This article was updated to reflect an earnings call that took place after the original publication time.
Unum Group did well in the fourth quarter of 2021, but the COVID-19 pandemic devastated many of the people who had its group life insurance coverage.
Unum reports claims for its U.S. group life business together with claims for its group accidental death and disememberment, or AD&D, insurance business.
The overall ratio of benefits to premium income soared to 98.3% in the fourth quarter of 2021, according to figures Unum released Tuesday.
That was up from 90.4% in the fourth quarter of 2020, and up from 71.7% in the fourth quarter of 2019, before the COVID-19 pandemic began.
Richard McKenney, Unum’s CEO, said in a comment, included in the earnings announcement, that the company has entered 2022 with solid premium growth and favorable investment returns.
“Yet our elevated claims experience is a reminder of the impact COVID continues to have on our world,” McKenney said.
During a call Unum held today, to go over the latest results with securities analysts, Steve Zabel, the company’s chief financial officer, noted that the 98.3% group life and AD&D benefit ratio for the fourth quarter was better than the 106% benefit ratio for the third quarter of 2021.
“We were impacted by the continued high level of national COVID-related mortality, which was a reported 94,000 in the third quarter and increased to a reported 127,000 in the fourth quarter,” Zabel said. “Age demographics continue to show a high impact on younger working-age individuals though this impact is lessened in the fourth quarter.”
McKenney noted that Unum believes that most of the group life claims that arrived in the fourth quarter were due to the COVID-19 delta variant.
Zabel said Unum might start to talk about the effects of the COVID-19 omicron variant in February.
At this point, Zabel said, forecasters with high omicron mortality forecasts seem to be reducing their estimates, but forecasters who started with low mortality forecasts seem to be increasing their estimates.”
“So, we’d like to see just a little bit more of how February plays out, I think before we try to call how the first quarter is,” Zabel said.
Unum has posted a recording of the call on the investor relations section of its website.