Segment Information

6 Months Ended

Jun. 30, 2014

Segment Reporting [Abstract]

Segment Information

We have three principal operating business segments: Unum US, Unum UK, and Colonial Life. Our other segments are the Closed Block and the Corporate segments.

Premium income by major line of business within each of our segments is presented as follows:

	Three Months Ended June 30				Six Months Ended June 30
	2014		2013		2014		2013
	(in millions of dollars)
Unum US
Group Disability
Group Long-term Disability	$	386.2	$	394.8	$	769.7	$	787.5
Group Short-term Disability	137.8		129.1		275.1		260.1
Group Life and Accidental Death & Dismemberment
Group Life	313.2		303.6		623.1		605.8
Accidental Death & Dismemberment	31.1		30.2		61.7		61.1
Supplemental and Voluntary
Individual Disability - Recently Issued	116.0		114.3		231.9		234.4
Voluntary Benefits	173.4		159.5		348.7		322.3
	1,157.7		1,131.5		2,310.2		2,271.2
Unum UK
Group Long-term Disability	105.9		96.3		208.9		194.2
Group Life	33.7		26.5		68.5		57.5
Supplemental	14.4		14.8		28.3		29.7
	154.0		137.6		305.7		281.4
Colonial Life
Accident, Sickness, and Disability	189.2		184.7		378.3		369.5
Life	57.5		55.3		114.9		110.1
Cancer and Critical Illness	70.1		67.9		140.0		135.4
	316.8		307.9		633.2		615.0
Closed Block
Individual Disability	157.8		170.6		318.9		352.4
Long-term Care	157.1		157.8		313.6		316.6
All Other	0.2		0.4		0.5		0.1
	315.1		328.8		633.0		669.1
Total	$	1,943.6	$	1,905.8	$	3,882.1	$	3,836.7

Selected operating statement data by segment is presented as follows:

	Unum US		Unum UK			Colonial Life		Closed Block		Corporate			Total
	(in millions of dollars)
Three Months Ended June 30, 2014
Premium Income	$	1,157.7	$	154.0		$	316.8	$	315.1	$	—		$	1,943.6
Net Investment Income	221.2		44.3			36.2		326.5		0.9			629.1
Other Income	30.3		0.2			0.1		24.5		(0.2		)	54.9
Operating Revenue	$	1,409.2	$	198.5		$	353.1	$	666.1	$	0.7		$	2,627.6
Operating Income (Loss)	$	218.8	$	39.6		$	75.3	$	37.3	$	(35.8	)	$	335.2
Three Months Ended June 30, 2013
Premium Income	$	1,131.5	$	137.6		$	307.9	$	328.8	$	—		$	1,905.8
Net Investment Income	231.1		45.4			34.3		316.1		(0.8		)	626.1
Other Income	32.1		(0.1		)	0.1		23.8		0.8			56.7
Operating Revenue	$	1,394.7	$	182.9		$	342.3	$	668.7	$	—		$	2,588.6
Operating Income (Loss)	$	214.0	$	33.5		$	71.1	$	29.6	$	(37.1	)	$	311.1

	Unum US		Unum UK		Colonial Life		Closed Block		Corporate			Total
	(in millions of dollars)
Six Months Ended June 30, 2014
Premium Income	$	2,310.2	$	305.7	$	633.2	$	633.0	$	—		$	3,882.1
Net Investment Income	447.6		77.9		73.1		642.8		0.2			1,241.6
Other Income	61.2		0.1		—		46.1		1.3			108.7
Operating Revenue	$	2,819.0	$	383.7	$	706.3	$	1,321.9	$	1.5		$	5,232.4
Operating Income (Loss)	$	429.6	$	76.1	$	154.7	$	66.4	$	(70.0	)	$	656.8
Six Months Ended June 30, 2013
Premium Income	$	2,271.2	$	281.4	$	615.0	$	669.1	$	—		$	3,836.7
Net Investment Income	466.8		76.2		74.0		629.2		1.0			1,247.2
Other Income	68.8		—		0.1		47.9		2.4			119.2
Operating Revenue	$	2,806.8	$	357.6	$	689.1	$	1,346.2	$	3.4		$	5,203.1
Operating Income (Loss)	$	422.1	$	64.8	$	146.5	$	56.9	$	(70.8	)	$	619.5

We measure and analyze our segment performance using non-GAAP financial measures. A non-GAAP financial measure is a numerical measure of a company's performance, financial position, or cash flows that excludes or includes amounts that are not normally excluded or included in the most directly comparable measure calculated and presented in accordance with GAAP. The non-GAAP financial measures of "operating revenue" and "operating income" or "operating loss" differ from total revenue and income before income tax as presented in our consolidated statements of income due to the exclusion of net realized investment gains and losses, non-operating retirement-related gains or losses, and costs related to early retirement of debt as specified in the reconciliations below. We believe operating revenue and operating income or loss are better performance measures and better indicators of the revenue and profitability and underlying trends in our business.

Realized investment gains or losses depend on market conditions and do not necessarily relate to decisions regarding the underlying business of our segments. Our investment focus is on investment income to support our insurance liabilities as opposed to the generation of realized investment gains or losses. Although we may experience realized investment gains or losses which will affect future earnings levels, a long-term focus is necessary to maintain profitability over the life of the business since our underlying business is long-term in nature, and we need to earn the interest rates assumed in calculating our liabilities.

The amortization of prior period actuarial gains or losses, a component of the net periodic benefit cost for our pensions and other postretirement benefit plans, is driven by market performance as well as plan amendments and is not indicative of the operational results of our businesses. We believe that excluding the amortization of prior period gains or losses from operating income or loss provides investors with additional information for comparison and analysis of our operating results. Although we manage our non-operating retirement-related gains or losses separately from the operational performance of our business, these gains or losses impact the overall profitability of our company and have historically increased or decreased over time, depending on plan amendments and market conditions and the resulting impact on the actuarial gains or losses in our pensions and other postretirement benefit plans.

We believe that excluding the second quarter of 2014 costs related to the early retirement of debt is appropriate because in conjunction with the debt redemption, we recognized in realized investment gains and losses a deferred gain from previously terminated derivatives which were associated with the hedge of this debt. The amount recognized as a realized investment gain, which basically offsets the cost of the debt redemption, is also excluded from our non-GAAP financial measures since we analyze our performance excluding amounts reported as realized investment gains or losses. We believe it provides investors with a more realistic view of our overall profitability if we are consistent in excluding both the cost of the debt retirement as well as the gain on the hedge of the debt.

We may at other times exclude certain other items from our discussion of financial ratios and metrics in order to enhance the understanding and comparability of our operational performance and the underlying fundamentals, but this exclusion is not an indication that similar items may not recur and does not replace net income or net loss as a measure of our overall profitability.

A reconciliation of "operating revenue" to total revenue and "operating income" to income before income tax is as follows:

	Three Months Ended June 30						Six Months Ended June 30
	2014			2013			2014			2013
	(in millions of dollars)
Operating Revenue	$	2,627.6		$	2,588.6		$	5,232.4		$	5,203.1
Net Realized Investment Gain	25.9			13.3			32.2			23.6
Total Revenue	$	2,653.5		$	2,601.9		$	5,264.6		$	5,226.7
Operating Income	$	335.2		$	311.1		$	656.8		$	619.5
Net Realized Investment Gain	25.9			13.3			32.2			23.6
Non-operating Retirement-related Loss	(1.4		)	(12.9		)	(2.8		)	(27.8		)
Costs Related to Early Retirement of Debt	(13.2		)	—			(13.2		)	—
Income Before Income Tax	$	346.5		$	311.5		$	673.0		$	615.3

Assets by segment are as follows:

	June 30		December 31
	2014		2013
	(in millions of dollars)
Unum US	$	18,731.0	$	18,384.3
Unum UK	3,987.0		3,654.1
Colonial Life	3,613.5		3,482.9
Closed Block	33,062.6		31,564.2
Corporate	2,824.0		2,318.1
Total	$	62,218.1	$	59,403.6