Conseco to Eliminate Insurance Unit
INDIANAPOLIS (AP) _ Debt-burdened Conseco Inc. will eliminate its last major medical insurance unit, costing 445 employees their jobs and leaving 40,000 customers in 20 states looking for new coverage.
The financial services company had been looking for a buyer for Conseco Medical Insurance Co., but couldn’t agree on a deal, said Brad Wolfram, the unit’s senior vice president of operations.
``We talked to a number of parties who were interested in a sale. But we couldn’t reach terms that were financially acceptable,″ Wolfram told The Indianapolis Star for a story appearing in Wednesday’s editions.
``At the end, we were not profitable. Some of it goes back to regulations, some of it has to do with the increased costs of health care.″
Employees of the Rockford, Ill.-based medical insurance unit were informed last week of the division’s impending closure in an internal memo. So far this year, Conseco has cut more than 600 jobs.
Applications for new coverage through Pioneer Life Insurance, Washington National Insurance and Conseco Medical Insurance will be denied beginning March 1.
Customers will receive six months notice of their policies’ termination. Most will be void by Sept. 15, Wolfram said.
Carmel-based Conseco began divesting its medical insurance business last summer, phasing out about half its policies and taking a $60 million pre-tax charge and $39 million after taxes.