Unum (NYSE: UNM) cedes $3.8B long-term care reserves in Fortitude Re deal
Filing Impact
Filing Sentiment
Form Type
8-K
Rhea-AI Filing Summary
Unum Group is transferring a large portion of its legacy long-term care exposure through a new reinsurance deal with Fortitude Re. Unum Life Insurance Company of America will cede, on a coinsurance basis, individual long-term care policies representing $3.8 billion of statutory reserves previously in its Fairwind captive.
The block covers about 50,000 policies with $3.8 billion of statutory reserves and $4.5 billion of best estimate reserves, equal to 26% of total LTC statutory reserves and 52% of individual LTC reserves as of March 31, 2026. After this and a prior 2025 transaction, Unum expects roughly 40% cumulative reduction in LTC statutory reserves and remaining LTC reserves of about $11.0 billion, now weighted toward group LTC. Management expects capital and tax benefits, while maintaining year-end 2026 holding company liquidity of $1.5–$2.0 billion, leverage near 25%, and RBC of 400–425%, with only limited impact on operating earnings.
Positive
- Major reduction in legacy LTC exposure: Reinsuring $3.8 billion of individual long-term care statutory reserves (26% of total LTC and 52% of individual LTC reserves) continues Unum’s shift away from high-risk closed blocks and, combined with the 2025 deal, cuts total LTC statutory reserves by about 40%.
- Improved risk mix and capital profile: Remaining approximately $11.0 billion of LTC statutory reserves become predominantly group LTC with less rich benefits and lower sensitivities, while management still targets year-end 2026 holding company liquidity of $1.5–$2.0 billion, leverage near 25%, and RBC of 400–425%.
Negative
- None.
Insights
Large LTC reinsurance further de-risks Unum’s legacy block while keeping capital targets intact.
Unum is ceding $3.8 billion of long-term care statutory reserves, its first stand-alone LTC risk transfer, following a $3.4 billion LTC transaction in 2025. Together, more than $7 billion of LTC statutory reserves are reinsured, materially shrinking the closed block.
The reinsured block is older, benefit-rich individual LTC, with 83% inflation protection and 43% lifetime benefits, making it a key source of tail risk. After the deal, remaining LTC reserves are expected to be about $11.0 billion, ~70% backing group LTC with simpler benefit structures and lower sensitivity to adverse experience.
Unum highlights disciplined pricing: net cost is framed against $4.5 billion of best estimate reserves and offset by required capital release, tax benefits and rate actions. Management projects a robust post-transaction capital profile, including $1.5–$2.0B holding company liquidity, ~25% leverage and 400–425% RBC at year-end 2026, with earnings impact largely limited to foregone investment income and incremental interest expense. Execution still depends on regulatory approvals and reinsurer performance, but the transaction directionally supports a lower-risk balance sheet.
8-K Event Classification
3 items: 1.01, 7.01, 9.01
3 items
Item 1.01
Entry into a Material Definitive Agreement
Business
The company signed a significant contract such as a merger agreement, credit facility, or major partnership.
Item 7.01
Regulation FD Disclosure
Disclosure
Material non-public information disclosed under Regulation Fair Disclosure, often investor presentations or guidance.
Item 9.01
Financial Statements and Exhibits
Exhibits
Financial statements, pro forma financial information, and exhibit attachments filed with this report.
Key Figures
Reinsured LTC statutory reserves: $3.8 billion
Share of total LTC statutory reserves: 26%
Share of individual LTC reserves: 52%
+5 more
8 metrics
Reinsured LTC statutory reserves
$3.8 billion
Individual long-term care reserves in Fairwind as of March 31, 2026
Share of total LTC statutory reserves
26%
Portion of Unum’s total LTC statutory reserves represented by the reinsured block
Share of individual LTC reserves
52%
Portion of individual LTC statutory reserves included in the transaction
Best estimate reserves in block
$4.5 billion
Best estimate reserves for the reinsured individual LTC policies
Expected remaining LTC statutory reserves
$11.0 billion
Unum’s LTC statutory reserves after the transaction
Cumulative LTC reserve reduction
≈40%
Reduction in total LTC statutory reserves from 2025 and 2026 deals
Target holding company liquidity
$1.5–$2.0 billion
Projected year-end 2026 liquidity after the transaction
Target RBC ratio
400–425%
Projected risk-based capital range at year-end 2026
Key Terms
coinsurance, statutory reserves, retrocession, closed block strategy, +1 more
5 terms
coinsurance financial
"will cede to Fortitude Reinsurance Company Ltd. (“Fortitude Re”), on a coinsurance basis, certain individual long-term care"
Coinsurance is the portion of a medical or insurance bill that the policyholder must pay as a percentage after any deductible is met — for example, paying 20% of a doctor's bill while the insurer pays the remaining 80%. Like splitting a restaurant check by percentage rather than a fixed amount, it changes how much people actually use services. Investors watch coinsurance because higher patient cost-sharing can reduce demand for treatments, affect health-care providers’ and drugmakers’ revenue, and change insurers’ claims patterns and profitability.
statutory reserves financial
"reinsures $3.8 billion of long-term care (LTC) statutory reserves, representing 26% of total LTC statutory reserves"
Amounts that insurance companies and some financial firms are legally required to set aside to cover future policyholder claims or other obligations; regulators dictate how these reserves are calculated and reported. Think of it as a mandated emergency fund or safety cushion whose size and adequacy affect a company’s reported capital, solvency ratings, and the reliability of its ability to pay claims—information investors use to assess financial strength and risk.
retrocession financial
"Fortitude Re will retrocede biometric risk on the reinsured block to a highly rated global reinsurer"
closed block strategy financial
"advancing our Closed Block strategy to further reduce our exposure to our legacy long-term care business"
RBC financial
"with year-end 2026 holding company liquidity of $1.5 billion to $2.0 billion, leverage of approximately 25%, and RBC of 400% to 425%"
FAQ
What is Unum Group (UNM) announcing in this 8-K filing?
Unum is announcing a long-term care reinsurance agreement with Fortitude Re. The deal cedes individual LTC policies backed by $3.8 billion of statutory reserves from its Fairwind captive, further shrinking Unum’s legacy LTC closed block exposure while keeping Unum as administrator.
How large is the long-term care block Unum is reinsuring with Fortitude Re?
The reinsured block holds about $3.8 billion of statutory reserves and $4.5 billion of best estimate reserves. It includes roughly 50,000 individual LTC policies, representing 26% of Unum’s total LTC statutory reserves and 52% of its individual LTC reserves as of March 31, 2026.
How does this transaction affect Unum’s remaining LTC reserves?
After closing, Unum expects remaining long-term care statutory reserves of about $11.0 billion. Around 70% of these reserves will back group LTC policies, which generally have simpler, less benefit-rich designs than individual LTC, lowering overall risk in the legacy block.
What cumulative impact do Unum’s recent LTC reinsurance deals have?
Combined with its 2025 LTC reinsurance transaction, Unum’s new deal with Fortitude Re will reinsure more than $7 billion of LTC statutory reserves. Management states these actions are expected to reduce Unum’s total LTC statutory reserves by roughly 40% from prior levels.
What is the expected capital impact of the Fortitude Re transaction for Unum?
Unum expects capital and tax benefits from the structure and funding of the deal. Despite foregone investment income and financing costs, management projects year-end 2026 holding company liquidity of $1.5–$2.0 billion, leverage around 25%, and an RBC ratio between 400% and 425%.
Will Unum continue to manage claims on the reinsured long-term care block?
Yes. Even after ceding the risk to Fortitude Re, Unum will retain administration of the reinsured business. That includes ongoing servicing of policies, handling LTC claims, and managing the premium rate increase program for affected policyholders under the transaction terms.
UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM 8-K
Current Report
Pursuant to Section 13 or 15(d) of The Securities Exchange Act of 1934
Date of Report (Date of earliest event reported): July 2, 2026
(Exact name of registrant as specified in its charter)
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Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions (see General Instruction A.2. below):
| Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425) | |||||
| Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12) | |||||
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Indicate by check mark whether the registrant is an emerging growth company as defined in Rule 405 of the Securities Act of 1933 (§230.405 of this chapter) or Rule 12b-2 of the Securities Exchange Act of 1934 (§240.12b-2 of this chapter).
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Item 1.01 Entry into a Material Definitive Agreement.
On July 2, 2026, Unum Life Insurance Company of America (the “Ceding Company”), a Maine-domiciled insurance company and a wholly owned subsidiary of Unum Group (“Unum”), entered into a Master Transaction Agreement (the “Agreement”) with Fortitude Reinsurance Company Ltd. (the “Reinsurer”), a reinsurance company organized under the laws of Bermuda, pursuant to which, among other things, on the terms and subject to the conditions set forth in Agreement, the Reinsurer has agreed to reinsure from the Ceding Company a portion of the closed block individual long-term care business written by the Ceding Company (such portion, the “Reinsured Business”). To facilitate the transactions contemplated by the Agreement, the Ceding Company will first recapture the Reinsured Business from Fairwind Insurance Company, a wholly owned subsidiary of Unum and a Vermont captive insurance company (“Fairwind”), pursuant to a partial recapture agreement (the “Partial Recapture Agreement”). The Reinsurer intends to retrocede a portion of the risk reinsured from the Ceding Company to a third-party global reinsurance partner (the “Retrocessionaire”) pursuant to a retrocession agreement (the “Retrocession Agreement”).
The closing of the transactions contemplated by the Agreement (the “Closing”) is expected to occur during 2026, subject to the satisfaction or waiver of customary closing conditions specified in the Agreement, including the receipt of required regulatory approvals for, and the Ceding Company’s entry into, the Partial Recapture Agreement, and the Reinsurer’s and Retrocessionaire’s execution of the Retrocession Agreement. The Agreement may be terminated if the Closing has not occurred on or before the date that is six months after the execution thereof.
At the Closing, the Ceding Company, the Reinsurer and, for certain limited purposes, the Retrocessionaire will enter into a Coinsurance Agreement (the “Coinsurance Agreement”), whereby, effective as of April 1, 2026 (the “Effective Date”), the Ceding Company will cede to the Reinsurer, and the Reinsurer will reinsure, on a coinsurance basis, a 100% quota share of the Reinsured Business. At March 31, 2026, Unum carried $3.8 billion of long-term care statutory reserves for the Reinsured Business in Fairwind. In connection with such reinsurance, the Agreement provides that, on the date of the Closing, the Ceding Company will transfer to the Reinsurer a pre-agreed portfolio of assets (the “Initial Portfolio”) and cash with a fair market value of approximately $5.7 billion, which amount is subject to adjustment prior to the Closing for changes in interest rates, plus certain net cash flows with respect to the Reinsured Business between the Effective Date and the Closing. Among other things, the Coinsurance Agreement provides for the Ceding Company to retain responsibility for administration and servicing of the Reinsured Policies, and for the Reinsurer to pay to the Ceding Company an experience refund based on premium rate increases realized in excess of the rate increases already reflected in the transaction economics.
The Agreement contains customary representations and warranties, as well as customary covenants of each of the parties. Such representations and warranties are the product of negotiation between the Ceding Company and the Reinsurer and are for the sole benefit of such parties and, in certain cases, the Retrocessionaire. In some instances, the representations and warranties in the Agreement may represent an allocation among the parties of risk associated with particular matters. The Reinsurer has agreed to indemnify the Ceding Company and its respective affiliates, and the Ceding Company has agreed to indemnify the Reinsurer, the Retrocessionaire and their respective affiliates, with respect to certain losses resulting from breaches of its respective representations, warranties and covenants, subject to agreed limits in the case of losses relating to representations and warranties.
At the Closing, Provident Life and Accident Insurance Company, a Tennessee-domiciled insurance company and wholly owned subsidiary of Unum (“PLA”) will provide an experience volatility cover (the “PLA Cover”) to the Retrocessionaire, subject to a cap of $125 million (in net present value terms). PLA’s payment obligations will be settled every five years and will be secured by a trust account to be funded at all times with the remaining possible payment by PLA. PLA will provide the PLA Cover in exchange for a payment from the Retrocessionaire of $5 million on the date of the Closing.
Unum expects the transaction to generate capital and tax benefits, which, combined with participation in potential future premium rate increases, will reduce the economic cost of the transaction.
The foregoing description of the Agreement is qualified in its entirety by reference to the full text of the Agreement, a copy of which will be filed as an exhibit to the Company’s Quarterly Report on Form 10-Q for the quarterly period ended September 30, 2026.
Item 7.01 Regulation FD Disclosure.
On July 6, 2026, Unum issued a news release announcing entry into the Agreement and the transactions contemplated thereby. The news release, a copy of which is furnished herewith as Exhibit 99.1, also announced that members of senior management of Unum will host a conference call today at 8:00 a.m. ET on July 6, 2026, to discuss the reinsurance transaction. The conference call will be simulcast via audio webcast and accompanied by a slide presentation with additional information concerning the transaction, a copy of which is furnished herewith as Exhibit 99.2. The conference call webcast and slide presentation are accessible on Unum’s investor relations website at www.investors.unum.com.
In accordance with General Instruction B.2 of Form 8-K, the information furnished pursuant to Item 7.01 of this report, including Exhibits 99.1 and 99.2, shall not be deemed “filed” for purposes of Section 18 of the Securities Exchange Act of 1934, as amended (the “Exchange Act”), or otherwise subject to the liabilities of that section, nor shall they be deemed to be incorporated by reference into any of Unum’s filings under the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in such a filing.
SAFE HARBOR STATEMENT
Certain information in this report constitutes “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are those not based on historical information, but rather relate to our outlook, future operations, strategies, financial results, or other developments and speak only as of the date made. These forward-looking statements, including statements about the anticipated overall capital benefit resulting from the reinsurance transaction, are subject to numerous assumptions, risks, and uncertainties, many of which are beyond our control. The following factors, in addition to other factors mentioned from time to time, may cause actual results to differ materially from those contemplated by the forward-looking statements: (1) our ability to close the transactions contemplated by the Agreement and to receive the expected benefits of the transactions; (2) fluctuation in insurance reserve liabilities, claim payments and pricing due to changes in claim incidence, recovery rates, mortality and morbidity rates, and policy benefit offsets due to, among other factors, the rate of unemployment and consumer confidence, the emergence of new diseases, epidemics, or pandemics, new trends and developments in medical treatments, the effectiveness of our claims operational processes, and changes in governmental programs; (3) sustained periods of low interest rates; (4) unfavorable economic or business conditions, both domestic and foreign, that may result in decreases in sales, premiums, or persistency, as well as unfavorable claims activity or unfavorable returns on our investment portfolio; (5) changes in, or interpretations or enforcement of, laws and regulations; (6) a cybersecurity attack or other security breach resulting in compromised data or the unauthorized acquisition of confidential data; (7) the failure of our business recovery and incident management processes to resume our business operations in the event of a natural catastrophe, cybersecurity attack, or other event; (8) increased competition from other insurers and financial services companies due to industry consolidation, new entrants to our markets, or other factors; (9) investment results, including, but not limited to, changes in interest rates, defaults, changes in credit spreads, impairments, and the lack of appropriate investments in the market which can be acquired to match our liabilities; (10) ineffectiveness of our derivatives hedging programs due to changes in forecasted cash flows, the economic environment, counterparty risk, ratings downgrades, capital market volatility, collateral requirements, changes in interest rates, and/or regulation; (11) our ability to develop digital capabilities or execute on our technology systems upgrades or replacements; (12) our use of artificial intelligence technology, as well as changes in artificial intelligence laws and regulations; (13) the impact of pandemics and other public health issues on our business, financial position, results of operations, liquidity and capital resources, and overall business operations; (14) changes in our financial strength and credit ratings; (15) our ability to hire and retain qualified employees; (16) the ability of our reinsurers to meet their obligations to us and availability of reinsurance in the market; (17) disruptions to our business or our ability to access data caused by the use and reliance on third party vendors, including vendors providing web and cloud-based applications; (18) ability to generate sufficient internal liquidity and/or obtain external financing; (19) damage to our reputation due to, among other factors, regulatory investigations, legal proceedings, social issues, third-party vendors, external events, and/or cyber or other information security incidents; (20) recoverability and/or realization of the carrying value of our intangible assets, long-lived assets, and deferred tax assets; (21) effectiveness of our risk management program; (22) contingencies and the level and results of litigation; (23) fluctuation in foreign currency exchange rates; and (24) our ability to meet sustainability standards and expectations of investors, regulators, customers, and other stakeholders.
For further discussion of risks and uncertainties which could cause actual results to differ from those contained in the forward-looking statements, see Part 1, Item 1A “Risk Factors” of our annual report on Form 10-K for the year ended December 31, 2025. The forward-looking statements in this report are being made as of the date of this report, and we expressly disclaim any obligation to update or revise any forward-looking statement contained herein, even if made available on our website or otherwise.
Item 9.01 Financial Statements and Exhibits.
(d) Exhibits.
| Exhibit No. | Description | |||||||
| 99.1 | News release of Unum Group dated July 6, 2026 (furnished and not filed). | |||||||
| 99.2 | Slide presentation of Unum Group for its conference call on July 6, 2026 (furnished and not filed). | |||||||
| 104 | Cover Page Interactive Data File (embedded with the Inline XBRL document). | |||||||
SIGNATURES
Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.
| Unum Group | |||||||||||
| (Registrant) | |||||||||||
| Date: July 6, 2026 | By: | /s/ J. Paul Jullienne | |||||||||
| Name: | J. Paul Jullienne | ||||||||||
| Title: | Vice President, Managing Counsel, and | ||||||||||
| Corporate Secretary | |||||||||||
| Exhibit 99.1 | |||||
 | 1 Fountain Square Chattanooga, TN 37402 www.unum.com | ||||
| news | FOR IMMEDIATE RELEASE | |||||||
| Contacts | ||||||||
| MEDIA | Emily Downing-Baer edowning@unum.com | |||||||
| INVESTORS | Matt Royal investorrelations@unum.com | |||||||
Unum Group Announces $3.8 Billion Long-Term Care
Reinsurance Transaction with Fortitude Re
•Transaction reinsures $3.8 billion of long-term care (LTC) statutory reserves, representing 26% of total LTC statutory reserves and 52% of individual LTC reserves, each as of March 31, 2026
•Combined with the LTC reinsurance transaction announced in 2025, cumulative reduction in Unum’s total LTC statutory reserves is approximately 40%
•Covers 100% of remaining individual LTC policies reinsured to Fairwind
•Capital strength and capital deployment priorities remain unchanged
CHATTANOOGA, Tenn. (July 6, 2026) – Unum Group (NYSE: UNM) announced today that its Unum Life Insurance Company of America subsidiary (“Unum America”) has entered into an agreement to cede to Fortitude Reinsurance Company Ltd. (“Fortitude Re”), on a coinsurance basis, certain individual long-term care (“LTC”) insurance policies representing $3.8 billion of statutory reserves in Fairwind Insurance Company, a wholly owned subsidiary of Unum (“Fairwind”).
At closing, Unum America will recapture the reinsured individual LTC block from Fairwind and cede the block to Fortitude Re. Fortitude Re will retrocede biometric risk on the reinsured block to a highly rated global reinsurer. Unum will retain administration of the reinsured business, including claims handling and premium rate increase program management.
The reinsured block consists of approximately 50,000 individual LTC policies with $3.8 billion of statutory reserves and approximately $4.5 billion of best estimate reserves. Following the transaction, Unum’s remaining LTC statutory reserves are expected to be approximately $11.0 billion, with approximately 70% of remaining reserves backing group LTC policies, which generally have more basic benefit structures than individual LTC policies.
“This marks another important step in advancing our Closed Block strategy to further reduce our exposure to our legacy long-term care business and maintain our focus on Unum’s leading employee benefits franchise,” said Richard P. McKenney, president and chief executive officer. “Building on the actions we have taken over the last several years, including our prior external reinsurance transactions, this agreement significantly reduces the size and risk profile of the Closed Block. With a strong capital position and a clear strategic focus, we remain committed to disciplined execution, prudent capital management, and delivering long-term value for shareholders.”
The transaction represents the next step in Unum’s execution of its closed block strategy and follows the company’s previously announced LTC reinsurance transaction in 2025. Together, the two external transactions will have decreased the company’s closed block footprint through reinsurance of more than $7 billion of LTC statutory reserves.
The transaction is expected to be funded through a combination of Fairwind excess capital, holding company liquidity and financing related to future tax benefits. Following the closing of the transaction, Unum expects to maintain a robust capital position, with year-end 2026 holding company liquidity of $1.5 billion to $2.0 billion, leverage of approximately 25%, and RBC of 400% to 425%. The transaction’s impact on operating earnings is expected to be limited to foregone investment income and incremental interest expense associated with transaction financing. The transaction is expected to close during 2026, subject to receipt of required regulatory approvals and satisfaction or waiver of other customary closing conditions.
Members of Unum Group senior management will host a conference call on Monday, July 6, 2026, at 8:00 a.m. ET to discuss the reinsurance transaction.
To access the conference call, you must register in advance using the following URL: https://registrations.events/direct/Q4I3307946. Upon registration, you will receive a dial-in number to use to access the event. It is recommended that you register at least 10 minutes before the start of the event. In addition, a live webcast of the call will be available in a listen-only mode on the company’s investors website at www.investors.unum.com. It is recommended that webcast viewers access the website and opt in to the webcast approximately 5-10 minutes prior to the start of the call. Following the conference call, a replay of the webcast will be available on the company’s investors website, and a recording of the call will also be available using the registration URL noted above through Monday, July 13, 2026.
In conjunction with today’s announcement, a presentation with details of the transaction and additional information is available on the company’s investors website.
Debevoise & Plimpton LLP served as legal counsel to Unum in connection with this transaction.
# # #
FORWARD-LOOKING STATEMENTS
Certain statements in this release constitute “forward-looking statements” within the meaning of the Private Securities Litigation Reform Act of 1995. Forward-looking statements are made based on management’s current expectations and beliefs concerning future developments and their potential effects upon Unum Group and its subsidiaries. Unum Group’s actual results may differ, possibly materially, from expectations or estimates reflected in such forward-looking statements. Certain important factors that could cause actual results to differ, possibly materially, from expectations or estimates reflected in such forward-looking statements can be found in Part 1, Item 1A (Risk Factors) of Unum Group’s Annual Report on Form 10-K for the year ended December 31, 2025. The forward-looking statements in this release speak only as of the date of this release, and Unum Group does not undertake to update any particular forward-looking statement included in this release.
ABOUT UNUM GROUP
Unum Group (NYSE: UNM), a leading international provider of workplace benefits and services, has been helping workers and their families thrive for more than 175 years. Through its Unum and Colonial Life brands, the company offers disability, life, accident, critical illness, dental, and vision insurance; leave and absence management support; and behavioral health services. In 2025, Unum Group reported revenues of $13.1 billion and paid $8.3 billion in benefits. The Fortune 500 company is recognized as one of the World’s Most Ethical Companies by Ethisphere®.
Visit the Unum newsroom (https://www.unumgroup.com/newsroom) for more information, and connect with us on LinkedIn (https://www.linkedin.com/company/unum), Facebook (https://www.facebook.com/unumbenefits/), and Instagram (https://www.instagram.com/unumbenefits/).
$3.8 Billion LTC External Reinsurance Transaction Executing on our Closed Block Strategy July 6, 2026
SAFE HARBOR STATEMENT Certain information in this presentation constitutes "forward-looking statements" within the meaning of the Private Securities Litigation Reform Act of 1995. Forward- looking statements are those not based on historical information, but rather relate to our outlook, future operations, strategies, financial results, or other developments and speak only as of the date made. These forward-looking statements are subject to numerous assumptions, risks, and uncertainties, many of which are beyond our control. The following factors, in addition to other factors mentioned from time to time, may cause actual results to differ materially from those contemplated by the forward-looking statements: (1) fluctuation in insurance reserve liabilities, claim payments, and pricing due to changes in claim incidence, recovery rates, mortality and morbidity rates, and policy benefit offsets due to, among other factors, the rate of unemployment and consumer confidence, the emergence of new diseases, epidemics, or pandemics, new trends and developments in medical treatments, the effectiveness of our claims operational processes, and changes in governmental programs; (2) sustained periods of low interest rates; (3) unfavorable economic or business conditions, both domestic and foreign, that may result in decreases in sales, premiums, or persistency, as well as unfavorable claims activity or unfavorable returns on our investment portfolio; (4) changes in, or interpretations or enforcement of, laws and regulations; (5) a cybersecurity attack or other security breach resulting in compromised data or the unauthorized acquisition of confidential data; (6) the failure of our business recovery and incident management processes to resume our business operations in the event of a natural catastrophe, cybersecurity attack, or other event; (7) increased competition from other insurers and financial services companies due to industry consolidation, new entrants to our markets, or other factors; (8) investment results, including, but not limited to, changes in interest rates, defaults, changes in credit spreads, impairments, and the lack of appropriate investments in the market which can be acquired to match our liabilities; (9) ineffectiveness of our derivatives hedging programs due to changes in forecasted cash flows, the economic environment, counterparty risk, ratings downgrades, capital market volatility, collateral requirements, changes in interest rates, and/or regulation; (10) our ability to develop digital capabilities or execute on our technology systems upgrades or replacements; (11) our use of artificial intelligence technology, as well as changes in artificial intelligence laws and regulations; (12) the impact of pandemics and other public health issues on our business, financial position, results of operations, liquidity and capital resources, and overall business operations; (13) changes in our financial strength and credit ratings; (14) the ability of our reinsurers to meet their obligations to us and availability of reinsurance in the market; (15) our ability to hire and retain qualified employees; (16) disruptions to our business or our ability to access data caused by the use and reliance on third party vendors, including vendors providing web and cloud- based applications; (17) ability to generate sufficient internal liquidity and/or obtain external financing; (18) damage to our reputation due to, among other factors, regulatory investigations, legal proceedings, social issues, third-party vendors, external events, and/or cyber or other information security incidents; (19) recoverability and/or realization of the carrying value of our intangible assets, long-lived assets, and deferred tax assets; (20) effectiveness of our risk management program; (21) contingencies and the level and results of litigation; (22) fluctuation in foreign currency exchange rates; and (23) our ability to meet sustainability standards and expectations of investors, regulators, customers, and other stakeholders. For further discussion of risks and uncertainties which could cause actual results to differ from those contained in the forward-looking statements, see Part 1, Item 1A "Risk Factors" of our annual report on Form 10-K for the year ended December 31, 2025. The forward-looking statements in this news release are being made as of the date of this news release, and we expressly disclaim any obligation to update or revise any forward-looking statement contained herein, even if made available on our website or otherwise. 2
KEY MESSAGES • Executing the next step in our closed block strategy with a second external LTC transaction, and first stand-alone LTC risk transfer transaction • Combined with our prior transaction, actions reinsure over $7B of LTC reserves, materially reducing our closed block footprint • Transactions executed at disciplined pricing appropriate for the risk transferred, reflecting both the characteristics of the block and strong market demand • Risk profile materially improves as remaining block shifts to predominantly GLTC, with reduced sensitivities and strong protection retained • Capital strength and capital deployment priorities remain intact • We continue to be selective and opportunistic as we further manage our closed block 3
EXECUTING ON OUR CLOSED BLOCK STRATEGY Consistent and active management to reduce the footprint and capital demands for the closed block • External Transactions – Materially reduced the closed block footprint through multiple transactions with highly rated counterparties, removing exposure to legacy IDI and LTC • Internal Restructuring – Enhanced policyholder protection, reduced capital volatility, and improved capital efficiency through internal reinsurance • Risk Reduction – Reduced uncertainty by implementing an interest rate hedge program and fully removing morbidity and mortality improvement assumptions • Group Case Management – Eliminated enrollment of new employees on existing group cases reducing exposure • Pricing Actions – Continual execution of appropriate pricing actions and adjustment of policy terms. Rate increases of >$5B achieved to-date 2026 Discontinued new lives on existing GLTC cases $3.8B LTC Reinsurance Transaction Today Morbidity and Mortality Improvement Removed 2025 $3.4B LTC Reinsurance Transaction & Restructuring 2023 Capital contributions finalized; no further capital contributions needed 2022 Hedge Program Initiated 2020 $7.1B Legacy IDI Transaction 4
7.5 7.5 7.3 3.5 $14.8 $11.0 Year-End 2025 Post Transaction LTC Statutory Reserves (All legal entities) GLTC ILTC SECOND EXTERNAL TRANSACTION RESULTS IN SIGNIFICANT FURTHER REDUCTION OF LTC BLOCK 100% of Individual Long-Term Care (ILTC) reserves in Fairwind reinsured • $3.8B of statutory reserves representing 26% of total LTC and 52% of ILTC block • ILTC block of 50k policies with average attained age of 76; 75% active lives • Highly benefit-rich profile (83% inflation protected; 43% lifetime benefits) 5
COST RELATIVE TO BEST ESTIMATE RESERVES REMAINS CONSISTENT ACROSS TRANSACTIONS ($ in millions) 2025 ILTC Transaction 2026 ILTC Transaction Combined Market Value of Required Assets 4,050 5,660 9,710 Reserves Best Estimate Reserves 3,260 4,500 7,760 Statutory Reserves 3,370 3,840 7,210 Reserve Margin 110 (660) (550) Economic Benefits Required Capital Release 190 130 320 Total Tax Benefits 200 490 690 Future Rate Increases 90 n/a 90 Total 480 620 1,100 Net Cost, relative to: Best Estimate Reserves ($) 310 540 850 Best Estimate Reserves (%) 10% 12% 11% Statutory Reserves ($) 200 1,200 1,400 Statutory Reserves (%) 6% 31% 19% • Pricing remains disciplined and consistent when evaluated relative to best estimate reserves • Economic benefits vary by transaction, reflecting differences in underlying risk profile and structure • 2026 transaction reflects a more adverse reserve profile, partially offset by higher economic benefits Note: Estimated values at time of announcement for each transaction 6
Key Assumption Sensitivity From To Change Future Unapproved Premium Rate Increases Removed $1,000 $720 (28)% Active Policy Lapses and Mortality 7% $320 $210 (35)% Claim Incidence 3% $270 $170 (36)% Claim Resolutions 2% $200 $120 (42)% New Money Rate/30-Year UST Down to 3.50% $500 $310 (38)% GLTC-WEIGHTED MIX DRIVES MATERIALLY LOWER RISK PROFILE IN REMAINING BLOCK Reduced sensitivity across all key Fairwind assumptions NET RESULT: smaller, less rich benefit profile with materially lower sensitivities • Post-transaction, GLTC represents ~70% of reserves and ~95% of insured lives • Younger average age supports continued rate adjustments and block management • Group benefits are materially less rich than ILTC, reducing tail risk and protection sensitivity ⎼ Average Daily Benefit 1/3rd of ILTC ⎼ 77% of policies with no inflation ⎼ 7% lifetime benefits vs. 33% for ILTC 7
STRONG PROTECTIONS SUPPORT REMAINING LTC RESERVES (1) Pro forma Fairwind Reserve Margin on GPV basis at closing; YE25 PLA cashflow testing results ($ in millions) Fairwind Insurance Company Provident Life & Accident Insurance Company Statutory Reserves Long-Term Care 7,080 3,920 All Other Products – 3,300 Reserve Margin1 2,080 1,380 Excess Capital >350% (160) 520 Total Protections 1,920 1,900 Remaining reserves exhibit strong margin profile across both legal entities • Funding modestly reduces absolute LTC protection in Fairwind, while maintaining a strong RBC position (~300%) • LTC exposure in PLA is supported by diversification across the broader product set • No incremental capital contributions required to support remaining LTC reserves 8
2026 CAPITAL SOURCES AND USES • Capital Generation: $1.4–$1.6B • Capital Uses: ~$1.5B, including ~$1.3B of buybacks and dividends Robust capital position and capital deployment priorities remain unchanged YE26 CAPITAL METRICS • Holding Company Liquidity: $1.5-$2.0B • Leverage: ~25% • RBC: 400-425% POST-TRANSACTION CAPITAL OUTLOOK 9
CLOSING COMMENTS • Continued execution of our closed block strategy through a second, stand-alone external LTC transaction • Meaningful additional reduction in LTC exposure, with improved risk profile on the remaining block • Transaction reflects disciplined pricing aligned with the risk characteristics of the block transferred • Capital position remains robust; capital deployment priorities remain intact • We remain selective and opportunistic as we continue to actively manage the closed block 10
Questions and Answers 11
Appendix: • LTC Block Demographic Profile 12
13 LTC BLOCK DEMOGRAPHIC PROFILE 1) Demographics as of 9/30/2025 for retained blocks and 2026 transaction block; 9/30/2024 for 2025 transaction block 2) Average reflects nonforfeiture and paid-up insureds GLTC ILTC Demographic Profile1 Retained Retained 2025 ILTC Transaction 2026 ILTC Transaction Overview Average issue date 2003 2004 2000 2001 Number of insureds (approx.) 752,000 33,000 31,000 50,000 Avg annual premiums/insured (approx.)2 600 2,925 2,490 1,839 Attained Age Average attained age of ALR 57 75 86 76 Average attained age of DLR 81 85 89 85 Benefits % lifetime benefit by lives count 7% 33% 34% 43% Avg inflated daily benefit 113 333 250 272 Avg benefit period (non-lifetime) 3.0 years 4.3 years 4.3 years 4.4 years Avg elimination period (days) 90 78 82 82 Inflation Protection % with 5% compound 10% 24% 16% 22% % with < 5% compound 0% 23% 35% 31% Simple inflation 13% 27% 31% 30% No inflation 77% 26% 18% 17%