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


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
Rating Activity
web page. For additional information
regarding the use and limitations of Credit Rating opinions, please view
Best's Credit Ratings
. For information on the proper media
use of Best's Credit Ratings and A.M. Best press releases, please view
for Media - Proper Use of Best's Credit Ratings and A.M. Best Rating
Action Press Releases

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