Analysis CNO
CNO's earnings are outpacing life and health policy sales
CNO raised its earnings forecast as life and health sales growth slowed. Investment returns and changed insurance assumptions explain the gap.
Ticker Byline
CNO Financial Group, Inc.
CNO Financial Group sells life and supplemental health insurance and annuities, serving middle-income households through consumer and workplace distribution.
- Ticker
- CNO
- Exchange
- XNYS
- SEC CIK
- 0001224608
Insurance for middle-income households
CNO Financial Group, Inc. trades on the New York Stock Exchange under CNO. It sells life and supplemental health insurance and annuities through consumer and workplace channels. Earnings come from the policies it services, claims experience, expenses and the returns on invested assets supporting its business.
Recent financial and sales results
Comparable third quarters ended September 30. Dollar amounts are millions. New life and health sales use annualized premiums; annuity premiums are reported separately.
| Metric | Q3 2025 | Q3 2026 |
|---|---|---|
| Reported revenue | $1,188.7 | $1,086.0 |
| Net income | $23.1 | $161.1 |
| Operating earnings | $127.2 | $179.1 |
| Operating earnings excluding significant items | $95.0 | $134.2 |
| New life and health premiums | $125.1 | $126.7 |
| Annuity collected premiums | $472.5 | $514.0 |
Reported revenue includes investment and market-value effects. Insurance policy income rose to $688.2 million from $658.4 million. The net-income comparison also reflects a $96.7 million goodwill and asset impairment charge in Q3 2025.
Operating earnings remove selected investment-market and other non-operating effects. They retained $44.9 million of annual-review benefits this quarter, versus $32.2 million a year earlier. Removing those benefits in both years gives the final earnings row above.
Insurance product margin excluding review effects rose to $276.7 million from $259.2 million, before allocated expenses. Operating net investment income rose to $350.7 million from $310.5 million, including stronger variable alternative-investment returns. These provide different sources of earnings from new policy sales.
How the annual outlook changed
Full-year 2026 forecasts. Earnings per share and the expense ratio exclude significant items; free cash flow is the holding company's measure.
| Forecast | July 30 | October 29 |
|---|---|---|
| Operating earnings per share | $4.60 to $4.80 | $5.05 to $5.15 |
| Expense ratio | 18.8% to 19.0% | 18.6% to 18.8% |
| Free cash flow, millions | $200 to $250 | $220 to $240 |
The earnings forecast rose while the cash-flow range narrowed. CNO's annual review also changed expected future quarterly income patterns for fixed indexed annuities and Medicare Supplement coverage, alongside its immediate earnings benefit.
Cash, debt and insurance capital
The holding company's quarterly free cash flow fell to $73.5 million from $83.6 million. This measure combines parent-company cash sources with net tax receipts or payments, then deducts expenses and interest; shareholder distributions and financing transactions follow separately. It differs from the consolidated insurer's operating cash flow.
At September 30, the holding company had $230.7 million of unrestricted cash and investments, compared with $233.2 million in June and $351.4 million at December 31. CNO repurchased $60 million of stock under its program and paid $16.5 million of common dividends in the quarter.
Direct corporate notes on the balance sheet were $1.34 billion. Borrowings used in investment programs are separate. The estimated risk-based capital ratio of the U.S. insurance subsidiaries was 374%, within management's 360% to 390% target range.
Completed internal reinsurance
On October 1, 2026, CNO completed its third reinsurance transaction with its wholly owned Bermuda affiliate. It covered about $270 million of existing graded-benefit life insurance statutory reserves from Colonial Penn, changing how the group allocates insurance obligations and capital internally.
Future results can show whether life and health sales regain momentum, whether investment returns continue supporting earnings, and how cash generation follows the higher profit outlook.
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