At the annual meeting of shareholders on Thursday, Unum (NYSE: UNM) CEO Richard P. (Rick) McKenney addressed "the company’s strong performance, industry leadership, and the growing need for the financial protection Unum provides."
He said, “2016 was an excellent year for us, continuing a strong track record of success. We delivered on our promises to customers and shareholders, while continuing to build on the strong Unum brand. The result was one of the best years in our company’s history.
"Most importantly, we are strategically well-positioned now and for the future as the need for our products and services is only increasing.”
Officials said, "In 2016, Unum earned record revenues of nearly $11.1 billion and paid approximately $6.9 billion in benefits. Over the course of the year, Unum protected more than 35 million policyholders, helped 189,000 companies attract and retain employees, and assisted 327,000 people in returning to work following a disability.
"Unum also achieved historically high levels of customer and broker satisfaction, and made strategic investments to support disciplined growth.
"Additionally, McKenney noted that Unum’s total shareholder return has outperformed its peers across multiple indices for the last decade."
Mr. McKenney said, “Unum has been a very good performer and an excellent long-term investment during one of the most challenging economic periods in memory.”
The company generated a 9.76 percent compound annual return to shareholders from 2006 through 2016.
Mr. McKenney said, “Our mission now is to build on our company’s progress. Although much of the uncertainty from last year continues, we entered 2017 with strong momentum and remain intensely focused on the disciplined execution of our business plan – and on serving the needs of working people and their families throughout the U.S. and U.K.”
In discussing the company’s future, Mr. McKenney said the need for financial protection benefits continues to grow. “One in four U.S. workers between 20 and 50 years old will be out of work at some point in their career due to a disability.
“We also know that 40 percent of families live paycheck-to-paycheck, and half would have trouble coming up with the money to cover a $2,000 emergency. Yet most striking of all, 70 percent of workers lack disability protection.”
To fill the void, he said Unum has invested heavily in understanding the best potential coverage options for employees in different life stages. “Today, there are four distinct generations working side-by-side. This trend affirms our true purpose of providing financial security and peace of mind for an increasingly diverse workforce. It also demands that we push beyond the one-size-fits-all model and be certain our offerings are valuable for workers in any stage of their careers.”
Mr. McKenney attributed the company’s success to competitive advantages in claims management, risk management and distribution, as well as its singular focus on employee benefits.
“Creating new products, enhancing existing offerings, and finding new ways to create great customer experiences ensure that we remain at the forefront of the employee benefits market,” he said. “This helps to emphasize a key differentiator for Unum: Delivering benefits at the workplace is our sole business. That focus sets us apart from many of our competitors.”
Also during the meeting, Thomas R. Watjen concluded his two-year term as chairman of the board of directors, following 12 years as the company’s CEO.
“It’s been an unbelievable privilege to have served as your CEO for over a dozen years and as your chairman these past two years,” Mr. Watjen said. “I’ll miss being part of this special company and group of people, but I leave knowing that the company is on sound footing and in good hands.”
Mr. McKenney thanked Mr. Watjen for his instrumental role in shaping the company and providing a solid foundation during his time as CEO and chairman of the board. He also "noted that Unum’s position as an industry leader is stronger than ever, thanks in large part to Watjen’s vision and leadership."
Kevin Kabat, who has served as the board’s Lead Independent Director over the past year, becomes the new chairman of Unum’s board of directors.“We all have great confidence in Kevin’s ability to lead the board in its oversight of the company,” Mr. McKenney said. “His experience on other public company boards, as well as his leadership positions on this board, make him an ideal candidate for this new role.”
Also at the meeting, Unum shareholders voted to re-elect 11 directors for terms expiring in 2018: Theodore Bunting, group president of utility operations at Entergy Corporation; Michael Caulfield, former president of Mercer Human Resource Consulting; Joseph Echevarria, retired CEO of Deloitte LLP; Cynthia Egan, retired president of T. Rowe Price Retirement Plan Services; Pamela Godwin, President of Change Partners, Inc.; Kevin Kabat, chairman of the board of Unum Group and retired president and CEO of Fifth Third Bancorp; Timothy Keaney, former vice chairman of The Bank of New York Mellon Corporation; Gloria Larson, president of Bentley University; Rick McKenney, president and CEO of Unum Group; Ronald O’Hanley, president and CEO of State Street Global Advisors and vice chairman of State Street Corporation; and Francis Shammo, retired CFO of Verizon Communications. Edward Muhl, retired national leader of PricewaterhouseCoopers LLP, has reached mandatory retirement age and retired from the board.