UnumProvident's New Supplemental Insurance Helps Combat Rising Healthcare Costs

Business Wire, August 30, 2005

CHATTANOOGA, Tenn. -- MedSupport's benefits can help employees pay for medical co-insurance, co-pays and deductibles, as well as other ancillary medical expenses

UnumProvident (NYSE:UNM) today announced the release of MedSupport, a new voluntary insurance product designed to help employers and employees address the financial impact of rising medical costs.

MedSupport, the latest in the company's range of supplemental insurance products, helps pay out-of-pocket expenses associated with hospital stays, outpatient surgeries, certain diagnostic tests and emergency care. Coverage is designed to complement an individual's employer-sponsored healthcare benefits by paying a lump-sum benefit directly to the covered individual. The benefit can be used at the individual's discretion to meet personal financial needs.

The need for supplemental medical insurance is becoming essential as healthcare costs continue to increase. Families often struggle to pay for the additional expenses that traditional health plans do not cover. The U.S. Department of Commerce, in a release titled "Personal Income and Outlays," reports that most American workers do not have enough savings to pay the costs associated with a sudden health event: the average personal savings rate at the beginning of 2005 was just 1 percent. And a Harvard study published in the February 2005 edition of the Health Affairs journal found that more than half of individuals surveyed who filed for bankruptcy did so due to medical expenses, even though most of them had medical insurance at the onset of their health problem.

"The increase in medical insurance costs is the leading concern among HR benefit managers," said Mike Simonds, UnumProvident's vice president of Market Development. "Many employers have been forced to introduce significant cost containment measures, and are often reducing benefits or shifting more costs to employees. We designed our MedSupport solution to address the increased financial risk that today's employees face. It can help pay out-of-pocket expenses including co-insurance, co-pays and deductibles, as well as other ancillary expenses associated with a covered illness or accident."

The new MedSupport product:

--offers coverage to employees and their families;

--provides lump sum benefits directly to the covered individual;

--is sold only at the worksite and paid through payroll deduction;

--provides coverage for life as long as premiums are paid;

--includes a benefit for specified diagnostic tests, under an enhanced plan;

--offers an optional rider for the costs of emergency care; and

--allows employees to continue coverage at the same benefit amount and premium if they retire or leave the company.

The release of MedSupport expands UnumProvident's supplemental benefits portfolio to provide insurance options for all types of medical events - inpatient, outpatient and catastrophic. The new product is expected to have the strongest appeal with small and mid-size employers - especially those introducing changes, such as higher deductibles, co-insurance or co-payments, to their health care plans.

About UnumProvident

UnumProvident (UNM) is the largest provider of disability income protection insurance in the United States and United Kingdom. Through its subsidiaries, UnumProvident Corporation is a preferred source of supplemental benefits and benefit plan ideas and services, insuring more than 25 million people and paying $5.9 billion in total benefits to customers in 2004. With headquarters in Chattanooga, Tenn., the company employs more than 12,000 people worldwide. For more information, visit www.unumprovident.com.