Premium growth continued during 1993 and 1992 on slightly increased sales and the continued development of private label agreements. UNUM continues its investment in the private label business and proceeds to form new strategic alliances with private label partners to continue the growth of this business.
During 1993 and 1992, assets under management for TSA contracts grew by $103.1 million and $216.9 million, respectively. During 1993, UNUM offered the holders of certain types of TSA contracts the opportunity to modify such contracts. The proposed contract amendments provide for UNUM to increase the minimum guaranteed credited rates in return for contractholders relinquishing the right to make lump-sum withdrawals without an associated fee. Expected levels of contract withdrawals affected the overall growth of assets under management for TSAs.
The increased loss before income taxes in Corporate in 1993 was primarily due to the expenses incurred in connection with the March 26, 1993, merger of UNUM Corporation and Colonial Companies, Inc., decreased interest income and increased investment in the Tokyo, Japan office. The decreased loss before income taxes in 1992 was primarily due to increased interest income partially offset by lower realized investment gains and increased expense associated with UNUM's various incentive compensation plans.
Mortgage loans in the amount of $26.1 million were delinquent sixty days or more on a contract delinquency basis at December 31, 1993, representing 1.8% of the mortgage loan portfolio. This compares with $32.9 million or 2.0% of the mortgage loan portfolio at December 31, 1992.
For UNUM's retirement and universal life products accounted for under Financial Accounting Standard No. 97, revenues consist of policy and surrender charges assessed during the year. Charges related to services to be performed in the future are deferred. Benefits and expenses for these products include amounts incurred during the year for benefit claims in excess of related account balances, policy maintenance expenses, interest credited and amortization of deferred policy acquisition costs. Fund balance liabilities for these contracts, included in other policyholder funds in the Consolidated Balance Sheets, are accumulated with interest at various rates.
The estimated fair values of liabilities under all insurance contracts (investment-type and other than investment-type) are taken into consideration in UNUM's overall management of interest rate risk, which minimizes exposure to changing interest rates through the matching of investment maturities with amounts due under insurance contracts.
Combined and separate results of UNUM and Colonial for periods prior to the merger were as follows: Year Ended December 31, (Dollars in millions) 1992 1991 Revenues UNUM $2,641.2 $2,420.6 Colonial 407.3 363.9 Total $3,048.5 $2,784.5
Held to maturity: United States Government and government agencies and authorities $ 10.0 $ 0.6 $ -- $ 10.6 States, municipalities and political subdivisions 718.7 64.5 (0.2) 783.0 Foreign governments 255.3 50.3 (0.2) 305.4 Public utilities 1,333.7 98.6 (1.6) 1,430.7 Corporate bonds 4,186.8 377.7 (5.0) 4,559.5 Certificates of deposit 36.4 1.1 -- 37.5 Mortgage-backed securities 15.2 2.6 -- 17.8 Other debt securities 4.6 0.8 -- 5.4 Total held to maturity $6,560.7 $ 596.2 $ (7.0) $7,149.9
The amortized cost and estimated fair values of fixed maturities at December 31, 1992, are as follows:
Held to maturity: United States Government and government agencies and authorities $ 108.7 $ 7.8 $ -- $ 116.5 States, municipalities and political subdivisions 461.8 45.1 -- 506.9 Foreign governments 199.4 27.1 -- 226.5 Public utilities 1,305.0 62.9 (2.6) 1,365.3 Corporate bonds 4,240.3 291.1 (5.7) 4,525.7 Certificates of deposit 72.4 3.7 -- 76.1 Redeemable preferred stocks 0.9 -- (0.1) 0.8 Mortgage-backed securities 42.3 4.2 -- 46.5 Other debt securities 6.8 1.5 -- 8.3 Total held to maturity $6,437.6 $443.4 $ (8.4) $6,872.6
UNUM has transferred 401(k) service responsibilities to its formerly wholly- owned subsidiary, Preferred Benefits Corporation, which was sold in May 1992. UNUM will continue to manage the approximately $300.0 million in assets remaining as of December 31, 1993, associated with its 401(k) business until maturity.
As of December 31, 1993, deferred U.S. income taxes have not been provided on the accumulated earnings of UNUM's foreign subsidiaries. These earnings would become subject to U.S. tax if remitted to UNUM Corporation. The tax effect of such a distribution is not expected to be material.
In the normal course of its business operations, UNUM is involved in litigation from time to time with claimants, beneficiaries and others, and a number of lawsuits were pending at December 31, 1993. In the opinion of management, the ultimate liability, if any, arising from this litigation is not expected to have a material adverse effect on the consolidated financial position or the consolidated operating results of UNUM.
Premiums $551.7 $538.6 $525.3 $526.8 Investment income 204.9 206.5 199.2 198.6 Net realized investment gains 6.7 11.9 11.7 11.2 Benefits to policyholders 400.3 383.4 371.2 377.7 Net income $ 69.9 $ 74.8 $ 73.9 $ 72.6