LYCOS RETRIEVER 
Conseco: Companies
built 635 days ago
Conseco assumes a formidable position in insurance distribution. As 2002 begins, the company ranks as the Number 1 provider of agent distributed Medicare supplement insurance, the Number 1 provider of heart/stroke insurance, the Number 2 provider of cancer insurance and the Number 3 provider of long-term care insurance. Over the past 15 years, Conseco has been a leading provider of annuities in the senior market, often taking a leading position in the distribution of annuities through financial institutions. Through then-owned Bankmark, Conseco worked to establish insurance distributions systems at some of the largest financial institutions in America, reaching run rates in the 1990s close to $1 billion per year in annuity sales.
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Conseco's problems continued and in October 2001, Wendt admitted the turnaround might take a year longer than the 2004 target date he originally set. In November, the stock price fell to its lowest level since early 1991, closing at $2.99. Wendt then decided to prove his faith in the company's future by purchasing one million shares of stock. Ten senior managers followed suit, buying hundreds of thousands of shares themselves. The stock rose to $3.55.
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In late 2001 the Conseco Inc. (CNO) stock on the NYSE crashed to an all time low of only $0.45 per share. This was all in part to the $8 billion debt that the company had accrued over the previous few years. The company fired CEO Stephen Hilbert and filed Chapter 11 Bankruptcy. They then hired the new chairman R. Glenn Hilliard, who was able to put together a legal staff that was in turn able to persuade the judge to lowering the debt amount to a mere $1.4 billion compared to the before $8 billion. Consistent with most Chapter 11 Bankruptcy procedures, the previous common stock was canceled prior to new shares being issued to secured debt holders.
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As Conseco headed into 1998, the company had a number of accomplishments under its belt. In 1996 the company was named to the Fortune 500, and in 1997 Conseco was added to the S & P 500 Index. The company's stock had returned an average of 39 percent a year since becoming a public company in 1985. Total revenues, after dropping from $3 billion in 1993 to $2.36 billion in 1994, climbed steadily, rising to $3.56 billion in 1995 and $3.79 billion in 1996. In 1997, total revenues reached $6.85 billion, a significant increase over the previous year.
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Conseco faced the challenge of maintaining and adapting large, internally created mainframe applications, a task complicated further by the turnover and/or retirement of many of the original developers of these important business applications. Conseco was ... shifting a portion of the company’s internal work to a Conseco office in India during the project. Conseco turned to Compuware to help manage these complexities.
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The Conseco owned insurers are licensed and in good standing with the Wisconsin Office of the Commissioner of Insurance (OCI), and continue to operate normally. The state of Texas is the direct regulator of most of the insurers in the Conseco group. The Texas Department of Insurance is in close contact with Conseco, Inc., and has taken the necessary actions to protect the insurers from effects of the holding company's financial troubles. The OCI has been in regular contact with the Texas Department of Insurance and has been monitoring the progress of the Conseco, Inc., situation.
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