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Risk Management

Risk Management Overview

At Unum, as an insurer, we are in the business of risk management. Risk management is essential to our ability to meet our commitments while maintaining and growing our businesses.

We employ a decentralized risk management model under which risk-based decisions are made daily on a local level. To achieve long-term success, we believe risk management must be the responsibility of all employees. The individual and collective decisions of our employees play a key role in successfully managing our overall risk profile. We strive for a culture of accountability that supports our risk management framework and regulatory compliance. We believe these values allow our employees to feel comfortable identifying issues as well as taking ownership for addressing potential problems and directing solutions.

Our Enterprise Risk Management framework strives to:

  • Identify, assess, monitor, prioritize, and report on our risk positions and exposures, including notable risk events;
  • Assess material risks, including how they affect us, how individual risks interrelate, and how management addresses these risks;
  • Practice strong risk management, including diversification across and within business units and systematic limit monitoring;
  • Identify emerging risks and analyze how material future risks might affect us;
  • Fulfill regulatory, rating agency, and governance objectives; and
  • Maintain our risk appetite policy and report against its tolerance and limits.

Through adherence to these objectives, we believe we are better positioned to fulfill our corporate mission, maximize shareholder value, and meet commitments to our policyholders.

Risk Management Oversight

Our governance structure is a multi-layered approach which fully supports our Enterprise Risk Management framework and emanates a strong “tone at the top” behavior. This behavior is demonstrated through the participation of senior leaders on the Executive Risk Management Committee.

The Executive Risk Management Committee manages the overall risk profile, aiming for a balance between growth objectives, risk and capital. The Company’s Chief Risk Officer, who is a member of the Executive Risk Management Committee, has primary responsibility for Unum's Enterprise Risk Management framework and is supported by risk committees of our business segments, as well as several corporate risk committees.

Our board has an active role in overseeing our Enterprise Risk Management framework. The board is responsible for managing strategic risk and regularly reviews impacts from market, credit, insurance, operational and reputational risks.

Through our Enterprise Risk Management framework, we have established a culture that supports candid discussion and reporting of risks while empowering our employees to take ownership for risk management.