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CNO hopes to improve Bankers Life agent retention

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CNO Financial Group Inc. says it’s happy with recruiting and retention of insurance agents at its Washington National unit but wants to improve agent recruiting and retention at its Bankers Life unit.

Executives at the Carmel, Indiana-based insurer talked about the company’s agent force today during a conference call with securities analysts.

CNO’s units sell life insurance, indexed annuities, long-term care insurance, Medicare supplement insurance products and other supplemental health products.

Washington National, a unit that sells life insurance and supplemental health products to middle-income consumers, increased its average number of producing agents by 8 percent between the fourth quarter of 2015 and the fourth quarter of 2016, the company said when it released its earnings for the quarter.

At Bankers Life, which sells long-term care insurance and other products through career agents, new agent recruitment was down 12 percent, and the average number of producing agents fell 5 percent, primarily due to lower first-year agent retention, the company said.

CNO is evaluating candidate sourcing, recruiting activities, agent onboarding, and retention efforts, according to CNO President Gary Bhojwani. 

Related: CNO and CNA open blinds on LTCI performance

CNO is reporting $234 million in net income for the quarter on $1 billion in revenue, compared with $137 million in net income on $970 million in revenue for the fourth quarter of 2015.

New annualized premium from product sales fell to $5.5 million, from $6.7 million, for long-term care insurance.

New sales of Medicare supplement insurance and life insurance also fell.

Sales of the companies’ annuities increased to $17 million, from $14 million.

Bhojwani said one factor hurting life sales was a drop in the number of life leads, due to 2016 election advertising crowding out the company’s Colonial Penn unit television ads.

Total collected long-term care insurance premiums fell to $115 million, from $117 million, but LTCI premium increase moves led to some policyholders letting policies lapse. That added $2.7 million in freed LTCI reserves to the company’s earnings.

The company said it believes, based on new analyses, that the reserve margin at its LTCI unit is thicker than it originally thought.

A securities analysts asked whether higher interest rates and new understanding of the reserves could help CNO make a reinsurance deal or other deal to transfer LTCI risk to another party.

Edward Bonach, CNO’s chief executive officer, said that claims experience is a bigger factor for the company’s LTCI block than interest rates, and that, because its LTCI policyholders have tended to be older than average, it already has more claims experience data than most competitors.


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