CNO Financial Group, Inc. Q1 2026 Earnings Call Summary

1Key Financial Results and Metrics

Operating Earnings: $1.05 per diluted share, up 33% year-over-year (42% excluding significant items).

Sales Growth: Fifteenth consecutive quarter of sales growth; total new annualized premiums increased by 11%.

Book Value: $38.98 per diluted share, up 5%.

Expense Ratio: 18.9%, lower than planned, expected to normalize over the year.

Return on Equity: 13.1% on a trailing twelve-month basis, 12.2% excluding significant items.

Shareholder Returns: $77 million returned to shareholders through dividends and share repurchases.

2Strategic Updates and Business Highlights

Consumer Division:

Life and Health NAP increased by 9%, with total Health NAP up 20%.

Medicare policies sold rose by 24%, with Medicare supplement NAP up 53%.

Direct-to-Consumer (D2C) life sales benefited from diversified marketing strategies, with 65% from non-television sources.

Worksite Division:

Life and Health NAP up 22%, marking sixteenth consecutive quarters of sales growth.

Significant increases in life insurance (56%) and hospital indemnity insurance (121%).

Technology Investments: Ongoing enhancements in AI and data analytics to improve agent productivity and customer experience.

3Forward Guidance and Outlook

CNO maintains its original guidance for 2026, citing confidence in controllable variables despite a volatile macroeconomic environment.

Plans to refine projections later in the year.

The company aims to increase its three-year operating return on equity target beyond the current 12%.

4Challenges and Points of Concern

Medicare Supplement Claims: Adverse claims experience noted, prompting planned rate increases to maintain profitability.

Annuity Premiums: Collected premiums down 2% year-over-year, attributed to strong comparables from the previous year.

Expense Management: While current expenses were favorable, there is uncertainty about normalization in future quarters.

Market Volatility: Concerns about credit market fluctuations and their impact on investment performance.

5Notable Q&A Insights

Medicare Supplement Pricing: Rate increases filed for both closed and open blocks, expected to improve benefit ratios by Q4 2026.

Consumer Segment Performance: CEO Gary Bhojwani emphasized strong long-term demand for products, downplaying minor quarterly fluctuations.

Investment Strategy: CNO remains cautious in the credit markets, focusing on high-quality investments and waiting for favorable conditions before issuing new securities.

Long-term Care Performance: Continued favorable claims experience, with expectations for stable margins moving forward. Overall, CNO Financial Group demonstrated strong performance in Q1 2026, with significant growth across divisions and a robust capital position, while also addressing challenges in claims experience and market volatility. The company remains optimistic about its future growth and profitability.