Unum Group (UNM) M&A announcement summary

Deal rationale and strategic fit

• Reinsures $3.8 billion of LTC statutory reserves, reducing exposure by 40% since last year and advancing the closed block strategy.

• Marks the second external LTC risk transfer and first stand-alone LTC risk transfer, executing the closed block strategy.

• Combined with prior actions, over $7 billion of LTC reserves have been reinsured, materially reducing the closed block footprint.

• Enables focus on core employee benefits franchise and disciplined capital management.

Financial terms and conditions

• $3.8 billion of statutory reserves, representing 26% of total and 52% of individual LTC reserves as of March 31, 2026, are reinsured.

• Market value of required assets for the 2026 transaction is $5.66 billion; best estimate reserves are $3.84 billion.

• Net cost is $650 million of holding company excess capital, or 12% of best estimate reserves, consistent with prior deal pricing.

• Economic benefits include required capital release ($130 million) and total tax benefits ($490 million), offsetting a significant portion of gross cost.

• Funded through Fairwind excess capital, holding company liquidity, and temporary financing tied to future tax benefits.

Synergies and expected cost savings

• Transaction releases capital and reduces risk sensitivities by 28%-42% across key assumptions.

• Pricing remains disciplined and consistent, with economic benefits varying by risk profile and structure.

• Rate increases of over $5 billion have been achieved to date, supporting ongoing block management.

• No change to planned $1.3 billion return to shareholders via dividends and buybacks.

• Allows for more efficient capital deployment and risk management.