Insurance Liabilities and Financial Assumptions - As of December 31, 2024, the total liabilities for insurance products amounted to $29.7 billion, payable over an extended period[90] - The profitability of insurance products is influenced by various assumptions, including investment yields, mortality, morbidity, and cash flow assumptions[91] - The company’s liabilities for insurance products are based on numerous assumptions, and if actual claims exceed these assumptions, it may need to increase liabilities, adversely affecting net income[217] - The company’s operating results may suffer if policyholder surrender levels differ significantly from assumptions, impacting net income and requiring asset disposals[220] Reinsurance and Capital Management - The company’s reinsurance receivables from Wilton Reassurance Company totaled $2,457.3 million, with other significant reinsurers including Jackson National Life Insurance Company at $898.6 million[94] - The company ceded approximately $7.6 billion of fixed indexed annuity statutory reserves to CNO Bermuda Re as of December 31, 2024, under an intercompany reinsurance agreement initiated in 2023[222] - The company’s third-party reinsurance receivables and ceded life insurance inforce totaled $3.9 billion and $2.8 billion, respectively, with 97% of ceded life insurance inforce accounted for by its seven largest reinsurers[221] - CNO Bermuda Re is required to maintain a minimum solvency margin of the greater of $0.5 million, 1.5% of assets, or 25% of its enhanced capital requirement (ECR) as reported at the end of the relevant year[148] - CNO Bermuda Re's statutory economic capital and surplus is expected to exceed the TCL, indicating strong capitalization[153] Regulatory Environment and Compliance - The company’s insurance subsidiaries are licensed in all 50 states and are subject to extensive regulation and supervision by insurance regulators[110] - The NAIC's principle-based reserving approach for life insurance and annuity contracts has been adopted by all states, effective for products issued on or after January 1, 2020[115] - The NAIC has developed a Group Capital Calculation (GCC) tool to aggregate available and minimum capital across insurance holding company systems, with an annual filing requirement effective January 1, 2026[120] - The NAIC's Financial Condition (E) Committee is reviewing the insurance regulatory framework to enhance oversight of investments in complex assets, focusing on reducing reliance on credit rating providers[123] - The company is required to file an annual Certification of Compliance with the NYDFS regarding its cybersecurity program, following amendments to regulations effective April 29, 2024[157] Employee Relations and Benefits - The company employs approximately 3,500 full-time associates, with no collective bargaining agreements in place, indicating generally favorable employee relations[97] - The company has enhanced paid time-off benefits in 2024, including increased parental and maternity leave and the addition of two new company-paid holidays[103] - The company’s commitment to fair pay practices and pay equity is reflected in its compensation philosophy, which focuses on pay-for-performance[101] Market and Economic Conditions - Economic conditions such as inflation and market volatility pose risks to the demand for life insurance and annuities, potentially leading to higher policy lapses[195] - Changes in interest rates can affect the liquidity and value of investments, with rising rates potentially increasing policy surrenders as customers seek higher returns[196] - The company faces risks from prolonged low interest rates, which could reduce the spread between required payments and investment income, impacting net income[198] - Approximately 54% of fixed interest annuities and 29% of universal life products have crediting rates set at minimum levels, increasing reinvestment risk in a low interest rate environment[199] Technology and Innovation - The NAIC's Innovation, Cybersecurity and Technology Committee adopted the Model Bulletin on the Use of Artificial Intelligence Systems by Insurers in December 2023, which sets expectations for the governance of AI technologies[164] - The use of AI technologies presents operational risks, including potential misuse and flawed models, which could harm customer relationships and competitive standing[271] Competition and Market Position - The company faces competition from larger firms with greater market share and financial resources, which may impair customer retention and sales growth[276] - Many competitors have higher financial strength ratings, which impacts the company's ability to attract new customers and maintain market share[277] - The company may lose market share if competitors sell products at prices that do not cover actual costs, potentially leading to reduced profitability[278] Financial Performance and Ratings - The company's debt to total capitalization ratio was 30.5% as of December 31, 2024, against a maximum requirement of 35.0%[225] - The consolidated net worth of the company was $3,869.8 million at December 31, 2024, exceeding the minimum requirement of $2,698.8 million[226] - The estimated Risk-Based Capital (RBC) ratio of Conseco Life Insurance Company of Texas was 330% at December 31, 2024, well above the required level[231] - The current financial strength ratings of the company's primary insurance subsidiaries are "A", "A-", "A3", and "A" from Fitch, S&P, Moody's, and AM Best respectively[274] Risks and Challenges - The company is exposed to operational risks, including fraud and cybersecurity attacks, which could lead to financial loss and regulatory sanctions[259] - Major public health issues, such as pandemics, could adversely impact the company's financial condition and results of operations[261] - Natural or man-made disasters could disrupt operations and lead to increased claims, adversely affecting financial results[265] - The company faces risks from climate change regulations that may affect the value of invested assets and the willingness to hold them[267] Legislative and Tax Impacts - The Inflation Reduction Act introduces a 15% minimum tax based on financial statement income and a 1% excise tax on share buybacks, effective for tax years beginning in 2023[191] - The SECURE 2.0 Act of 2022 introduces new requirements for retirement plans aimed at expanding coverage and increasing savings, impacting annuity providers[192] - Recent federal and state legislation regarding healthcare reform could limit the company's ability to vary pricing terms, potentially increasing benefit ratios and adversely impacting financial results[253]

Core Insights - Optavise has launched Optavise Clear, a solution aimed at reducing employee confusion regarding benefits, which is crucial for workplace retention and performance [1][3] - The solution provides a seamless, year-round experience for employees to navigate their benefits confidently [1] Employee Needs and Research Findings - A study indicates that 73% of employees desire more education on their benefit options, while 68% find online resources helpful for understanding health benefits [2] - Additionally, 84% of employees value one-on-one conversations for learning about their benefits [2] Product Features and Services - Optavise Clear offers personalized guidance and support through a single point of contact, addressing employee needs during critical moments [2][3] - The product includes year-round support for benefits and healthcare decisions, Medicare advocacy services, foundational communications for better understanding of healthcare, and a unified digital experience [6]

Core Points - CNO Financial Group, Inc. announced a $500 million increase in its share repurchase program, with approximately $240.3 million remaining as of December 31, 2024 [1] - The company declared a quarterly cash dividend of $0.16 per share, payable on March 24, 2025, to shareholders of record as of March 10, 2025 [2] - CNO will hold its annual shareholder meeting virtually on May 8, 2025, at 8:00 a.m. ET, allowing shareholders to participate and vote [3] Company Overview - CNO Financial Group focuses on securing the future of middle-income America, providing life and health insurance, annuities, financial services, and workforce benefits solutions [4] - The company manages 3.2 million policies and has total assets of $37.9 billion, supported by a workforce of 3,500 associates and 4,900 exclusive agents [4]

Core Viewpoint - CNO Financial Group, Inc. reported strong fourth-quarter 2024 results, driven by increased collected premiums across various insurance products, despite facing challenges in investment income [1][2]. Financial Performance - Adjusted earnings per share (EPS) for Q4 2024 were $1.31, exceeding the Zacks Consensus Estimate by 22.4% and reflecting an 11% year-over-year increase [2]. - Total operating revenues decreased by 2.7% year over year to $1.1 billion, but still surpassed the consensus estimate by 19.9% [2]. - Total insurance policy income rose by 2.9% year over year to $643.6 million, exceeding the Zacks Consensus Estimate of $641.1 million [3]. Investment Income and Expenses - Net investment income fell by 10.4% year over year to $416.6 million [4]. - Total benefits and expenses decreased by 21.1% year over year to $886.7 million, attributed to lower insurance policy benefits and operating costs [5]. Premiums and Revenue Breakdown - Annuity collected premiums increased by 13% year over year to $493.1 million [5]. - New annualized premiums for health products rose by 21.6% year over year, while life products grew by 2.7% year over year [5]. - Fee revenues and other income increased by 13.4% year over year to $78.7 million [4]. Financial Position - As of December 31, 2024, unrestricted cash and cash equivalents stood at $1.7 billion, more than doubling from the end of 2023 [6]. - Total assets increased by 8.1% year over year to $37.9 billion [6]. - Total shareholders' equity improved by 12.8% from the end of 2023 to $2.5 billion [6]. Shareholder Returns - CNO Financial returned $91.6 million to shareholders through share buybacks and $16.4 million in dividends during Q4 2024 [8]. - The company had a remaining repurchase capacity of $240.3 million as of December 31, 2024 [8]. Future Guidance - For 2025, CNO anticipates operating EPS in the range of $3.70-$3.90, indicating a 4.3% decline from the 2024 figure of $3.97 [9]. - Management estimates excess cash flow of $200-$250 million for the holding company in 2025 [9]. - The projected expense ratio for 2025 is between 19-19.4%, with an effective tax rate around 23% [9].

Core Insights - Bankers Life announced its Top Women Financial Advisors (TWFA) for 2025, recognizing the top-performing women in its financial advisory services [1][3] - The 2025 class includes 37 women financial advisors, marking the largest group since the program's inception in 2022 [2] Company Initiatives - Bankers Life emphasizes the recruitment, retention, and advancement of women in the financial services industry, supporting initiatives like the Women's Leadership and Networking Committee (WLNC) [3][4] - The WLNC offers various programs aimed at personal and professional growth for women, including Advancing Financial Advisors, the Superwoman Summit, and the Making Mentors program [4] Company Overview - Bankers Life focuses on the insurance and investment needs of middle-income Americans nearing or in retirement and is part of CNO Financial Group, Inc. [5] - The company operates with approximately 4,900 exclusive agents, including 700 financial representatives across more than 220 U.S. sales offices [5]

Financial Data and Key Metrics Changes - CNO Financial Group reported operating earnings per diluted share of $3.97, an increase of 28% year-over-year, with a 40% increase when excluding significant items [10][32] - Total new annualized premium was up 7% across the enterprise, marking the tenth consecutive quarter of sales growth [9][10] - Book value per diluted share, excluding AOCI, was $37.19, up 10% [12] - Capital and liquidity were well above target levels, with $349 million returned to shareholders, a 50% increase over 2023 [12][32] Business Line Data and Key Metrics Changes Consumer Division - Total NAP in the Consumer Division was up 5% for the full year, with health NAP up 18% and Medicare Supplement NAP up 26% [15][16] - Long-term Care NAP increased by 35% for the year, reflecting growing demand [18] - Annuity collected premiums were up 13% for the year, with record sales in the last two quarters [20][21] Worksite Division - Worksite Division insurance sales were up 16% for the full year and 23% for the fourth quarter, marking the 11th consecutive quarter of insurance growth [25] - New insurance products in the Worksite Division saw double-digit sales growth, with critical illness up 24% and accident insurance up 13% [25][26] - Producing agent count in the Worksite Division was up 8% for the year, continuing a trend of growth [29] Market Data and Key Metrics Changes - Client assets in brokerage and advisory were up 28% to a record $4.1 billion, with new accounts up 13% [21] - The market value of invested assets grew 12% from the prior year, with 96% of the fixed maturity portfolio rated investment-grade [41] Company Strategy and Development Direction - CNO is focused on expanding return on equity (ROE) and has set a target to improve ROE by 150 basis points over the next three years [55] - The company is investing in technology modernization to enhance operational efficiency and support long-term growth [49][58] - CNO aims to leverage its strong sales momentum and agent distribution to drive future growth [24][30] Management's Comments on Operating Environment and Future Outlook - Management expressed confidence in continued demand for annuities due to demographic trends and a lack of alternatives for lifetime income [75] - The company anticipates challenges in matching previous quarters' performance due to tougher comparisons but remains optimistic about long-term growth [76] - Management highlighted the importance of maintaining expense discipline while pursuing growth opportunities [66][108] Other Important Information - The new money rate was reported at 6.72%, marking the eighth consecutive quarter above 6% [38] - CNO's consolidated risk-based capital ratio was 383%, indicating a strong capital position [42] Q&A Session Summary Question: Thoughts on buybacks and excess free cash flow guidance - Management indicated that free cash flow guidance should be considered alongside excess cash position relative to minimum liquidity [63] Question: Geographic expansion opportunities - Management believes there is significant potential for geographic expansion, particularly in the Worksite Division [66] Question: Additional Bermuda opportunities - Management is evaluating opportunities in Bermuda but did not provide specifics, focusing on establishing relationships and team capabilities [70] Question: Surrender rates and sales activity in fixed indexed annuities - Surrender rates have moderated, and management is optimistic about continued strong sales activity in annuities [72][74] Question: Breakdown of tech investments - The technology investment focuses on converting legacy systems to cloud-based solutions to enhance flexibility and efficiency [80][81] Question: Confidence in ROE improvement - Management emphasized a cautious approach to guidance, highlighting a strong track record and various initiatives to support ROE growth [90][94] Question: Drivers of excess cash flow outlook - The outlook for excess cash flow is influenced by organic growth pace, economic conditions, and investment portfolio risk [108] Question: Long-term expense ratio expectations - Management expects the expense ratio to improve over time as the company grows and develops operating leverage [112]

Fourth Quarter 2024 Financial and operating results for the period ended December 31, 2024 February 6, 2025 Unless otherwise specified, comparisons in this presentation are between 4Q23 and 4Q24. 1 IMPORTANT LEGAL INFORMATION Forward-Looking Statements Certain statements made in this presentation should be considered forward-looking statements as defined in the Private Securities Litigation Reform Act of 1995. These include statements about future results of operations and capital plans. We caution investor ...

Core Insights - CNO Financial reported a revenue of $1.14 billion for the quarter ended December 2024, reflecting a decrease of 2.7% year-over-year, while EPS increased to $1.31 from $1.18 in the same quarter last year [1] - The revenue exceeded the Zacks Consensus Estimate of $949.73 million by 19.92%, and the EPS also surpassed the consensus estimate of $1.07 by 22.43% [1] Financial Performance Metrics - Insurance policy income was reported at $643.60 million, slightly above the estimated $641.13 million, marking a year-over-year increase of 2.9% [4] - The Insurance Product Margin for Annuity was $55 million, below the average estimate of $62.07 million from two analysts [4] - The Insurance Product Margin for Life was reported at $68 million, exceeding the average estimate of $57.02 million [4] - The Insurance Product Margin for Health was $130.10 million, slightly above the estimated $129.10 million [4] Stock Performance - CNO shares have returned +7.9% over the past month, outperforming the Zacks S&P 500 composite's +2.1% change [3] - The stock currently holds a Zacks Rank 2 (Buy), indicating potential for outperformance in the near term [3]

Core Insights - CNO Financial reported quarterly earnings of $1.31 per share, exceeding the Zacks Consensus Estimate of $1.07 per share, and showing an increase from $1.18 per share a year ago, resulting in an earnings surprise of 22.43% [1] - The company generated revenues of $1.14 billion for the quarter ended December 2024, surpassing the Zacks Consensus Estimate by 19.92%, although this represents a slight decrease from $1.17 billion in the same quarter last year [2] - CNO has outperformed the S&P 500, with shares increasing by approximately 7.7% since the beginning of the year compared to the S&P 500's gain of 3.1% [3] Earnings Outlook - The current consensus EPS estimate for the upcoming quarter is $0.80 on revenues of $943.95 million, while for the current fiscal year, the estimate is $3.79 on revenues of $3.88 billion [7] - The estimate revisions trend for CNO is favorable, leading to a Zacks Rank 2 (Buy) for the stock, indicating expectations of outperformance in the near future [6] Industry Context - The Insurance - Multi line industry, to which CNO belongs, is currently ranked in the bottom 44% of over 250 Zacks industries, suggesting potential challenges ahead [8] - Hamilton Insurance, another company in the same industry, is expected to report a quarterly earnings decline of 33.9% year-over-year, with revenues projected to be $571.22 million, reflecting a 15.4% increase from the previous year [9][10]

Financial Performance - Total revenues for 2023 reached $4,146.8 million, with a year-to-date (YTD) total of $4,449.5 million for 2024[9]. - Net income for 2023 was $276.5 million, while the YTD net income for 2024 stands at $404.0 million[9]. - The company experienced a significant increase in income before income taxes, reaching $356.8 million in 2023 and $518.3 million in 2024[9]. - Net operating income for Q4 2023 was $138.0 million, compared to $133.9 million in Q4 2022, reflecting a growth of about 3.1%[12]. - Net income for 2023 reached $404.0 million, compared to $276.5 million in 2022, which is an increase of approximately 46.1%[12]. - The company reported a net operating income of $356.1 million for the full year 2023, which is $3.09 per diluted share[56]. Assets and Liabilities - Total assets increased from $33,957.2 million in Mar-23 to $37,852.6 million in Dec-24, reflecting a growth of approximately 11.3%[6]. - Total liabilities rose from $31,925.4 million in Mar-23 to $35,354.2 million in Dec-24, an increase of about 10.4%[6]. - Shareholders' equity decreased from $2,031.8 million in Mar-23 to $2,498.4 million in Dec-24, showing a decline of approximately 22.5%[6]. - Cash and cash equivalents increased significantly from $425.0 million in Mar-23 to $1,656.7 million in Dec-24, a rise of approximately 289.5%[6]. Insurance Products and Premiums - The company reported an increase in collected premiums and insurance policy income, indicating a positive trend in revenue generation[6]. - New annualized premiums for health and life insurance products showed a significant increase, contributing to overall growth in the insurance segment[6]. - Total collected premiums for 2023 reached $4,098.0 million, with a quarterly increase to $1,068.1 million in Q4[22]. - Total insurance policy income for 2023 was $2,505.5 million, with Q4 income at $625.7 million[22]. - Insurance policy income for the year-to-date (YTD) reached $1,618.3 million, showing a steady increase from $1,594.6 million in the previous year[14]. Investment Income - The company reported a net investment income of $1,250.2 million for 2023, increasing to $1,419.4 million in 2024[9]. - Net investment income for 2023 totaled $1,499.7 million, with a quarterly breakdown of $343.0 million in Q1, $399.7 million in Q2, $291.8 million in Q3, and $465.2 million in Q4[35]. - The total net investment income for 2024 is projected to be $1,748.8 million, indicating a growth trajectory from 2023[35]. - Investment income allocated to product lines is based on the book yield of investments backing the business, applied to average net insurance liabilities[65]. Margins and Expenses - Total insurance product margin for 2023 was $1,040.0 million, up from $959.0 million in 2022, representing an increase of approximately 8.5%[12]. - The annuity margin increased to $91.1 million in Q4 2023 from $63.6 million in Q4 2022, marking a significant rise of approximately 43.3%[12]. - Total expenses for the year amounted to $64.0 million, with consistent quarterly expenses of $7.6 million in the first three quarters[38]. - Allocated expenses for 2023 totaled $615.3 million, slightly higher than $599.0 million in 2022, reflecting an increase of about 2.2%[12]. Future Projections - The company anticipates continued growth in 2024, with preliminary amounts indicating a potential increase in net gain from operations[32]. - The forecast for insurance policy income in Q1 2024 is $182.0 million, increasing to $183.3 million in Q4 2024[18]. - The company aims to maintain a consistent growth trajectory in net investment income, targeting $39.6 million in Q1 2024[18]. - The total insurance product margin for 2024 is projected at $1,012.7 million, excluding significant items[48]. Shareholder Information - The weighted average basic shares outstanding decreased from 114,343.1 thousand at the beginning of 2023 to 109,357.5 thousand by the end of 2023[26]. - The diluted shares outstanding at the end of 2023 were 111,750.3 thousand, down from 116,176.0 thousand at the beginning of 2023[26]. - The company repurchased a total of 2,201.3 thousand shares in 2023, with significant repurchases occurring in each quarter[26]. Market Strategy - The company is focusing on market expansion and new product development to enhance its competitive position in the industry[6]. - The company anticipates continued growth in policyholder account balances and new business issuances in the upcoming quarters, driven by market expansion strategies[29].