UNM » Topics » Ratings

This excerpt taken from the UNM 10-Q filed Apr 30, 2009.

Ratings

AM Best, Fitch, Moody’s, and S&P are among the third parties that assign issuer credit ratings to Unum Group and financial strength ratings to our insurance subsidiaries. Issuer credit ratings reflect an agency’s opinion of the overall financial capacity of a company to meet its senior debt obligations. Financial strength ratings are specific to each individual insurance subsidiary and reflect each rating agency’s view of the overall financial strength (capital levels, earnings, growth, investments, business mix, operating performance, and market position) of the insuring entity and its ability to meet its obligations to policyholders. Both the issuer credit ratings and financial strength ratings incorporate quantitative and qualitative analyses by rating agencies and are routinely reviewed and updated on an ongoing basis.

We compete based in part on the financial strength ratings provided by rating agencies. A downgrade of our financial strength ratings can be expected to adversely affect us and could potentially, among other things, adversely affect our relationships with distributors of our products and services and retention of our sales force, negatively impact persistency and new sales, particularly large case group sales and individual sales, and generally adversely

 

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affect our ability to compete. A downgrade in the issuer credit rating assigned to Unum Group can be expected to adversely affect our cost of capital or our ability to raise additional capital.

The table below reflects the issuer credit ratings for Unum Group and the financial strength ratings for each of our traditional insurance subsidiaries as of the date of this filing.

 

    

AM Best

  

Fitch

  

Moody’s

  

S&P

Issuer Credit Ratings

   bbb- (Good)    BBB- (Good)    Ba1 (Speculative)    BBB- (Good)

Financial Strength Ratings

           

Provident Life & Accident

   A- (Excellent)    A- (Strong)    Baa1 (Adequate)    A- (Strong)

Provident Life & Casualty

   A- (Excellent)    A- (Strong)    Not Rated    Not Rated

Unum Life of America

   A- (Excellent)    A- (Strong)    Baa1 (Adequate)    A- (Strong)

First Unum Life

   A- (Excellent)    A- (Strong)    Baa1 (Adequate)    A- (Strong)

Colonial Life & Accident

   A- (Excellent)    A- (Strong)    Baa1 (Adequate)    A- (Strong)

Paul Revere Life

   A- (Excellent)    A- (Strong)    Baa1 (Adequate)    A- (Strong)

Paul Revere Variable

   A- (Excellent)    A- (Strong)    Baa1 (Adequate)    Not Rated

Unum Limited

   A- (Excellent)    Not Rated    Not Rated    A- (Strong)

We maintain an ongoing dialogue with the four rating agencies that evaluate us in order to inform them of progress we are making regarding our strategic objectives and financial plans, as well as other pertinent issues. A significant component of our communications involves an annual review meeting; included as well are other meetings not limited to quarterly updates regarding our business. We plan to hold our annual review meetings with S&P during the second quarter of 2009 and with Moody’s, AM Best, and Fitch during the second half of 2009.

On January 29, 2008, AM Best reaffirmed the ratings of Unum Group and its operating subsidiaries and upgraded the company’s outlook from “negative” to “stable.” The agency’s revised outlook was attributed to our increased financial flexibility, the quality of our investment portfolio, the operational execution of our operating segments, and the completion of the claim reassessment process. On February 4, 2008, Fitch revised its outlook for Unum Group and its operating subsidiaries to “positive” from “stable,” citing our progress in increasing profitability and decreasing risk along with our improved capitalization levels as the basis for the upgrade. On February 14, 2008, Moody’s revised its outlook for Unum Group and its operating subsidiaries to “stable” from “negative,” basing its revision on the overall improvement in our financial flexibility.

On July 17, 2008, S&P raised its counterparty credit and senior unsecured debt rating on Unum Group from “BB+” to “BBB-” and raised its counterparty credit and financial strength ratings on Unum Group’s insurance subsidiaries from “BBB+” to “A-”. S&P stated that the rating actions were reflective of the maintenance of our market position, the improved insurance risk profile of the company, our operating profitability, the enhanced investments quality of our portfolio, and our stronger capitalization through statutory earnings. Coincident with the ratings action, the company’s outlook from S&P was revised from “positive” to “stable.”

There have been no other changes in any of the rating agencies’ outlook statements or ratings during the first quarter of 2009 or prior to the date of this filing.

Agency ratings are not directed toward the holders of our securities and are not recommendations to buy, sell, or hold our securities. Each rating is subject to revision or withdrawal at any time by the assigning rating organization, and each rating should be regarded as an independent assessment, not conditional on any other rating. Given the dynamic nature of the ratings process, changes by these or other rating agencies may or may not occur in the near-term. Based on our ongoing dialogue with the rating agencies concerning our improved insurance risk profile, our financial flexibility, our operating performance, and the quality of our investment portfolio, we do not expect any negative actions from any of the four rating agencies related to either Unum Group’s current issuer credit ratings or the financial strength ratings of its insurance subsidiaries. However, in the event that we are unable to meet the rating agency specific guideline values to maintain our current ratings, including but not limited to maintenance of our capital management metrics at the threshold values stated and maintenance of our financial flexibility

 

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and operational consistency, we could be placed on a negative credit watch, with a potential for a downgrade to both our issuer credit ratings and our financial strength ratings.

See our annual report on Form 10-K for the year ended December 31, 2008, for further information regarding our debt and financial strength ratings and the risks associated with rating changes.

These excerpts taken from the UNM 10-K filed Feb 24, 2009.

Ratings

AM Best, Fitch Ratings (Fitch), Moody’s Investors Service (Moody’s), and Standard & Poor’s Corporation (S&P) are among the third parties that assign issuer credit ratings to Unum Group and financial strength ratings to our insurance subsidiaries. Issuer credit ratings reflect an agency’s opinion of the overall financial capacity of a company to meet its senior debt obligations. Financial strength ratings are specific to each individual insurance subsidiary and reflect each rating agency’s view of the overall financial strength (capital levels, earnings, growth, investments, business mix, operating performance, and market position) of that insuring entity and its ability to meet its obligations to policyholders. Both the issuer credit ratings and financial strength ratings incorporate quantitative and qualitative analyses by rating agencies and are routinely reviewed and updated on an ongoing basis.

Rating agencies assign an outlook statement of “positive,” “negative,” or “developing” to indicate an intermediate-term trend in credit fundamentals which could lead to a rating change. “Positive” means that a rating may be raised, “negative” means that a rating may be lowered, and “developing” means that a rating may be raised or lowered with equal probability. Alternatively, a rating may have a “stable” outlook to indicate that the rating is not expected to change.

“Credit watch” or “under review” highlights the potential direction of a short-term or long-term rating. It focuses on identifiable events and short-term trends that cause a rating to be placed under heightened surveillance by a rating agency. Events that may trigger this action include mergers, acquisitions, recapitalizations, or anticipated operating developments. Ratings may be placed on credit watch or under review when an event or a change in an expected

 

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Index to Financial Statements

trend occurs and additional information is needed to evaluate the current rating level. This status does not mean that a rating change is inevitable, and ratings may change without first being placed on a watch list.

Our financial strength ratings as of February 2009 for our principal U.S. domiciled insurance company subsidiaries were:

 

   

A- (Excellent) by AM Best – 4th of 15 rankings

   

A- (Strong) by Fitch – 7th of 23 rankings

   

Baa1 (Adequate) by Moody’s – 8th of 21 rankings

   

A- (Strong) by S&P – 7th of 21 rankings

Our issuer credit ratings as of February 2009 were:

 

   

bbb- (Good) by AM Best – 10th of 22 rankings

   

BBB- (Good) by Fitch – 9th of 23 rankings

   

Ba1 (Speculative) by Moody’s – 11th of 21 rankings

   

BBB- (Good) by S&P – 10th of 22 rankings

At present, our ratings from AM Best, Moody’s, and S&P have a “stable” outlook, and our rating from Fitch has a “positive” outlook. None of the ratings are currently under review or on credit watch. See further discussion in “Risk Factors” contained herein in Item 1A and in “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Ratings” contained herein in Item 7. A rating is not a recommendation to buy, sell, or hold securities and may be subject to revision or withdrawal at any time by the rating agency. Each rating should be evaluated independently of any other rating.

Ratings

AM Best,
Fitch Ratings (Fitch), Moody’s Investors Service (Moody’s), and Standard & Poor’s Corporation (S&P) are among the third parties that assign issuer credit ratings to Unum Group and financial strength ratings to our
insurance subsidiaries. Issuer credit ratings reflect an agency’s opinion of the overall financial capacity of a company to meet its senior debt obligations. Financial strength ratings are specific to each individual insurance subsidiary and
reflect each rating agency’s view of the overall financial strength (capital levels, earnings, growth, investments, business mix, operating performance, and market position) of that insuring entity and its ability to meet its obligations to
policyholders. Both the issuer credit ratings and financial strength ratings incorporate quantitative and qualitative analyses by rating agencies and are routinely reviewed and updated on an ongoing basis.

STYLE="margin-top:12px;margin-bottom:0px">Rating agencies assign an outlook statement of “positive,” “negative,” or “developing” to indicate an intermediate-term trend in credit
fundamentals which could lead to a rating change. “Positive” means that a rating may be raised, “negative” means that a rating may be lowered, and “developing” means that a rating may be raised or lowered with equal
probability. Alternatively, a rating may have a “stable” outlook to indicate that the rating is not expected to change.

“Credit watch”
or “under review” highlights the potential direction of a short-term or long-term rating. It focuses on identifiable events and short-term trends that cause a rating to be placed under heightened surveillance by a rating agency. Events
that may trigger this action include mergers, acquisitions, recapitalizations, or anticipated operating developments. Ratings may be placed on credit watch or under review when an event or a change in an expected

 


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Index to Financial Statements



trend occurs and additional information is needed to evaluate the current rating level. This status does not mean that a rating change is inevitable, and
ratings may change without first being placed on a watch list.

Our financial strength ratings as of February 2009 for our principal U.S. domiciled
insurance company subsidiaries were:

 







  

A- (Excellent) by AM Best – 4th of 15 rankings







  

A- (Strong) by Fitch – 7th of 23 rankings







  

Baa1 (Adequate) by Moody’s – 8th of 21 rankings







  

A- (Strong) by S&P – 7th of 21 rankings

SIZE="2">Our issuer credit ratings as of February 2009 were:

 







  

bbb- (Good) by AM Best – 10th of 22 rankings







  

BBB- (Good) by Fitch – 9th of 23 rankings







  

Ba1 (Speculative) by Moody’s – 11th of 21 rankings







  

BBB- (Good) by S&P – 10th of 22 rankings

SIZE="2">At present, our ratings from AM Best, Moody’s, and S&P have a “stable” outlook, and our rating from Fitch has a “positive” outlook. None of the ratings are currently under review or on credit watch. See further
discussion in “Risk Factors” contained herein in Item 1A and in “Management’s Discussion and Analysis of Financial Condition and Results of Operations – Ratings” contained herein in Item 7. A rating is not a
recommendation to buy, sell, or hold securities and may be subject to revision or withdrawal at any time by the rating agency. Each rating should be evaluated independently of any other rating.

STYLE="margin-top:12px;margin-bottom:0px">Competition

There is intense competition among insurance companies
for the types of products we sell. We believe that the principal competitive factors affecting our business are integrated product choices, price, quality of customer service and claims management, financial strength, and claims-paying ratings. In
the individual and group disability markets, we compete in the United States with a limited number of major companies and regionally with other companies offering specialty products. Our principal competitors for our other products, including group
life and long-term care as well as the product offerings sold to groups of employees through payroll deduction, include the largest insurance companies in the United States. Some of these companies have more competitive pricing or have higher
claims-paying ratings. Some may also have greater financial resources with which to compete.

In the United Kingdom, we compete for
individual and group products with a number of large internationally recognized providers. The life insurance market continues to go through a restructuring phase which has led to opportunities for both the strong
specialist supplier and also new organizations that have recently been established to handle the run-off of closed businesses. Current penetration levels indicate that there is still significant upside growth potential in the United Kingdom for
the types of products we offer.

All areas of the employee benefits markets are highly competitive due to the yearly renewable term nature of the products
and the large number of insurance companies offering products in this market. There is a risk that purchasers of employee benefits products may be able to obtain more favorable terms from competitors in lieu of renewing coverage with us. The effect
of competition may, as a result, adversely affect the persistency of these and other products, as well as our ability to sell products in the future.

We
must attract and retain independent agents and brokers to actively market our products. Strong competition exists among insurers for agents and brokers. We compete with other insurers for sales agents and brokers primarily on the basis of our
product offerings, financial strength, support services, and compensation. Sales of our products could be materially adversely affected if we are unsuccessful in attracting and retaining agents and brokers.

STYLE="margin-top:0px;margin-bottom:0px"> 


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Index to Financial Statements


This excerpt taken from the UNM 10-Q filed Oct 31, 2008.

Ratings

A.M. Best Company (AM Best), Fitch Ratings (Fitch), Moody’s Investors Service (Moody’s), and Standard & Poor’s Corporation (S&P) are among the third parties that assign issuer credit ratings to Unum Group and financial strength ratings to our insurance subsidiaries. Issuer credit ratings reflect an agency’s opinion of the overall financial capacity of a company to meet its senior debt obligations. Financial strength ratings are specific to each individual insurance subsidiary and reflect each rating agency’s view of the overall financial strength (capital levels, earnings, growth, investments, business mix, operating performance, and market position) of the insuring entity and its ability to meet its obligations to policyholders. Both the issuer credit ratings and financial strength ratings incorporate quantitative and qualitative analyses by rating agencies and are routinely reviewed and updated on an ongoing basis.

We compete based in part on the financial strength ratings provided by rating agencies. A downgrade of our financial strength ratings can be expected to adversely affect us and could potentially, among other things, adversely affect our relationships with distributors of our products and services and retention of our sales force, negatively impact persistency and new sales, particularly large case group sales and individual sales, and generally adversely affect our ability to compete. A downgrade in the issuer credit rating assigned to Unum Group can be expected to adversely affect our cost of capital or our ability to raise additional capital.

The table below reflects the issuer credit ratings for Unum Group and the financial strength ratings for each of our traditional insurance subsidiaries as of the date of this filing.

 

    

AM Best

  

Fitch

  

Moody’s

  

S&P

Issuer Credit Ratings

   bbb- (Good)    BBB- (Good)    Ba1 (Speculative)    BBB- (Good)

Financial Strength Ratings

           

Provident Life & Accident

   A- (Excellent)    A- (Strong)    Baa1 (Adequate)    A- (Strong)

Provident Life & Casualty

   A- (Excellent)    A- (Strong)    Not Rated    Not Rated

Unum Life of America

   A- (Excellent)    A- (Strong)    Baa1 (Adequate)    A- (Strong)

First Unum Life

   A- (Excellent)    A- (Strong)    Baa1 (Adequate)    A- (Strong)

Colonial Life & Accident

   A- (Excellent)    A- (Strong)    Baa1 (Adequate)    A- (Strong)

Paul Revere Life

   A- (Excellent)    A- (Strong)    Baa1 (Adequate)    A- (Strong)

Paul Revere Variable

   A- (Excellent)    A- (Strong)    Baa1 (Adequate)    Not Rated

Unum Limited

   A- (Excellent)    Not Rated    Not Rated    A- (Strong)

We maintain an ongoing dialogue with the four rating agencies that evaluate us in order to inform them of progress we are making regarding our strategic objectives and financial plans, as well as other pertinent issues. A significant component of our communications involves an annual review meeting; included as well are other meetings not limited to quarterly updates regarding our business. During the second quarter of 2008, we held our annual review meetings with S&P and Moody’s. During late October 2008, we held our annual review meeting with AM Best. We plan to hold our annual review meeting with Fitch in early November 2008.

 

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On January 29, 2008, AM Best reaffirmed the ratings of Unum Group and its operating subsidiaries and upgraded the outlook from “negative” to “stable.” The agency’s revised outlook was attributed to our increased financial flexibility, the quality of our investment portfolio, the operational execution of our operating segments, and the completion of the claim reassessment process. On February 4, 2008, Fitch revised its outlook for Unum Group and its operating subsidiaries to “positive” from “stable,” citing our progress in increasing profitability and decreasing risk along with our improved capitalization levels as the basis for the upgrade. On February 14, 2008, Moody’s revised its outlook for Unum Group and its operating subsidiaries to “stable” from “negative,” basing its revision on the overall improvement in our financial flexibility.

On July 17, 2008, S&P raised its counterparty credit and senior unsecured debt rating on Unum Group from “BB+” to “BBB-” and raised its counterparty credit and financial strength ratings on Unum Group’s insurance subsidiaries from “BBB+” to “A-”. S&P stated that the rating actions reflect our maintenance of our market position, improved insurance risk profile, operating profitability, enhanced investments quality, and stronger capitalization through statutory earnings.

There have been no other changes in any of the rating agencies’ outlook statements or ratings during the period January 1, 2008 to the date of this filing.

Agency ratings are not directed toward the holders of our securities and are not recommendations to buy, sell, or hold our securities. Each rating is subject to revision or withdrawal at any time by the assigning rating organization, and each rating should be regarded as an independent assessment, not conditional on any other rating. Given the dynamic nature of the ratings process, changes by these or other rating agencies may or may not occur in the near-term.

See our annual report on Form 10-K for the year ended December 31, 2007, for further information regarding our debt and financial strength ratings and the risks associated with rating changes.

 

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This excerpt taken from the UNM 10-Q filed Aug 1, 2008.

Ratings

A.M. Best Company (AM Best), Fitch Ratings (Fitch), Moody’s Investors Service (Moody’s), and Standard & Poor’s Corporation (S&P) are among the third parties that assign issuer credit ratings to Unum Group and financial strength ratings to our insurance subsidiaries. Issuer credit ratings reflect an agency’s opinion of the overall financial capacity of a company to meet its senior debt obligations. Financial strength ratings are specific to each individual insurance subsidiary and reflect each rating agency’s view of the overall financial strength (capital levels, earnings, growth, investments, business mix, operating performance, and market position) of the insuring entity and its ability to meet its obligations to policyholders. Both the issuer credit ratings and financial strength ratings incorporate quantitative and qualitative analyses by rating agencies and are routinely reviewed and updated on an ongoing basis.

 

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We compete based in part on the financial strength ratings provided by rating agencies. A downgrade of our financial strength ratings can be expected to adversely affect us and could potentially, among other things, adversely affect our relationships with distributors of our products and services and retention of our sales force, negatively impact persistency and new sales, particularly large case group sales and individual sales, and generally adversely affect our ability to compete. A downgrade in the issuer credit rating assigned to Unum Group can be expected to adversely affect our cost of capital or our ability to raise additional capital.

The table below reflects the issuer credit ratings for Unum Group and the financial strength ratings for each of our traditional insurance subsidiaries as of the date of this filing.

 

    

AM Best

  

Fitch

  

Moody’s

  

S&P

Issuer Credit Ratings

   bbb- (Good)    BBB- (Good)    Ba1 (Speculative)    BBB- (Good)

Financial Strength Ratings

           

Provident Life & Accident

   A- (Excellent)    A- (Strong)    Baa1 (Adequate)    A- (Strong)

Provident Life & Casualty

   A- (Excellent)    A- (Strong)    Not Rated    Not Rated

Unum Life of America

   A- (Excellent)    A- (Strong)    Baa1 (Adequate)    A- (Strong)

First Unum Life

   A- (Excellent)    A- (Strong)    Baa1 (Adequate)    A- (Strong)

Colonial Life & Accident

   A- (Excellent)    A- (Strong)    Baa1 (Adequate)    A- (Strong)

Paul Revere Life

   A- (Excellent)    A- (Strong)    Baa1 (Adequate)    A- (Strong)

Paul Revere Variable

   A- (Excellent)    A- (Strong)    Baa1 (Adequate)    Not Rated

Unum Limited

   A- (Excellent)    Not Rated    Not Rated    A- (Strong)

We maintain an ongoing dialogue with the four rating agencies that evaluate us in order to inform them of progress we are making regarding our strategic objectives and financial plans, as well as other pertinent issues. A significant component of our communications involves an annual review meeting; included as well are other meetings not limited to quarterly updates regarding our business. During the second quarter of 2008, we held our annual review meetings with S&P and Moody’s. We plan to hold our annual review meetings with Fitch and AM Best during the latter part of the year.

On January 29, 2008, AM Best reaffirmed the ratings of Unum Group and its operating subsidiaries and upgraded the outlook from “negative” to “stable.” The agency’s revised outlook was attributed to our increased financial flexibility, the quality of our investment portfolio, the operational execution of our operating segments, and the completion of the claim reassessment process. On February 4, 2008, Fitch revised its outlook for Unum Group and its operating subsidiaries to “positive” from “stable,” citing our progress in increasing profitability and decreasing risk along with our improved capitalization levels as the basis for the upgrade. On February 14, 2008, Moody’s revised its outlook for Unum Group and its operating subsidiaries to “stable” from “negative,” basing its revision on the overall improvement in our financial flexibility.

On July 17, 2008, S&P raised its counterparty credit and senior unsecured debt rating on Unum Group from “BB+” to “BBB-” and raised its counterparty credit and financial strength ratings on Unum Group’s insurance subsidiaries from “BBB+” to “A-”. S&P stated that the rating actions reflect our maintenance of our market position, improved insurance risk profile, operating profitability, enhanced investments quality, and stronger capitalization through statutory earnings.

There have been no other changes in any of the rating agencies’ outlook statements or ratings during the period January 1, 2008 to the date of this filing.

Agency ratings are not directed toward the holders of our securities and are not recommendations to buy, sell, or hold our securities. Each rating is subject to revision or withdrawal at any time by the assigning rating organization, and each rating should be regarded as an independent assessment, not conditional on any other rating. Given the dynamic nature of the ratings process, changes by these or other rating agencies may or may not occur in the near-term.

 

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See our annual report on Form 10-K for the year ended December 31, 2007, for further information regarding our debt and financial strength ratings and the risks associated with rating changes.

This excerpt taken from the UNM 10-Q filed May 2, 2008.

Ratings

A.M. Best Company (AM Best), Fitch Ratings (Fitch), Moody’s Investors Service (Moody’s), and Standard & Poor’s Corporation (S&P) are among the third parties that assign issuer credit ratings to Unum Group and financial strength ratings to our insurance subsidiaries. Issuer credit ratings reflect an agency’s opinion of the overall financial capacity of a company to meet its senior debt obligations. Financial strength ratings are specific to each individual insurance subsidiary and reflect each rating agency’s view of the overall financial strength (capital levels, earnings, growth, investments, business mix, operating performance, and market position) of the insuring entity and its ability to meet its obligations to policyholders. Both the issuer credit ratings and financial strength ratings incorporate quantitative and qualitative analyses by rating agencies and are routinely reviewed and updated on an ongoing basis.

We compete based in part on the financial strength ratings provided by rating agencies. A downgrade of our financial strength ratings can be expected to adversely affect us and could potentially, among other things, adversely affect our relationships with distributors of our products and services and retention of our sales force, negatively impact persistency and new sales, particularly large case group sales and individual sales, and generally adversely affect our ability to compete. A downgrade in the issuer credit rating assigned to Unum Group can be expected to adversely affect our cost of capital or our ability to raise additional capital.

The table below reflects the issuer credit ratings for Unum Group and the financial strength ratings for each of our traditional insurance subsidiaries as of the date of this filing.

 

    

AM Best

   Fitch    Moody’s    S&P
Issuer Credit Ratings    bbb- (Good)    BBB- (Good)    Ba1 (Speculative)    BB+ (Speculative)

Financial Strength Ratings

           

Provident Life & Accident

   A- (Excellent)    A- (Strong)    Baa1 (Adequate)    BBB+ (Good)

Provident Life & Casualty

   A- (Excellent)    A- (Strong)    Not Rated    Not Rated

Unum Life of America

   A- (Excellent)    A- (Strong)    Baa1 (Adequate)    BBB+ (Good)

First Unum Life

   A- (Excellent)    A- (Strong)    Baa1 (Adequate)    BBB+ (Good)

Colonial Life & Accident

   A- (Excellent)    A- (Strong)    Baa1 (Adequate)    BBB+ (Good)

Paul Revere Life

   A- (Excellent)    A- (Strong)    Baa1 (Adequate)    BBB+ (Good)

Paul Revere Variable

   A- (Excellent)    A- (Strong)    Baa1 (Adequate)    Not Rated

Unum Limited

   A- (Excellent)    Not Rated    Not Rated    BBB+ (Good)

We maintain an ongoing dialogue with the four rating agencies that evaluate us in order to inform them of progress we are making regarding our strategic objectives and financial plans, as well as other pertinent issues. A significant component of our communications involves an annual review meeting; included as well are other meetings not limited to quarterly updates regarding our business. We plan to hold our annual review with each of the rating agencies during the second and third quarters of 2008.

 

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On January 29, 2008, AM Best reaffirmed the ratings of Unum Group and its operating subsidiaries and upgraded the outlook from “negative” to “stable.” The agency’s revised outlook was positioned on our increased financial flexibility, the quality of our investment portfolio, the operational execution of our operating segments, and the completion of the claim reassessment process. On February 4, 2008, Fitch revised its outlook for Unum Group and its operating subsidiaries to “positive” from “stable,” citing our progress in increasing profitability and decreasing risk along with our improved capitalization levels as the basis for the upgrade. On February 14, 2008, Moody’s revised its outlook for Unum Group and its operating subsidiaries to “stable” from “negative,” basing its revision on the overall improvement in our financial flexibility. There have been no other changes in any of the rating agencies’ outlook statements or ratings during the first quarter of 2008 or prior to the date of this filing.

Agency ratings are not directed toward the holders of our securities and are not recommendations to buy, sell, or hold our securities. Each rating is subject to revision or withdrawal at any time by the assigning rating organization, and each rating should be regarded as an independent assessment, not conditional on any other rating. Given the dynamic nature of the ratings process, changes by these or other rating agencies may or may not occur in the near-term.

See our annual report on Form 10-K for the year ended December 31, 2007, for further information regarding our debt and financial strength ratings and the risks associated with rating changes.

This excerpt taken from the UNM 10-K filed Feb 25, 2008.

Ratings

A.M. Best Company (AM Best), Fitch Ratings (Fitch), Moody’s Investors Service (Moody’s), and Standard & Poor’s Corporation (S&P) are among the third parties that assign issuer credit ratings to Unum Group and financial strength ratings to our insurance subsidiaries. Issuer credit ratings reflect an agency’s opinion of the overall financial capacity of a company to meet its senior debt obligations. Financial strength ratings are specific to each individual insurance subsidiary and reflect each rating agency’s view of the overall financial strength (capital levels, earnings, growth, investments, business mix, operating performance, and market position) of the insuring entity and its ability to meet its obligations to policyholders. Both the issuer credit ratings and financial strength ratings incorporate quantitative and qualitative analyses by rating agencies and are routinely reviewed and updated on an ongoing basis.

 

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We compete based in part on the financial strength ratings provided by rating agencies. A downgrade of our financial strength ratings can be expected to adversely affect us and could potentially, among other things, adversely affect our relationships with distributors of our products and services and retention of our sales force, negatively impact persistency and new sales, particularly large case group sales and individual sales, and generally adversely affect our ability to compete. A downgrade in the issuer credit rating assigned to Unum Group can be expected to adversely affect our cost of capital or our ability to raise additional capital.

The table below reflects the issuer credit ratings for Unum Group and the financial strength ratings for each of our traditional insurance subsidiaries as of the date of this filing.

 

    

AM Best

  

Fitch

  

Moody’s

  

S&P

Issuer Credit Ratings

   bbb- (Good)    BBB- (Good)    Ba1 (Speculative)    BB+ (Speculative)

Financial Strength Ratings

           

Provident Life & Accident

   A- (Excellent)    A- (Strong)    Baa1 (Adequate)    BBB+ (Good)

Provident Life & Casualty

   A- (Excellent)    A- (Strong)    Not Rated    Not Rated

Unum Life of America

   A- (Excellent)    A- (Strong)    Baa1 (Adequate)    BBB+ (Good)

First Unum Life

   A- (Excellent)    A- (Strong)    Baa1 (Adequate)    BBB+ (Good)

Colonial Life & Accident

   A- (Excellent)    A- (Strong)    Baa1 (Adequate)    BBB+ (Good)

Paul Revere Life

   A- (Excellent)    A- (Strong)    Baa1 (Adequate)    BBB+ (Good)

Paul Revere Variable

   A- (Excellent)    A- (Strong)    Baa1 (Adequate)    Not Rated

Unum Limited

   A- (Excellent)    Not Rated    Not Rated    BBB+ (Good)

We maintain an ongoing dialogue with the four rating agencies in order to inform them of progress we are making regarding our strategic objectives and financial plans, as well as other pertinent issues. A significant component of our communications includes an annual review meeting, as well as other meetings not limited to quarterly updates regarding our business. During the second quarter of 2007, we conducted our annual review with Moody’s, S&P, and Fitch. Our annual review meeting with AM Best took place in the fourth quarter of 2007.

On August 1, 2007, S&P raised the outlook from “stable” to “positive” on our financial strength ratings and reaffirmed the positive outlook on our holding company’s issuer credit rating. On January 29, 2008, AM Best reaffirmed the ratings of Unum Group and its operating subsidiaries and upgraded the outlook from “negative” to “stable.” The agency’s revised outlook was positioned on our increased financial flexibility, the quality of our investment portfolio, the operational execution of our operating segments, and the completion of the claim reassessment process. On February 4, 2008, Fitch revised its outlook for Unum Group and its operating subsidiaries to “positive” from “stable,” citing our progress in increasing profitability and decreasing risk and our improved capitalization levels as the basis for the upgrade. On February 14, 2008, Moody’s revised its outlook for Unum Group and its operating subsidiaries to “stable” from “negative,” basing its revision on the overall improvement in our financial flexibility. There have been no other changes in any of the rating agencies’ outlook statements or ratings during 2007 or prior to the date of this filing.

Agency ratings are not directed toward the holders of our securities and are not recommendations to buy, sell, or hold our securities. Each rating is subject to revision or withdrawal at any time by the assigning rating organization, and each rating should be regarded as an independent assessment, not conditional on any other rating. Given the dynamic nature of the ratings process, changes by these or other rating agencies may or may not occur in the near-term.

See “Ratings” in Part 1, Item 1 and “Risk Factors – Issuer Credit Ratings and Financial Strength Ratings” in Part 1, Item 1A, contained herein for further discussion.

 

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This excerpt taken from the UNM 10-Q filed Nov 5, 2007.

Ratings

A.M. Best Company (AM Best), Fitch Ratings (Fitch), Moody’s Investors Service (Moody’s), and Standard & Poor’s Corporation (S&P) are among the third parties that rate our senior debt and the financial strength of our principal U.S. insurance subsidiaries. Financial strength ratings are primarily based on U.S. statutory financial information and are individually stated for each of the U.S. domiciled insurance companies. These ratings reflect each rating agency’s view of the overall financial strength (capital levels, earnings, growth, investments, business mix, operating performance, and market position) of the insuring entity and also incorporate an assessment of each entity’s ability to meet obligations to policyholders. Debt ratings represent the opinions of the rating agencies specific to an issuer’s ability to repay its debt and are based primarily on consolidated financial information prepared using GAAP. Both financial strength ratings and debt ratings incorporate both quantitative and qualitative analyses by rating agencies and are routinely evaluated and updated on an ongoing basis.

We compete based in part on the financial strength ratings provided by rating agencies. A downgrade of our financial strength ratings could, among other things, adversely affect our relationships with distributors of our products and services and retention of our sales force; negatively impact persistency and new sales, particularly with respect to large case group sales and individual sales; and generally adversely affect our ability to compete. Downgrades in our debt ratings can be expected to adversely affect our cost of capital and our ability to raise additional capital.

The table below reflects our senior debt ratings and the financial strength ratings for our traditional insurance company subsidiaries as of the date of this filing.

 

    

AM Best

  

Fitch

  

Moody’s

  

S&P

Senior Debt Ratings

   Bbb- (Good)    BBB- (Good)    Ba1 (Speculative)    BB+ (Speculative)

Financial Strength Ratings

           

Provident Life and Accident

   A- (Excellent)    A- (Strong)    Baa1 (Adequate)    BBB+ (Good)

Provident Life and Casualty

   A- (Excellent)    A- (Strong)    Not Rated    Not Rated

Unum Life of America

   A- (Excellent)    A- (Strong)    Baa1 (Adequate)    BBB+ (Good)

First Unum Life

   A- (Excellent)    A- (Strong)    Baa1 (Adequate)    BBB+ (Good)

Colonial Life & Accident

   A- (Excellent)    A- (Strong)    Baa1 (Adequate)    BBB+ (Good)

Paul Revere Life

   A- (Excellent)    A- (Strong)    Baa1 (Adequate)    BBB+ (Good)

Paul Revere Variable

   A- (Excellent)    A- (Strong)    Baa1 (Adequate)    BBB+ (Good)

Unum Limited

   A- (Excellent)    Not Rated    Not Rated    BBB+ (Good)

We maintain an ongoing dialogue with these four rating agencies in order to inform them of progress we are making regarding our strategic objectives and financial plans, as well as other pertinent issues. A significant component of our communications includes an annual review meeting, as well as other meetings not limited to quarterly updates regarding our business. During the second quarter of 2007, we conducted our annual review with Moody’s, S&P, and Fitch. We plan to hold our annual review meeting with AM Best in the fourth quarter of 2007.

 

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On August 1, 2007, S&P raised the outlook from “stable” to “positive” on our financial strength ratings and reaffirmed the positive outlook on our holding company’s senior debt ratings. There have been no other changes in any of the rating agencies’ outlook statements or ratings during 2007.

Agency ratings are not directed toward the holders of our securities and are not recommendations to buy, sell, or hold our securities. Each rating is subject to revision or withdrawal at any time by the assigning rating organization, and each rating should be regarded as an independent assessment, not conditional on any other rating. Given the dynamic nature of the ratings process, changes by these or other rating agencies may or may not occur in the near-term. See our annual report on Form 10-K for the year ended December 31, 2006, for further information regarding our debt and financial strength ratings and the risks associated with rating changes.

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