CHATTANOOGA, Tenn. – In a forced self-review, the Unum Group agreed to fully or partly reverse 42 percent of previously denied disability claims and paid out $676 million in additional benefits.

The Tennessee Department of Commerce and Insurance in a statement Wednesday said the agreement with the Chattanooga-based insurer involved a review of claims from January 1997 through 2004.

An investigation of complaints about Unum’s claims handling led to a $1 million fine in March 2003 after Georgia’s insurance commissioner said regulators found a mind-set of looking “for every technical legal way to avoid paying a claim.”

In 2004, insurance officials in Tennessee, Maine, Massachusetts and New York directed the company to review its claims handling as part of an agreement that was ultimately accepted by most states.

Tennessee insurance officials said Wednesday that the four-year review, now finished, shows the success of working with an insurer to “successfully change corporate culture.”

“Millions of disabled people across the nation have benefited,” the statement said.

Company spokesman Jim Sabourin said the reviews have been based on new standards and do not necessarily mean mistakes were made the first time.

“Essentially we are pleased that the exam process has been concluded and particularly pleased with the results,” he said. “We have taken a lot of steps over the last couple of years to improve our claims practices and processes.”

Sabourin said the company handles about 400,000 claims a year and pays out about $6 billion in benefits, including $4.3 billion for disability.

He said the review started with the company sending about 300,000 letters to customers. About 70,000 of those “opted in,” and about 20,000 of those responded and had their claims reviewed.

Sabourin said 41.7 percent of those 20,000 were reversed.

“Many of the claims that were overturned in whole or in part, there was additional information provided,” Sabourin said.

Shares of Unum fell 47 cents, or 2 percent, to close at $23.21 Wednesday.

Unum earned $679.3 million in 2007 compared with $411 million in 2006. The company’s stock climbed 14 percent last year.

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