Q1 2021 Unum Group Earnings Call
And welcome to the European Group first quarter, 2020, One earnings conference call.
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Now I'd like to turn the conference over to somewhat senior Vice President of Investor Relations. Please go ahead.
Great. Thank you and good morning, everyone and welcome to the first quarter 2021 earnings conference call for Unum.
Our remarks today will include forward looking statements, which are statements that are not on current or historical fact, as a result actual results might differ materially from results suggested by these forward looking statements infill.
Information concerning factors that could cause results to differ appears in our filings with the Securities and Exchange Commission and are also located in the sections titled cautionary statement regarding forward looking statements and risk factors and our annual report on form 10-K for the fiscal year ended December 31 and 2020.
Our SEC filings can be found and the investors section of our website I.
And I remind you that statements on today's call speak only as of the day. They are made and we undertake no obligation to publicly update or revise any forward looking statements.
A presentation of the most directly comparable GAAP measures and reconciliations of any non-GAAP financial measures included in today's presentation can be found and our statistical supplement on our website also on the investors section yes.
Yesterday afternoon, Unum reported first quarter 2021, net income of $153 million or 75 cents per diluted common share compared to $161 million or 79 cents per diluted common share in the first quarter 2020.
Net income for the first quarter of 2021 included first the net after tax loss from the second phase of the closed block individual disability reinsurance transaction of $56 $7 million, which is 27 cents per diluted common share.
And the after tax and amortization of the cost of reinsurance of $15 8 million, which is eight cents per diluted common share and a net after tax realized investment gain on the company's investment portfolio and this excludes the net realized investment gain associated with the reinsurance transaction.
13, and a half million dollars or six cents per diluted common share.
Net income and the first quarter of 2020 included a net after tax realized investment loss of $113 $1 million, which is 56 cents per diluted common share.
So excluding these items after tax adjusted operating income and the first quarter of 2021 was $212 million or $1.04 per diluted common share compared to $274 $1 million or $1.35.
Per diluted common share and the year ago quarter.
Participating in this mornings conference call are <unk>, President and CEO, Rick Mckenney, Chief Financial Officer, Steve Zabel.
Chief operating officer, Mike Simonds, and Tim Arnold, who heads our colonial life and voluntary benefits business I'd also like to introduce our new head of the Unum International business, Mark till Marquez and experienced later in the insurance industry and we're very happy to have him here at Unum and now I'll turn the call over to Rick for his opening comments.
And Tom and good day, everyone.
Our first quarter results represent a solid start to 2021 with improving trends, we entered the quarter with positive momentum and I'm, sorry, with entering second quarter with positive momentum and increasing optimism, we expect to see us strong second half recovery from the COVID-19 related pandemic. It certainly has been a tumultuous period, but we believe.
We are well positioned both strategically and financially to return to our pre pandemic levels of profitability and margins in the coming quarters.
Each quarter over the past year, we've described how the COVID-19, pandemic and resulting economic impacts have influenced our operations and financial results across our business.
Each quarter has had its own set of dynamics.
This quarter was no different with the sharp increase and infections and deaths through the year and period we.
We have seen rapid changes since that period of time, but nonetheless, it has had an impact on the quarter.
First COVID-19 has significantly impacted mortality experience and her life insurance businesses and generated higher volumes of short term disability claims and lead requests at the workplace.
Additionally, the severe dislocations to the economy and national employment levels have dampened our premium growth by slowing sales and the gating the natural growth, we typically see in our in force premium base.
And finally, the downdraft and the financial markets last spring and the sharp decline and interest rates further pressured new money yields we expect each of these trends to turn.
Throughout these challenging times I've been proud of how our employees have stepped up and successfully met our corporate purpose to help people thrive throughout life's moments as we stand today I'm confident that the challenges posed by COVID-19, and the 2020 recession are largely behind us I'm.
And I'm optimistic that while the pandemic certainly is not over and we expect to see lingering effects into the second quarter. We will also see a strong recovery and our results through the balance of 2021.
Coming back to our first quarter results. The core business continued to perform well generating solid sequential premium growth continued strong persistency and favorable benefits experience across most lines.
The challenges from COVID-19 continued to be well defined within our life insurance product lines, primarily within Unum U S group life.
Well the human loss from the pandemic continues to be heartbreaking for all of US COVID-19 related mortality across the U S had been trending favorably on a weekly basis from peak levels in December and January on.
Our own results mirror these week to week, improving trends that you see a national statistics, and we look forward to improved results and our life insurance lines, beginning in the second quarter and accelerating further into the second half of 2021.
In addition to improving COVID-19 related trends for mortality and infection rates. We are very encouraged by the improving economic environment that's emerging.
Forecast for strong GDP growth and coming quarters, along with continued financial and fiscal stimulus and further improvement and employment levels and wage growth we are expecting to see.
And both of those be beneficial to the growth of our business. Additionally.
Additionally, the improved interest rate environment, and ongoing strength and the credit markets are all positives for us.
We believe we are already beginning to see these benefits emerge and our results. Most notable the increase of two 8% and premium income growth, we experienced and our core business segments from the fourth quarter of 2020 to the first quarter 2021.
This growth is reemerging due to continued strong persistency trends and our major product lines, along with the sales rebound that has emerged and our U S employee benefit lives.
Combined with the stabilization and natural growth on our in force blogs as import employment levels improve.
We anticipate that this will accelerate through the year us sales momentum continues to build and economic growth re emerges as a tailwind for us.
I mentioned and the improving trend that is evident and COVID-19 related mortality, but as infection rates also subside, we expect to see more favorable trends and our short term disability and leave services line that had been adversely impacted over the past year.
And our otherwise the business we saw good results with the benefits experienced in the first quarter of.
Our voluntary benefits businesses for Unum U S and colonial performed well this quarter outside of the impacts we felt that our life insurance exposures.
The recently issued individual disability life continued to show favorable benefits experience and we saw very good recovery and our Unum UK results. This quarter with strong performance and the group income protection and group critical illness lines offsetting adverse COVID-19 related mortality, there as well and the group life.
The benefits experience for our Unum U S. Long term disability line was within our expectations and consistent with the trends of the past several quarters those up from the very favorable performance on the fourth quarter as we anticipated.
Finally experienced and our long term care line remained quite favorable relative to our long term expectations, though we believe results in this line and are beginning to trend back towards our long term expected ranges.
A couple of thoughts on our investment portfolio. This is another area, where we've seen meaningful improvement over the past several months.
But the first quarter's performance our alternative asset portfolio has now fully recovered from the markdowns recorded and the second quarter of last year and are on a solid path to generating the respect to returns going forward.
We remain very pleased with the overall performance and quality of the portfolio and are currently seeing very few areas of credit concerns and and increased outlook for upgrades within the portfolio.
Turning to our capital position, our strong position gives us significant financial flexibility to execute our growth plans going forward.
Our holding company cash position finished the quarter at $1.7 billion aided by the successful completion of phase two of the closed disability block reinsurance transaction.
Risk based capital for our traditional U S insurance companies remains solidly above our targets and 370% and our leverages down three points from a year ago.
As the pandemic winds that winds down and we are evaluating alternatives on how to best utilize us capital position to drive growth in line with our strategy as well as shareholder value. We expect to have more on that for you and the coming months.
As we look to enter and accelerated recovery period and important area of differentiation for US and is the strong engagement. We have we've continued to have with our commercial markets.
That connection starts with a strong employee engagement and I continue to be very proud of the work our employees continue to do and to provide excellent service to our customers. While we have navigated through this disruptive time.
It's no surprise us strong employee engagement drives a strong claim and satisfaction scores we are seeing.
Additionally, I'm very pleased to see the growing acceptance of the various digital capabilities, we have invested in over the past several years reasons.
Recently, we rolled out our <unk>, our new total leave offering which will help employers and employees better manage the complex Lee process. We anticipate that these advanced tools and capabilities will help us further enhance our leadership position in the employee benefits market.
And finally, a couple of words on how we are focused on our culture of the company. Our purpose is clear and serving the working world at time of need it requires a foundation of strong values throughout the enterprise, we're proud to be recognized as one of the world's most ethical companies designated by Ethisphere.
You can see some of the great work and our newly launched ESG report on our website. It adds to the totality of who we are at Unum.
Now I'll ask Steve to cover the details on the first quarter results Steve.
Thank you Rick and good morning, everyone in discussing Unum US first quarter financial results. This morning, My remarks will primarily focus on analysis of our first quarter results relative to the fourth quarter of 'twenty, and 'twenty, which will allow us to show how the company's business lines are progressing through the pandemic I'll start with the Unum US segment, which reported adjusted operating income for the first quarter.
On $115.7 million compared to $143 $5 million in the fourth quarter as I'll describe in greater detail. These results were significantly impacted by COVID-19 related mortality in our group life business line and the life insurance line within the voluntary benefits business beyond this significant mortality impact we were pleased with the <unk>.
Ally and performance of the rest of the businesses, particularly the 2.7% increase and premium income related to the fourth quarter.
Starting with Unum US group disability line adjusted operating income for the first quarter was $64 $1 million compared to $64.7 million and the fourth quarter of 2020, we were very pleased to see premium income increased by three 5% compared to the fourth quarter with solid sales this quarter very good persistency and natural growth stabilizing.
The benefit ratio was 74, 8% compared to the very favorable 72.5% and the fourth quarter as we expected the first quarter benefit ratio was elevated due to the short term disability line, where we continue to see high COVID-19 related claims driven by infection rates. We continue to expect the annual group disability benefit ratio to run it.
And the 73% to 74% range with some quarterly volatility.
There are two other points to mention on group disability first net investment income was slightly higher in the first quarter largely driven by higher miscellaneous investment income second the expense ratio improved nicely declining to 28, 4% and the first quarter from 34% in the fourth quarter and some of this improvement relates to timing of.
Expenses. So the ratio is likely to move up slightly in future quarters. Those stay below the fourth quarter level, we're pleased with the improvement and the expense ratio this quarter as we balance making investments to further enhance our service capabilities with managing through the ongoing pressures on expenses from our leave services offerings related to COVID-19 driven volumes.
Adjusted operating income for Unum Us group life, and a D and D continue to show the impact of COVID-19 related mortality with a loss of $58 $3 million and the first quarter compared to a loss of $21 $9 million and the fourth quarter. The change from the fourth to the first quarter is largely explained by the national COVID-19 related mortality trend it showed and <unk>.
Increased from approximately 145000 nationwide observed death, and the fourth quarter to approximately 200000, and the first quarter or 1% claims rule of thumb for unum share of COVID-19 related mortality did hold consistent in the quarter and we estimate that we incurred approximately 2050 club COVID-19 claims with and.
Average claim size of approximately $50000.
Non COVID-19 related mortality did not have a significant impact on results and the first quarter as while incidence was slightly higher on a seasonally adjusted basis. It was largely offset by a lower average claim size compared to the prior quarter.
Now looking ahead to the second quarter National COVID-19 mortality is trending favorably from the peak levels seen in December and January 2nd quarter estimates of U S. COVID-19 related mortality are in the 50 to 60000 range compared to the first quarter level of approximately 200000, we are seeing this improving trend and our COVID-19 claims experience as well the <unk>.
<unk> of the decline is expected to drive a recovery and our group life results. However, the 1% rule of thumb, we have experienced throughout the pandemic is likely to change somewhat if the age distribution of mortality changes and is skewed more to younger people and away from the elderly population due to the vaccine rollout we would expect to see.
A higher percentage of national quaint claim counts and a higher average claim size since working age policies tend to have higher policy amounts and retired and over age 65 individuals.
This does equate to an approximately $40 million impact a group wide income from COVID-19 related claims compared to over $100 million and the first quarter in other words using these estimates we would expect our group life earnings to improve by approximately $60 million from the first quarter to the second quarter, two and approximately <unk> <unk>.
Lake even level of earnings in the second quarter.
Now shifting to the Unum us supplemental and voluntary lines, we saw and improved quarter with adjusted operating income of $109 $9 million and the first quarter compared to $100.7 million and the fourth quarter outside of the COVID-19 related mortality impacts we saw on the voluntary benefits life insurance line. We were generally pleased with the trends we saw on the segment the IND.
Visual disability line continues to generate favorable results with a benefit ratio at 42, 4% and the first quarter compared to 42% in the fourth quarter and 52.1% in the year ago quarter, driven primarily by continued favorable incidence and mortality trends in the block.
Benefits experience for voluntary benefits, excluding the life insurance exposure was generally in line with our expectations finally utilization and the dental and vision line was higher this quarter pushing the benefit ratio to 73, 2% and the first quarter compared to 65, 4% in the fourth quarter dental and vision utilization has been volatile.
And since a significant decline in utilization, we experienced in the second quarter of 2020.
Sales for Unum U S and total declined by 10, 3% and the first quarter compared to the year ago quarter within that sales increased 15, 9% for the employee benefits lines, which are S. T. D. L. T D group life, and a D and D combined with a good mix of growth and both large case and core market business. This is consistent.
With our outlook that sales and our group employee benefit lines would recover more quickly than our voluntary benefits businesses. We are currently seeing a good level of quote activity and the group markets, which has recovered to pre pandemic levels.
Recovery and sales growth growth in the supplemental and voluntary lines is slower which is in line with our expectation. Our recently issued individual disability sales were down 25, 1% and the quarter coming off a strong pre pandemic first quarter last year voluntary benefit sales were down 21.5% and the quarter, which is consistent with our view that mid and larger.
Case, VB sales will take longer to recover large case VB sales in particular have a longer sales cycle and our more concentrated around January one effective dates. So we wouldn't expect to see growing momentum there until later in the year.
Finally sales in dental and vision were 25, 9% lower caused by the disruption and group sales resolving from discounts and other incentives. Many carriers are providing and response to the unusually favorable claims trends seen in the second quarter of last year, we are seeing a positive offset with higher persistency for dental and vision at 87, 4%.
For the first quarter compared to 81, 9% in the year ago first quarter for.
Persistency for our major product lines, and Unum U S where in line to higher this quarter relative to the first quarter last year, giving us a good tailwind to premium growth for the full year.
Now, let's move on to Unum International segment, where adjusted operating income for the first quarter showed a strong improvement to $26 $4 million compared to $20 $7 million and the fourth quarter last year, a big driver of this and improvement was improved results in Unum U K with adjusted operating income of $18 6 million pounds in the first quarter.
Compared to $15 4 million pounds and the fourth quarter.
Benefits experience improved and the U K with strong performance and the group income protection line due to improved claim recoveries and higher levels of mortality and we also experienced improved performance and the group critical illness life.
This improvement offset adverse experience and the group lifeline, largely resulting from a higher level of COVID-19 related mortality.
Unum, Poland has seen adverse impacts from COVID-19 on its results and the first quarter relative to the year ago quarter, but we're pleased with the growth, we're seeing and this business with growth and premium income of 11.7% on a year over year basis. Although we are encouraged by the improved income and the international operations, we do remain cautious with our near term out.
Look at both the U K and pole and deal with COVID-19 and related economic impacts.
Next we are very pleased with the results generating generated by colonial life with adjusted operating income of $73.3 million in the first quarter compared to $71 $2 million and the fourth quarter. This uptake was primarily driven by a slight improvement and the benefit ratio and a lower expense ratio the benefit ratio of 55 point.
4% was slightly improved from 56, 6% and the fourth quarter, but did remain higher than our historical trends due to the continued impact from COVID-19 on our life insurance line.
Results and the accident sickness and disability line as well as the cancer and critical illness line were generally consistent with our long term experience.
Premium income for the first quarter picked up slightly from the fourth quarter, increasing 1.8%, primarily the result of favorable persistency trends, we will need to see further recovery and new sales to rebuild premium growth back to the historic levels of 5% to 6%.
We're encouraged by the sales trends, we saw on the first quarter for colonial although quarterly sales were down nine 2% year over year that is sharply improved from the 31% cumulative decline we experienced for the last three quarters of 2020, we look forward to further improvement and sales momentum over the balance of 2021, we are encouraged by the uptake we are.
<unk> and our recently developed digital enrollment tools, which in the quarter accounted for about one third of our enrollments and is also encouraging that face to face enrollments are rebuilding as we find new safe and socially distance ways to conduct these face to face enrollments.
And turning to the closed block segment adjusted operating income excluding the impact of the closed block individual disability reinsurance transaction was $97 million and the first quarter compared to $104 $2 million in the fourth quarter last year, both strong quarters relative to our historical levels of income for the segment.
Looking at the primary business lines within the closed block for the LTC block the interest adjusted loss ratio was 77, 7% for the first quarter compared to 62% in the fourth quarter. Excluding the income of the reserve assumption update and the fourth quarter of last year and results for the first quarter remained favorable to our long term assumption of a range of eight.
5% to 90% primarily due to the continued impact of COVID-19 related mortality on a claim of block.
And the first quarter, we estimate the accounts were approximately 15% higher than expected a similar trend to what we experienced in the fourth quarter.
LTC claim incidence was higher and the first quarter compared to the fourth quarter and remains volatile on a monthly basis, we anticipate that the interest adjusted loss ratio for LTC will likely revert to our long term range over the next several quarters as mortality and incidence trends normalize from the impacts of COVID-19.
For the closed disability block the interest adjusted loss ratio was 68, 9% and the first order and 79, 5% and the fourth quarter, both excluding the impacts from the reinsurance transaction and these quarters.
The underlying experience on the retained block, which largely reflects the active life reserve cohort and other smaller claim block we intend to retain ran favorably to our expectations, primarily due to lower submitted claims.
And wrapping up my commentary on the quarter's financial results. The adjusted operating loss and the corporate segment was $38 $9 million and the first quarter. This is favorable to the fourth quarter 2020, adjusted operating loss of $42 $7 million, primarily due to higher net investment income, which offset a slightly higher level of operating expenses.
Keep in mind that the assets backing and required capital, which were freed up from the individual individual disability reinsurance transaction have now been allocated to the corporate segment and generate a higher level of absolute net investment income for this segment as these assets are allocated out to the product lines and future quarters or deployed the favorable net.
And income for the corporate segment is expected to decline.
Now I'd like to turn to the completion of the closed block individual disability reinsurance transaction, which we first announced back in December phase one of the transaction, which covered approximately 75% of the transaction was reported and our fourth quarter earnings release and phase II covering the balance of the transaction was completed here in the first quarter.
Phase two involve the transfer of approximately $767 million of assets to the reinsurer and the recording of a net after tax loss on the transaction of $56 $7 million. The components are detailed on the statistical supplement. In addition, the amortization of the after tax cost of reinsurance with was $15 $8 million this quarter.
And.
With the transaction now completed we are very pleased with the ultimate release of approximately $600 million of capital to holding company cash and the flexibility that creates for us.
Now I'd like to next turn to our investment portfolio with a with a few points to highlight.
First we recorded an after tax net realized investment gain of $66 $9 million and the first quarter of that gain $53 $4 million was associated with the completion of phase two of the closed block individual disability reinsurance transaction. These assets had unrealized gains which were realized and the assets were transferred to the reinsurer at market value.
And the balance of this quarter as realized investment gains, which result from normal investment operations was $13 $5 million and was largely driven by a positive mark on our motto embedded derivative balance.
Second as I mentioned previously we continue to see a strong recovery and the valuation mark on our alternative investment invested assets of $35 $9 million. This quarter. Following a positive mark of $29 $4 million and the fourth quarter given the current portfolio size, we would expect quarterly positive marks on the portfolio of $8 million to $10 million.
We have now fully recovered the valuation lost from the market decline and early 2020, while also earning our expected returns over that period.
And I'd also note that it was a higher than average quarter for traditional miscellaneous investment income from bond calls in the first quarter following an unusually low amount in the fourth quarter.
And third with third with phase two of the reinsurance transaction, we were able to retain approximately $361 million and invested assets that were not transferred to the reinsurer.
Of that amount $234 million of investment great assets with a book value with a book yield of seven 4% had been allocated to the LTC portfolio.
And then finally, we remain very pleased with the overall quality of the investment portfolio. During the first quarter, we saw only $92 million of investment grade bonds downgraded to below investment grade and $13 million of upgrades of below investment grade bonds to investment grade status and our holdings of high yield fixed income securities.
Were seven 7% of total fixed income securities at the end of the first quarter, which was down from seven 9% at year end 2020.
Our watch list of potentially travel troubled investments remains at very low levels as we've taken advantage of the rebound and the credit market to reduce our exposure of these positions.
And then looking to our capital position, we are very pleased with the financial position of the company and the flexibility. It provides us as we come out of the pandemic the risk based capital ratio for our traditional U S insurance companies is slightly over 370% and holding company cash is at $1 7 billion as of the end of the first quarter, both well above our targeted levels.
In addition, I would note that our leverage ratio has declined to 26% providing additional flexibility. We are actively evaluating on our capital plans as we come out of the pandemic and we'll have more to update you on in the coming months imported importantly, we intend to focus on the deployment opportunities that we believe can create the greatest value for the company and our shares.
Holders, which historically has included investing and the growth of our core businesses, maintaining a competitive dividend and payout ratio and repurchasing our shares and the market.
I'll close my comments with an update to our expectations regarding our outlook for 2020, one with our fourth quarter reporting in February we outlined our expectation of a modest decline of 5% to 6% for full year 2021, adjusted operating income per share relative to the 2020 level of $4 93 per diluted common share and on.
Our view that continues to be a realistic outlook as we look for a strong recovery and the second half of 2020. One following some lingering COVID-19 related mortality impacts and the second quarter.
Now I'll turn the call back to Rick for his closing comments and look forward to your questions.
Great. Thank you Steve as you can hear from our comments, we continue to be very pleased with the operational performance of the company through what has been and extraordinary environment.
We believe we are well positioned to benefit from improving business conditions as vaccines take hold and mortality and infection rates from COVID-19, and continue to subside teams.
It seems here to take your questions. So I'll ask the operator to begin the Q&A session.
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G of Barclays. Please go ahead.
Thank you good morning, and just want to touch on your holding company cash of one 7 billion on do you anticipate and need to downstream part of that and now back to the operating company or is that and I'm truly fungible and I did hear your comments about and positive credit trajectory.
Yeah. So when you think about the $1 seven of cash that sits there and actually us for our US when you think about the overall course of our capital plans for the year as we talked about a year and everything is contemplated in that what we would have said at year end is that we would expect the year to and then a similar spots where we ended 2020.
So we're up above that right now and I think that number is roughly $1 5 billion and we've had some good positive things that have happened as a result of the transaction leverage et cetera. So we believe that's available for us to go back as Steve said into core growth to go to go into acquisitions.
Acquisitions, if we see the opportunity there and then dividends and share repurchase. So we feel good about that there's no expectation that that and any portion of that per se will be downstream into into the companies.
Okay. So I guess my follow up is also at that outlet, meaning you mentioned potentially having to hold on to that capital for us.
And in Q1 charge, you that where it's going to come in this year I think it may be next year, so any update on that thinking.
We did talk about a D. L. A meeting that that was as we roll forward the year contemplated and that a $1 5 billion roughly a year and was C. One factor change, which was in the range of $200 million.
And we're gonna see a reversion back here over the course of the year and maybe will will dissect some of those so it might do you Wanna start on the group life side and know what we're seeing what we might expect sure yeah, why don't I hate group disability, even wondering if you could hit group life on on the disability Brian.
And get you a bit of and elevated loss ratio and the quarter and us we've talked about that short term disability entirely and underneath that it's COVID-19 related claims entirely so that'll followed pretty closely actually the the track of improvement that's E laid out and is opening comment so us national COVID-19.
Cases, and then come down and which we saw not only through through the curse of course of the first quarter Butt sitting here and the second quarter, there's nothing that sort of suggest anything different and that's continued steady patient of improvement and there will be lingering impact on and this is really side and that short term. This is only complaint and the segment.
And here in the second quarter, but like we talked about and December I think the outlook and the second half is quite good and with L. T D right there within expectations that kind of $73 and 74% disability loss ratio that we tend to see on an annual basis I think that's still a reasonable price to think about us being and the second half of the year.
Yeah, Great and then I'll I'll take Eric I'll take group life. This is Steve. So if I have mentioned my comments and the first quarter nationally. We had about 200000, that's that that was reflected in our book about what we got about one per cent of that or just over 2000 and deaf. We do estimate from what we've seen kind of out there that we're gonna.
Be around 50 to 60000 deaths, probably and the second quarter nationally and how we equate that to our book would imply that our group life and a D and D business would be about breakeven in the second quarter I would say then for the remainder of the year, we would have that gradually revert.
Back to kind of historical loss ratios in that business. So we we think second quarter might be kind of tough, but the latter half of the year will get back to where we certainly were out for margin I would say on L. T. C. We've clearly had very low loss ratios over the last year or at 77.7%.
I think as we've always said.
We have good capital flexibility at our disposal, we're going to make sure we put that right back into our core operations. We've seen some really good investments to make just on the core operational side M&A. When you think about that it's going to be probably smaller capability type transactions. We think we like our portfolio. Today, we think we have good breadth, but we will.
Look at us and capabilities as we've done over the last several years and then other.
Other forms of dividends and share repurchase are are always on the table you added the question about pre funding the LTC.
As well I don't we don't see the need to do that we actually are on a path there on on.
On putting funds into our LTC that makes sense and we'll continue to do that at the pace. We've been doing no change in plans and we have there.
So, but we're always looking at our LTC block and and making sure just like we did at year end with our individual disability what are ways and we can free capital from behind that and it is a closed block and so making sure. We can think about the pieces that will be good for potentially for risk transfer are out there, but as we've said before those are more difficult transactions will take.
Some time, but.
But certainly that's a place where we're looking to.
Essentially deploy some capital if we see the right risk transfer opportunities.
Thank you and I appreciate the comments.
Yeah.
Thank you.
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