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A.M. Best Comments on Credit Ratings of CNO Financial Group, Inc. and Its Life/Health Subsidiaries Following Announced Transaction

August 2, 2018

OLDWICK, N.J.--(BUSINESS WIRE)--Aug 2, 2018--A.M. Best has commented that the Credit Ratings (ratings) of CNO Financial Group, Inc. (CNO Financial) (headquartered in Carmel, IN) [NYSE:CNO] and its life/health subsidiaries remain unchanged following the Aug. 1, 2018 announcement that Bankers Life and Casualty Company (Bankers Life), a wholly owned subsidiary of CNO Financial, has entered into an agreement to cede all of its legacy (prior to 2003) comprehensive and nursing home long-term care policies to Wilton Reassurance Company through a 100% indemnity coinsurance arrangement. The outlooks of these ratings remain stable.

Bankers Life will pay a negative ceding commission of $825 million to reinsure the block and will transfer assets equal to the statutory liabilities supporting the block, which are expected to be approximately $2.7 billion. As part of its de-risking strategy, CNO Financial will reduce its long-term care reserves by more than 50% after completing this transaction and reduce potential earnings volatility and related capital at risk. While the impact to CNO Financial’s balance sheet is material given the size of the reinsured blocks, A.M. Best notes that pro-forma risk-adjusted capitalization will remain supportive of CNO Financial’s current ratings. The transaction is expected to close in the third quarter of 2018, pending regulatory approval and other customary closing conditions.

This press release relates to Credit Ratings that have been published on A.M. Best’s website. For all rating information relating to the release and pertinent disclosures, including details of the office responsible for issuing each of the individual ratings referenced in this release, please see A.M. Best’s web page. For additional information regarding the use and limitations of Credit Rating opinions, please view . For information on the proper media use of Best’s Credit Ratings and A.M. Best press releases, please view .

A.M. Best is a global rating agency and information provider with a unique focus on the insurance industry. Visit for more information.

Copyright © 2018 by A.M. Best Rating Services, Inc. and/or its affiliates. ALL RIGHTS RESERVED.

View source version on businesswire.com:https://www.businesswire.com/news/home/20180802005694/en/

CONTACT: A.M. Best

Prafull Jhawar,+1-908-439-2200, ext. 5214

Senior Financial Analyst

prafull.jhawar@ambest.com

or

Christopher Sharkey, +1-908 439-2200, ext. 5159

Manager, Public Relations

christopher.sharkey@ambest.com

or

William Pargeans,+1-908-439-2200, ext. 5359

Director

william.pargeans@ambest.com

or

Jim Peavy, +1-908-439-2200, ext. 5644

Director, Public Relations

james.peavy@ambest.com

KEYWORD: UNITED STATES EUROPE NORTH AMERICA INDIANA NEW JERSEY

INDUSTRY KEYWORD: HEALTH OTHER HEALTH PROFESSIONAL SERVICES FINANCE INSURANCE MANAGED CARE

SOURCE: A.M. Best

Copyright Business Wire 2018.

PUB: 08/02/2018 12:52 PM/DISC: 08/02/2018 12:52 PM

http://www.businesswire.com/news/home/20180802005694/en

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