Efforts to cut interest expenses and benefits costs helped improve second-quarter results at Conseco Inc., Carmel, Ind.[@@]
Conseco, a company that emerged from Chapter 11 reorganization proceedings in September 2003, is reporting $68 million in net income for the latest quarter on $1 billion in revenue. Its predecessor company reported a net loss of $21 million on $1.2 billion in revenue for the second quarter of 2003.
A 24% drop in insurance policy benefits, to $667 million, compensated for the 9.5% drop in revenue.
Conseco shut down some unprofitable lines of business when it reorganized, and it has improved loss ratios for some of the remaining lines. At the Conseco Insurance Group unit’s specified disease insurance operation, the loss ratio fell to 64.35% during the latest quarter, from 77.77%.
Conseco is reporting a modest decline in collected premiums for some product lines, but annuity product premiums at the Bankers Life unit increased to $230 million, from $177 million. Earned premiums for Bankers Life long term care insurance products increased to $133 million, from $125 million.
Bankers Life managed to increase premium revenue for annuity and LTC products despite Conseco’s fears that agent and consumer worries about its finances might hurt sales.
Bankers Life has strengthened its career agent sales network this year by replacing some branch managers and opening 21 new branches offices, Conseco says. Bankers Life now has 155 branch offices.
Conseco’s primary strategic goal is to “become a premier insurance company serving middle-income Americans throughout their working careers and retirement,” Conseco President William Shea says in a statement about the latest earnings.