About Provident Life & Accident Insurance Company

Through injury or illness, Unum works to keep employees employed. A top disability insurer in the US and the UK, it offers short-term and long-term disability insurance, as well as life and accidental death and dismemberment insurance, to individuals and groups in a workplace benefits setting. Specialty coverage offerings include cancer, dental, and travel insurance. US subsidiaries include Unum Life Insurance Company of America, Provident Life and Accident, First Unum Life, Colonial Life & Accident, and Paul Revere Life Insurance. It operates as Unum Limited in the UK. Unum's products are sold through field sales agents and independent brokers. In 2015, Unum paid out $6.8 billion in benefits.

Operations

Around 60% of Unum's annual premiums come from the Unum US segment, which offers group disability, life, and accident policies, as well as supplemental and voluntary policies under the Unum America and Provident Brands. The Colonial Life segment -- which offers accident, sickness, disability, and life products -- accounted for 16% of sales in 2015, while the Unum UK segment represented 7% of sales. Unum also generates revenue from its Closed Block business (about 15%), which services policies in the runoff segments (long-term care, non-workplace individual disability) where the company no longer issues new policies.

The company covers 33 million people worldwide and counts 181,000 businesses in the US among its customers (including a third of the Fortune 500). In 2015, the group's disability business alone helped more than 327,000 people return to work.

Geographic Reach

The US market contributes more than 60% of annual revenues. Unum runs four primary operating centers (in Tennessee, Maine, Massachusetts, and South Carolina) and about 35 sales offices scattered across the US market. Its Unum Limited office is the headquarters for the smaller Unum UK operations, which include Ireland.

Sales and Marketing

The company strives to maintain a close relationship with its sales force, as well as with its independent agents and brokers, as it relies on these representatives to market its products to employers.

Unum advertises through print media (in such publications as Bloomberg Businessweek, The New Yorker, Forbes, and HR Magazine) and through online videos on sites such as CNBC.com, WebMD, and Hulu.

Financial Performance

With the exception of 2013, revenue has been trending upward for the past five years. In 2015, it increased 2% to $10.7 billion thanks to growth across all of its segments. Premium earnings rose that year due to higher sales and rate increases. These gains were partially offset by investment losses that year. And as is to be expected, premiums in its Closed Block segment continue to decline every year.

Net income, which has been more turbulent than revenue, more than doubled to $867.1 million in 2015. This rise was driven by increased sales and equity in undistributed earnings of subsidiaries. Cash flow from operations grew 6% to $1.2 billion that year.

Strategy

Unum seeks to achieve a competitive edge by providing group, individual, and voluntary workplace products that can be combined with other coverage to better integrate benefits for customers. The insurer has stayed ahead of the game in the disability market by sticking to conservative investment and growth strategies, primarily seeking to expand its group product offerings and its geographic presence through organic measures.

Specific goals include securing new customers, investing in growth that meets new demands of the market, and expanding into new geographic areas and distribution channels. Acquisitions play an important part of reaching these goals. For example, it acquired the UK-based National Dental Plan to enter the employee dental benefits market there.

The company has especially seen growth in its voluntary benefits products, which allow employees to purchase individual coverage products on a supplemental basis. Such options are increasingly important as economic difficulties put pressure on low and middle-income workers. Unum has also expanded its offering of services to help employers and government agencies manage costs, such as its leave management program, flexible corporate contribution programs, and wellness initiatives.

While expanding in areas where the greatest market needs are seen, the firm also occasionally exits (or places into run-off) certain businesses where demand has slowed.

In 2015 Unum introduced a new disability offering allowing employers to choose between financial protection plans.

Mergers and Acquisitions

In 2016 Unum bought Louisiana-based H&J Capital, which owns Starmount Life Insurance and third-party administrator AlwaysCare Benefits, for $127 million. Starmount operates in 49 states plus the District of Columbia, offering individual products for dental, vision, life, and accident coverage. It also offers group and voluntary benefits including dental, vision, life, accident, disability, and critical illness, under the AlwaysCare Benefits brand.

The company acquired UK-based National Dental plan for £35.9 million in 2015; that purchase added a complementary offering to its existing portfolio of employee benefits products.

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Provident Life & Accident Insurance Company

1 Fountain Sq Ste 1
Chattanooga, TN 37402-1303
Phone: 1 (423) 755-1011
Fax: 1 (423) 755-1883

Stats

  • Employer Type: Public
  • Exec V Pres: Thomas B Heys
  • Claims: Marianne Justin

Major Office Locations

  • Chattanooga, TN

Other Locations

  • Glendale, CA
  • Tampa, FL
  • Atlanta, GA
  • Oakbrook Terrace, IL
  • Portland, ME
  • Southfield, MI
  • Charlotte, NC
  • Mount Laurel, NJ
  • Pleasantville, NY
  • King Of Prussia, PA
  • Spring, TX
  • Elm Grove, WI
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