LYCOS RETRIEVER 
Conseco: Insurance
built 635 days ago
Headquartered in suburban Indianapolis, Indiana, Conseco, Inc., is one of middle America's leading sources for insurance, investment and lending products. Through its subsidiaries and a nationwide network of distributors, Conseco helps 13 million customers step up to a better, more secure future.
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In 1998, Conseco purchased the former Greentree Financial, one of the largest financiers of mobile homes, in an attempt to diversify into consumer financial services. That attempt ended with the divestiture of GreenTree in 2003, and Conseco is now solely focused on the insurance industry.
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Looking to offer its products nationwide, Conseco offers Medicare Supplement insurance coverage in all states except Alaska, Connecticut, Washington D.C., Florida, Hawaii, Massachusetts, Minnesota, New Hampshire, New Jersey, New York, Rhode Island and Washington. Conseco’s Medicare supplement policies assist in the payment of expenses not covered under Medicare Plan Part A and Part B.
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Additional asset sales -- chiefly insurance lines and Conseco's variable annuities business -- appeared to have solved the problem in the spring. Conseco shares briefly rebounded to $5 per share. But its inability to persuade its banks to renegotiate $545 million in directors and officers loans due in 2003, plus the massive second-quarter write-off, left Conseco too heavily leveraged to recover through Wendt's debt-reduction plan.
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Conseco, the second largest provider of long term care insurance in the U.S., indicated in their latest SEC filing that they are increasing premiums on long term care policies. The 10Q filed May 15, 2000 states, "The loss ratios for long-term care products increased in the first quarter of 2000, reflecting unfavorable claims experience and the effects of the asset accumulation phase of these products...In order to improve the profitability of the long-term care product line, we are currently selling products with higher margins and we have continued to apply for appropriate rate increases on older blocks of business."
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Two decisions that could affect Conseco's ability to operate are expected by the end of March. The first is from A. M. Best, which is considering whether to reduce Conseco's A- minus insurance rating. A cut would make it harder to sell certain insurance products.
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