CNO Financial Group (CNO) Status update summary

Worksite Division Strategy and Performance

• Focuses on serving middle-income employees in sectors like education, public sector, transit, and unions, addressing gaps in employer-paid benefits with supplemental health and life products.

• Achieved an 18% compound annual sales growth rate from 2020 to 2025, outpacing the broader market's 5% CAGR, with 22% and 29% year-over-year growth in Q1 and Q2 2026, respectively.

• Growth driven by both agent count and productivity, with strategic emphasis on leadership development, technology, and geographic expansion.

• Products are primarily employee-paid, portable, and feature return-of-premium options, enhancing persistency and customer loyalty.

• Owned distribution through captive agents (Optavise) enables direct relationships, high-touch service, and reduced broker-driven churn.

Distribution Model and Agent Development

• Optavise agents are independent contractors, incentivized through commissions, and supported by robust training, CRM, and sales enablement tools.

• Leadership development and technology investments aim to accelerate agent productivity and scale the distribution system efficiently.

• Geographic expansion is disciplined, focusing on adjacent states and proven leaders, with 24% of annual sales now from new markets.

• The model emphasizes live, in-person education and enrollment, particularly effective in industries with shift work and limited digital access.

• Maintains a national network of over 5,000 captive health insurance agents, providing face-to-face guidance.

Medicare Business Overview and Growth

• Medicare market is large and expanding, with over 69 million beneficiaries and spending exceeding $1.2 trillion.

• Offers both proprietary Medicare Supplement (own risk) and third-party Medicare Advantage and drug plans.

• Medicare Supplement sales have grown over 18% annually since 2023, with in-force policies rising to 212,000 in 2026 and now representing 15% of new annualized premium.

• Rate increases have offset higher claims, with benefit ratios expected to return to historical levels and persistency remaining strong.

• Market share is under 2%, indicating significant room for growth as the field force expands.