Analysis CNO
CNO's earnings are outpacing life and health policy sales
The insurer raised its annual outlook as returns on investments and its existing policies improved.
CNO Financial's new life and health insurance sales grew just 1.3% in the quarter ended September 30, 2026, down from 6.5% growth in the previous quarter. Earnings grew much faster, even after removing the benefit from its annual review of insurance assumptions.
On that basis, operating earnings rose 41% to $134.2 million. CNO's operating measure removes selected investment market movements and other non-operating items; this comparison also excludes the annual-review benefit in both years.
The gap reflects an insurer's ability to earn more from policies already on its books and the assets supporting them. CNO sells life and supplemental health coverage and annuities to middle-income households.
Investments and existing policies did more of the work
Insurance product margins, before allocated expenses and excluding the annual-review effects, rose about 7%. Annuities led the improvement. Lower claims in long-term care also helped, while higher claims weighed on Medicare Supplement coverage.
Net investment income in CNO's operating presentation rose 13% to $350.7 million. The investment income it keeps outside product-line results rose to $68.1 million from $39.5 million, helped by stronger alternative-investment returns and income from investment-financing programs.
The annual assumptions review added a separate $44.9 million after tax to quarterly earnings. Updated expectations about existing policies also changed the pattern of future earnings: CNO expects higher quarterly contributions from fixed indexed annuities and Medicare Supplement insurance.
That helps explain why the annual forecast improved beyond the immediate review benefit. CNO now expects operating earnings per share of $5.05 to $5.15 for 2026, up from July's $4.60 to $4.80. Both ranges exclude significant items such as the annual-review gain.
The sales streak is becoming less even
CNO's measure of new life and health premiums rose for a seventeenth consecutive quarter. It expresses new-policy premiums at an annual rate. Consumer-division sales on that measure fell 1.7%, while workplace sales rose 17.9%.
Annuities followed a different path: collected premiums rose 8.8%. Their growth and the larger existing insurance book give CNO earnings support beyond the slower life and health sales measure.
Cash available at the parent did not rise alongside quarterly profit. CNO's holding-company free cash flow fell to $73.5 million from $83.6 million. Its annual forecast narrowed to $220 million to $240 million, from $200 million to $250 million.
The CNO Financial company profile compares the forecasts, cash generation and the internal reinsurance transaction completed in October.