UNUM REPORTS SIGNIFICANT INCREASE IN INCOME
On July 31, 2008, Unum Group announced its second quarter results for 2008 which included a net income of $240 million, representing a significant increase over its net income for the similar quarter in 2007 of a mere $153 million. Included within its domestic operating segment, Unum’s its group disability line of business reported operating income of $45.7 million for the quarter, a three fold increase over its income reported for 2007. It appears quite obvious that Unum continues to be an extremely profitable insurance company.
A few years back, the companies that make up the Unum Group were the subject of a multi-state market conduct investigation conducted by the various attorneys generals throughout the country given Unum’s alleged inappropriate handling and payment of disability income benefits. The investigation resulted in a settlement under which Unum voluntarily agreed to pay a fine of $15 million and to re-evaluate over 200,000 previously denied and terminated disability benefit claims. Despite this regulatory settlement, and Unum’s re-assessment of these denied claims, which continues to this day, Unum remains a highly profitable company. At last check, Unum’s stock price on the NYSE is the highest it has been since January 2000.
It goes without saying that an insurance company’s profit is derived from paying out fewer dollars in claims to insureds than the company receives in premium payments. The claims process should not take into account the profitability of the company but it can, and does. If you have been denied your claim for disability or other insurance benefits, feel free to contact us for a review of your situation.