Metrics Changes - For the full year 2025, adjusted EPS was $8.13, down year-over-year and below expectations due to higher than expected benefits experience [5][16] - Core operations premium grew nearly 4.5%, with Colonial Life at 3.1% and International at 10% [7][14] - Adjusted ROE for core operations was approximately 20%, reflecting durable earnings power despite margin volatility [16][18] Business Line Data and Key Metrics Changes - In Unum US, adjusted operating income decreased 13.1% in Q4 to $289.7 million, and full year adjusted operating income decreased 11.6% to $1.3 billion [18] - Group Disability's adjusted operating income was $102.3 million in Q4, down 22.8% year-over-year, with a benefit ratio of 64.2% in Q4 and 62.4% for the full year [19] - Colonial Life's adjusted operating income declined 7.2% in Q4 to $113.9 million, while full year sales increased 5.3% to $560.3 million [22][23] Market Data and Key Metrics Changes - International segment saw a 10% increase in full year premium to $1.1 billion, with fourth quarter premiums growing 11.5% [22] - Persistency in US Group was strong at 90.2%, contributing to premium growth [14] - The corporate segment produced a loss of $51.1 million in Q4, with a full year loss of $171.6 million [24] Company Strategy and Development Direction - The company is focused on reducing legacy exposures and enhancing its employee benefits franchise, with a strong emphasis on digital capabilities [12][10] - Plans for 2026 include organic growth, continued investment in technology, and a target of 4%-7% premium growth [13][34] - The strategy includes a disciplined approach to pricing and risk management, aiming for a stable benefit ratio in Group Disability [33][52] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in the underlying claims performance and the sustainability of the business model, despite some quarterly volatility [52][55] - The outlook for 2026 anticipates adjusted EPS growth of 8%-12%, driven by improved top-line growth and stable margins [33][58] - The company aims to maintain robust capital levels and return approximately 100% of free cash flow to shareholders [40][41] Other Important Information - The company completed two small acquisitions in 2025 and increased its dividend by 10% [10] - Significant progress was made in addressing the closed block, with a reduction of over $4 billion in long-term care reserves [11][26] - A change in reporting will exclude Closed Block earnings from Adjusted Operating Earnings starting in Q1 2026, focusing on core business performance [27][30] Q&A Session Summary Question: Drivers of the group's disability loss ratio and outlook for 2026 - Management discussed the favorable market conditions and pricing discipline, expressing confidence in maintaining strong loss ratios [48][49] Question: 2026 EPS outlook on an apples-to-apples basis - Management indicated expectations for higher top-line growth and consistent benefit ratios, supporting an 8%-12% EPS growth rate [56][58] Question: Competition in the market and pricing dynamics - Management acknowledged competitive pressures but emphasized their pricing discipline and strong market position [80]

Financial Data and Key Metrics Changes - For the full year 2025, adjusted EPS was $8.13, down year-over-year and below expectations, primarily due to higher than expected benefits experience [4][16] - Adjusted operating income for Unum US was $289.7 million in Q4, a decrease of 13.1% year-over-year, and full year adjusted operating income decreased 11.6% to $1.3 billion [18] - After-tax adjusted operating earnings for Q4 were $322.3 million, or $1.92 per share, and for the full year, it was $1.4 billion, or $8.83 per share [16] Business Line Data and Key Metrics Changes - Core operations premium grew nearly 4.5% in 2025, with Colonial Life showing 3.1% growth and International showing 10% growth [5][12] - Group Disability reported a benefit ratio of 64.2% in Q4, above expectations, driven by lower average size of recoveries and lower-than-expected mortality [15] - Colonial Life's fourth quarter sales increased 10% to $203.9 million, the largest quarterly sales since 2019, and full year sales increased 5.3% to $560.3 million [22] Market Data and Key Metrics Changes - Persistency in US Group was reported at 90.2%, indicating strong customer retention [13] - International segment saw fourth quarter premiums grow 11.5% to $283.9 million, and full year premium increased 10% to $1.1 billion [21] - The corporate segment produced a loss of $51.1 million in Q4, reflecting elevated staffing and IT costs [22] Company Strategy and Development Direction - The company is focused on digital capabilities, with over one-third of the core premium base associated with customers using digital tools [6] - Continued investment in technology is expected to drive growth in 2026, with top-line growth projected in the range of 4%-7% [12][31] - The company aims to reduce legacy exposures and strengthen its employee benefits franchise, with a focus on risk management and capital deployment [11][26] Management's Comments on Operating Environment and Future Outlook - Management expressed optimism for 2026, expecting adjusted EPS growth of 8%-12% and strong capital return levels [32][39] - The company anticipates a stabilizing benefit ratio for Group Disability in the range of 62%-64% for 2026, supporting a robust ROE of over 25% [34] - Management highlighted the importance of maintaining disciplined pricing and risk management strategies in a competitive market [80] Other Important Information - The company completed an external reinsurance transaction that ceded roughly 20% of long-term care reserves, reducing potential capital volatility [10] - The company plans to repurchase approximately $1 billion of stock and grow its common dividend per share by 10% in 2026 [38] - Adjusted operating income will exclude Closed Block earnings starting in Q1 2026, aligning with the strategy to reduce the footprint of legacy blocks [27] Q&A Session Summary Question: Drivers of the group's disability loss ratio and outlook for 2026 - Management discussed the favorable market conditions and pricing discipline that support confidence in maintaining strong loss ratios [45][46] Question: 2026 EPS outlook on an apples-to-apples basis - Management indicated expectations for higher top-line growth and consistent benefit ratios, supporting an 8%-12% EPS growth rate [54][56] Question: Competition in the market and pricing dynamics - Management acknowledged ongoing competition but emphasized a disciplined pricing approach to maintain margins [80]

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