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CNO Financial Group NYSE: CNO executives said the insurer delivered “excellent quarter and full year results” in 2025, citing continued sales momentum, improving profitability, and a strong capital position during the company’s fourth-quarter earnings call.
Chief Executive Officer Gary Bhojwani said the company achieved, and in most cases exceeded, its 2025 guidance, including improving operating return on equity (ROE) to 11.4% excluding significant items. He characterized results as “consistent and repeatable,” driven by execution in the underserved middle-income market and CNO’s captive agent distribution model.
Sales growth, agent expansion, and record new annualized premium
Bhojwani highlighted sustained production and distribution growth, including 14 consecutive quarters of sales growth and 12 consecutive quarters of growth in producing agent count. For the full year, the company delivered record total new annualized premium (NAP), up 15%, with production records “across both divisions and in multiple product lines.”
Operating earnings per diluted share were $4.40, up 11%, according to Bhojwani, who said results benefited from strong insurance product margin and investment performance, including an expanding portfolio book yield. He added that new money rates exceeded 6% for 12 consecutive quarters while maintaining portfolio quality.
The company also returned $386 million to shareholders during the year and raised its quarterly common stock dividend for the 13th consecutive year. Book value per diluted share, excluding accumulated other comprehensive income (AOCI), was $38.81, which management said represents a 7% compound annual growth rate over the past three years.
Consumer division: life, health, Medicare Supplement, annuities, and advisory growth
In the consumer division, Bhojwani said 2025 marked the 13th consecutive quarter of sales growth and the third consecutive year of record production by the Bankers Life agent force. He pointed to double-digit growth in Life, Supplemental Health, and Medicare Supplements, along with record growth in annuities and client assets in brokerage and advisory.
- Life NAP: Up 10% for the full year, led by record direct-to-consumer (D2C) life sales up 20%. Bhojwani said the D2C effort benefited from technology-driven productivity enhancements and a diversification of direct marketing away from television toward web, digital, and third-party channels. Non-television lead sources generated more than 70% of D2C life sales for the year.
- Total health NAP: Up 22%, marking 14 consecutive quarters of growth. Supplemental health was up 15% and long-term care was up 4%.
- Medicare Supplement NAP: Up 49% for the year and up 92% for the quarter, which Bhojwani called the best Med Supp quarter in 15 years.
- Medicare Advantage policies sold: Down 3% for the year (not reflected in NAP). Bhojwani attributed this to a shift in consumer preferences toward Medicare Supplement as some leading Medicare Advantage carriers “pare back plans and benefits.” Total Medicare policies sold were up 5%.
- Annuity collected premiums: Record results, up 9% for the full year and up 3% for the quarter, marking the 10th consecutive quarter of growth. Fourth-quarter collected premiums totaled $508 million, and in-force account values exceeded $13 billion, up 7%.
- Brokerage and advisory: The company posted its 11th consecutive quarter of growth, with client assets up 24% year over year to more than $5 billion and total accounts up 12%. Combined with annuity account values, Bhojwani said customers entrusted CNO with more than $18 billion of assets, up 11% from 2024.
Bhojwani also emphasized that producing agent count increased for the 12th consecutive quarter, while registered agent count was up 8%.
Worksite division: record production, recruiting gains, and fee-services exit
CNO’s worksite business posted what Bhojwani called its strongest year ever, finishing 2025 with record full-year insurance sales up 15% and record fourth-quarter insurance sales up 13%. This represented the second consecutive year of record production and the 15th consecutive quarter of NAP growth.
Full-year product highlights included record life insurance sales up 36%, hospital indemnity insurance up 41%, and accident insurance up 11%. Bhojwani said strategic initiatives contributed to results, including a geographic expansion initiative that delivered 11% of NAP growth for the year and NAP from new group clients that rose 23%.
Producing agent count was up 7%, driven by recruiting that rose 10%, marking the 14th consecutive quarter of growth in the agent force. Bhojwani added that CNO’s previously announced exit of the fee services business within worksite was on schedule and expected to be “largely complete” in the first half of 2026.
Margins, investment results, and capital position
Chief Financial Officer Paul McDonough said operating ROE excluding significant items improved to 11.4% from a “10% run rate” in 2024, representing progress toward a 12% target ROE in 2027. He said operating EPS excluding significant items grew 10% in the quarter and 6% for the year, reflecting strength in insurance product margin and net investment income. McDonough noted full-year operating EPS excluding significant items was $4.02, exceeding the high end of original guidance.
McDonough also said the full-year expense ratio excluding significant items was 18.9%, better than the low end of guidance, and the effective tax rate on operating income was 20.6%, below the 22% to 22.5% range, citing tax strategies implemented in the fourth quarter, reduced state tax impact, and increased tax-exempt interest.
On capital deployment, McDonough said the company repurchased $320 million of shares in 2025, up 14%, including $60 million in the fourth quarter. He said this contributed to an 8% reduction in weighted average diluted shares outstanding.
Investment results remained a focus. McDonough said total insurance product margin excluding significant items increased again in the quarter, supported by sales performance and stable underlying claims trends. Net investment income marked the ninth consecutive quarter of growth in total net investment income, supported by asset growth, improving yields, alternative investment income that met yield expectations, and a $12 million special dividend from a strategic investment.
McDonough said the company issued $400 million of FABN in the quarter and $750 million for the full year, and expects to continue issuing under the program subject to market conditions. New investments in the quarter totaled about $1.6 billion, with an average rating of single-A and average duration of six years, and the new money rate was 6.11%—the 12th consecutive quarter above 6%.
As of year-end, CNO held a record $31 billion of invested assets, with 97% rated investment grade and an average rating of single-A. McDonough said commercial real estate and private credit performed as expected. The company’s consolidated risk-based capital (RBC) ratio was 380%, with management referencing a target range of 360% to 390%. Holding company liquidity ended the year at $351 million, and debt to total capital remained within a 25% to 28% target range.
2026 outlook and themes from Q&A
McDonough provided initial 2026 guidance that management said aligns with its profitability trajectory toward 2027. The company expects operating EPS of $4.25 to $4.45, an expense ratio of 18.8% to 19.2%, fee income of approximately $30 million (with a seasonal pattern), an effective tax rate of about 22.5%, and free cash flow of $200 million to $250 million. He said guidance assumes a stable macro environment and investment returns consistent with long-term expectations.
McDonough also discussed a previously announced three-year technology modernization initiative expected to total about $170 million, noting roughly $20 million was deployed in 2025 and an additional $75 million is expected in 2026; free cash flow guidance is net of this investment.
During Q&A, Bhojwani said CNO expects producing agent count to grow in 2026, but emphasized productivity as the primary focus. He also described “lack of visibility” in the macro environment and said layoffs can help recruiting but can make consumers more hesitant around discretionary purchases. He suggested Medicare Supplement sales may be more resilient, while products such as annuities, life, and long-term care can become more difficult in a tougher macro backdrop.
Management reiterated expectations for continued pressure on Medicare Advantage industrywide and continued strength in Medicare Supplement, while noting that economically the company is “indifferent” between Medicare Advantage and Medicare Supplement distribution, even as Bhojwani said he prefers Medicare Supplement operationally because CNO manufactures and distributes it and because those customers “typically” have higher net worth and cross-sell potential, within applicable marketing rules.
On capital deployment, McDonough said the company’s approach is unchanged and that it generally returns excess capital through share repurchases absent more compelling alternatives, while being “measured” about reducing excess liquidity.
On investments, executive Eric Johnson said the company was largely “running back” its second-half approach from last year, focusing on sustaining portfolio quality with tactical additions, and said tight spreads limit areas where investors are being rewarded for risk. Johnson also disclosed that CNO had roughly $250 million of software exposure in its portfolio (about 60 to 70 basis points), with a tilt toward mission-critical enterprise software. He added that in private credit—about a $1.4 billion allocation—less than 10% was exposed to software, and in private equity, about 15% of holdings (on a $400+ million base) were in software.
Management closed the call by reiterating confidence in its momentum, capital position, and path toward the company’s 2027 ROE target.
About CNO Financial Group NYSE: CNO
CNO Financial Group is an Indiana‐based holding company that offers a range of insurance and retirement solutions through its operating subsidiaries. Its primary business activities include life insurance, annuities, and supplemental health insurance products designed to help individuals plan for retirement and manage health‐related expenses. The company serves middle‐income Americans, with particular emphasis on senior customers seeking guaranteed coverage and reliable income streams.
Originally founded as Conseco in 1979, the company underwent a financial restructuring and rebranded as CNO Financial Group in 2010.
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