NU Online News Service, April 25, 2003, 12:33 p.m. EDT – UnumProvident Corp., Chattanooga, Tenn., is reporting a $246 million net loss for the first quarter on $2.5 billion in revenue, compared with $88 million in net income for the first quarter of 2002.
Net results for the latest quarter include a $454 million increase in reserves for group long-term disability insurance, UnumProvident says.
UnumProvident says it is increasing the group long-term disability reserves 6.2%, to $7.3 billion, because it has having a harder time making recoveries on group LTD claims.
Excluding the effects of the reserve increase and other unusual gains and charges, operating income would have fallen to $106 million, from $151 million for the first quarter of 2002, UnumProvident says.
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UnumProvident sells disability insurance and group life and accident insurance. It also sells individual insurance products at the worksite through its Colonial Life & Accident Insurance Company subsidiary.
Disability insurance: The disability insurance unit generated a $354 million operating loss for the latest quarter on $1.3 billion in premium revenue, compared with $163 million in operating income on $1.2 billion in revenue for the first quarter of 2002.