CNO CEO Writes to Shareholders From His Home Office

Many publicly traded insurers are warning in their shareholder vote proxies that the COVID-19 pandemic may force them to skip holding in-person annual meetings this year.

Gary Bhojwani, the chief executive officer of CNO Financial Group Inc., started the letter at the front of his company's annual report to shareholders by noting that, as he was finishing the letter, he and most other CNO associates had been working from their homes for at least the past week, due to the pandemic.

CNO's life insurance company units sell products such as life insurance, annuities, Medicare supplement insurance and long-term care insurance.

"Nothing is more important to us than ensuring our ability to keep the promises we make with every product we sell," Bhojwani writes in the letter to shareholders. "We know the responsibility that rests with us, and we take it very seriously."

Resources

A copy of CNO's annual report to shareholders is available here.
An article about Aflac's brush with COVID-19 in Japan is available here.

Bhojwani says CNO's portfolio investment managers are managing through an extremely challenging environment.

He says the 10-Treasury bond yield started out at 3% at the end of 2018, fell to 1.8% in late 2019, and sank to 0.5% March 9.

CNO's investment team also faces geopolitical risks, such as the oil market turbulence and the COVID-19 pandemic, along with extreme disruption in the stock and bond markets, Bhojwani says.

But CNO's investment managers got through the Sept. 11, 2001, attacks and the 2007-2009 financial crisis, and the company's investments have performed better than the comparison benchmarks, Bhojwani says.

He says CNO is trying to make up for some of the effects of low interest rates by cutting expenses.

"We cannot predict the challenges that the future will bring — new record-low interest rates, the evolving COVID-19 situation, recession or other disruptions," Bhojwani says. "However, I know for certain that CNO, our associates and our agents will be there for our policyholders when they need us most. We are in this business to help ensure that our middle-market customers can rest easy knowing that their futures are secure. I am confident that as a company and a nation, we will come out of this stronger."

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