CNO’s Bonach has insurance firm back on offense [Indianapolis Business Journal (IN)]
|By O'Malley, Chris|
To the contrary:
Some analysts that follow the successor to
Bonach and his team slowly but surely are stomping out smoldering remains of Conseco's legacy business units. And they've arranged
That's strengthened CNO's capital, liquidity and earnings.
"We're no longer CNO the project. We're now CNO a compelling value proposition," Bonach told analysts at CNO's first-ever investor day, last month.
Bonach wants the operating units of
"That market is still vastly underserved and growing quite rapidly," Bonach told IBJ recently.
Bonach said CNO plans to spend up to
Bankers now has more than 275 offices nationwide and over 5,600 career agents and sales managers who employ the "kitchen table" sales model to sell life,
There aren't immediate plans for a new branch office in
Bankers' strategy to appeal to middle-income America has been to set up offices in Class B office space, with agents who mirror the socioeconomic status of the customers they're trying to reach.
"You won't see mahogany and marble" decor in these offices, Bonach said.
CNO also seeks to improve production at
One big focus will be on the Hispanic marketplace through direct-mail marketing, said
Colonial Penn also will add new products, including
Retaining and attracting new agents is another goal for Bonach.
The company recently introduced a management trainee program that identifies high-potential candidates from outside the company. The goal is to get them into management ranks in 2-1/2 to three years, which is about half the time internal candidates move through.
It also plans to put 700 to 900 of its agents into a program to improve agent productivity.
Bonach also said he's been taking steps to improve customer service and policy administration. The old company had more than a dozen subsidiaries, each with its own systems in place. He rattles off a short list of executives brought in to help clean up the company's IT and other operations.
Better operating results
As for what Bonach ultimately expects from all these efforts, they include sales growth upwards of 10 percent to 12 percent (it's been 6 percent to 8 percent in recent times), and a dividend payout ratio of 20 percent of earnings.
And, he says, "we do believe by 2015 we'll be investment-grade."
In the third quarter, CNO posted a loss of
That loss included a
It brought to more than
CNO also was battered lately by a
However, the company had "solid results from operating segments," Goldman Sachs analyst
Bonach, 58, former president of
Last month, CNO said it would spend an additional
Stock buybacks are one way to drive the price of company stock higher, but Bonach isn't counting on such maneuvers alone. He said he expects to drive results from the company's organic growth initiatives.
|Copyright:||(c) 2013 IBJ Corporation|