UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, D.C. 20549

FORM 8-K

CURRENT REPORT
PURSUANT TO SECTION 13 OR 15(d) OF THE
SECURITIES EXCHANGE ACT OF 1934

Date of Report (Date of earliest event reported): April 22, 2014

CNO Financial Group, Inc.
(Exact Name of Registrant as Specified in Charter)

	
			
Delaware	001-31792	75-3108137	
(State or Other
Jurisdiction of Incorporation)	(Commission File Number)	(I.R.S. Employer
Identification No.)	
11825 North Pennsylvania Street
Carmel, Indiana  46032
(Address of Principal Executive Offices) (Zip Code)

(317) 817-6100
(Registrant's telephone number, including area code)

Check the appropriate box below if the Form 8-K filing is intended to simultaneously satisfy the filing obligation of the registrant under any of the following provisions:

	
		
o	Written communications pursuant to Rule 425 under the Securities Act (17 CFR 230.425)	
 	 	
o	Soliciting material pursuant to Rule 14a-12 under the Exchange Act (17 CFR 240.14a-12)	
 	 	
o	Pre-commencement communications pursuant to Rule 14d-2(b) under the Exchange Act (17 CFR 240.14d-2(b))	
 	 	
o	Pre-commencement communications pursuant to Rule 13e-4(c) under the Exchange Act (17 CFR 240.13e-4(c))	

	
		
Item 2.02.	Results of Operations and Financial Condition.	

On April 22, 2014, CNO Financial Group, Inc. (the "Company") issued: (i) additional financial information related to the historical reporting impact of the previously announced agreement to sell Conseco Life Insurance Company on its business segments (a copy of such additional financial information is attached hereto as Exhibit 99.1 and is incorporated herein by reference); and (ii) the Quarterly Financial Supplement for the fourth quarter of 2013, revised to provide historical financial information based on such impact (a copy of which is attached hereto as Exhibit 99.2 and is incorporated herein by reference).
The information contained under Item 2.02 in this Current Report on Form 8-K (including Exhibits 99.1 and 99.2) are being furnished and shall not be deemed "filed" for purposes of Section 18 of the Securities and Exchange Act of 1934, as amended (the "Exchange Act"), or otherwise subject to the liabilities of that Section. The information contained in this Current Report on Form 8-K shall not be incorporated by reference into any registration statement or other document pursuant to the Securities Act of 1933, as amended, or the Exchange Act, except as shall be expressly set forth by specific reference in any such filing.

	
		
Item 9.01(d).	Financial Statements and Exhibits.	

The following materials are furnished as exhibits to this Current Report on Form 8-K:

	
		
99.1	Presentation - Revised Segment Reporting - April 22, 2014.	
99.2	Revised Quarterly Financial Supplement - 4Q2013.	

2

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the Registrant has duly caused this report to be signed on its behalf by the undersigned hereunto duly authorized.

	
				
 	CNO Financial Group, Inc.	
 	 	
Date: April 22, 2014	 	
 	By:	/s/ John R. Kline	 	
 	 	John R. Kline	 	
 	 	Senior Vice President and
Chief Accounting Officer	 	

3

Revised Segment Reporting April 22, 2014 Exhibit 99.1

 

CNO Financial Group | Revised Segment Reporting | April 22, 2014 2 Annuities & Deposits $705** Interest- Sensitive Life $2,232 LTC $525* Traditional Life $424 Annuities & Deposits $788 Other Health $7 Interest- Sensitive Life $166 OCB Transactions - Overview 12/31/13 OCB Net Statutory Reserves Retained By CNO Ceded & Being Sold OCB – Ceded & Being Sold  $550mm of statutory LTC reserves reinsured to Beechwood Re - reported in 4Q 2013 results  Sale of Conseco Life Insurance Company (“CLIC”) to Wilton Re encompassing $3.4bn of interest- sensitive, traditional life and annuity reserves with anticipated close mid-2014 Business Retained by CNO  Approximately $788mm of annuities and deposits, $166mm of interest-sensitive life reserves and a small amount of A&H business  CNO will no longer report on OCB as a segment and will embed the remaining business and unabsorbed overhead expenses into existing reporting segments * Excludes approximately $25mm of LTC reserves previously reinsured and transferred under the reinsurance agreement ** Includes $450mm of FHLB liabilities ($ millions)

 

CNO Financial Group | Revised Segment Reporting | April 22, 2014 3 • Certain businesses previously reported in the OCB segment and retained by CNO (annuity, interest-sensitive life, and health) will now be reported in the Washington National segment. OCB Businesses Not Sold or Ceded • The business of CLIC being sold to Wilton Re will be reported as non-operating earnings until closing expected mid-2014. The earnings of CLIC being sold are excluded from CNO’s operating earnings, operating earnings per share and operating ROE calculations. Earnings of CLIC Being Sold • The earnings of CLIC being sold do not include OCB expenses expected to continue after the sale. This residual overhead will be allocated to the remaining reporting segments according to our current expense allocation methodology beginning in 1Q2014. Allocation of OCB Overhead • CNO will enter into a two-year TSA at closing where Wilton Re pays CNO to provide transition services for the CLIC business. The transition services revenue less associated expense will be reported as a non-operating item and is expected to have a modest impact on reported results. Transition Services Agreement (TSA) Revised Segment Reporting

 

CNO Financial Group | Revised Segment Reporting | April 22, 2014 4 Navigating CNO’s Quarterly Financial Supplement  At closing, Bankers Life’s results will reflect the life insurance recapture from Wilton Re.  Transition services agreement begins with revenue less expense reported as a non- operating item.  Corporate results reflect modest investment management revenue from Wilton Re investment agreement. Historical Periods (Pre 2014) 2014 Pre-CLIC Sale Post CLIC Sale & Go-Forward  Washington National results are adjusted to include the retained OCB business.  OCB segment includes the LTC business ceded to Beechwood and residual overhead.  The CLIC business is reported as being sold, a non-operating item  No other segment changes.  OCB residual overhead is allocated to remaining operating segments.  There is no longer an OCB segment.  The CLIC business being sold continues to be reported as a non- operating item until the date of sale.  The assets and liabilities of the CLIC business being sold are each reported as single line items on the consolidated balance sheet.

 

CNO Financial Group | Revised Segment Reporting | April 22, 2014 5 Financial Reporting Impact 1 2 1 – EBIT (excluding residual expenses) from blocks of business sold to Wilton Re 2 – EBIT (excluding residual expenses) from retained blocks of business 3 – Comprised of ($8.0mm) of EBIT from closed block long-term care business that was reinsured to Beechwood Re in 4Q13 and $19.6mm of residual overhead expenses that are expected to continue after the completion of the sale of CLIC. Such residual overhead expenses will be reallocated to the remaining segments beginning in 1Q14. 3 * A non-GAAP measure. Refer to the Appendix for a reconciliation to the corresponding GAAP measure. $ in millions 1Q 2Q 3Q 4Q TY OCB EBIT, as previously reported 3.6$ 2.6$ 6.1$ 13.2$ 25.5$ EBIT transferred to operations of CLIC being sold (6.3) (5.8) (6.9) (14.3) (33.3) EBIT transferred to Washington National (4.6) (4.0) (4.9) (6.3) (19.8) OCB EBIT, revised * (7.3)$ (7.2)$ (5.7)$ (7.4)$ (27.6)$ Washington National EBIT, as previously reported 29.4$ 31.8$ 28.1$ 31.5$ 120.8$ EBIT transferred from OCB 4.6 4.0 4.9 6.3 19.8 Washington National EBIT, revised * 34.0$ 35.8$ 33.0$ 37.8$ 140.6$ Pre Tax Operating Income, as previously reported 77.6$ 104.0$ 114.0$ 116.0$ 411.6$ EBIT transferred to operations of CLIC being sold (6.3) (5.8) (6.9) (14.3) (33.3) Pre Tax Operating Income, revised * 71.3$ 98.2$ 107.1$ 101.7$ 378.3$ 2013

 

CNO Financial Group | Revised Segment Reporting | April 22, 2014 6 Appendix

 

CNO Financial Group | Revised Segment Reporting | April 22, 2014 7 Quarterly Earnings CNO *Management believes that an analysis of earnings before the operations of CLIC being sold, loss on reinsurance transaction, net realized investment gains (losses), fair value changes in embedded derivative liabilities, equity in earnings of certain non-strategic investments and earnings attributable to non-controlling interests, corporate interest expense, loss on extinguishment of debt and taxes (“EBIT,” a non-GAAP financial measure) provides a clearer comparison of the operating results of the company quarter-over- quarter because it excludes: (1) the operations of CLIC being sold; (2) loss on reinsurance transaction; (3) net realized investment gains (losses); (4) fair value changes due to fluctuations in the interest rates used to discount embedded derivative liabilities related to our fixed index annuities that are unrelated to the company’s underlying fundamentals; (5) equity in earnings of certain non-strategic investments and earnings attributable to non-controlling interests; (6) corporate interest expense; and (7) loss on extinguishment of debt. The table above provides a reconciliation of EBIT to net income. 1Q13 2Q13 3Q13 4Q13 2013 Bankers Life 62.1$ 79.1$ 86.3$ 83.0$ 310.5$ Washington National 34.0 35.8 33.0 37.8 140.6 Colonial Penn (5.4) 1.2 (4.2) (4.1) (12.5) Other CNO Business (7.3) (7.2) (5.7) (7.4) (27.6) EBIT from business segments continuing after the CLIC sale 83.4 108.9 109.4 109.3 411.0 Corporate operations, excluding interest expense 3.0 2.4 9.4 3.8 18.6 EBIT* from operations continuing after the CLIC sale 86.4 111.3 118.8 113.1 429.6 Corporate interest expense (15.1) (13.1) (11.7) (11.4) (51.3) Operating earnings before taxes 71.3 98.2 107.1 101.7 378.3 Tax expense on period income 25.7 34.3 34.4 35.5 129.9 Net operating income 45.6 63.9 72.7 66.2 248.4 Earnings of CLIC being sold 5.5 4.8 5.5 9.7 25.5 Loss on reinsurance transaction - - - (63.3) (63.3) Net realized investment gains (losses) 8.0 0.8 (1.1) 9.1 16.8 Fair value changes in embedded derivative liabilities 1.3 12.1 2.2 7.4 23.0 (1.8) (2.7) (3.0) (2.4) (9.9) Loss on extinguishment of debt, net of income taxes (57.2) (6.8) - - (64.0) Net income before valuation allowance for deferred tax assets and other tax items 1.4 72.1 76.3 26.7 176.5 Valuation allowance for deferred tax assets and other tax items 10.5 5.0 206.7 79.3 301.5 Net income 11.9$ 77.1$ 283.0$ 106.0$ 478.0$ Equity in earnings of certain non-strategic investments and earnings attributable to non-controlling interests ($ millions)

 

Exhibit 99.2

	

 	 	 	 	 	 	
Revised Quarterly Financial Supplement - 4Q2013*	 	 	 	 	 	
*Historical information has been revised to reflect changes to our segment reporting. These revisions are due to the previously announced definitive agreement to sell 100% of the common stock of Conseco Life Insurance Company ("CLIC") to Wilton Reassurance Company, which sale is expected to close mid-year 2014. In addition, the earnings of CLIC have been reflected as non-operating in certain non-GAAP disclosures.	 	 	 	 	 	

 	 	 	 	 	 	
April 22, 2014	 	 	 	 	 	

Page 1

	
					
Table of Contents	 	 	 	Page	
 	 	 	 	 	
Consolidated balance sheet	 	 	 	3	
Consolidated statement of operations	 	 	 	4	
Operating results	 	 	 	5	
Computation of weighted average shares outstanding	 	 	 	6	
EBIT from Business Segments Summarized by In-Force and New Business	 	 	 	7	
Analyses of income before taxes and selected data:	 	 	 	 	
     Bankers Life	 	 	 	8-10	
     Washington National	 	 	 	11-13	
     Colonial Penn	 	 	 	14-15	
     Other CNO Business	 	 	 	16	
     Corporate Operations	 	 	 	17	
Premiums collected on insurance products:	 	 	 	 	
     Bankers Life	 	 	 	18	
     Washington National	 	 	 	19	
     Colonial Penn	 	 	 	20	
     Other CNO Business	 	 	 	20	
New Annualized Premiums	 	 	 	21	
Statutory information	 	 	 	22	
Operations of CLIC being sold*	 	 	 	23-24	
Notes	 	 	 	25	
Appendix	 	 	 	26	

* We previously announced a definitive agreement to sell 100% of the common stock of CLIC to Wilton Reassurance Company, which sale is expected to close mid-year 2014.

Page 2

	
																									
CNO Financial Group, Inc.	 	 	 	 	 	 	 	 	
Consolidated balance sheet (in millions)	Mar-12	Jun-12	Sep-12	Dec-12	Mar-13	Jun-13	Sep-13	Dec-13	
 	 	 	 	 	 	 	 	 	
Assets	 	 	 	 	 	 	 	 	
Investments:	 	 	 	 	 	 	 	 	
  Fixed maturities, available for sale, at fair value	$	23,777.7		$	24,276.6		$	24,742.3		$	24,614.1		$	24,894.5		$	23,623.0		$	23,497.7		$	23,178.3		
  Equity securities at fair value	176.5		187.3		180.0		171.4		216.9		241.3		262.0		249.3		
  Mortgage loans	1,546.7		1,550.9		1,597.2		1,573.2		1,639.8		1,692.2		1,635.1		1,729.5		
  Policy loans	277.8		274.7		274.1		272.0		271.5		269.1		267.5		277.0		
  Trading securities	122.3		114.8		199.4		266.2		229.8		241.0		246.6		247.6		
  Investments held by variable interest entities	564.7		789.3		829.4		814.3		1,009.9		1,087.9		1,080.7		1,046.7		
  Other invested assets	270.9		257.1		265.0		248.1		309.7		312.6		330.6		423.3		
  Total investments	26,736.6		27,450.7		28,087.4		27,959.3		28,572.1		27,467.1		27,320.2		27,151.7		
Cash and cash equivalents - unrestricted	173.5		190.2		415.3		582.5		251.6		280.0		376.7		699.0		
Cash and cash equivalents held by variable interest entities	65.8		88.6		48.2		54.2		462.2		210.7		85.1		104.3		
Accrued investment income	313.6		296.4		317.8		286.2		315.8		294.8		306.2		286.9		
Present value of future profits	675.4		658.1		642.4		626.0		606.6		591.6		578.9		679.3		
Deferred acquisition costs	790.4		653.5		623.4		629.7		654.4		762.1		846.0		968.1		
Reinsurance receivables	3,052.7		3,013.8		2,967.7		2,927.7		2,879.5		2,838.0		2,822.4		3,392.1		
Income tax assets, net	819.9		679.7		699.5		716.9		708.5		931.2		1,135.7		1,147.2		
Assets held in separate accounts	16.0		15.6		15.7		14.9		15.5		15.0		13.3		10.3		
Other assets	402.3		395.8		338.6		334.0		433.0		385.1		432.6		341.7		
Total assets	$	33,046.2		$	33,442.4		$	34,156.0		$	34,131.4		$	34,899.2		$	33,775.6		$	33,917.1		$	34,780.6		
Liabilities	 	 	 	 	 	 	 	 	
Liabilities for insurance products:	 	 	 	 	 	 	 	 	
  Policyholder account balances	$	13,158.1		$	13,036.2		$	12,955.5		$	12,913.1		$	12,833.4		$	12,774.4		$	12,766.1		$	12,776.4		
  Future policy benefits	10,619.8		10,748.8		11,131.9		11,319.4		11,311.7		11,017.9		11,058.3		11,222.5		
  Liability for policy and contract claims	554.2		546.8		548.9		559.3		563.5		554.2		551.7		566.0		
  Unearned and advanced premiums	290.0		283.1		275.9		282.8		285.7		278.5		274.5		300.6		
  Liabilities related to separate accounts	16.0		15.6		15.7		14.9		15.5		15.0		13.3		10.3		
Other liabilities	721.0		686.0		709.0		570.6		903.0		626.8		712.7		590.6		
Payable to reinsurer	—		—		—		—		—		—		—		590.3		
Investment borrowings	1,684.9		1,687.9		1,650.9		1,650.8		1,880.2		1,878.0		1,850.2		1,900.0		
Borrowings related to variable interest entities	519.9		766.7		766.9		767.0		1,143.4		1,143.7		1,035.1		1,012.3		
Notes payable - direct corporate obligations	799.3		778.2		1,035.1		1,004.2		934.2		905.7		868.6		856.4		
Total liabilities	28,363.2		28,549.3		29,089.8		29,082.1		29,870.6		29,194.2		29,130.5		29,825.4		
Shareholders' equity									
Common stock	2.4		2.3		2.3		2.2		2.2		2.2		2.2		2.2		
Additional paid-in capital	4,345.6		4,312.0		4,251.2		4,174.7		4,173.2		4,128.2		4,121.3		4,092.8		
Retained earnings (accumulated deficit)	(473.0	)	(412.0	)	(421.7	)	(325.0	)	(317.5	)	(247.1	)	29.1		128.4		
Total shareholders' equity before accumulated other comprehensive income	3,875.0		3,902.3		3,831.8		3,851.9		3,857.9		3,883.3		4,152.6		4,223.4		
Accumulated other comprehensive income	808.0		990.8		1,234.4		1,197.4		1,170.7		698.1		634.0		731.8		
Total shareholders' equity	4,683.0		4,893.1		5,066.2		5,049.3		5,028.6		4,581.4		4,786.6		4,955.2		
Total liabilities and shareholders' equity	$	33,046.2		$	33,442.4		$	34,156.0		$	34,131.4		$	34,899.2		$	33,775.6		$	33,917.1		$	34,780.6		

 	 	 	 	 	 	 	 	 	
 	1Q12	2Q12	3Q12	4Q12	1Q13	2Q13	3Q13	4Q13	
 	 	 	 	 	 	 	 	 	
Book value per share at period-end (1) (2)	$	16.20		$	16.67		$	16.70		$	17.39		$	17.26		$	17.70		$	18.70		$	19.17		
 	 	 	 	 	 	 	 	 	
Book value per diluted share (1) (3)	$	14.05		$	14.41		$	15.63		$	16.21		$	16.57		$	17.01		$	18.24		$	18.62		

	
	
No changes have been made to our consolidated historical balance sheet, as CLIC is not being reported as a discontinued operation.	
The assets and liabilities of CLIC each will be presented separately in a single line ("Assets of CLIC being sold" and "Liabilities of CLIC being	
 sold") on the face of our consolidated balance sheet beginning March 31, 2014.	

Page 3

	
																															
CNO Financial Group, Inc.	 	 	 	 	 	 	 	 	 	 	
Consolidated statement of operations (in millions)	1Q12	2Q12	3Q12	4Q12	2012	1Q13	2Q13	3Q13	4Q13	2013	
 	 	 	 	 	 	 	 	 	 	 	
Revenues	 	 	 	 	 	 	 	 	 	 	
Insurance policy income	$	686.3		$	694.8		$	690.2		$	684.1		$	2,755.4		$	691.2		$	691.3		$	686.1		$	676.1		$	2,744.7		
Net investment income (loss):	 	 	 	 	 	 	 	 	 	 	
   General account assets	345.2		351.1		349.4		352.8		1,398.5		351.9		348.8		350.7		354.4		1,405.8		
Policyholder and reinsurer accounts and other special-purpose portfolios	65.6		(17.3	)	39.1		0.5		87.9		77.7		31.8		49.0		99.7		258.2		
Realized investment gains (losses):	 	 	 	 	 	 	 	 	 	 	
Net realized investment gains, excluding impairment losses	30.8		35.4		32.2		20.5		118.9		15.3		3.8		2.8		23.1		45.0		
   Other-than-temporary impairment losses:	 	 	 	 	 	 	 	 	 	 	
      Total other-than-temporary impairment losses	(7.9	)	(3.5	)	(23.1	)	(3.3	)	(37.8	)	—		(0.6	)	(2.9	)	(8.1	)	(11.6	)	
Portion of other-than-temporary impairment losses recognized in accumulated other comprehensive income	—		—		—		—		—		—		—		—		—		—		
   Net impairment losses recognized	(7.9	)	(3.5	)	(23.1	)	(3.3	)	(37.8	)	—		(0.6	)	(2.9	)	(8.1	)	(11.6	)	
Total realized gains (losses)	22.9		31.9		9.1		17.2		81.1		15.3		3.2		(0.1	)	15.0		33.4		
Fee revenue and other income	3.9		4.5		5.2		6.2		19.8		6.5		6.4		8.1		13.0		34.0		
Total revenues	1,123.9		1,065.0		1,093.0		1,060.8		4,342.7		1,142.6		1,081.5		1,093.8		1,158.2		4,476.1		
 	 	 	 	 	 	 	 	 	 	 	
Benefits and expenses	 	 	 	 	 	 	 	 	 	 	
Insurance policy benefits	689.0		689.7		745.7		639.5		2,763.9		754.1		673.2		702.2		710.2		2,839.7		
Loss related to reinsurance transaction	—		—		—		—		—		—		—		—		98.4		98.4		
Interest expense	28.8		28.7		29.2		27.9		114.6		27.3		26.9		25.8		25.3		105.3		
Amortization	86.6		68.3		60.9		73.2		289.0		79.3		79.2		61.4		76.4		296.3		
Loss on extinguishment of debt	0.2		0.5		198.5		1.0		200.2		57.7		7.7		—		—		65.4		
Other operating costs and expenses	227.0		173.3		217.5		201.5		819.3		189.6		179.8		190.0		206.8		766.2		
Total benefits and expenses	1,031.6		960.5		1,251.8		943.1		4,187.0		1,108.0		966.8		979.4		1,117.1		4,171.3		
 	 	 	 	 	 	 	 	 	 	 	
Income (loss) before income taxes	92.3		104.5		(158.8	)	117.7		155.7		34.6		114.7		114.4		41.1		304.8		
Income tax expense (benefit) on period income	33.2		38.8		(10.8	)	45.0		106.2		33.2		42.6		38.1		14.4		128.3		
Valuation allowance for deferred tax assets and other tax items	—		—		(143.0	)	(28.5	)	(171.5	)	(10.5	)	(5.0	)	(206.7	)	(79.3	)	(301.5	)	
Net income (loss)	$	59.1		$	65.7		$	(5.0	)	$	101.2		$	221.0		$	11.9		$	77.1		$	283.0		$	106.0		$	478.0		

	
	
No changes have been made to our consolidated historical statement of operations, as CLIC is not being reported as a discontinued operation.	
CLIC's revenues and expenses will continue to be reported in our consolidated statement of operations until the close of the sale which	
is expected mid-year 2014.	

Page 4

	
																															
CNO Financial Group, Inc.	 	 	 	 	 	 	 	 	 	 	
Operating results ($ in millions, except per share amounts)	1Q12	2Q12	3Q12	4Q12	2012	1Q13	2Q13	3Q13	4Q13	2013	
 	 	 	 	 	 	 	 	 	 	 	
EBIT (4):	 	 	 	 	 	 	 	 	 	 	
   Bankers Life	$	70.5		$	76.1		$	80.6		$	73.7		$	300.9		$	62.1		$	79.1		$	86.3		$	83.0		$	310.5		
   Washington National	30.3		39.1		38.1		41.3		148.8		34.0		35.8		33.0		37.8		140.6		
   Colonial Penn	(9.8	)	0.6		(2.6	)	3.2		(8.6	)	(5.4	)	1.2		(4.2	)	(4.1	)	(12.5	)	
Other CNO Business:	 	 	 	 	 	 	 	 	 	 	
Losses from the long-term care business reinsured effective December 31, 2013	(1.4	)	(1.0	)	(4.4	)	(2.4	)	(9.2	)	(2.7	)	(2.2	)	(1.0	)	(2.1	)	(8.0	)	
Overhead expense of CLIC expected to continue after the completion of the sale	(6.1	)	(3.9	)	(6.1	)	(4.4	)	(20.5	)	(4.6	)	(5.0	)	(4.7	)	(5.3	)	(19.6	)	
EBIT from business segments continuing after the CLIC sale	83.5		110.9		105.6		111.4		411.4		83.4		108.9		109.4		109.3		411.0		
Corporate operations, excluding corporate interest expense	(1.8	)	(9.1	)	(6.7	)	(2.7	)	(20.3	)	3.0		2.4		9.4		3.8		18.6		
EBIT from operations continuing after the CLIC sale	81.7		101.8		98.9		108.7		391.1		86.4		111.3		118.8		113.1		429.6		
Corporate interest expense	(17.5	)	(16.6	)	(16.3	)	(15.8	)	(66.2	)	(15.1	)	(13.1	)	(11.7	)	(11.4	)	(51.3	)	
Operating earnings before taxes	64.2		85.2		82.6		92.9		324.9		71.3		98.2		107.1		101.7		378.3		
Tax expense on operating income	23.4		32.0		26.2		36.4		118.0		25.7		34.3		34.4		35.5		129.9		
Net operating income (5)	40.8		53.2		56.4		56.5		206.9		45.6		63.9		72.7		66.2		248.4		
Earnings of CLIC being sold (net of taxes)	(2.1	)	2.4		(34.7	)	3.3		(31.1	)	5.5		4.8		5.5		9.7		25.5		
Loss related to reinsurance transaction (net of taxes)	—		—		—		—		—		—		—		—		(63.3	)	(63.3	)	
Net realized investment gains (net of related amortization and taxes)	16.0		17.3		8.7		11.0		53.0		8.0		0.8		(1.1	)	9.1		16.8		
Fair value changes in embedded derivative liabilities (net of related amortization and taxes)	4.5		(6.9	)	(2.0	)	2.6		(1.8	)	1.3		12.1		2.2		7.4		23.0		
Equity in earnings of certain non-strategic investments and earnings attributable to non-controlling interests (net of taxes)	—		—		—		—		—		(1.8	)	(2.7	)	(3.0	)	(2.4	)	(9.9	)	
Loss on extinguishment of debt (net of taxes)	(0.1	)	(0.3	)	(176.4	)	(0.7	)	(177.5	)	(57.2	)	(6.8	)	—		—		(64.0	)	
Net income (loss) before valuation allowance for deferred tax assets and other tax items	59.1		65.7		(148.0	)	72.7		49.5		1.4		72.1		76.3		26.7		176.5		
Valuation allowance for deferred tax assets and other tax items	—		—		143.0		28.5		171.5		10.5		5.0		206.7		79.3		301.5		
Net income (loss)	$	59.1		$	65.7		$	(5.0	)	$	101.2		$	221.0		$	11.9		$	77.1		$	283.0		$	106.0		$	478.0		
 	 	 	 	 	 	 	 	 	 	 	
Per diluted share:	 	 	 	 	 	 	 	 	 	 	
Net operating income	$	.15		$	.20		$	.24		$	.24		$	.78		$	.19		$	.28		$	.32		$	.29		$	1.07		
Earnings of CLIC being sold (net of taxes)	(.01	)	—		(.15	)	.01		(.11	)	.02		.02		.02		.04		.11		
Loss related to reinsurance transaction (net of taxes)	—		—		—		—		—		—		—		—		(.28	)	(.27	)	
Net realized investment gains (net of related amortization and taxes)	.06		.06		.04		.04		.19		.04		.01		(.01	)	.04		.08		
Fair value changes in embedded derivative liabilities (net of related amortization and taxes)	.01		(.02	)	(.01	)	.01		(.01	)	.01		.05		.01		.04		.10		
Equity in earnings of certain non-strategic investments and earnings attributable to non-controlling interests (net of taxes)	—		—		—		—		—		(.01	)	(.01	)	(.01	)	(.01	)	(.04	)	
Loss on extinguishment of debt (net of taxes)	—		—		(.76	)	—		(.63	)	(.24	)	(.03	)	—		—		(.28	)	
Valuation allowance for deferred tax assets and other tax items	—		—		.62		.11		.61		.04		.02		.90		.35		1.29		
Net income (loss)	$	.21		$	.24		$	(.02	)	$	.41		$	.83		$	.05		$	.34		$	1.23		$	.47		$	2.06		

	
	
The information presented above reflects:	
The transfer of certain health, annuity and life blocks from the Other CNO Business segment to the Washington National segment; and the presentation of CLIC earnings as non-operating, excluding overhead expense that is expected to continue after the sale.	
The Other CNO Business segment is comprised of the long-term care business that was reinsured effective December 31, 2013 and the overhead expense of CLIC that is expected to continue after completion of the sale.	
Refer to page 26 for more information which quantifies the impact of the changes.	

Page 5

	
																					
CNO Financial Group, Inc.	 	 	 	 	 	 	 	 	 	 	
Computation of weighted average shares outstanding	1Q12	2Q12	3Q12 (a)	4Q12	2012	1Q13	2Q13	3Q13	4Q13	2013	
(000s)	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	
Basic	 	 	 	 	 	 	 	 	 	 	
Shares outstanding, beginning of period	241,304.5		239,219.4		234,026.4		229,506.7		241,304.5		221,502.4		223,502.1		219,378.7		222,007.2		221,502.4		
Weighted average shares issued during the period:	 	 	 	 	 	 	 	 	 	 	
Shares repurchased	(470.7	)	(2,078.2	)	(2,689.9	)	(4,571.9	)	(8,307.8	)	—		(3,161.2	)	(809.7	)	(1,024.5	)	(4,105.8	)	
Conversion of 7.0% convertible debentures	—		—		—		—		—		—		—		4,103.3		—		2,210.5		
Stock options exercised and vested restricted and performance stock	83.5		148.2		144.0		154.2		804.2		678.8		157.6		204.9		80.4		2,307.6		
Shares withheld for the payment of taxes on the vesting of restricted stock	(22.2	)	(0.5	)	—		(14.8	)	(116.2	)	(100.0	)	(0.1	)	(1.2	)	(7.1	)	(286.8	)	
Weighted average basic shares outstanding during the period	240,895.1		237,288.9		231,480.5		225,074.2		233,684.7		222,081.2		220,498.4		222,876.0		221,056.0		221,627.9		
Basic shares outstanding, end of period	239,219.4		234,026.4		229,506.7		221,502.4		221,502.4		223,502.1		219,378.7		222,007.2		220,323.8		220,323.8		
Diluted	 	 	 	 	 	 	 	 	 	 	
Weighted average basic shares outstanding	240,895.1		237,288.9		231,480.5		225,074.2		233,684.7		222,081.2		220,498.4		222,876.0		221,056.0		221,627.9		
Common stock equivalent shares related to:	 	 	 	 	 	 	 	 	 	 	
7.0% convertible debentures	53,366.9		53,377.5		—		17,038.9		44,037.4		16,590.4		5,692.2		838.7		—		5,780.3		
Stock options, restricted stock and performance units	2,582.2		2,366.7		—		3,132.5		2,762.4		2,828.3		2,410.8		2,858.6		3,005.2		2,775.7		
Warrants	498.6		441.5		—		1,515.1		942.9		1,967.2		2,291.4		2,773.8		3,039.7		2,518.1		
Weighted average diluted shares outstanding during the period	297,342.8		293,474.6		231,480.5		246,760.7		281,427.4		243,467.1		230,892.8		229,347.1		227,100.9		232,702.0		
Diluted shares outstanding, end of period	295,667.1		290,212.1		250,819.6		243,188.8		243,188.8		234,865.1		229,928.4		227,693.4		226,867.8		226,867.8		

(a) Equivalent common shares of 56,651.1 were not included in the diluted weighted average shares outstanding, due to the net loss recognized in 3Q12.

	
	
The above information was not impacted by changes to our segment reporting or the presentation of CLIC earnings as non-operating.	

Page 6

	
																															
EBIT from Business Segments Continuing After the CLIC Sale Summarized by In-Force and New Business (6)	 	 	 	 	 	 	 	 	 	 	
(in millions)	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	
CNO Financial Group, Inc.	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	
EBIT from In-Force Business	1Q12	2Q12	3Q12	4Q12	2012	1Q13	2Q13	3Q13	4Q13	2013	
 	 	 	 	 	 	 	 	 	 	 	
Revenues	 	 	 	 	 	 	 	 	 	 	
Insurance policy income	$	529.6		$	539.3		$	533.6		$	528.9		$	2,131.4		$	535.0		$	539.6		$	537.9		$	534.6		$	2,147.1		
Net investment income	318.3		267.1		301.8		281.5		1,168.7		348.2		309.0		316.9		361.4		1,335.5		
Fee revenue and other income	1.9		2.4		3.3		3.4		11.0		2.6		2.9		4.0		3.8		13.3		
Total revenues	849.8		808.8		838.7		813.8		3,311.1		885.8		851.5		858.8		899.8		3,495.9		
 	 	 	 	 	 	 	 	 	 	 	
Benefits and expenses	 	 	 	 	 	 	 	 	 	 	
Insurance policy benefits	547.9		513.9		547.0		498.3		2,107.1		595.9		557.0		557.9		577.1		2,287.9		
Interest expense	2.1		2.2		2.0		1.8		8.1		1.9		2.2		2.3		2.2		8.6		
Amortization	69.4		61.3		49.4		57.8		237.9		68.6		57.6		50.3		59.8		236.3		
Other operating costs and expenses	98.3		80.2		85.8		97.9		362.2		84.5		82.0		87.1		96.4		350.0		
Total benefits and expenses	717.7		657.6		684.2		655.8		2,715.3		750.9		698.8		697.6		735.5		2,882.8		
EBIT from In-Force Business	$	132.1		$	151.2		$	154.5		$	158.0		$	595.8		$	134.9		$	152.7		$	161.2		$	164.3		$	613.1		

EBIT from New Business	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	
Revenues	 	 	 	 	 	 	 	 	 	 	
Insurance policy income	$	89.3		$	93.1		$	95.8		$	100.1		$	378.3		$	99.0		$	96.7		$	92.7		$	90.9		$	379.3		
Net investment income	11.7		4.3		11.7		5.0		32.7		9.7		5.7		9.6		15.4		40.4		
Fee revenue and other income	1.4		1.4		1.2		2.0		6.0		1.5		1.5		2.3		2.1		7.4		
Total revenues	102.4		98.8		108.7		107.1		417.0		110.2		103.9		104.6		108.4		427.1		
 	 	 	 	 	 	 	 	 	 	 	
Benefits and expenses	 	 	 	 	 	 	 	 	 	 	
Insurance policy benefits	65.3		60.3		69.8		65.3		260.7		70.9		63.9		64.3		68.0		267.1		
Interest expense	—		—		—		—		—		—		—		—		—		—		
Amortization	7.7		7.7		6.7		7.5		29.6		6.7		8.0		7.5		8.4		30.6		
Other operating costs and expenses	78.0		71.1		81.1		80.9		311.1		84.1		75.8		84.6		87.0		331.5		
Total benefits and expenses	151.0		139.1		157.6		153.7		601.4		161.7		147.7		156.4		163.4		629.2		
EBIT from New Business	$	(48.6	)	$	(40.3	)	$	(48.9	)	$	(46.6	)	$	(184.4	)	$	(51.5	)	$	(43.8	)	$	(51.8	)	$	(55.0	)	$	(202.1	)	

EBIT from In-Force and New Business	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	
Revenues	 	 	 	 	 	 	 	 	 	 	
Insurance policy income	$	618.9		$	632.4		$	629.4		$	629.0		$	2,509.7		$	634.0		$	636.3		$	630.6		$	625.5		$	2,526.4		
Net investment income	330.0		271.4		313.5		286.5		1,201.4		357.9		314.7		326.5		376.8		1,375.9		
Fee revenue and other income	3.3		3.8		4.5		5.4		17.0		4.1		4.4		6.3		5.9		20.7		
Total revenues	952.2		907.6		947.4		920.9		3,728.1		996.0		955.4		963.4		1,008.2		3,923.0		
 	 	 	 	 	 	 	 	 	 	 	
Benefits and expenses	 	 	 	 	 	 	 	 	 	 	
Insurance policy benefits	613.2		574.2		616.8		563.6		2,367.8		666.8		620.9		622.2		645.1		2,555.0		
Interest expense	2.1		2.2		2.0		1.8		8.1		1.9		2.2		2.3		2.2		8.6		
Amortization	77.1		69.0		56.1		65.3		267.5		75.3		65.6		57.8		68.2		266.9		
Other operating costs and expenses	176.3		151.3		166.9		178.8		673.3		168.6		157.8		171.7		183.4		681.5		
Total benefits and expenses	868.7		796.7		841.8		809.5		3,316.7		912.6		846.5		854.0		898.9		3,512.0		
EBIT from In-Force and New Business	$	83.5		$	110.9		$	105.6		$	111.4		$	411.4		$	83.4		$	108.9		$	109.4		$	109.3		$	411.0		

	
	
The information presented above reflects:	
No change to EBIT from New Business, since CLIC was not writing new business.	
EBIT from In-Force Business that has been reduced by the pre-tax earnings of CLIC.	
Refer to page 26 for more information which quantifies the impact of the changes.	

Page 7

	
																															
CNO Financial Group, Inc.	 	 	 	 	 	 	 	 	 	 	
Bankers Life	 	 	 	 	 	 	 	 	 	 	
Analysis of income before taxes (in millions)	1Q12	2Q12	3Q12	4Q12	2012	1Q13	2Q13	3Q13	4Q13	2013	
 	 	 	 	 	 	 	 	 	 	 	
Insurance policy income	$	406.5		$	419.0		$	416.1		$	415.8		$	1,657.4		$	418.0		$	419.1		$	407.4		$	404.2		$	1,648.7		
Net investment income (loss):	 	 	 	 	 	 	 	 	 	 	
   General account invested assets	200.3		204.9		205.4		207.0		817.6		212.8		211.0		212.4		217.8		854.0		
   Fixed index products	34.6		(19.3	)	16.2		(10.2	)	21.3		48.9		15.6		23.0		64.2		151.7		
Fee revenue and other income	2.9		3.3		4.0		5.0		15.2		3.7		4.0		5.8		5.5		19.0		
   Total revenues	644.3		607.9		641.7		617.6		2,511.5		683.4		649.7		648.6		691.7		2,673.4		
 	 	 	 	 	 	 	 	 	 	 	
Insurance policy benefits (a)	333.3		363.8		367.5		350.4		1,415.0		373.8		370.4		357.0		346.3		1,447.5		
Amounts added to policyholder account balances:	 	 	 	 	 	 	 	 	 	 	
Cost of interest credited to policyholders	40.0		38.8		38.8		37.4		155.0		35.9		36.0		35.3		34.7		141.9		
Cost of options to fund index credits, net of forfeitures	13.2		12.8		12.5		12.6		51.1		11.8		11.9		11.7		12.0		47.4		
Market value changes credited to policyholders	34.4		(18.7	)	15.8		(9.7	)	21.8		49.0		15.8		23.3		63.8		151.9		
Amortization related to operations	56.9		50.5		35.6		44.6		187.6		54.5		45.7		39.7		47.6		187.5		
Interest expense on investment borrowings	1.4		1.4		1.3		1.2		5.3		1.4		1.7		1.8		1.8		6.7		
Other operating costs and expenses	94.6		83.2		89.6		107.4		374.8		94.9		89.1		93.5		102.5		380.0		
   Total benefits and expenses	573.8		531.8		561.1		543.9		2,210.6		621.3		570.6		562.3		608.7		2,362.9		
EBIT (4)	$	70.5		$	76.1		$	80.6		$	73.7		$	300.9		$	62.1		$	79.1		$	86.3		$	83.0		$	310.5		

 	 	 	 	 	 	 	 	 	 	 	
Health underwriting margins (in millions)	1Q12	2Q12	3Q12	4Q12	2012	1Q13	2Q13	3Q13	4Q13	2013	
 	 	 	 	 	 	 	 	 	 	 	
Medicare supplement:	 	 	 	 	 	 	 	 	 	 	
   Earned premium	$	182.7		$	184.1		$	185.1		$	185.5		$	737.4		$	188.4		$	189.2		$	190.7		$	190.3		$	758.6		
   Benefit ratio	64.5	%	72.2	%	67.8	%	71.4	%	69.0	%	68.5	%	67.2	%	67.0	%	65.7	%	67.1	%	
Underwriting margin (earned premium less policy benefits)	$	64.9		$	51.2		$	59.6		$	53.2		$	228.9		$	59.4		$	62.0		$	62.9		$	65.3		$	249.6		
 	 	 	 	 	 	 	 	 	 	 	
PDP:	 	 	 	 	 	 	 	 	 	 	
   Earned premium	$	10.8		$	17.7		$	11.4		$	10.0		$	49.9		$	8.9		$	10.8		$	—		$	—		$	19.7		
   Benefit ratio	85.9	%	64.2	%	74.8	%	64.8	%	71.4	%	74.9	%	85.2	%	N/A		N/A		80.5	%	
Underwriting margin (earned premium less policy benefits)	$	1.6		$	6.3		$	2.9		$	3.5		$	14.3		$	2.2		$	1.6		$	—		$	—		$	3.8		
 	 	 	 	 	 	 	 	 	 	 	
Long-term care:	 	 	 	 	 	 	 	 	 	 	
   Earned premium	$	140.6		$	139.7		$	138.5		$	136.7		$	555.5		$	135.3		$	134.1		$	132.6		$	130.9		$	532.9		
Benefit ratio before interest income on reserves	110.9	%	121.4	%	121.4	%	116.7	%	117.6	%	129.4	%	129.5	%	128.4	%	130.0	%	129.3	%	
   Interest-adjusted benefit ratio	65.5	%	75.4	%	74.7	%	69.0	%	71.2	%	81.7	%	81.4	%	79.4	%	80.0	%	80.6	%	
Underwriting margin (earned premium plus interest income on reserves less policy benefits)	$	48.5		$	34.4		$	35.0		$	42.3		$	160.2		$	24.8		$	25.0		$	27.3		$	26.1		$	103.2		

	
	
The above information was not impacted by changes to our segment reporting or the presentation of CLIC earnings as non-operating.	

Page 8

	
																															
CNO Financial Group, Inc.	 	 	 	 	 	 	 	 	 	 	
Bankers Life	 	 	 	 	 	 	 	 	 	 	
Average liabilities for insurance products (in millions)	1Q12	2Q12	3Q12	4Q12	2012	1Q13	2Q13	3Q13	4Q13	2013	
 	 	 	 	 	 	 	 	 	 	 	
Fixed index annuities	$	2,707.4		$	2,798.2		$	2,872.1		$	2,948.3		$	2,831.5		$	3,038.8		$	3,132.2		$	3,224.6		$	3,347.7		$	3,185.8		
Deferred annuities	4,504.8		4,436.7		4,373.1		4,314.0		4,407.2		4,245.7		4,162.1		4,091.9		4,049.0		4,137.2		
SPIAs and supplemental contracts:	 	 	 	 	 	 	 	 	 	 	
Mortality based	233.8		231.7		229.4		231.8		231.7		229.2		227.2		223.3		206.5		221.5		
Deposit based	163.1		163.3		163.4		160.1		162.5		158.6		157.9		156.2		153.4		156.5		
Health:	 	 	 	 	 	 	 	 	 	 	
Long-term care	4,245.0		4,277.0		4,339.2		4,619.0		4,370.0		4,837.7		4,651.7		4,507.3		4,532.0		4,632.2		
Medicare supplement	346.3		332.6		326.5		331.2		334.2		337.4		333.3		326.6		332.3		332.4		
Other health	43.2		43.6		44.3		44.7		43.9		45.1		45.3		45.3		45.7		45.4		
Life:	 	 	 	 	 	 	 	 	 	 	
   Interest sensitive	441.4		444.7		450.8		458.7		448.9		467.6		480.3		497.4		516.2		490.4		
   Non-interest sensitive	460.0		484.0		511.8		541.5		499.3		570.5		598.1		624.3		649.5		610.6		
Total average liabilities for insurance products, net of reinsurance ceded	$	13,145.0		$	13,211.8		$	13,310.6		$	13,649.3		$	13,329.2		$	13,930.6		$	13,788.1		$	13,696.9		$	13,832.3		$	13,812.0		

 	 	 	 	 	 	 	 	 	 	 	
Present value of future profits (in millions)	1Q12	2Q12	3Q12	4Q12	2012	1Q13	2Q13	3Q13	4Q13	2013	
 	 	 	 	 	 	 	 	 	 	 	
Balance, beginning of period	$	201.8		$	189.8		$	181.8		$	175.1		$	201.8		$	168.8		$	159.9		$	155.6		$	152.5		$	168.8		
Amortization related to operations	(18.7	)	(13.6	)	(7.0	)	(11.3	)	(50.6	)	(16.6	)	(11.5	)	(10.6	)	(10.1	)	(48.8	)	
Amortization related to net realized investment (gains) losses	(0.1	)	—		(0.1	)	—		(0.2	)	(0.1	)	—		—		—		(0.1	)	
Adjustment related to unrealized (gain) or loss on fixed maturities, available for sale	6.8		5.6		0.4		5.0		17.8		7.8		7.2		7.5		120.8		143.3		
Balance, end of period	$	189.8		$	181.8		$	175.1		$	168.8		$	168.8		$	159.9		$	155.6		$	152.5		$	263.2		$	263.2		

 	 	 	 	 	 	 	 	 	 	 	
Deferred acquisition costs (in millions)	1Q12	2Q12	3Q12	4Q12	2012	1Q13	2Q13	3Q13	4Q13	2013	
 	 	 	 	 	 	 	 	 	 	 	
Balance, beginning of period	$	491.0		$	486.5		$	352.2		$	330.1		$	491.0		$	332.8		$	350.8		$	439.5		$	514.5		$	332.8		
Deferred acquisition expenses	34.3		34.4		35.2		35.1		139.0		37.7		37.1		38.4		44.9		158.1		
Amortization related to operations	(38.2	)	(36.9	)	(28.6	)	(33.3	)	(137.0	)	(37.9	)	(34.2	)	(29.1	)	(37.5	)	(138.7	)	
Amortization related to net realized investment (gains) losses	(0.8	)	(1.7	)	(1.3	)	(0.3	)	(4.1	)	(0.6	)	(0.4	)	—		(0.1	)	(1.1	)	
Amortization related to fair value changes in embedded derivative liabilities	(4.2	)	6.3		1.6		(2.0	)	1.7		(1.1	)	(9.1	)	(1.6	)	(5.1	)	(16.9	)	
Adjustment related to unrealized (gain) or loss on fixed maturities, available for sale	4.4		(136.4	)	(29.0	)	3.2		(157.8	)	19.9		95.3		67.3		111.1		293.6		
Balance, end of period	$	486.5		$	352.2		$	330.1		$	332.8		$	332.8		$	350.8		$	439.5		$	514.5		$	627.8		$	627.8		

	
	
The above information was not impacted by changes to our segment reporting or the presentation of CLIC earnings as non-operating.	

Page 9

	
																															
Bankers Life Segment EBIT Summarized by In-Force and New Business (6)	 	 	 	 	 	 	 	 	 	 	
(in millions)	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	
CNO Financial Group, Inc.	 	 	 	 	 	 	 	 	 	 	
EBIT from In-Force Business	1Q12	2Q12	3Q12	4Q12	2012	1Q13	2Q13	3Q13	4Q13	2013	
 	 	 	 	 	 	 	 	 	 	 	
Revenues	 	 	 	 	 	 	 	 	 	 	
Insurance policy income	$	341.8		$	351.6		$	345.7		$	342.2		$	1,381.3		$	345.8		$	349.4		$	341.8		$	341.0		$	1,378.0		
Net investment income (loss)	223.2		181.3		209.9		191.8		806.2		252.0		220.9		225.8		266.6		965.3		
Fee revenue and other income	1.5		1.9		2.8		3.0		9.2		2.2		2.5		3.5		3.4		11.6		
Total revenues	566.5		534.8		558.4		537.0		2,196.7		600.0		572.8		571.1		611.0		2,354.9		
 	 	 	 	 	 	 	 	 	 	 	
Benefits and expenses	 	 	 	 	 	 	 	 	 	 	
Insurance policy benefits	367.4		348.7		377.0		338.1		1,431.2		412.8		383.4		376.3		402.2		1,574.7		
Interest expense	1.4		1.4		1.3		1.2		5.3		1.4		1.7		1.8		1.8		6.7		
Amortization	50.0		43.7		29.9		38.2		161.8		48.7		38.7		33.2		40.3		160.9		
Other operating costs and expenses	50.6		38.4		40.1		52.0		181.1		41.0		39.4		40.9		48.7		170.0		
Total benefits and expenses	469.4		432.2		448.3		429.5		1,779.4		503.9		463.2		452.2		493.0		1,912.3		
EBIT from In-Force Business	$	97.1		$	102.6		$	110.1		$	107.5		$	417.3		$	96.1		$	109.6		$	118.9		$	118.0		$	442.6		

EBIT from New Business	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	
Revenues	 	 	 	 	 	 	 	 	 	 	
Insurance policy income	$	64.7		$	67.4		$	70.4		$	73.6		$	276.1		$	72.2		$	69.7		$	65.6		$	63.2		$	270.7		
Net investment income (loss)	11.7		4.3		11.7		5.0		32.7		9.7		5.7		9.6		15.4		40.4		
Fee revenue and other income	1.4		1.4		1.2		2.0		6.0		1.5		1.5		2.3		2.1		7.4		
Total revenues	77.8		73.1		83.3		80.6		314.8		83.4		76.9		77.5		80.7		318.5		
 	 	 	 	 	 	 	 	 	 	 	
Benefits and expenses	 	 	 	 	 	 	 	 	 	 	
Insurance policy benefits	53.5		48.0		57.6		52.6		211.7		57.7		50.7		51.0		54.6		214.0		
Interest expense	—		—		—		—		—		—		—		—		—		—		
Amortization	6.9		6.8		5.7		6.4		25.8		5.8		7.0		6.5		7.3		26.6		
Other operating costs and expenses	44.0		44.8		49.5		55.4		193.7		53.9		49.7		52.6		53.8		210.0		
Total benefits and expenses	104.4		99.6		112.8		114.4		431.2		117.4		107.4		110.1		115.7		450.6		
EBIT from New Business	$	(26.6	)	$	(26.5	)	$	(29.5	)	$	(33.8	)	$	(116.4	)	$	(34.0	)	$	(30.5	)	$	(32.6	)	$	(35.0	)	$	(132.1	)	

EBIT from In-Force and New Business	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	
Revenues	 	 	 	 	 	 	 	 	 	 	
Insurance policy income	$	406.5		$	419.0		$	416.1		$	415.8		$	1,657.4		$	418.0		$	419.1		$	407.4		$	404.2		$	1,648.7		
Net investment income (loss)	234.9		185.6		221.6		196.8		838.9		261.7		226.6		235.4		282.0		1,005.7		
Fee revenue and other income	2.9		3.3		4.0		5.0		15.2		3.7		4.0		5.8		5.5		19.0		
Total revenues	644.3		607.9		641.7		617.6		2,511.5		683.4		649.7		648.6		691.7		2,673.4		
 	 	 	 	 	 	 	 	 	 	 	
Benefits and expenses	 	 	 	 	 	 	 	 	 	 	
Insurance policy benefits	420.9		396.7		434.6		390.7		1,642.9		470.5		434.1		427.3		456.8		1,788.7		
Interest expense	1.4		1.4		1.3		1.2		5.3		1.4		1.7		1.8		1.8		6.7		
Amortization	56.9		50.5		35.6		44.6		187.6		54.5		45.7		39.7		47.6		187.5		
Other operating costs and expenses	94.6		83.2		89.6		107.4		374.8		94.9		89.1		93.5		102.5		380.0		
Total benefits and expenses	573.8		531.8		561.1		543.9		2,210.6		621.3		570.6		562.3		608.7		2,362.9		
EBIT from In-Force and New Business	$	70.5		$	76.1		$	80.6		$	73.7		$	300.9		$	62.1		$	79.1		$	86.3		$	83.0		$	310.5		

	
	
The above information was not impacted by changes to our segment reporting or the presentation of CLIC earnings as non-operating.	

Page 10

	
																															
CNO Financial Group, Inc.	 	 	 	 	 	 	 	 	 	 	
Washington National	 	 	 	 	 	 	 	 	 	 	
Analysis of income before taxes (in millions)	1Q12	2Q12	3Q12	4Q12	2012	1Q13	2Q13	3Q13	4Q13	2013	
 	 	 	 	 	 	 	 	 	 	 	
Insurance policy income	$	152.4		$	152.4		$	152.5		$	151.6		$	608.9		$	152.9		$	153.1		$	159.2		$	156.3		$	621.5		
Net investment income (loss):	 	 	 	 	 	 	 	 	 	 	
   General account invested assets	69.8		70.4		69.9		71.3		281.4		69.8		68.3		69.1		67.8		275.0		
Fixed index products	5.4		(2.9	)	2.7		(1.0	)	4.2		6.8		1.6		2.6		6.9		17.9		
Trading account income related to reinsurer accounts	0.1		1.5		1.3		0.2		3.1		(0.4	)	(2.5	)	(0.5	)	(0.3	)	(3.7	)	
Change in value of embedded derivatives related to modified coinsurance agreements	(0.1	)	(1.4	)	(1.2	)	0.3		(2.4	)	0.4		2.5		0.5		0.3		3.7		
Trading account income related to policyholder accounts	1.9		(0.2	)	1.1		0.1		2.9		1.3		(0.1	)	1.2		1.6		4.0		
Fee revenue and other income	0.2		0.3		0.3		0.3		1.1		0.2		0.2		0.3		0.2		0.9		
   Total revenues	229.7		220.1		226.6		222.8		899.2		231.0		223.1		232.4		232.8		919.3		
 	 	 	 	 	 	 	 	 	 	 	
Insurance policy benefits	121.6		119.7		116.6		111.1		469.0		123.6		123.3		132.6		118.3		497.8		
Amounts added to policyholder account balances:	 	 	 	 	 	 	 	 	 	 	
Cost of interest credited to policyholders	4.2		4.3		4.2		3.8		16.5		3.8		3.9		3.4		3.6		14.7		
Cost of options to fund index credits, net of forfeitures	2.0		2.4		2.4		2.1		8.9		1.9		1.4		1.5		1.3		6.1		
Market value changes credited to policyholders	7.3		(3.3	)	3.1		(0.9	)	6.2		8.4		1.7		4.1		8.6		22.8		
Amortization related to operations	16.5		14.6		17.0		16.8		64.9		17.1		16.2		14.4		17.2		64.9		
Interest expense on investment borrowings	0.7		0.8		0.7		0.6		2.8		0.5		0.5		0.5		0.4		1.9		
Other operating costs and expenses	47.1		42.5		44.5		48.0		182.1		41.7		40.3		42.9		45.6		170.5		
   Total benefits and expenses	199.4		181.0		188.5		181.5		750.4		197.0		187.3		199.4		195.0		778.7		
EBIT (4)	$	30.3		$	39.1		$	38.1		$	41.3		$	148.8		$	34.0		$	35.8		$	33.0		$	37.8		$	140.6		

 	 	 	 	 	 	 	 	 	 	 	
Health underwriting margins (in millions)	1Q12	2Q12	3Q12	4Q12	2012	1Q13	2Q13	3Q13	4Q13	2013	
 	 	 	 	 	 	 	 	 	 	 	
Medicare supplement:	 	 	 	 	 	 	 	 	 	 	
Earned premium	$	30.8		$	30.2		$	29.3		$	28.3		$	118.6		$	26.8		$	25.9		$	25.2		$	24.4		$	102.3		
Benefit ratio	65.4	%	67.7	%	63.8	%	64.7	%	65.4	%	65.0	%	65.5	%	64.3	%	63.6	%	64.6	%	
Underwriting margin (earned premium less policy benefits)	$	10.7		$	9.7		$	10.7		$	9.9		$	41.0		$	9.4		$	8.9		$	9.0		$	8.9		$	36.2		
 	 	 	 	 	 	 	 	 	 	 	
Supplemental health:	 	 	 	 	 	 	 	 	 	 	
Earned premium	$	111.6		$	113.1		$	114.0		$	115.1		$	453.8		$	117.8		$	119.0		$	121.1		$	123.6		$	481.5		
Benefit ratio before interest income on reserves	82.4	%	77.0	%	74.2	%	72.9	%	76.6	%	79.3	%	78.6	%	80.8	%	75.4	%	78.5	%	
Interest-adjusted benefit ratio	55.1	%	50.1	%	47.5	%	46.6	%	49.8	%	53.1	%	52.6	%	54.3	%	49.2	%	52.3	%	
Underwriting margin (earned premium plus interest income on reserves less policy benefits)	$	50.1		$	56.5		$	59.8		$	61.4		$	227.8		$	55.3		$	56.4		$	55.4		$	62.7		$	229.8		

	
	
The information presented above reflects:	
The transfer to the Washington National segment of certain health, annuity and life blocks of business from the Other CNO Business segment. Refer to page 26 for more information which quantifies the impact of the changes.	
No changes to the health underwriting margins.	

Page 11

	
																															
CNO Financial Group, Inc.	 	 	 	 	 	 	 	 	 	 	
Washington National	 	 	 	 	 	 	 	 	 	 	
Average liabilities for insurance products (in millions)	1Q12	2Q12	3Q12	4Q12	2012	1Q13	2Q13	3Q13	4Q13	2013	
 	 	 	 	 	 	 	 	 	 	 	
Fixed index annuities	$	553.8		$	532.5		$	510.5		$	489.9		$	521.7		$	474.2		$	462.1		$	451.1		$	442.3		$	457.4		
Deferred Annuities	171.9		168.7		165.1		162.3		166.9		157.0		151.2		143.3		136.9		147.1		
SPIAs and supplemental contracts:	 	 	 	 	 	 	 	 	 	 	
Mortality based	264.2		260.2		257.2		254.0		258.9		250.9		248.2		248.2		248.2		248.9		
Deposit based	229.4		232.1		235.8		239.4		234.2		241.9		245.9		248.1		247.6		245.9		
Separate Accounts	15.5		15.8		15.6		15.3		15.6		15.2		15.3		14.2		11.8		14.1		
Health:	 	 	 	 	 	 	 	 	 	 	
Supplemental health	2,198.2		2,199.2		2,199.4		2,201.7		2,199.6		2,212.0		2,224.5		2,237.1		2,250.2		2,231.0		
Medicare supplement	48.5		44.4		42.4		41.5		44.2		40.4		39.0		37.7		37.7		38.7		
Other health	17.2		15.0		14.4		13.8		15.1		12.9		12.3		12.1		11.7		12.3		
Life:	 	 	 	 	 	 	 	 	 	 	
Interest sensitive	167.6		166.4		166.6		166.5		166.8		167.1		166.7		164.9		166.3		166.2		
Non-interest sensitive life	200.4		199.1		200.3		197.8		199.4		197.2		202.6		198.9		196.4		198.8		
Total average liabilities for insurance products, net of reinsurance ceded	$	3,866.7		$	3,833.4		$	3,807.3		$	3,782.2		$	3,822.4		$	3,768.8		$	3,767.8		$	3,755.6		$	3,749.1		$	3,760.4		

 	 	 	 	 	 	 	 	 	 	 	
Present value of future profits (in millions)	1Q12	2Q12	3Q12	4Q12	2012	1Q13	2Q13	3Q13	4Q13	2013	
 	 	 	 	 	 	 	 	 	 	 	
Balance, beginning of period	$	403.1		$	395.8		$	389.6		$	383.3		$	403.1		$	375.9		$	367.7		$	359.8		$	352.2		$	375.9		
Amortization related to operations	(7.3	)	(6.0	)	(5.9	)	(7.5	)	(26.7	)	(8.4	)	(8.7	)	(7.7	)	(8.0	)	(32.8	)	
Adjustment related to unrealized (gain) or loss on fixed maturities, available for sale	—		(0.2	)	(0.4	)	0.1		(0.5	)	0.2		0.8		0.1		0.1		1.2		
Balance, end of period	$	395.8		$	389.6		$	383.3		$	375.9		$	375.9		$	367.7		$	359.8		$	352.2		$	344.3		$	344.3		

 	 	 	 	 	 	 	 	 	 	 	
Deferred acquisition costs (in millions)	1Q12	2Q12	3Q12	4Q12	2012	1Q13	2Q13	3Q13	4Q13	2013	
 	 	 	 	 	 	 	 	 	 	 	
Balance, beginning of period	$	194.9		$	200.0		$	198.0		$	193.2		$	194.9		$	195.2		$	201.5		$	219.2		$	228.0		$	195.2		
Deferred acquisition expenses	9.7		10.8		9.1		10.1		39.7		12.3		12.8		12.7		12.8		50.6		
Amortization related to operations	(9.2	)	(8.6	)	(11.1	)	(9.3	)	(38.2	)	(8.7	)	(7.5	)	(6.7	)	(9.2	)	(32.1	)	
Amortization related to net realized investment (gains) losses	(0.2	)	(1.5	)	(0.2	)	(0.2	)	(2.1	)	(0.1	)	—		(0.1	)	(0.2	)	(0.4	)	
Amortization related to fair value changes in embedded derivative liabilities	(0.5	)	0.8		—		(0.4	)	(0.1	)	0.1		(1.4	)	0.1		(0.9	)	(2.1	)	
Adjustment related to unrealized (gain) or loss on fixed maturities, available for sale	5.3		(3.5	)	(2.6	)	1.8		1.0		2.7		13.8		2.8		1.7		21.0		
Balance, end of period	$	200.0		$	198.0		$	193.2		$	195.2		$	195.2		$	201.5		$	219.2		$	228.0		$	232.2		$	232.2		

	
	
The information presented above reflects:	
An increase in average liabilities due to the transfer to the Washington National segment of certain annuity and interest-sensitive life blocks of business from the Other CNO Business segment.	
Slightly lower average liabilities for supplemental health and Medicare supplement products. Certain health business of CLIC was previously included in the Washington National segment. In conjunction with the sale of CLIC to Wilton Reassurance Company, these blocks will be assumed by Washington National Insurance Company under a modified coinsurance agreement. The reserves related to this business are included in the operations of CLIC being sold.	
An increase in the balances of deferred acquisition costs as a result of the transfer of certain annuity and interest-sensitive life blocks of business from the Other CNO Business segment.	

Page 12

	
																															
Washington National Segment EBIT Summarized by In-Force and New Business (6)	 	 	 	 	 	 	 	 	 	 	
(in millions)	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	
CNO Financial Group, Inc.	 	 	 	 	 	 	 	 	 	 	
EBIT from In-Force Business	1Q12	2Q12	3Q12	4Q12	2012	1Q13	2Q13	3Q13	4Q13	2013	
 	 	 	 	 	 	 	 	 	 	 	
Revenues	 	 	 	 	 	 	 	 	 	 	
Insurance policy income	$	138.0		$	137.6		$	138.1		$	136.3		$	550.0		$	137.4		$	137.6		$	143.3		$	139.7		$	558.0		
Net investment income (loss)	77.1		67.4		73.8		70.9		289.2		77.9		69.8		72.9		76.3		296.9		
Fee revenue and other income	0.2		0.3		0.3		0.3		1.1		0.2		0.2		0.3		0.2		0.9		
Total revenues	215.3		205.3		212.2		207.5		840.3		215.5		207.6		216.5		216.2		855.8		
 	 	 	 	 	 	 	 	 	 	 	
Benefits and expenses	 	 	 	 	 	 	 	 	 	 	
Insurance policy benefits	129.2		117.0		120.4		109.8		476.4		131.0		123.7		134.8		124.7		514.2		
Interest expense	0.7		0.8		0.7		0.6		2.8		0.5		0.5		0.5		0.4		1.9		
Amortization	15.8		13.8		16.3		16.1		62.0		16.3		15.3		13.5		16.2		61.3		
Other operating costs and expenses	33.8		31.4		31.5		34.8		131.5		30.4		30.2		32.6		33.3		126.5		
Total benefits and expenses	179.5		163.0		168.9		161.3		672.7		178.2		169.7		181.4		174.6		703.9		
EBIT from In-Force Business	$	35.8		$	42.3		$	43.3		$	46.2		$	167.6		$	37.3		$	37.9		$	35.1		$	41.6		$	151.9		

EBIT from New Business	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	
Revenues	 	 	 	 	 	 	 	 	 	 	
Insurance policy income	$	14.4		$	14.8		$	14.4		$	15.3		$	58.9		$	15.5		$	15.5		$	15.9		$	16.6		$	63.5		
Net investment income (loss)	—		—		—		—		—		—		—		—		—		—		
Fee revenue and other income	—		—		—		—		—		—		—		—		—		—		
Total revenues	14.4		14.8		14.4		15.3		58.9		15.5		15.5		15.9		16.6		63.5		
 	 	 	 	 	 	 	 	 	 	 	
Benefits and expenses	 	 	 	 	 	 	 	 	 	 	
Insurance policy benefits	5.9		6.1		5.9		6.3		24.2		6.7		6.6		6.8		7.1		27.2		
Interest expense	—		—		—		—		—		—		—		—		—		—		
Amortization	0.7		0.8		0.7		0.7		2.9		0.8		0.9		0.9		1.0		3.6		
Other operating costs and expenses	13.3		11.1		13.0		13.2		50.6		11.3		10.1		10.3		12.3		44.0		
Total benefits and expenses	19.9		18.0		19.6		20.2		77.7		18.8		17.6		18.0		20.4		74.8		
EBIT from New Business	$	(5.5	)	$	(3.2	)	$	(5.2	)	$	(4.9	)	$	(18.8	)	$	(3.3	)	$	(2.1	)	$	(2.1	)	$	(3.8	)	$	(11.3	)	

EBIT from In-Force and New Business	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	
Revenues	 	 	 	 	 	 	 	 	 	 	
Insurance policy income	$	152.4		$	152.4		$	152.5		$	151.6		$	608.9		$	152.9		$	153.1		$	159.2		$	156.3		$	621.5		
Net investment income (loss)	77.1		67.4		73.8		70.9		289.2		77.9		69.8		72.9		76.3		296.9		
Fee revenue and other income	0.2		0.3		0.3		0.3		1.1		0.2		0.2		0.3		0.2		0.9		
Total revenues	229.7		220.1		226.6		222.8		899.2		231.0		223.1		232.4		232.8		919.3		
 	 	 	 	 	 	 	 	 	 	 	
Benefits and expenses	 	 	 	 	 	 	 	 	 	 	
Insurance policy benefits	135.1		123.1		126.3		116.1		500.6		137.7		130.3		141.6		131.8		541.4		
Interest expense	0.7		0.8		0.7		0.6		2.8		0.5		0.5		0.5		0.4		1.9		
Amortization	16.5		14.6		17.0		16.8		64.9		17.1		16.2		14.4		17.2		64.9		
Other operating costs and expenses	47.1		42.5		44.5		48.0		182.1		41.7		40.3		42.9		45.6		170.5		
Total benefits and expenses	199.4		181.0		188.5		181.5		750.4		197.0		187.3		199.4		195.0		778.7		
EBIT from In-Force and New Business	$	30.3		$	39.1		$	38.1		$	41.3		$	148.8		$	34.0		$	35.8		$	33.0		$	37.8		$	140.6		

	
	
The information presented above reflects:	
No change to EBIT from New Business, since there was not any new business written in the blocks transferred from the Other CNO Business segment.	
Increased EBIT from In-Force Business from the EBIT on the blocks transferred from the Other CNO Business segment.	
Refer to page 26 for more information which quantifies the impact of the changes.	

Page 13

	
																															
CNO Financial Group, Inc.	 	 	 	 	 	 	 	 	 	 	
Colonial Penn	 	 	 	 	 	 	 	 	 	 	
Analysis of income (loss) before taxes (in millions)	1Q12	2Q12	3Q12	4Q12	2012	1Q13	2Q13	3Q13	4Q13	2013	
 	 	 	 	 	 	 	 	 	 	 	
Insurance policy income	$	53.4		$	54.6		$	54.5		$	55.3		$	217.8		$	56.9		$	58.0		$	58.1		$	59.1		$	232.1		
Net investment income on general account invested assets	10.0		10.2		9.9		10.3		40.4		9.9		9.9		10.2		10.0		40.0		
Fee revenue and other income	0.2		0.2		0.2		0.1		0.7		0.2		0.2		0.2		0.2		0.8		
   Total revenues	63.6		65.0		64.6		65.7		258.9		67.0		68.1		68.5		69.3		272.9		
 	 	 	 	 	 	 	 	 	 	 	
Insurance policy benefits	41.9		39.3		38.2		40.9		160.3		42.8		41.1		39.6		41.5		165.0		
Amounts added to annuity and interest-sensitive life product account balances	0.2		0.3		0.1		0.2		0.8		0.2		0.1		0.2		0.2		0.7		
Amortization related to operations	3.7		3.9		3.5		3.9		15.0		3.7		3.7		3.7		3.4		14.5		
Other operating costs and expenses	27.6		20.9		25.4		17.5		91.4		25.7		22.0		29.2		28.3		105.2		
   Total benefits and expenses	73.4		64.4		67.2		62.5		267.5		72.4		66.9		72.7		73.4		285.4		
EBIT (4)	$	(9.8	)	$	0.6		$	(2.6	)	$	3.2		$	(8.6	)	$	(5.4	)	$	1.2		$	(4.2	)	$	(4.1	)	$	(12.5	)	

 	 	 	 	 	 	 	 	 	 	 	
Average liabilities for insurance products (in millions)	1Q12	2Q12	3Q12	4Q12	2012	1Q13	2Q13	3Q13	4Q13	2013	
 	 	 	 	 	 	 	 	 	 	 	
SPIAs - mortality based	$	77.0		$	76.8		$	76.4		$	75.9		$	76.5		$	74.8		$	74.4		$	73.5		$	71.3		$	73.5		
Health:	 	 	 	 	 	 	 	 	 	 	
Medicare supplement	10.5		10.2		10.1		9.8		10.2		9.6		9.3		9.1		8.9		9.2		
Other health	4.9		4.9		4.9		4.9		4.9		4.8		4.8		4.7		4.6		4.7		
Life:	 	 	 	 	 	 	 	 	 	 	
   Interest sensitive	19.9		18.9		18.1		17.9		18.7		17.7		17.7		17.4		17.1		17.5		
   Non-interest sensitive	598.4		601.8		605.8		612.2		604.5		618.1		629.9		631.7		637.8		629.4		
Total average liabilities for insurance products, net of reinsurance ceded	$	710.7		$	712.6		$	715.3		$	720.7		$	714.8		$	725.0		$	736.1		$	736.4		$	739.7		$	734.3		

 	 	 	 	 	 	 	 	 	 	 	
Present value of future profits (in millions)	1Q12	2Q12	3Q12	4Q12	2012	1Q13	2Q13	3Q13	4Q13	2013	
 	 	 	 	 	 	 	 	 	 	 	
Balance, beginning of period	$	72.6		$	70.2		$	67.8		$	65.7		$	72.6		$	63.6		$	61.6		$	59.6		$	57.7		$	63.6		
  Amortization related to operations	(2.4	)	(2.4	)	(2.1	)	(2.1	)	(9.0	)	(2.0	)	(2.0	)	(1.9	)	(2.0	)	(7.9	)	
Balance, end of period	$	70.2		$	67.8		$	65.7		$	63.6		$	63.6		$	61.6		$	59.6		$	57.7		$	55.7		$	55.7		

 	 	 	 	 	 	 	 	 	 	 	
Deferred acquisition costs (in millions)	1Q12	2Q12	3Q12	4Q12	2012	1Q13	2Q13	3Q13	4Q13	2013	
 	 	 	 	 	 	 	 	 	 	 	
Balance, beginning of period	$	51.5		$	52.6		$	53.8		$	54.6		$	51.5		$	57.5		$	59.1		$	60.7		$	61.7		$	57.5		
  Deferred acquisition expenses	2.4		2.7		2.2		4.7		12.0		3.3		3.3		2.8		3.1		12.5		
  Amortization related to operations	(1.3	)	(1.5	)	(1.4	)	(1.8	)	(6.0	)	(1.7	)	(1.7	)	(1.8	)	(1.4	)	(6.6	)	
  Other	—		—		—		—		—		—		—		—		4.0		4.0		
Balance, end of period	$	52.6		$	53.8		$	54.6		$	57.5		$	57.5		$	59.1		$	60.7		$	61.7		$	67.4		$	67.4		

	
	
The above information was not impacted by changes to our segment reporting or the presentation of CLIC earnings as non-operating.	

Page 14

	
																															
Colonial Penn Segment EBIT Summarized by In-Force and New Business (6)	 	 	 	 	 	 	 	 	 	 	
(in millions)	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	
CNO Financial Group, Inc.	 	 	 	 	 	 	 	 	 	 	
EBIT from In-Force Business	1Q12	2Q12	3Q12	4Q12	2012	1Q13	2Q13	3Q13	4Q13	2013	
 	 	 	 	 	 	 	 	 	 	 	
Revenues	 	 	 	 	 	 	 	 	 	 	
Insurance policy income	$	43.2		$	43.7		$	43.5		$	44.1		$	174.5		$	45.6		$	46.5		$	46.9		$	48.0		$	187.0		
Net investment income (loss)	10.0		10.2		9.9		10.3		40.4		9.9		9.9		10.2		10.0		40.0		
Fee revenue and other income	0.2		0.2		0.2		0.1		0.7		0.2		0.2		0.2		0.2		0.8		
Total revenues	53.4		54.1		53.6		54.5		215.6		55.7		56.6		57.3		58.2		227.8		
 	 	 	 	 	 	 	 	 	 	 	
Benefits and expenses	 	 	 	 	 	 	 	 	 	 	
Insurance policy benefits	36.2		33.4		32.0		34.7		136.3		36.5		34.6		33.3		35.4		139.8		
Amortization	3.6		3.8		3.2		3.5		14.1		3.6		3.6		3.6		3.3		14.1		
Other operating costs and expenses	6.9		5.7		6.8		5.2		24.6		6.8		6.0		7.5		7.4		27.7		
Total benefits and expenses	46.7		42.9		42.0		43.4		175.0		46.9		44.2		44.4		46.1		181.6		
EBIT from In-Force Business	$	6.7		$	11.2		$	11.6		$	11.1		$	40.6		$	8.8		$	12.4		$	12.9		$	12.1		$	46.2		

EBIT from New Business	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	
Revenues	 	 	 	 	 	 	 	 	 	 	
Insurance policy income	$	10.2		$	10.9		$	11.0		$	11.2		$	43.3		$	11.3		$	11.5		$	11.2		$	11.1		$	45.1		
Net investment income (loss)	—		—		—		—		—		—		—		—		—		—		
Fee revenue and other income	—		—		—		—		—		—		—		—		—		—		
Total revenues	10.2		10.9		11.0		11.2		43.3		11.3		11.5		11.2		11.1		45.1		
 	 	 	 	 	 	 	 	 	 	 	
Benefits and expenses	 	 	 	 	 	 	 	 	 	 	
Insurance policy benefits	5.9		6.2		6.3		6.4		24.8		6.5		6.6		6.5		6.3		25.9		
Amortization	0.1		0.1		0.3		0.4		0.9		0.1		0.1		0.1		0.1		0.4		
Other operating costs and expenses	20.7		15.2		18.6		12.3		66.8		18.9		16.0		21.7		20.9		77.5		
Total benefits and expenses	26.7		21.5		25.2		19.1		92.5		25.5		22.7		28.3		27.3		103.8		
EBIT from New Business	$	(16.5	)	$	(10.6	)	$	(14.2	)	$	(7.9	)	$	(49.2	)	$	(14.2	)	$	(11.2	)	$	(17.1	)	$	(16.2	)	$	(58.7	)	

EBIT from In-Force and New Business	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	
Revenues	 	 	 	 	 	 	 	 	 	 	
Insurance policy income	$	53.4		$	54.6		$	54.5		$	55.3		$	217.8		$	56.9		$	58.0		$	58.1		$	59.1		$	232.1		
Net investment income (loss)	10.0		10.2		9.9		10.3		40.4		9.9		9.9		10.2		10.0		40.0		
Fee revenue and other income	0.2		0.2		0.2		0.1		0.7		0.2		0.2		0.2		0.2		0.8		
Total revenues	63.6		65.0		64.6		65.7		258.9		67.0		68.1		68.5		69.3		272.9		
 	 	 	 	 	 	 	 	 	 	 	
Benefits and expenses	 	 	 	 	 	 	 	 	 	 	
Insurance policy benefits	42.1		39.6		38.3		41.1		161.1		43.0		41.2		39.8		41.7		165.7		
Amortization	3.7		3.9		3.5		3.9		15.0		3.7		3.7		3.7		3.4		14.5		
Other operating costs and expenses	27.6		20.9		25.4		17.5		91.4		25.7		22.0		29.2		28.3		105.2		
Total benefits and expenses	73.4		64.4		67.2		62.5		267.5		72.4		66.9		72.7		73.4		285.4		
EBIT from In-Force and New Business	$	(9.8	)	$	0.6		$	(2.6	)	$	3.2		$	(8.6	)	$	(5.4	)	$	1.2		$	(4.2	)	$	(4.1	)	$	(12.5	)	

	
	
The above information was not impacted by changes to our segment reporting or the presentation of CLIC earnings as non-operating.	

Page 15

	
																															
CNO Financial Group, Inc.	 	 	 	 	 	 	 	 	 	 	
Other CNO Business	 	 	 	 	 	 	 	 	 	 	
Analysis of loss before taxes (in millions)	1Q12	2Q12	3Q12	4Q12	2012	1Q13	2Q13	3Q13	4Q13	2013	
 	 	 	 	 	 	 	 	 	 	 	
Insurance policy income	$	6.6		$	6.4		$	6.3		$	6.3		$	25.6		$	6.2		$	6.1		$	5.9		$	5.9		$	24.1		
Net investment income on general account invested assets	8.0		8.2		8.2		8.5		32.9		8.4		8.4		8.0		8.5		33.3		
   Total revenues	14.6		14.6		14.5		14.8		58.5		14.6		14.5		13.9		14.4		57.4		
 	 	 	 	 	 	 	 	 	 	 	
Insurance policy benefits	15.1		14.8		17.6		15.7		63.2		15.6		15.3		13.5		14.8		59.2		
Other operating costs and expenses:	 	 	 	 	 	 	 	 	 	 	
Related to long-term care block reinsured effective December 31, 2013	0.9		0.8		1.3		1.5		4.5		1.7		1.4		1.4		1.7		6.2		
Overhead expense of CLIC expected to continue after the completion of the sale	6.1		3.9		6.1		4.4		20.5		4.6		5.0		4.7		5.3		19.6		
   Total benefits and expenses	22.1		19.5		25.0		21.6		88.2		21.9		21.7		19.6		21.8		85.0		
EBIT (4)	$	(7.5	)	$	(4.9	)	$	(10.5	)	$	(6.8	)	$	(29.7	)	$	(7.3	)	$	(7.2	)	$	(5.7	)	$	(7.4	)	$	(27.6	)	

 	 	 	 	 	 	 	 	 	 	 	
Health underwriting margins (in millions)	1Q12	2Q12	3Q12	4Q12	2012	1Q13	2Q13	3Q13	4Q13	2013	
 	 	 	 	 	 	 	 	 	 	 	
Long-term care:	 	 	 	 	 	 	 	 	 	 	
   Earned premium	$	6.6		$	6.4		$	6.3		$	6.3		$	25.6		$	6.2		$	6.1		$	5.9		$	5.9		$	24.1		
Benefit ratio before interest income on reserves	227.4	%	230.2	%	282.4	%	249.8	%	247.0	%	252.2	%	251.0	%	227.5	%	252.0	%	245.7	%	
   Interest-adjusted benefit ratio	122.0	%	121.3	%	169.9	%	138.8	%	137.6	%	140.7	%	137.6	%	111.6	%	134.4	%	131.2	%	
Underwriting margin (earned premium plus interest income on reserves less policy benefits)	$	(1.5	)	$	(1.4	)	$	(4.3	)	$	(2.5	)	$	(9.7	)	$	(2.5	)	$	(2.3	)	$	(0.7	)	$	(2.0	)	$	(7.5	)	

	

 	 	 	 	 	 	 	 	 	 	 	
Average liabilities for insurance products (in millions)	1Q12	2Q12	3Q12	4Q12	2012	1Q13	2Q13	3Q13	4Q13	2013	
 	 	 	 	 	 	 	 	 	 	 	
Average liabilities for long-term care products, net of reinsurance ceded	$	467.0		$	466.4		$	466.8		$	467.8		$	467.0		$	468.0		$	468.0		$	467.3		$	466.4		$	467.4		

	
	
After the transfer of certain health, annuity and life blocks to the Washington National segment and the presentation of CLIC earnings as non-operating, the Other CNO Business segment includes the long-term care business which was reinsured with Beechwood Re effective December 31, 2013 and the overhead expense of CLIC that is expected to continue after its sale. Effective January 1, 2014, this segment will no longer exist as the long-term care business will be reinsured and the overhead expense of CLIC that is expected to continue after the sale will be allocated to the other segments.	
There are no changes to the health underwriting margins.	
Average liabilities are lower, reflecting the transfer of reserves to the Washington National segment and the reserves classified in the operations of CLIC being sold.	
All EBIT of the Other CNO Business segment relates to in-force business, since there was not any new business written in the blocks of this segment.	

Page 16

	
																															
CNO Financial Group, Inc.	 	 	 	 	 	 	 	 	 	 	
Corporate Operations	 	 	 	 	 	 	 	 	 	 	
Analysis of loss before taxes (in millions)	1Q12	2Q12	3Q12	4Q12	2012	1Q13	2Q13	3Q13	4Q13	2013	
 	 	 	 	 	 	 	 	 	 	 	
Net investment income (loss):	 	 	 	 	 	 	 	 	 	 	
   General investment portfolio	$	0.9		$	1.0		$	1.0		$	0.7		$	3.6		$	1.1		$	1.5		$	1.2		$	1.6		$	5.4		
   Other special-purpose portfolios	16.2		(1.1	)	8.2		4.2		27.5		9.0		3.0		9.8		12.6		34.4		
Fee revenue and other income	0.4		0.2		0.3		0.3		1.2		1.7		1.5		1.7		1.3		6.2		
Net operating results of variable interest entities	2.2		2.9		4.7		2.5		12.3		—		—		—		—		—		
Interest expense on investment borrowings	(0.1	)	(0.2	)	(0.1	)	—		(0.4	)	(0.1	)	—		—		—		(0.1	)	
Other operating costs and expenses	(21.4	)	(11.9	)	(20.8	)	(10.4	)	(64.5	)	(8.7	)	(3.6	)	(3.3	)	(11.7	)	(27.3	)	
Corporate operations, excluding corporate interest expense	(1.8	)	(9.1	)	(6.7	)	(2.7	)	(20.3	)	3.0		2.4		9.4		3.8		18.6		
Interest expense on corporate debt	(17.5	)	(16.6	)	(16.3	)	(15.8	)	(66.2	)	(15.1	)	(13.1	)	(11.7	)	(11.4	)	(51.3	)	
Loss before net realized investment gains (losses), equity in earnings of certain non-strategic investments and earnings attributable to non-controlling interests, loss on extinguishment of debt and income taxes	$	(19.3	)	$	(25.7	)	$	(23.0	)	$	(18.5	)	$	(86.5	)	$	(12.1	)	$	(10.7	)	$	(2.3	)	$	(7.6	)	$	(32.7	)	

	
	
The above information was not impacted by changes to our segment reporting or the presentation of CLIC earnings as non-operating.	

Page 17

	
																															
CNO Financial Group, Inc.	 	 	 	 	 	 	 	 	 	 	
Bankers Life	 	 	 	 	 	 	 	 	 	 	
Premiums collected on insurance products (in millions)	1Q12	2Q12	3Q12	4Q12	2012	1Q13	2Q13	3Q13	4Q13	2013	
 	 	 	 	 	 	 	 	 	 	 	
Annuities	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	
Fixed index (first-year)	$	134.9		$	120.2		$	114.5		$	135.4		$	505.0		$	126.6		$	143.4		$	143.3		$	153.5		$	566.8		
 	 	 	 	 	 	 	 	 	 	 	
Other fixed rate (first-year)	47.8		47.9		56.0		46.3		198.0		37.2		38.5		45.3		49.6		170.6		
Other fixed rate (renewal)	2.0		1.4		1.2		1.4		6.0		1.8		1.8		1.6		1.5		6.7		
  Subtotal - other fixed rate annuities	49.8		49.3		57.2		47.7		204.0		39.0		40.3		46.9		51.1		177.3		
 	 	 	 	 	 	 	 	 	 	 	
      Total annuities	184.7		169.5		171.7		183.1		709.0		165.6		183.7		190.2		204.6		744.1		
 	 	 	 	 	 	 	 	 	 	 	
Health	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	
Medicare supplement (first-year)	23.8		25.1		24.7		25.8		99.4		22.7		22.7		22.3		24.4		92.1		
Medicare supplement (renewal)	151.1		149.8		153.0		163.9		617.8		162.5		153.4		159.7		177.6		653.2		
  Subtotal - Medicare supplement	174.9		174.9		177.7		189.7		717.2		185.2		176.1		182.0		202.0		745.3		
 	 	 	 	 	 	 	 	 	 	 	
Long-term care (first-year)	5.5		5.9		6.0		6.0		23.4		5.7		5.4		5.1		5.0		21.2		
Long-term care (renewal)	131.2		132.9		130.1		128.9		523.1		129.7		127.8		126.0		129.3		512.8		
  Subtotal - long-term care	136.7		138.8		136.1		134.9		546.5		135.4		133.2		131.1		134.3		534.0		
 	 	 	 	 	 	 	 	 	 	 	
PDP (first-year)	0.3		0.1		0.1		0.2		0.7		0.1		—		—		—		0.1		
PDP (renewal)	15.0		14.6		10.2		7.3		47.1		10.1		10.5		(2.5	)	—		18.1		
  Subtotal - PDP	15.3		14.7		10.3		7.5		47.8		10.2		10.5		(2.5	)	—		18.2		
 	 	 	 	 	 	 	 	 	 	 	
Supplemental health (first-year)	—		0.2		0.6		1.1		1.9		1.6		2.0		2.3		2.4		8.3		
Supplemental health (renewal)	—		—		—		—		—		—		0.2		0.5		0.9		1.6		
  Subtotal - supplemental health	—		0.2		0.6		1.1		1.9		1.6		2.2		2.8		3.3		9.9		
 	 	 	 	 	 	 	 	 	 	 	
Other health (first-year)	0.4		0.4		0.3		0.3		1.4		0.3		0.4		0.3		0.3		1.3		
Other health (renewal)	2.2		2.3		2.3		2.3		9.1		2.4		2.2		2.2		2.3		9.1		
  Subtotal - other health	2.6		2.7		2.6		2.6		10.5		2.7		2.6		2.5		2.6		10.4		
 	 	 	 	 	 	 	 	 	 	 	
    Total health	329.5		331.3		327.3		335.8		1,323.9		335.1		324.6		315.9		342.2		1,317.8		
 	 	 	 	 	 	 	 	 	 	 	
Life insurance	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	
First-year	32.8		35.7		38.9		42.5		149.9		42.4		41.0		41.7		38.2		163.3		
Renewal	37.3		39.7		42.4		45.3		164.7		47.1		50.1		52.5		55.3		205.0		
 	 	 	 	 	 	 	 	 	 	 	
    Total life insurance	70.1		75.4		81.3		87.8		314.6		89.5		91.1		94.2		93.5		368.3		
 	 	 	 	 	 	 	 	 	 	 	
Collections on insurance products	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	
Total first-year premium collections on insurance products	245.5		235.5		241.1		257.6		979.7		236.6		253.4		260.3		273.4		1,023.7		
Total renewal premium collections on insurance products	338.8		340.7		339.2		349.1		1,367.8		353.6		346.0		340.0		366.9		1,406.5		
 	 	 	 	 	 	 	 	 	 	 	
    Total collections on insurance products	$	584.3		$	576.2		$	580.3		$	606.7		$	2,347.5		$	590.2		$	599.4		$	600.3		$	640.3		$	2,430.2		

	
	
The above information was not impacted by changes to our segment reporting or the presentation of CLIC earnings as non-operating.	

Page 18

	
																															
CNO Financial Group, Inc.	 	 	 	 	 	 	 	 	 	 	
Washington National	 	 	 	 	 	 	 	 	 	 	
Premiums collected on insurance products (in millions)	1Q12	2Q12	3Q12	4Q12	2012	1Q13	2Q13	3Q13	4Q13	2013	
 	 	 	 	 	 	 	 	 	 	 	
Annuities	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	
Fixed index (first-year)	$	—		$	0.2		$	0.1		$	0.3		$	0.6		$	0.2		$	0.1		$	0.1		$	—		$	0.4		
Fixed index (renewal)	0.7		0.8		0.4		0.4		2.3		0.6		1.3		1.0		0.5		3.4		
  Subtotal - fixed index annuities	0.7		1.0		0.5		0.7		2.9		0.8		1.4		1.1		0.5		3.8		
 	 	 	 	 	 	 	 	 	 	 	
Other fixed rate (all renewal)	0.1		0.1		0.3		0.1		0.6		0.1		—		0.2		0.2		0.5		
 	 	 	 	 	 	 	 	 	 	 	
      Total annuities	0.8		1.1		0.8		0.8		3.5		0.9		1.4		1.3		0.7		4.3		
 	 	 	 	 	 	 	 	 	 	 	
Health	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	
Medicare supplement (first-year)	0.3		0.3		0.2		0.2		1.0		0.2		—		—		0.1		0.3		
Medicare supplement (renewal)	27.8		28.8		28.2		28.1		112.9		26.4		25.0		24.2		26.0		101.6		
  Subtotal - Medicare supplement	28.1		29.1		28.4		28.3		113.9		26.6		25.0		24.2		26.1		101.9		
 	 	 	 	 	 	 	 	 	 	 	
Supplemental health (first-year)	14.1		15.1		14.7		15.3		59.2		15.6		16.3		16.1		16.7		64.7		
Supplemental health (renewal)	98.8		100.3		99.8		101.6		400.5		104.7		105.6		106.6		109.7		426.6		
  Subtotal - supplemental health	112.9		115.4		114.5		116.9		459.7		120.3		121.9		122.7		126.4		491.3		
Other health (first-year)	—		—		—		—		—		—		—		0.1		0.1		0.2		
Other health (renewal)	0.9		0.8		0.8		0.9		3.4		0.8		0.8		0.5		0.8		2.9		
  Subtotal - other health	0.9		0.8		0.8		0.9		3.4		0.8		0.8		0.6		0.9		3.1		
 	 	 	 	 	 	 	 	 	 	 	
    Total health	141.9		145.3		143.7		146.1		577.0		147.7		147.7		147.5		153.4		596.3		
 	 	 	 	 	 	 	 	 	 	 	
Life insurance	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	
First-year	0.8		1.0		1.0		1.3		4.1		1.2		1.1		1.0		1.3		4.6		
Renewal	5.4		4.8		4.8		4.7		19.7		5.1		5.2		5.1		6.5		21.9		
 	 	 	 	 	 	 	 	 	 	 	
    Total life insurance	6.2		5.8		5.8		6.0		23.8		6.3		6.3		6.1		7.8		26.5		
 	 	 	 	 	 	 	 	 	 	 	
Collections on insurance products	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	
Total first-year premium collections on insurance products	15.2		16.6		16.0		17.1		64.9		17.2		17.5		17.3		18.2		70.2		
Total renewal premium collections on insurance products	133.7		135.6		134.3		135.8		539.4		137.7		137.9		137.6		143.7		556.9		
 	 	 	 	 	 	 	 	 	 	 	
    Total collections on insurance products	$	148.9		$	152.2		$	150.3		$	152.9		$	604.3		$	154.9		$	155.4		$	154.9		$	161.9		$	627.1		

	
	
The information presented above reflects:	
Increases to other health, life and annuity premiums collected due to the transfer of blocks of business to the Washington National segment from the Other CNO Business segment.	

Page 19

	
																															
CNO Financial Group, Inc.	 	 	 	 	 	 	 	 	 	 	
Colonial Penn	 	 	 	 	 	 	 	 	 	 	
Premiums collected on insurance products (in millions)	1Q12	2Q12	3Q12	4Q12	2012	1Q13	2Q13	3Q13	4Q13	2013	
 	 	 	 	 	 	 	 	 	 	 	
Life insurance	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	
First-year	$	10.4		$	10.7		$	10.9		$	11.1		$	43.1		$	11.4		$	11.4		$	11.4		$	11.0		$	45.2		
Renewal	42.2		41.8		42.1		42.7		168.8		44.7		45.0		46.2		46.5		182.4		
 	 	 	 	 	 	 	 	 	 	 	
    Total life insurance	52.6		52.5		53.0		53.8		211.9		56.1		56.4		57.6		57.5		227.6		
 	 	 	 	 	 	 	 	 	 	 	
Health (all renewal)	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	
Medicare supplement	1.2		1.1		1.1		1.1		4.5		1.0		0.9		0.9		0.9		3.7		
 	 	 	 	 	 	 	 	 	 	 	
Other health	0.1		0.1		0.1		0.1		0.4		0.1		0.1		0.1		0.1		0.4		
 	 	 	 	 	 	 	 	 	 	 	
    Total health	1.3		1.2		1.2		1.2		4.9		1.1		1.0		1.0		1.0		4.1		
 	 	 	 	 	 	 	 	 	 	 	
Collections on insurance products	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	
Total first-year premium collections on insurance products	10.4		10.7		10.9		11.1		43.1		11.4		11.4		11.4		11.0		45.2		
Total renewal premium collections on insurance products	43.5		43.0		43.3		43.9		173.7		45.8		46.0		47.2		47.5		186.5		
 	 	 	 	 	 	 	 	 	 	 	
    Total collections on insurance products	$	53.9		$	53.7		$	54.2		$	55.0		$	216.8		$	57.2		$	57.4		$	58.6		$	58.5		$	231.7		

	
																															
Other CNO Business	 	 	 	 	 	 	 	 	 	 	
Premiums collected on insurance products (in millions)	1Q12	2Q12	3Q12	4Q12	2012	1Q13	2Q13	3Q13	4Q13	2013	
 	 	 	 	 	 	 	 	 	 	 	
Health	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	
Long-term care (all renewal)	$	6.7		$	6.3		$	6.0		$	6.1		$	25.1		$	6.3		$	6.1		$	5.7		$	5.5		$	23.6		

	
	
The Other CNO Business segment reflects long-term care premiums collected prior to the reinsurance agreement effective December 31, 2013. The premiums on the blocks transferred to the Washington National segment and the premiums related to the operations of CLIC being sold are no longer included in this segment.	

Page 20

	
																															
CNO Financial Group, Inc.	 	 	 	 	 	 	 	 	 	 	
New Annualized Premiums ("NAP") (in millions)	 	 	 	 	 	 	 	 	 	 	

Bankers Life	1Q12	2Q12	3Q12	4Q12	2012	1Q13	2Q13	3Q13	4Q13	2013	
 	 	 	 	 	 	 	 	 	 	 	
Medicare supplement	$	19.5		$	19.9		$	19.3		$	28.6		$	87.3		$	19.1		$	19.0		$	18.7		$	31.5		$	88.3		
Long-term care	7.9		7.8		7.2		6.0		28.9		6.1		6.5		6.2		5.7		24.5		
Supplemental health	—		0.8		1.8		2.4		5.0		2.8		2.7		2.6		2.2		10.3		
Life	20.3		20.9		18.9		21.4		81.5		22.5		24.2		23.5		22.4		92.6		
Annuity	11.1		10.1		10.4		10.9		42.5		10.0		10.8		11.5		12.1		44.4		
   Subtotal Bankers Life	58.8		59.5		57.6		69.3		245.2		60.5		63.2		62.5		73.9		260.1		

Washington National	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	
Supplemental health	17.6		20.3		19.7		21.2		78.8		19.2		21.3		22.5		24.8		87.8		
Medicare supplement	0.3		0.2		0.2		0.1		0.8		—		—		—		—		—		
Life	2.0		1.7		1.5		1.5		6.7		1.4		1.9		1.3		1.4		6.0		
Annuity	—		0.1		—		—		0.1		—		0.1		0.1		—		0.2		
   Subtotal Washington National	19.9		22.3		21.4		22.8		86.4		20.6		23.3		23.9		26.2		94.0		

Colonial Penn	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	
Graded Life	17.5		15.6		15.1		13.6		61.8		17.0		15.8		15.4		14.0		62.2		

 	 	 	 	 	 	 	 	 	 	 	
Total NAP	$	96.2		$	97.4		$	94.1		$	105.7		$	393.4		$	98.1		$	102.3		$	101.8		$	114.1		$	416.3		

	
	
The above information was not impacted as there was no NAP on the business in the operations of CLIC being sold.	

Page 21

	
																															
CNO Financial Group, Inc.	 	 	 	 	 	 	 	 	 	 	
Statutory information - consolidated basis (7) (in millions)	1Q12	2Q12	3Q12	4Q12	2012	1Q13	2Q13	3Q13	4Q13	2013	
 	 	 	 	 	 	 	 	 	 	 	
Net gain from operations before interest expense and federal income taxes	$	100.4		$	107.7		$	82.8		$	111.9		$	402.8		$	123.4		$	115.4		$	109.4		$	80.4		$	428.6		
Interest expense on surplus debentures held by parent company	12.1		12.1		22.4		12.3		58.9		12.0		12.2		27.2		12.3		63.7		
 	 	 	 	 	 	 	 	 	 	 	
Net gain from operations before federal income taxes	88.3		95.6		60.4		99.6		343.9		111.4		103.2		82.2		68.1		364.9		
Federal income tax expense (benefit)	1.7		(0.9	)	0.1		5.6		6.5		(1.1	)	1.1		0.8		(3.4	)	(2.6	)	
 	 	 	 	 	 	 	 	 	 	 	
Net gain from operations before net realized capital gains (losses)	86.6		96.5		60.3		94.0		337.4		112.5		102.1		81.4		71.5		367.5		
Net realized capital gains (losses)	7.8		7.2		(10.6	)	8.6		13.0		9.7		4.1		5.3		(0.1	)	19.0		
 	 	 	 	 	 	 	 	 	 	 	
Net income	$	94.4		$	103.7		$	49.7		$	102.6		$	350.4		$	122.2		$	106.2		$	86.7		$	71.4		$	386.5		

 	 	 	 	 	 	 	 	 	 	 	
Capital and surplus	$	1,601.9		$	1,626.0		$	1,554.3		$	1,560.4		$	1,560.4		$	1,579.8		$	1,626.8		$	1,660.6		$	1,711.9		$	1,711.9		
Asset valuation reserve (AVR)	191.3		206.1		212.5		222.2		222.2		234.3		238.1		240.9		233.9		233.9		
 	 	 	 	 	 	 	 	 	 	 	
  Capital, surplus and AVR	1,793.2		1,832.1		1,766.8		1,782.6		1,782.6		1,814.1		1,864.9		1,901.5		1,945.8		1,945.8		
 	 	 	 	 	 	 	 	 	 	 	
Interest maintenance reserve (IMR)	562.2		581.4		590.1		585.8		585.8		587.2		586.1		579.8		582.5		582.5		
 	 	 	 	 	 	 	 	 	 	 	
  Total statutory capital, surplus, AVR & IMR	$	2,355.4		$	2,413.5		$	2,356.9		$	2,368.4		$	2,368.4		$	2,401.3		$	2,451.0		$	2,481.3		$	2,528.3		$	2,528.3		

	
	
The above information was not impacted by changes to our segment reporting or the presentation of CLIC earnings as non-operating.	

Page 22

	
																															
CNO Financial Group, Inc.	 	 	 	 	 	 	 	 	 	 	
Operations of CLIC being sold	 	 	 	 	 	 	 	 	 	 	
Analysis of income (loss) before taxes (in millions)	1Q12	2Q12	3Q12	4Q12	2012	1Q13	2Q13	3Q13	4Q13	2013	
 	 	 	 	 	 	 	 	 	 	 	
Insurance policy income	$	67.4		$	62.4		$	60.8		$	55.1		$	245.7		$	57.2		$	55.0		$	55.5		$	50.6		$	218.3		
Net investment income (loss):	 	 	 	 	 	 	 	 	 	 	
   General account invested assets	56.2		56.4		55.0		55.0		222.6		53.2		52.9		52.0		52.1		210.2		
   Fixed index products	1.4		(1.2	)	0.6		(0.8	)	—		2.2		0.8		1.3		3.6		7.9		
Fee revenue and other income	—		—		—		—		—		—		—		—		5.1		5.1		
   Total revenues	125.0		117.6		116.4		109.3		468.3		112.6		108.7		108.8		111.4		441.5		
 	 	 	 	 	 	 	 	 	 	 	
Insurance policy benefits (a)	60.7		73.4		99.0		58.8		291.9		64.6		57.3		60.7		57.0		239.6		
Amounts added to policyholder account balances:	 	 	 	 	 	 	 	 	 	 	
Cost of interest credited to policyholders	24.8		25.0		24.3		23.8		97.9		23.3		22.7		22.5		21.7		90.2		
Cost of options to fund index credits, net of forfeitures	0.5		0.5		0.3		0.5		1.8		0.4		0.3		0.4		0.3		1.4		
Market value changes credited to policyholders	1.4		(1.1	)	0.7		(0.9	)	0.1		2.1		1.0		1.3		3.5		7.9		
Amortization related to operations	3.7		3.3		4.7		4.9		16.6		2.2		2.7		2.0		1.9		8.8		
Interest expense on investment borrowings	5.1		5.0		5.0		4.8		19.9		4.8		4.8		4.8		4.9		19.3		
Other operating costs and expenses	29.2		9.9		29.7		12.1		80.9		8.9		14.1		10.2		7.8		41.0		
   Total benefits and expenses	125.4		116.0		163.7		104.0		509.1		106.3		102.9		101.9		97.1		408.2		
Income (loss) before net realized investment gains and income taxes	(0.4	)	1.6		(47.3	)	5.3		(40.8	)	6.3		5.8		6.9		14.3		33.3		
Net realized investment gains (losses)	(2.9	)	2.0		(5.9	)	(0.1	)	(6.9	)	2.1		1.6		1.6		0.7		6.0		
Amortization related to net realized investment gains (losses)	—		0.1		(0.1	)	(0.1	)	(0.1	)	—		—		—		—		—		
Net realized investment gains (losses), net of related amortization	(2.9	)	2.1		(6.0	)	(0.2	)	(7.0	)	2.1		1.6		1.6		0.7		6.0		
Income (loss) before income taxes	(3.3	)	3.7		(53.3	)	5.1		(47.8	)	8.4		7.4		8.5		15.0		39.3		
Income tax expense (benefit) on period income	(1.2	)	1.3		(18.6	)	1.8		(16.7	)	2.9		2.6		3.0		5.3		13.8		
Net income (loss)	$	(2.1	)	$	2.4		$	(34.7	)	$	3.3		$	(31.1	)	$	5.5		$	4.8		$	5.5		$	9.7		$	25.5		

	
	
The information presented above represents the income (loss) related to the operations of CLIC being sold. Operating expenses exclude overhead expense that is expected to continue after the sale of CLIC.	

Page 23

	
																															
CNO Financial Group, Inc.	 	 	 	 	 	 	 	 	 	 	
Operations of CLIC being sold	 	 	 	 	 	 	 	 	 	 	
Average liabilities for insurance products (in millions)	1Q12	2Q12	3Q12	4Q12	2012	1Q13	2Q13	3Q13	4Q13	2013	
 	 	 	 	 	 	 	 	 	 	 	
Fixed index annuities	$	—		$	—		$	—		$	—		$	—		$	—		$	0.8		$	0.8		$	0.8		$	0.6		
Deferred annuities	152.7		162.1		159.2		155.9		157.5		151.9		148.9		147.3		145.3		148.4		
SPIAs and supplemental contracts:	 	 	 	 	 	 	 	 	 	 	
Mortality based	42.6		42.2		41.8		41.1		41.9		40.3		39.4		38.8		38.2		39.2		
Deposit based	137.8		119.1		122.1		115.9		123.7		111.4		109.6		105.1		100.6		106.7		
Health:	 	 	 	 	 	 	 	 	 	 	
Supplemental health	162.1		157.1		155.4		154.8		157.4		153.6		149.0		145.0		140.4		146.9		
Medicare supplement	3.6		3.2		2.9		2.7		3.1		2.5		2.2		2.1		2.0		2.2		
Other health	14.0		13.4		12.8		9.7		12.5		6.8		6.7		6.7		6.7		6.7		
Life:	 	 	 	 	 	 	 	 	 	 	
   Interest sensitive	2,431.8		2,387.2		2,369.1		2,364.1		2,388.1		2,354.0		2,333.9		2,305.8		2,277.4		2,317.8		
   Non-interest sensitive	452.9		449.8		451.4		447.2		450.3		439.9		433.0		429.2		426.4		432.1		
Total average liabilities for insurance products, net of reinsurance ceded	$	3,397.5		$	3,334.1		$	3,314.7		$	3,291.4		$	3,334.5		$	3,260.4		$	3,223.5		$	3,180.8		$	3,137.8		$	3,200.6		

 	 	 	 	 	 	 	 	 	 	 	
Present value of future profits (in millions)	1Q12	2Q12	3Q12	4Q12	2012	1Q13	2Q13	3Q13	4Q13	2013	
 	 	 	 	 	 	 	 	 	 	 	
Balance, beginning of period	$	20.1		$	19.6		$	18.9		$	18.3		$	20.1		$	17.7		$	17.4		$	16.6		$	16.5		$	17.7		
Amortization related to operations	(1.4	)	(1.3	)	(1.3	)	(3.1	)	(7.1	)	(0.7	)	(0.8	)	(0.2	)	(0.6	)	(2.3	)	
 Amortization related to net realized investment (gains) losses	—		0.1		—		(0.1	)	—		—		—		—		—		—		
Adjustment related to unrealized (gain) or loss on fixed maturities, available for sale	0.9		0.5		0.7		2.6		4.7		0.4		—		0.1		0.2		0.7		
Balance, end of period	$	19.6		$	18.9		$	18.3		$	17.7		$	17.7		$	17.4		$	16.6		$	16.5		$	16.1		$	16.1		

 	 	 	 	 	 	 	 	 	 	 	
Deferred acquisition costs (in millions)	1Q12	2Q12	3Q12	4Q12	2012	1Q13	2Q13	3Q13	4Q13	2013	
 	 	 	 	 	 	 	 	 	 	 	
Balance, beginning of period	$	53.7		$	51.3		$	49.5		$	45.5		$	53.7		$	44.2		$	43.0		$	42.7		$	41.8		$	44.2		
Deferred acquisition expenses	(0.2	)	0.5		0.1		0.5		0.9		0.3		0.6		0.7		0.2		1.8		
Amortization related to operations	(2.3	)	(2.0	)	(3.4	)	(1.8	)	(9.5	)	(1.5	)	(1.9	)	(1.8	)	(1.3	)	(6.5	)	
Amortization related to net realized investment (gains) losses	—		—		(0.1	)	—		(0.1	)	—		—		—		—		—		
Adjustment related to unrealized (gain) or loss on fixed maturities, available for sale	0.1		(0.3	)	(0.6	)	—		(0.8	)	—		1.0		0.2		—		1.2		
Balance, end of period	$	51.3		$	49.5		$	45.5		$	44.2		$	44.2		$	43.0		$	42.7		$	41.8		$	40.7		$	40.7		

	
																															
Premiums collected on insurance products (in millions)	1Q12	2Q12	3Q12	4Q12	2012	1Q13	2Q13	3Q13	4Q13	2013	
 	 	 	 	 	 	 	 	 	 	 	
Annuities	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	
Other fixed rate (all renewal)	$	0.1		$	0.1		$	0.1		$	—		$	0.3		$	0.1		$	0.1		$	0.1		$	—		$	0.3		
 	 	 	 	 	 	 	 	 	 	 	
Life insurance	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	
First-year	—		0.1		0.2		—		0.3		—		0.2		0.1		—		0.3		
Renewal	43.1		38.8		37.3		35.9		155.1		38.4		36.4		35.0		31.9		141.7		
 	 	 	 	 	 	 	 	 	 	 	
    Total life insurance	43.1		38.9		37.5		35.9		155.4		38.4		36.6		35.1		31.9		142.0		
 	 	 	 	 	 	 	 	 	 	 	
Collections on insurance products	 	 	 	 	 	 	 	 	 	 	
 	 	 	 	 	 	 	 	 	 	 	
Total first-year premium collections on insurance products	—		0.1		0.2		—		0.3		—		0.2		0.1		—		0.3		
Total renewal premium collections on insurance products	43.2		38.9		37.4		35.9		155.4		38.5		36.5		35.1		31.9		142.0		
 	 	 	 	 	 	 	 	 	 	 	
    Total collections on insurance products	$	43.2		$	39.0		$	37.6		$	35.9		$	155.7		$	38.5		$	36.7		$	35.2		$	31.9		$	142.3		

	
	
The information presented above relates to the operations of CLIC being sold.	

Page 24

Page 25

Notes

(1) Excludes accumulated other comprehensive income.

(2) Shareholders' equity divided by common shares outstanding.

(3) Book value per diluted share reflects the potential dilution that could occur if outstanding stock options and warrants were exercised, restricted stock and performance units were vested and convertible securities were converted. The dilution from options, warrants, restricted shares and performance units is calculated using the treasury stock method. Under this method, we assume the proceeds from the exercise of the options and warrants (or the unrecognized compensation expense with respect to restricted stock and performance units) will be used to purchase shares of our common stock at the closing market price on the last day of the period. The dilution from convertible securities is calculated assuming the securities were converted on the last day of the period.

(4) Management believes that an analysis of earnings before the operations of CLIC being sold, loss related to reinsurance transaction, net realized investment gains (losses), fair value changes due to fluctuations in the interest rates used to discount embedded derivative liabilities related to our fixed index annuities, corporate interest expense, equity in earnings of certain non-strategic investments and earnings attributable to non-controlling interests, loss on extinguishment of debt and taxes (“EBIT,” a non-GAAP financial measure) provides a clearer comparison of the operating results of the company quarter-over-quarter because these items are unrelated to the company's underlying fundamentals.

(5) Management believes that an analysis of Net income applicable to common stock before: (i) the operations of CLIC being sold; (ii) loss related to reinsurance transaction; (iii) net realized investment gains or losses, net of related amortization and taxes; (iv) fair value changes due to fluctuations in the interest rates used to discount embedded derivative liabilities related to our fixed index annuities, net of related amortization and taxes; (v) equity in earnings of certain non-strategic investments and earnings attributable to non-controlling interests, net of taxes; (vi) loss on extinguishment of debt, net of taxes; and (vii) changes in our valuation allowance for deferred tax assets (“Net operating income,” a non-GAAP financial measure) is important to evaluate the financial performance of the company, and is a key measure commonly used in the life insurance industry. Management uses this measure to evaluate performance because the items excluded from net operating income can be affected by events that are unrelated to the company's underlying fundamentals.

(6) Management believes that an analysis of EBIT, separated between in-force and new business provides increased clarity around the value drivers of our business, particularly since the new business results are significantly impacted by the rate of sales, mix of business and the distribution channel through which new sales are made. EBIT from new business includes pre-tax revenues and expenses associated with new sales of our insurance products during the first year after the sale is completed. EBIT from in-force business includes all pre-tax revenues and expenses associated with sales of insurance products that were completed more than one year before the end of the reporting period. The allocation of certain revenues and expenses between new and in-force business is based on estimates, which we believe are reasonable.

(7) Based on statutory accounting practices prescribed or permitted by regulatory authorities for CNO Financial's insurance subsidiaries after appropriate elimination of intercompany accounts among such subsidiaries. Such accounting practices differ from GAAP.

Page 26

APPENDIX

	
																															
Summary of Changes to our Operating Results Presented on Page 5	 	 	 	 	 	 	 	 	
Changes reflect the transfer of certain health, annuity and life blocks from the Other CNO Business segment to the Washington National segment; and the presentation of CLIC earnings as non-operating, excluding overhead expense that is expected to continue after the sale.	1Q12	2Q12	3Q12	4Q12	2012	1Q13	2Q13	3Q13	4Q13	2013	
 	 	 	 	 	 	 	 	 	 	 	
Washington National transfer from Other CNO Business	$	5.6		$	5.2		$	4.2		$	6.7		$	21.7		$	4.6		$	4.0		$	4.9		$	6.3		$	19.8		
Other CNO Business:	 	 	 	 	 	 	 	 	 	 	
Transfer to Washington National	(5.6	)	(5.2	)	(4.2	)	(6.7	)	(21.7	)	(4.6	)	(4.0	)	(4.9	)	(6.3	)	(19.8	)	
Transfer to operations of CLIC being sold	0.4		(1.6	)	47.3		(5.3	)	40.8		(6.3	)	(5.8	)	(6.9	)	(14.3	)	(33.3	)	
Subtotal - EBIT	0.4		(1.6	)	47.3		(5.3	)	40.8		(6.3	)	(5.8	)	(6.9	)	(14.3	)	(33.3	)	
Taxes:	 	 	 	 	 	 	 	 	 	 	
Transfer to operations of CLIC being sold	0.2		(0.6	)	16.5		(1.8	)	14.3		(2.2	)	(2.0	)	(2.4	)	(5.1	)	(11.7	)	
Subtotal operating earnings	0.2		(1.0	)	30.8		(3.5	)	26.5		(4.1	)	(3.8	)	(4.5	)	(9.2	)	(21.6	)	
Net realized (gains) losses:	 	 	 	 	 	 	 	 	 	 	
Transfer to operations of CLIC being sold	1.9		(1.4	)	3.9		0.2		4.6		(1.4	)	(1.0	)	(1.0	)	(0.5	)	(3.9	)	
Operations of CLIC being sold:	 	 	 	 	 	 	 	 	 	 	
Transfer from Other CNO Business	(0.4	)	1.6		(47.3	)	5.3		(40.8	)	6.3		5.8		6.9		14.3		33.3		
Transfer from taxes	0.2		(0.6	)	16.5		(1.8	)	14.3		(2.2	)	(2.0	)	(2.4	)	(5.1	)	(11.7	)	
Transfer from net realized gains (losses)	(1.9	)	1.4		(3.9	)	(0.2	)	(4.6	)	1.4		1.0		1.0		0.5		3.9		
Subtotal - operations of CLIC being sold	(2.1	)	2.4		(34.7	)	3.3		(31.1	)	5.5		4.8		5.5		9.7		25.5		
Grand total	$	—		$	—		$	—		$	—		$	—		$	—		$	—		$	—		$	—		$	—		

	
																															
Summary of Changes to EBIT Summarized by In-Force and New Business Presented on Page 7	 	 	 	 	 	
The EBIT from In-Force Business is increased (reduced) by the losses (earnings) from the operations of CLIC being sold.	1Q12	2Q12	3Q12	4Q12	2012	1Q13	2Q13	3Q13	4Q13	2013	
 	 	 	 	 	 	 	 	 	 	 	
EBIT from In-Force before changes	$	131.7		$	152.8		$	107.2		$	163.3		$	555.0		$	141.2		$	158.5		$	168.1		$	178.6		$	646.4		
Transfer from Other CNO Business segment	0.4		(1.6	)	47.3		(5.3	)	40.8		(6.3	)	(5.8	)	(6.9	)	(14.3	)	(33.3	)	
EBIT from In-Force after changes	$	132.1		$	151.2		$	154.5		$	158.0		$	595.8		$	134.9		$	152.7		$	161.2		$	164.3		$	613.1		

	
																															
Summary of Changes to the Washington National Segment Presented on Page 11	 	 	 	 	 	
Changes reflect the transfer to the Washington National segment of certain health, annuity and life blocks of business from the Other CNO Business segment.	1Q12	2Q12	3Q12	4Q12	2012	1Q13	2Q13	3Q13	4Q13	2013	
 	 	 	 	 	 	 	 	 	 	 	
Insurance policy income	$	5.0		$	4.8		$	4.7		$	4.0		$	18.5		$	3.8		$	3.9		$	8.9		$	4.2		$	20.8		
Net investment income	27.1		16.4		22.9		18.7		85.1		25.9		18.5		21.1		24.9		90.4		
Total revenues	32.1		21.2		27.6		22.7		103.6		29.7		22.4		30.0		29.1		111.2		
Insurance policy benefits	19.4		9.4		15.2		9.5		53.5		19.4		13.0		21.4		17.1		70.9		
Amortization related to operations	3.8		3.8		5.8		3.8		17.2		3.4		3.2		1.2		3.3		11.1		
Other operating costs and expenses	3.3		2.8		2.4		2.7		11.2		2.3		2.2		2.5		2.4		9.4		
Total benefits and expenses	26.5		16.0		23.4		16.0		81.9		25.1		18.4		25.1		22.8		91.4		
EBIT	$	5.6		$	5.2		$	4.2		$	6.7		$	21.7		$	4.6		$	4.0		$	4.9		$	6.3		$	19.8		

	
																															
Summary of Changes to the Washington National Segment EBIT Summarized by In-Force and New Business Presented on Page 13	 	 	
The EBIT from In-Force Business is increased for the EBIT on the blocks transferred from the Other CNO Business segment.	1Q12	2Q12	3Q12	4Q12	2012	1Q13	2Q13	3Q13	4Q13	2013	
 	 	 	 	 	 	 	 	 	 	 	
EBIT from In-Force before changes	$	30.2		$	37.1		$	39.1		$	39.5		$	145.9		$	32.7		$	33.9		$	30.2		$	35.3		$	132.1		
Transfer from Other CNO Business segment	5.6		5.2		4.2		6.7		21.7		4.6		4.0		4.9		6.3		19.8		
EBIT from In-Force after changes	$	35.8		$	42.3		$	43.3		$	46.2		$	167.6		$	37.3		$	37.9		$	35.1		$	41.6		$	151.9		

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