Unum(US:UNM)2020-02-18 21:33Competitive Environment - The company operates in a highly competitive environment, particularly in the voluntary benefits market, facing significant competition from both traditional and non-traditional insurers[104]. - The company must attract and retain independent agents and brokers to market its products, facing competition for these resources based on product offerings and financial strength[108]. Regulatory Environment - The company’s U.S. insurance subsidiaries are subject to extensive regulation, including oversight by state insurance regulators and the U.S. Department of Labor, which impacts operational compliance[111]. - Risk-based capital (RBC) standards are prescribed by the National Association of Insurance Commissioners (NAIC), which assess the adequacy of statutory capital for life and health insurers[116]. - The NAIC is reviewing solvency regulation frameworks, which may lead to significant changes in capital requirements and risk management practices for U.S. insurance subsidiaries[117]. - The company’s Polish insurance subsidiary is regulated by the Financial Supervision Authority, ensuring adherence to local financial health and stability standards[114]. - The NAIC has established a subgroup to study the use of captive reinsurers and special purpose vehicles, considering uniformity in approval and supervision[120]. - The NAIC has adopted the Corporate Governance Annual Disclosure Model Act, effective in Maine, Massachusetts, and Tennessee, requiring U.S. insurers to disclose governance practices[126]. - The Insurance Data Security Model Law requires insurance companies to establish cybersecurity programs to protect consumer data, currently effective only in South Carolina[127]. - The laws in most states require regulatory approval for a change in control of an insurance company, which may discourage potential acquisition proposals[129]. Financial Performance and Stability - The company’s financial strength ratings are assessed by agencies such as AM Best, Fitch, Moody's, and S&P, reflecting its capacity to meet obligations to policyholders[99]. - The company’s ability to generate sufficient internal liquidity and obtain external financing is critical for maintaining operational stability and growth[14]. - The company is monitoring developments related to international insurance regulatory reforms that may influence future capital requirements and operational strategies[118]. - Unum Limited adheres to Solvency II requirements, including capital adequacy and liquidity requirements, with its European holding company approved to use its own internal model for calculating regulatory capital[121]. - The Solvency II capital regime is currently not expected to change due to the U.K.'s exit from the EU, but economic conditions may cause volatility in solvency ratios[122]. - Adjusted operating revenue for Unum International segment was approximately 6% of consolidated adjusted operating revenue for 2019, 2018, and 2017[135]. - Federal tax laws and regulations are subject to change, which could materially impact federal taxes and reduce profitability for Unum[133]. Leadership and Management - Mr. Bhasin appointed as Executive Vice President, Chief Information and Digital Officer in March 2018, previously held multiple senior roles at Waste Management, Inc.[144]. - Ms. Iglesias joined as Executive Vice President, General Counsel in January 2015, previously served as Senior Vice President at WellCare Health Plans, Inc.[145]. - Ms. Leiper appointed as Executive Vice President, Chief Investment Officer in October 2019, previously held senior finance roles at USAA and Unum Group since 1985[146]. - Mr. O'Donnell named Executive Vice President, Unum International in February 2020, previously served as CEO of Unum UK since September 2012[147]. - Mr. Pyne appointed as Executive Vice President, Group Benefits in February 2020, previously held various senior positions within the Company's U.S. distribution organization since 1992[148].