The environment for selling employee benefits in the United States is poor, but Unum Group Corp. (NYSE:UNM) still managed to sell more group long-term disability (LTD) insurance during the third quarter.
Unum executives gave that assessment during the company’s third-quarter earnings call.
Thomas Watjen, the president, told securities analysts that, especially in the market for employers with fewer than 50 lives, challenges include a soft economy, an unsettling political environment, and distractions from employers’ need to understand and make decisions about the Patient Protection and Affordable Care Act (PPACA).
Unum executives said they see other insurers using low prices to get the attention of the employers that are willing to change their benefits plans.
The company as a whole is reporting $206 million in net income for the latest quarter on $2.5 billion in revenue, down from $230 million in net income on $2.6 billion in revenue for the third quarter of 2012.
Even at Unum, group short-term disability (STD) insurance sales fell 9.2 percent, to $13 million.
But group LTD sales increased to 8.9 percent, to $26 million.
The group disability unit as a whole is reporting $79 million in operating income for the quarter on $515 million in premium revenue, up from $74 million in operating income on $512 million in premium revenue for the comparable quarter in 2012.
During the earnings call, Watjen noticed that the company’s large “closed block” of group long-term care insurance (LTCI) business will be an “area of focus for a long time to come.”
Jack McGarry, the head of Unum’s closed-block operations, said efforts to get state insurance regulators to approve LTCI rate increases have been going more smoothly than expected, in part because regulators who have approved increases are encouraging peers in other states to do the same.