To our shareholders, customers and colleagues

As the world opens a new chapter in managing through the pandemic, Unum stands ready to meet the needs of the working world when employers and employees need us most. That is our purpose, and it’s never been more important than today. By delivering affordable access to vital benefits through the workplace, we help provide the financial protection people count on in uncertain times. It’s what unites our more than 10,000 employees around the world and inspires us every day.

Review of 2021 Performance

In the midst of the challenges brought on by the pandemic, our teams adapted to the environment with uncommon compassion and resilience. The impact of the pandemic was visible in our benefits businesses, reflecting elevated mortality and high levels of infection rates and hospitalizations.

During the last two years, we experienced dramatic increases in life and disability claims, as well as volumes in our leave management business. The impact to our financial results reflects the human toll the virus has taken. We have paid more than $500 million in group life insurance benefits alone to support families and loved ones. Across short- and long-term disability, we’ve seen a 35% increase compared to pre-pandemic levels. Being there in time of need is why we exist and reinforces the critical importance of workers obtaining coverage through their employers.

Thanks to the perseverance of our employees, premiums grew during the year and persistency reached some of the highest levels we have seen. The value we continue to deliver to our customers during the pandemic, as well as the increased recognition of the need for protection products, allows us to attract new customers. This underlying momentum in our core business, coupled with strong employment levels and wage growth, position us for further growth as we emerge from the later stages of the pandemic.

From a capital perspective, we closed 2021 in a strong position. Risk-based capital (RBC) at year-end was the highest it has been since 2016 and well above our internal targets. We completed the final phase of a transaction to reinsure most of our Closed Block individual disability insurance business to a third party, which freed significant capital to enhance our financial flexibility. For the first time in many years, we were able to decrease reserves at our First Unum subsidiary and return capital to our holding company, an example of how the funding needs for long-term care can be managed over time, especially with higher interest rates. We also increased our dividend 5.3% and resumed share repurchases in the fourth quarter, demonstrating confidence in our company and optimism for the future.

Our Business and Our Purpose

Since our founding in 1848, Unum has existed to protect people financially, and we’ve delivered on that commitment every year since. As the pandemic has highlighted the financial fragility of the working world, it has also exacerbated longstanding challenges to address a variety of employer and employee needs. At the center of this critical relationship are human resource departments and business owners, and the variety of solutions we provide to help them better safeguard the health and wellbeing of their workers.

One area where Unum stands out is leave administration, a service with newfound relevance amidst a rapidly changing environment. In 2021, we built on our track record of leadership by introducing Unum Total Leave, a modern, digital solution for employers and their workers to further streamline the oftencomplex leave process. In addition, employers must also respond to the growing mental health crisis with programs that focus on broad-based and early intervention. Unum Behavioral Health was introduced in 2021 to do just that as it provides a comprehensive workforce solution that addresses the full continuum of mental health. Alongside other services, like vaccination and testing management, we now offer a robust package of workplace solutions and look to continue to grow in that area to meet the dynamic needs of employers and employees.

Targeted initiatives are expected to accelerate growth in three distinct areas – product enhancements, distribution effectiveness and digital adoption. In our voluntary benefits business, for instance, we’re refreshing our offerings to meet emerging consumer needs and integrate with modern technology platforms. A greater focus on sales partner productivity, deepening client relationships and a greater presence among businesses with less than 100 employees will help employers compete for talent in an efficient and intuitive way. These and other efforts are reinforced by our digital-first agenda, where we are driving a significant increase in adoption of digital channels for enrollment, administration and claims.

We are dedicated to building strong communities.

Since the launching of our Social Justice Fund in 2020, we’ve contributed more than $700,000 to programs focused on systemic and policy change, training, economic justice and civic engagement. We also partner with local higher education institutions in the U.S. and U.K. to provide equitable opportunities for Black, Hispanic, Latino and socioeconomically disadvantaged students.

In total, Unum donated more than $12 million in 2021 across our geographic footprint to enhancing educational opportunities, promote wellbeing and help our communities grow stronger. And our work continues this year as we join with other companies and communities to condemn hostilities in Ukraine and provide support for the resulting humanitarian crisis. Through the hard work of our colleagues in Poland — which has especially been impacted by the refugee crisis — we have marshalled hundreds of volunteers and provided funding to support a variety of relief efforts.