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FOR IMMEDIATE RELEASE
OLDWICK - MARCH 03, 2014 10:58 AM (EST)
A.M. Best has placed under review with positive implications the financial strength rating (FSR) of B- (Fair) and issuer credit rating (ICR) of "bb-" of Conseco Life Insurance Company (CLIC). CLIC is a life/health subsidiary of CNO Financial Group, Inc. (CNO Financial)[NYSE: CNO]. Both companies are headquartered in Carmel, IN.
The rating actions follow the recently announced definitive agreement by CNO Financial to sell all of CLIC's common shares to Wilton Reassurance Company (Wilton Re) (Minneapolis, MN) for approximately $237 million in cash. The transaction, which includes CLIC's run-off blocks of traditional life, interest sensitive life and annuity lines of business, is expected to close by mid-year 2014.
CNO Financial has been actively de-risking its legacy blocks of business within its other CNO business segment in recent months. With this transaction, CNO Financial will significantly reduce its exposure to life and annuity closed blocks of business within other CNO business so that the organization can concentrate more on its core lines of business.
The under review status reflects A.M. Best's view that CLIC will benefit from being a part of the Wilton Re organization that focuses on the life and annuity market segments. The ratings will remain under review pending the completion of the transaction, during which time A.M. Best will discuss with Wilton Re's management CLIC's strategic fit within the organization.
The FSR, ICRs and debt ratings of CNO Financial and its subsidiaries are unchanged. However, A.M. Best views the recent long-term care reinsurance agreement with Beechwood Re and this current transaction, pending its closing, as a credit positive for CNO Financial.
The methodology used in determining these ratings is Best's Credit Rating Methodology, which provides a comprehensive explanation of A.M. Best's rating process and contains the different rating criteria employed in the rating process. Best's Credit Rating Methodology can be found at www.ambest.com/ratings/methodology.
A.M. Best Company is the world's oldest and most authoritative insurance rating and information source.