1Q profits plummet for insurer


CHATTANOOGA, Tenn. (AP) – Insurer UnumProvident Corp. on Wednesday said first-quarter earnings fell by more than half as the company booked a charge to adjust claim reserves and operating earnings missed Wall Street estimates.

Net income dropped 52 percent to $73.4 million, or 23 cents per share, from $152.2 million, or 49 cents per share, in the year-ago period.

The latest quarter was hampered by the adjustment charge of $55.9 million, or 17 cents per share, while the year-ago period contained a gain of $32 million, or 10 cents per share, related to a reversal of tax liabilities.

The claim reserve adjustment came at the company’s U.S. brokerage unit, which sells income protection insurance, or disability insurance, and was based on a settlement agreement with state insurance regulators reached in 2004.

Earnings excluding items and investment results rose to $131.2 million, or 41 cents per share, from $122.4 million, or 40 cents per share, in the year-ago period.

Revenue grew to $2.65 billion from $2.57 billion. Analysts polled by Thomson Financial expected 43 cents per share on revenue of $2.62 billion.

Shares of the company fell 21 cents to close at $20 on the New York Stock Exchange.

UnumProvident, created by the merger of Maine-based Unum and Chattanooga-based Provident Cos., has about 12,000 employees, including 3,600 in Portland.