CNO Financial Group, Inc.

Thank you for joining us today for the CNO Financial Group third quarter earnings call. My name is Sammy and I'll be coordinating your call today. During the presentation, you can register a question by pressing star followed by one on your telephone keypad. If you change your mind, please press star followed by two on your telephone keypad to remove yourself from the question queue. I would now like to hand over to your host, Adam Orville from CNO to begin. Please go ahead, Adam.

Good morning. Good morning. Thank you for joining us on CNO Financial Group's third quarter 2025 earnings conference call. Today's presentation will include remarks from Gary Bujwani, Chief Executive Officer, and Paul McDonough, Chief Financial Officer. Following the presentation, we will also have other business leaders available for the question and answer period. During this conference call, we will be referring to information contained in yesterday's press release. You can obtain the release by visiting the media section of our website at cnoinc.com. This morning's presentation is also available in the Investors section of our website and was filed in a Form 8K yesterday. Let me remind you that any forward-looking statements we make today are subject to a number of factors which may cause actual results to be materially different than those contemplated by the forward-looking statements. Today's presentation contains a number of non-GAAP measures, which should not be considered as substitutes for the most directly comparable GAAP measures. You'll find a reconciliation of the non-GAAP measures to the corresponding GAAP measures in the appendix. Throughout the presentation, we'll be making performance comparisons, and unless otherwise specified, any comparisons made will refer to changes between third quarter 2025 and third quarter 2024. And with that, I'll turn the call over to Gary.

Thanks, Adam. Good morning, everyone, and thank you for joining us. Starting at slide four. CNO once again delivered a strong quarter demonstrating our capabilities to generate consistent, repeatable results and execute on our strategic plan. We remain focused on growing earnings and improving profitability. To do so, we have taken action on two items that we expect will accelerate operating ROE improvement through 2027 by an additional 50 basis points. First, the execution of a second Bermuda treaty and second changes to our worksite divisions fee services business. Further details will be provided later in our prepared remarks. Sales results in the quarter were excellent, including record total new annualized premiums of $125 million up 26% and double digit insurance sales growth in both divisions. We also delivered our 13th consecutive quarter of strong insurance sales and our 11th consecutive quarter of growth in producing agent comp. I'll cover these results in more detail in each division's comments. Operating earnings for diluted share were $1.29, up 16%. Earnings continue to benefit from favorable insurance product margin and solid investment results, reflecting growth in the business and expansion of the portfolio book yield. New money rates have exceeded 6% for 11 consecutive quarters now while maintaining portfolio quality. Capital and liquidity remain above target levels. We returned $76 million to shareholders in the quarter and $310 million year-to-date. Book value per diluted share, excluding AOCI, was $38.10, up 6%. Paul will go into greater detail on our financial performance. Turning to slide five, nearly all of our growth scorecard metrics were up for the quarter. As a reminder, our growth scorecard focuses on three key drivers of our performance, production, distribution, and investments and capital. I'll discuss each division in the next two slides. Paul will cover investments and capital in more detail during his remarks. Beginning with the consumer division on slide six. The consumer business delivered another quarter of excellent sales results and our 12th consecutive quarter of sustained growth. Nearly all product lines were up, most by double digits. Steady execution and our dedication to serving the middle income market continue to fuel our growth. Life and Health NAP once again posted double digit growth in the quarter of 27%. We are pleased with our life and business results, including total life insurance up 33%, and record direct-to-consumer life insurance sales up 56%. Our B2C results benefited from three key factors. First, process and technology enhancements continue to drive sales productivity. Second, we have been proactively diversifying our direct marketing away from television to include more web, digital, and third-party channels. Non-TV lead sources combined generated 72% of all D2C life sales in the quarter. Lastly, our D2C results were bolstered by increased direct marketing spend by some of our third party partners. We don't expect this level of spending to repeat in the fourth quarter, which is traditionally the lowest selling quarter of the year for the D2C channel. Our approach to partnerships is intentionally selective, ensuring that distributors complement our existing capabilities and target markets that are different from our typical customer base. This strategy enables us to conduct rapid experiments with minimal investment that augment our in-house development and testing. Sustained growth in our health results continues to underscore strong customer demand for practical solutions to protect against out-of-pocket gaps in medical coverage and the growing cost of health care. Total health NAP was up 21%, which marks 13 consecutive quarters of growth. Supplemental health was up 23%, and long-term care was up 7%. Medicare supplement was up 33%. Medicare Advantage policies sold, which are not reflected in NAP, were down 24%. Our Medicare results reflect a growing shift in consumer preferences from Medicare Advantage to Medicare Supplement. reversing a decade-long trend. As many of the leading MA sponsors pare back plans and benefits, more customers are moving to Medicare supplement plans. With more than 11,000 people in the U.S. turning 65 every day, overall demand for Medicare products continues to grow, and we have an opportunity to continue to expand the total number of households we serve. Annuity collected premiums were up 2% in the quarter, our ninth consecutive quarter of growth. Collected premiums in the quarter totaled nearly $475 million, our third highest quarter of all time. Average account size was up 5% and in-force account values were up 8%, exceeding $13 billion for the first time. Our captive distribution and the long-term relationships that our agents establish with their clients add stability to our annuity blocks. We delivered our 10th consecutive quarter of brokerage and advisory growth. Client assets in brokerage and advisory were up 28% and hit a new record, surpassing $5 billion. Total accounts and average account size were each up 13%. When combined with our annuity account values, our clients now entrust us with more than $18 billion of their assets, up 13%. Agent productivity and retention continue to support our sustained sales momentum. Producing agent count grew for the 11th consecutive quarter and registered agent count was up 6%. Investments in technology continue to enable customer experience enhancement and drive operational efficiency. For example, accelerated underwriting on a portion of our simplified life products delivered an 89% instant decision rate on submitted policies in the quarter, up 11%. Next, slide seven and our worksite division performance. As a reminder, our worksite division encompasses two primary components, insurance products and fee services. First, insurance product sales are the larger part of our worksite business, which once again delivered record sales and our 14th consecutive quarter of growth. I'll touch on our third quarter performance shortly. We have a long and successful history of selling insurance at the worksite. We like the profile and growth of this business. The second component is our fee services business, which was added through the acquisitions of Web Benefit Design in 2019 and DirectPath in 2021. This includes benefits administration technology and education, advocacy, and communication services. This business is small, representing less than 1% of total C&O revenue and contributing a pre-tax annual loss of approximately $20 million. In October, we decided to streamline our worksite operations and exit the fee services business to sharpen our focus on the core insurance business and align resources to proven growth areas. We expect the exit process to be substantially complete in the first half of 2026. After several years of strategic investment, worksite fee services has not met our expectations for financial performance or in delivering new insurance customers. Additionally, competition has intensified with lower cost alternatives and new technologies disrupting our market positions. Paul will provide more detail on the financial impacts of this decision, which we expect to be favorable to earnings and return on equity. It was the right strategic decision for CNO and it was not made lightly. We remain grateful to the associates who supported this business and thank them for their service and dedication to our clients and customers. It is important to emphasize that we remain fully committed to our worksite insurance products and distribution. Worksite insurance sales have never been stronger. The division adds valuable diversification and balance to our model. Turning to our results in the quarter. We delivered another record performance for insurance sales with worksite life and health NAP up 20%. This represents our seventh consecutive quarter of record NAP growth and our 14th consecutive quarter of overall NAP growth. Highlights included life insurance sales up 24%, hospital indemnity insurance up 53%, critical illness insurance up 17%, and accident insurance up 15%. Strategic growth initiatives contributed significantly to our worksite NAP performance. Our geographic expansion initiative delivered 42% of the NAP growth in the quarter, marking the seventh consecutive quarter of growth from this program. Recent investments in training and sales tools continue to enhance agent productivity. Worksite recruiting was up 5% in the quarter, and agent productivity was up 15%. Producing agent count was up 9%, our 13th consecutive quarter of growth. As supported by our strong results, we remain bullish on worksite insurance growth in the fourth quarter of 2025 and beyond. And with that, I'll turn it over to Paul.