Unum Group, a provider of employee benefits and long-term care solutions, reiterated its full-year 2024 earnings per share (EPS) guidance at $8.60 to $8.90 per share during its presentation at the KBW Insurance Conference 2026. The company also outlined its capital allocation strategy, emphasizing organic growth, targeted acquisitions and shareholder returns totaling about $1.3 billion, including $300 million in dividends and $1 billion in share repurchases.
The U.S. segment, which represents a mid-teens growth rate in the first half of 2024, saw improvements in Colonial Life’s premium growth to around 3%, with sales rising 6% in the latest quarter. Colonial Life, which serves employers with 2,000 or fewer employees, continues to expand its market share. In the United Kingdom, the business has returned to low-teens returns after a repricing cycle expected to last 1 to 2 years. Polish operations have benefited from new product launches and expanded capabilities.
Unum’s underwriting performance in the first half of 2024 reflected strong results in group disability and life insurance. The group disability benefit ratio stood at 65% in the first half, slightly above the expected range of 62% to 64%, with a second-quarter ratio of 65.8%. Group life ratios were in the high 60s, outperforming expectations of around 70%. Paid Family and Medical Leave (PFML) ratios also matched expectations at 65%. Meanwhile, long-term care (LTC) de-risking efforts have advanced significantly. Unum has accumulated over $5 billion in price value increases over the past decade and has completed two reinsurance transactions targeting older individual lives in the Fairwind block. The second transaction, announced in July 2024, aims to cover the remaining individual lives in Fairwind upon closing. After these transactions, Unum expects to retain around $2 billion in protections without additional capital deployment.
Organic steps in group LTC included halting new admissions on February 1, 2024, following an announcement in the third quarter of 2023, which contributed to a 10% lapse rate in the first half of the year. The company has also prioritized digital transformation, with about 70% of the U.S. business now connected digitally since 2023. Unum HR Connect, a leave management platform developed over seven to eight years, remains a key differentiator in the market.
Capital allocation remains focused on three priorities: organic growth in core business, strategic acquisitions such as the recent Beanstalk Benefits acquisition, and shareholder returns through dividends and buybacks. Unum’s stock, trading at $93.07, has seen a 30.5% increase over the past six months and a 23.6% year-to-date gain, though it closed slightly down by 1.06% from the prior day. The company’s market capitalization stands at $14.7 billion, with a P/E ratio of 22 and a dividend yield of 2.15%. Unum has raised its dividend for 17 consecutive years.
