Net income for the third quarter of 2020 included a net after-tax realized investment gain of $3.8 million and after-tax cost related to an organizational design update of $18.6 million.
Net income in the third quarter of 2019 included a net after-tax realized investment loss of $20.8 million and after-tax debt extinguishment costs of $19.9 million.
So excluding these items, after-tax adjusted operating income in the third quarter of 2020 was $245.9 million or $1.21 per diluted common share compared to $282.7 million or $1.36 per diluted common share in the year ago quarter.
Our average death claim is around $50,000.
And finally, our capital position remains with very good RBC at approximately 380% and holding company cash at $1.2 billion at quarter end, both nicely above our targeted levels.
The $18.6 million of organizational design update cost we recorded this quarter was part of an ongoing effort and continue to manage our operations with an eye toward the future.
As Tom outlined in his opening, after-tax adjusted operating income in the third quarter was $245.9 million or $1.21 per common share.
By comparison, in the second quarter of this year, excluding the lease impairment costs and net realized investment gain, after-tax adjusted operating income was $250.1 million or $1.23 per common share.
The tax rate was impacted this quarter by an increase in the U.K. corporate tax rate to 19% from 17% adding $9.3 million in additional tax expense.
So we believe a good starting point for analyzing our results this quarter on a sequential basis is to look at before tax adjusted operating income, which showed a slight increase to $318.5 million in the third quarter compared to $316.5 million in the second quarter.
Excess deaths in the U.S. from COVID totaled an estimated 80,000 in the third quarter.
The unemployment rate is rebounding to 7.9% for September compared to the peak level in April of 14.7%, but by comparison remained significantly higher than 3.5% % at September 30, 2019 and a strong monthly employment reports leading up to the spike in April.
Adjusted operating income for the third quarter was $73 million, down slightly from $76 million in the second quarter.
Second, pressure on expenses from a continued high level of leave volumes, which increased over the second quarter and were approximately 60% above year ago volumes.
As Rick said, we continue to be very pleased with the consistency of the results in LTD as demonstrated by group disability benefit ratio of 74.1% this quarter, which is consistent with the ratio a year ago of 74.2%.
Adjusted operating income for Unum U.S. group life and AD&D remain depressed at $13.9 million for the third quarter compared to $19.4 million in the second quarter.
Shifting back to the COVID impact on the group life business in the quarter, we experienced slightly more than 900 excess life claims or about 12% higher than expected, benchmarked against a base of approximately 80,000 COVID-related deaths nationwide as reported by Johns Hopkins.
This compares to our second quarter reporting, which showed approximately 1,100 total excess death or about 14% higher than expected relative to reported base of 120,000 COVID-related deaths.
As we stated before, our rough estimate is that we expect to see approximately 1% at the U.S. mortality by count given our market share of life insurance in the country.
I'll add that so far in the fourth quarter, these trends are matching our third quarter results with a slightly higher average claim size, which is now in the low $50,000 range.
The Unum U.S. supplemental and voluntary lines experienced a more significant decline in the third quarter from the very favorable second quarter with adjusted operating income of $101.3 million in the third quarter compared to $136.5 million in the second quarter.
This resulted in the benefit ratio increasing to 76.8% from 36% in the second quarter.
Beyond these benefit and trends, premium income in the supplemental voluntary lines declined 2.8% on a sequential quarter basis due to lower new sales in recent quarters, slightly lower persistency and the effects of weaker employment trends by natural growth.
Sales for Unum U.S. declined 18.5% in the third quarter compared to the year ago quarter.
The group lines, which are LTD, STD and group life combined, increased by 1.5% as we continue to see good traction from our HR Connect platform that links customer HCM systems directly to Unum.
Voluntary benefits sales declined 35.8% year-over-year.
Dental and vision sales declined 33.1%, largely due to the disruption we are seeing in group sales activity as in-force providers are offering discounts and other incentives in response to the unusually favorable claim trends the industry experienced in the second quarter.
We are pleased to see improvement in adjusted operating income to $21.4 million in the third quarter compared to $15.1 million in the second quarter.
While Unum Poland, continue to be a strong performer overall, the bulk of the sequential quarter improvement came from Unum U.K., which produced adjusted operating income of GBP15.2 million in the third quarter compared to GBP10.1 million in the second quarter.
Colonial Life continued to report favorable results with adjusted operating income of $92.2 million in the third quarter compared to $90.9 million in the second quarter and $87.2 million in the year ago quarter.
Premium income for the third quarter declined 4.3% from the second quarter driven by the decline in sales this year and the negative impacts from individual lapses with in-force cases.
The benefit ratio was slightly elevated in the third quarter at 52.2% compared to 50.7% in the second quarter, largely reflecting the continued higher life and STD claims related to COVID with less offset from favorable accident and cancer lines.
Sales for Colonial Life declined 27.6% year-over-year in the third quarter, an improvement over the second quarter when sales showed a decline of 43% year-over-year.
In addition, agent recruiting remained strong with an 8% increase year-over-year.
And then in the Closed Block segment, adjusted operating earnings increased to $70.8 million in the third quarter compared to $36.7 million in the second quarter, largely driven by the continued favorable impact on high claimant mortality on the LTC block and a return to more normal positive marks on the alternative investment portfolio from the significant decline in value as of the end of the second quarter.
The positive mark on the holds was $11.3 million this quarter compared to a loss of $31.3 million in the second quarter, which we've reflected the negative market conditions at the end of the first quarter.
For the LTC block, the interest-adjusted loss ratio was 67.4% in the third quarter compared to 67% in the second quarter, and over the past four quarters is now 75.6% compared to our long-term expected range of 85% to 90%.
Our claimant mortality was a major factor again this quarter as mortality was approximately 15% higher than expected.
This impact was less than the second quarter, which was approximately 30% higher than normal.
For the closed disability block the, interest-adjusted loss ratio was 86.6% in the third quarter compared to 89.5% in the second quarter with slight improvement in underlying claims experience.
Coming back to LTC, we are pleased to have another successful quarter of in-force premium rate increase approvals, which gets us to $1 billion of the $1.4 billion of margin in our reserve assumptions.
So then wrapping up my commentary on the quarter's financial results, the adjusted operating loss in the corporate segment was $77.4 million in the third quarter.
Included in this are expenses related to the organizational design update that Rick referenced in his comments of $23.3 million before taxes or $18.6 million after taxes.
Excluding these costs, the adjusted operating loss of $54.1 million was consistent with our expectations and was largely driven by interest expense on our outstanding debt, which totaled $49 million in the third quarter.
With the maturity in September of a $400 million debt issue, our interest expense is expected to decline to approximately $45 million in the fourth quarter.
For the corporate segment, in total, we continue to expect quarterly losses in the mid $15 million range.
A few points to highlight are; first, net after-tax realized investment losses from sales and credit losses totaled $7.3 million this quarter compared to $7.7 million in the second quarter and $44.4 million in the first quarter.
In the third quarter, we saw $141 million of these downgrades compared to $193 million for the second quarter and $336 million in the first quarter.
Third, the net unrealized gain position on the fixed maturity securities portfolio improved to just over $8 billion from $7.4 billion in the second quarter and $4.3 billion at the end of the first quarter.
Then looking to our capital position, we finished the quarter in very good shape with the risk-based capital ratio for our traditional U.S. insurance companies at approximately 380% and holding company cash at $1.2 billion, both comfortably above our targeted levels.
Again, the cash balance at September 30 reflects the $40 million debt maturity in September and our next maturity is not until 2024.

Summary:
So excluding these items, after-tax adjusted operating income in the third quarter of 2020 was $245.9 million or $1.21 per diluted common share compared to $282.7 million or $1.36 per diluted common share in the year ago quarter.
As Tom outlined in his opening, after-tax adjusted operating income in the third quarter was $245.9 million or $1.21 per common share.