2019 Q2 Form 10-Q Financial Statement

#000122460819000042 Filed on August 06, 2019

View on sec.gov

Income Statement

Concept 2019 Q2 2018 Q2
Revenue $979.8M $1.046B
YoY Change -6.36% -1.02%
Cost Of Revenue $610.4M $618.2M
YoY Change -1.26% -2.52%
Gross Profit $369.4M $428.1M
YoY Change -13.71% 1.23%
Gross Profit Margin 37.7% 40.92%
Selling, General & Admin
YoY Change
% of Gross Profit
Research & Development
YoY Change
% of Gross Profit
Depreciation & Amortization
YoY Change
% of Gross Profit
Operating Expenses $886.2M $875.0M
YoY Change 1.28% -2.47%
Operating Profit $96.70M $104.1M
YoY Change -7.11% -121.95%
Interest Expense $38.60M $37.70M
YoY Change 2.39% 20.06%
% of Operating Profit 39.92% 36.22%
Other Income/Expense, Net
YoY Change
Pretax Income $47.70M $129.8M
YoY Change -63.25% 1.01%
Income Tax $10.10M $27.60M
% Of Pretax Income 21.17% 21.26%
Net Earnings $37.60M $102.2M
YoY Change -63.21% 22.54%
Net Earnings / Revenue 3.84% 9.77%
Basic Earnings Per Share $0.24 $0.62
Diluted Earnings Per Share $0.24 $0.61
COMMON SHARES
Basic Shares Outstanding 158.8M shares 166.1M shares
Diluted Shares Outstanding 159.7M shares 168.0M shares

Balance Sheet

Concept 2019 Q2 2018 Q2
SHORT-TERM ASSETS
Cash & Short-Term Investments
YoY Change
Cash & Equivalents $607.9M $745.7M
Short-Term Investments
Other Short-Term Assets
YoY Change
Inventory
Prepaid Expenses
Receivables
Other Receivables
Total Short-Term Assets
YoY Change
LONG-TERM ASSETS
Property, Plant & Equipment
YoY Change
Goodwill
YoY Change
Intangibles
YoY Change
Long-Term Investments $24.68B $26.96B
YoY Change -8.46% 0.28%
Other Assets $348.0M $485.0M
YoY Change -28.25% -18.35%
Total Long-Term Assets
YoY Change
TOTAL ASSETS
Total Short-Term Assets
Total Long-Term Assets
Total Assets $32.72B $32.47B
YoY Change 0.75% -1.13%
SHORT-TERM LIABILITIES
YoY Change
Accounts Payable
YoY Change
Accrued Expenses
YoY Change
Deferred Revenue
YoY Change
Short-Term Debt $0.00 $0.00
YoY Change
Long-Term Debt Due
YoY Change
Total Short-Term Liabilities
YoY Change
LONG-TERM LIABILITIES
Long-Term Debt $3.787B $3.980B
YoY Change -4.85% -2.78%
Other Long-Term Liabilities $740.0M $654.0M
YoY Change 13.15% -24.57%
Total Long-Term Liabilities $4.527B $4.634B
YoY Change -2.31% -6.59%
TOTAL LIABILITIES
Total Short-Term Liabilities
Total Long-Term Liabilities $4.527B $4.634B
Total Liabilities $28.46B $28.02B
YoY Change 1.59% -0.16%
SHAREHOLDERS EQUITY
Retained Earnings $249.2M $731.2M
YoY Change -65.92% -4.59%
Common Stock $2.905B $3.024B
YoY Change -3.93% -3.04%
Preferred Stock
YoY Change
Treasury Stock (at cost)
YoY Change
Treasury Stock Shares
Shareholders Equity $4.252B $4.455B
YoY Change
Total Liabilities & Shareholders Equity $32.72B $32.47B
YoY Change 0.75% -1.13%

Cashflow Statement

Concept 2019 Q2 2018 Q2
OPERATING ACTIVITIES
Net Income $37.60M $102.2M
YoY Change -63.21% 22.54%
Depreciation, Depletion And Amortization
YoY Change
Cash From Operating Activities $175.4M $171.5M
YoY Change 2.27% 20.27%
INVESTING ACTIVITIES
Capital Expenditures
YoY Change
Acquisitions
YoY Change
Other Investing Activities -$83.40M -$142.8M
YoY Change -41.6% -340.4%
Cash From Investing Activities -$83.40M -$142.8M
YoY Change -41.6% -340.4%
FINANCING ACTIVITIES
Cash Dividend Paid
YoY Change
Common Stock Issuance & Retirement, Net
YoY Change
Debt Paid & Issued, Net
YoY Change
Cash From Financing Activities -175.4M -9.400M
YoY Change 1765.96% -93.6%
NET CHANGE
Cash From Operating Activities 175.4M 171.5M
Cash From Investing Activities -83.40M -142.8M
Cash From Financing Activities -175.4M -9.400M
Net Change In Cash -83.40M 19.30M
YoY Change -532.12% -65.04%
FREE CASH FLOW
Cash From Operating Activities $175.4M $171.5M
Capital Expenditures
Free Cash Flow
YoY Change

Facts In Submission

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OtherComprehensiveIncomeUnrealizedHoldingGainLossOnSecuritiesArisingDuringPeriodBeforeTax
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us-gaap Other Comprehensive Income Unrealized Holding Gain Loss On Securities Arising During Period Before Tax
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us-gaap Other Comprehensive Income Unrealized Holding Gain Loss On Securities Arising During Period Before Tax
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66200000 USD
CY2018Q2 cno Other Comprehensive Income Loss Amortizationof Present Valueof Future Profitsand Deferred Acquisition Costs Unrealized Holding Gain Loss Arising During Periodbefore Tax
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cno Other Comprehensive Income Loss Amortizationof Present Valueof Future Profitsand Deferred Acquisition Costs Unrealized Holding Gain Loss Arising During Periodbefore Tax
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116700000 USD
cno Other Comprehensive Income Loss Amortizationof Present Valueof Future Profitsand Deferred Acquisition Costs Unrealized Holding Gain Loss Arising During Periodbefore Tax
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191400000 USD
cno Other Comprehensive Income Loss Amortizationof Present Valueof Future Profitsand Deferred Acquisitions Costs Reductionin Premium Deficienciesbefore Tax
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403000000.0 USD
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4000000.0 USD
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11300000 USD
us-gaap Other Comprehensive Income Loss Reclassification Adjustment From Aoci For Sale Of Securities Before Tax
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2900000 USD
us-gaap Other Comprehensive Income Loss Reclassification Adjustment From Aoci For Sale Of Securities Before Tax
OtherComprehensiveIncomeLossReclassificationAdjustmentFromAOCIForSaleOfSecuritiesBeforeTax
11700000 USD
CY2019Q2 cno Other Comprehensive Income Loss Reclassification Adjustment For Amortization Of Present Value Of Future Profits And Deferred Acquisition Costs Related To Net Realized Investment Gains Before Tax
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200000 USD
CY2018Q2 cno Other Comprehensive Income Loss Reclassification Adjustment For Amortization Of Present Value Of Future Profits And Deferred Acquisition Costs Related To Net Realized Investment Gains Before Tax
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400000 USD
cno Other Comprehensive Income Loss Reclassification Adjustment For Amortization Of Present Value Of Future Profits And Deferred Acquisition Costs Related To Net Realized Investment Gains Before Tax
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400000 USD
cno Other Comprehensive Income Loss Reclassification Adjustment For Amortization Of Present Value Of Future Profits And Deferred Acquisition Costs Related To Net Realized Investment Gains Before Tax
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400000 USD
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OtherComprehensiveIncomeLossBeforeTax
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us-gaap Other Comprehensive Income Loss Before Tax
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us-gaap Other Comprehensive Income Loss Before Tax
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123000000.0 USD
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255300000 USD
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443300000 USD
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OtherComprehensiveIncomeLossNetOfTax
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us-gaap Other Comprehensive Income Loss Net Of Tax
OtherComprehensiveIncomeLossNetOfTax
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us-gaap Other Comprehensive Income Loss Net Of Tax
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CY2018Q2 us-gaap Comprehensive Income Net Of Tax
ComprehensiveIncomeNetOfTax
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us-gaap Comprehensive Income Net Of Tax
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us-gaap Comprehensive Income Net Of Tax
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CY2019Q1 us-gaap Stockholders Equity
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443300000 USD
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55000000.0 USD
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6000000.0 USD
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4847500000 USD
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4847500000 USD
us-gaap Net Income Loss
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us-gaap Dividends Common Stock Cash
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CY2018Q4 us-gaap Stockholders Equity
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us-gaap Net Income Loss
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920400000 USD
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100000 USD
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102000000.0 USD
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33700000 USD
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10200000 USD
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us-gaap Net Cash Provided By Used In Investing Activities
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us-gaap Proceeds From Federal Home Loan Bank Borrowings
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CashCashEquivalentsRestrictedCashAndRestrictedCashEquivalents
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CY2018Q2 us-gaap Cash Cash Equivalents Restricted Cash And Restricted Cash Equivalents
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CY2019Q2 cno Accumulated Other Comprehensive Income Adjustment To Insurance Liabilities Due To Unrealized Gains That Would Result In Premium Deficiency If Unrealized Gains Were Realized
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CY2019Q2 cno Reduction To Present Value Of Future Profits Due To Unrealized Gains That Would Result In Premium Deficiency If Unrealized Gains Were Realized
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5700000 USD
CY2019Q2 cno Reduction To Deferred Acquisition Costs Due To Unrealized Gains That Would Result In Premium Deficiency If Unrealized Gains Were Realized
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3900000 USD
CY2019Q2 cno Accumulated Other Comprehensive Income Adjustment To Insurance Liabilities Due To Unrealized Gains That Would Result In Premium Deficiency If Unrealized Gains Were Realized
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-69400000 USD
CY2019Q2 cno Increase To Deferred Tax Assets Due To Unrealized Gains That Would Result In Premium Deficiency If Unrealized Gains Were Realized
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17100000 USD
CY2019Q2 us-gaap Available For Sale Securities Debt Maturities Within One Year Amortized Cost
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365100000 USD
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5000300000 USD
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us-gaap Gain Loss On Investments
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21400000 USD
us-gaap Impairment Of Investments
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877400000 USD
us-gaap Impairment Of Investments
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us-gaap Impairment Of Investments
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cno Available For Sale Securities Other Than Temporary Impairments Included In Accumulated Other Comprehensive Income Loss
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CY2019Q2 us-gaap Debt Securities Available For Sale Continuous Unrealized Loss Position Less Than12 Months
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632500000 USD
CY2019Q2 us-gaap Debt Securities Available For Sale Continuous Unrealized Loss Position Less Than12 Months Accumulated Loss
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CY2019Q2 us-gaap Debt Securities Available For Sale Continuous Unrealized Loss Position12 Months Or Longer
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1011500000 USD
CY2019Q2 us-gaap Debt Securities Available For Sale Continuous Unrealized Loss Position12 Months Or Longer Accumulated Loss
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35600000 USD
CY2019Q2 us-gaap Debt Securities Available For Sale Unrealized Loss Position
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CY2019Q2 us-gaap Debt Securities Available For Sale Unrealized Loss Position Accumulated Loss
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CY2018Q4 us-gaap Debt Securities Available For Sale Continuous Unrealized Loss Position Less Than12 Months
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CY2018Q4 us-gaap Debt Securities Available For Sale Continuous Unrealized Loss Position Less Than12 Months Accumulated Loss
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CY2018Q4 us-gaap Debt Securities Available For Sale Continuous Unrealized Loss Position12 Months Or Longer
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1465000000.0 USD
CY2018Q4 us-gaap Debt Securities Available For Sale Continuous Unrealized Loss Position12 Months Or Longer Accumulated Loss
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CY2018Q4 us-gaap Debt Securities Available For Sale Unrealized Loss Position
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CY2018Q4 us-gaap Debt Securities Available For Sale Unrealized Loss Position Accumulated Loss
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CY2018Q2 us-gaap Weighted Average Number Of Shares Outstanding Basic
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us-gaap Weighted Average Number Of Shares Outstanding Basic
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us-gaap Weighted Average Number Of Shares Outstanding Basic
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CY2019Q2 us-gaap Incremental Common Shares Attributable To Share Based Payment Arrangements
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CY2018Q2 us-gaap Incremental Common Shares Attributable To Share Based Payment Arrangements
IncrementalCommonSharesAttributableToShareBasedPaymentArrangements
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us-gaap Incremental Common Shares Attributable To Share Based Payment Arrangements
IncrementalCommonSharesAttributableToShareBasedPaymentArrangements
1080000 shares
us-gaap Incremental Common Shares Attributable To Share Based Payment Arrangements
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2249000 shares
CY2019Q2 us-gaap Weighted Average Number Of Diluted Shares Outstanding
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CY2018Q2 us-gaap Weighted Average Number Of Diluted Shares Outstanding
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us-gaap Weighted Average Number Of Diluted Shares Outstanding
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160962000 shares
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CY2018Q3 cno Statutory Liabilities Transferred Reinsurance Transaction
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2700000000 USD
CY2019Q2 cno Revenues Excluding Realized Gains Losses
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CY2018Q2 cno Revenues Excluding Realized Gains Losses
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1020100000 USD
cno Revenues Excluding Realized Gains Losses
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1938600000 USD
cno Revenues Excluding Realized Gains Losses
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2026000000.0 USD
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CY2018Q2 cno Benefits Losses And Expenses Excluding Amortization Related To Realized Gains Losses And Fair Value Changes In Embedded Derivative Liabilities Net Of Related Amortization And Income Taxes
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916000000.0 USD
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1758500000 USD
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1827000000.0 USD
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199000000.0 USD
CY2019Q2 cno Revenues Excluding Realized Gains Losses
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CY2019Q2 cno Revenues Related To Certain Non Strategic Investments And Earnings Attributable To Non Controlling Interests
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14900000 USD
CY2018Q2 cno Revenues Related To Certain Non Strategic Investments And Earnings Attributable To Non Controlling Interests
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15200000 USD
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32800000 USD
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32300000 USD
CY2019Q2 cno Revenue Relatedto Transitionand Support Services Agreements
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CY2018Q2 us-gaap Revenues
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2054100000 USD
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857900000 USD
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916000000.0 USD
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1758500000 USD
cno Benefits Losses And Expenses Excluding Amortization Related To Realized Gains Losses And Fair Value Changes In Embedded Derivative Liabilities Net Of Related Amortization And Income Taxes
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1827000000.0 USD
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2100000 USD
cno Embedded Derivative Amortization Related To Fair Value Changes In Embedded Derivative Liabilities
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7900000 USD
CY2019Q2 cno Amortization Related To Investment Gains Losses
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200000 USD
CY2018Q2 cno Amortization Related To Investment Gains Losses
AmortizationRelatedToInvestmentGainsLosses
400000 USD
cno Amortization Related To Investment Gains Losses
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400000 USD
cno Amortization Related To Investment Gains Losses
AmortizationRelatedToInvestmentGainsLosses
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CY2019Q2 cno Expenses Related To Certain Non Strategic Investments And Earnings Attributable To Non Controlling Interests
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CY2018Q2 cno Expenses Related To Certain Non Strategic Investments And Earnings Attributable To Non Controlling Interests
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33200000 USD
CY2019Q2 cno Fair Value Compensation Plan Changesin Fair Value Gain Loss
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CY2019Q2 cno Expensesrelatedtotransitionandsupportservicesagreements
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4700000 USD
CY2018Q2 cno Expensesrelatedtotransitionandsupportservicesagreements
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9500000 USD
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CY2019Q2 us-gaap Benefits Losses And Expenses
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932100000 USD
CY2018Q2 us-gaap Benefits Losses And Expenses
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us-gaap Benefits Losses And Expenses
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1889500000 USD
us-gaap Benefits Losses And Expenses
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CY2019Q2 us-gaap Income Loss From Continuing Operations Before Income Taxes Minority Interest And Income Loss From Equity Method Investments
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47700000 USD
CY2018Q2 us-gaap Income Loss From Continuing Operations Before Income Taxes Minority Interest And Income Loss From Equity Method Investments
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CY2019Q2 us-gaap Income Tax Expense Benefit
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CY2018Q2 us-gaap Income Tax Expense Benefit
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us-gaap Income Tax Expense Benefit
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us-gaap Income Tax Expense Benefit
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CY2019Q2 us-gaap Net Income Loss
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CY2018Q2 us-gaap Net Income Loss
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CY2018Q2 us-gaap Derivative Instruments Not Designated As Hedging Instruments Gain Loss Net
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CY2019Q2 us-gaap Ceded Premiums Written
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us-gaap Ceded Premiums Written
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us-gaap Ceded Premiums Written
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CY2019Q2 us-gaap Reinsurance Effect On Claims And Benefits Incurred Amount Ceded
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us-gaap Reinsurance Effect On Claims And Benefits Incurred Amount Ceded
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221000000.0 USD
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CY2019Q2 us-gaap Assumed Premiums Written
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CY2018Q2 us-gaap Assumed Premiums Written
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us-gaap Assumed Premiums Written
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12900000 USD
us-gaap Assumed Premiums Written
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8700000 USD
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17800000 USD
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CY2019Q2 us-gaap Current Income Tax Expense Benefit
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CY2018Q2 us-gaap Current Income Tax Expense Benefit
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CY2019Q2 cno Income Tax Expense Benefit Basedon Estimated Annual Effective Tax Rate
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CY2018Q2 cno Income Tax Expense Benefit Basedon Estimated Annual Effective Tax Rate
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27600000 USD
cno Income Tax Expense Benefit Basedon Estimated Annual Effective Tax Rate
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CY2019Q2 us-gaap Deferred Tax Liabilities Deferred Expense Deferred Policy Acquisition Cost
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CY2019Q2 us-gaap Deferred Tax Liabilities Other Comprehensive Income
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CY2019Q2 cno Deferred Tax Assets Before Valuation Allowance
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CY2018Q4 us-gaap Deferred Tax Assets Valuation Allowance
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CY2019Q2 cno Prepaid Accrued Income Taxes Current
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25300000 USD
CY2019Q2 cno Deferred Income Tax Assets Net Including Netof Current Income Tax Payable
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630000000.0 USD
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CY2019Q2 cno Deferred Tax Assets Before Valuation Allowance
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CY2019Q2 us-gaap Deferred Tax Assets Valuation Allowance
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193700000 USD
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85000000 USD
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380000000 USD
CY2019Q2 cno Loss Limitation Based On Income Of Life Insurance Company
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CY2019Q2 cno Federal Long Term Tax Exempt Rate
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CY2019Q2 us-gaap Operating Loss Carryforwards
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CY2019Q2 us-gaap Deferred Tax Assets Operating Loss Carryforwards State And Local
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CY2018Q4 us-gaap Deferred Tax Assets Operating Loss Carryforwards State And Local
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14500000 USD
CY2019Q2 us-gaap Deferred Finance Costs Noncurrent Gross
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11700000 USD
CY2018Q4 us-gaap Deferred Finance Costs Noncurrent Gross
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CY2019Q2 us-gaap Notes Payable
NotesPayable
988300000 USD
CY2018Q4 us-gaap Notes Payable
NotesPayable
916800000 USD
CY2019Q2 us-gaap Gains Losses On Extinguishment Of Debt
GainsLossesOnExtinguishmentOfDebt
-7300000 USD
CY2019Q2 cno Payment Of Redemption Premium
PaymentOfRedemptionPremium
6100000 USD
CY2019Q2 us-gaap Write Off Of Deferred Debt Issuance Cost
WriteOffOfDeferredDebtIssuanceCost
1200000 USD
CY2019Q2 us-gaap Long Term Debt Maturities Repayments Of Principal In Next Twelve Months
LongTermDebtMaturitiesRepaymentsOfPrincipalInNextTwelveMonths
0 USD
CY2019Q2 us-gaap Long Term Debt Maturities Repayments Of Principal In Year Two
LongTermDebtMaturitiesRepaymentsOfPrincipalInYearTwo
0 USD
CY2019Q2 us-gaap Long Term Debt Maturities Repayments Of Principal In Year Three
LongTermDebtMaturitiesRepaymentsOfPrincipalInYearThree
0 USD
CY2019Q2 us-gaap Long Term Debt Maturities Repayments Of Principal In Year Four
LongTermDebtMaturitiesRepaymentsOfPrincipalInYearFour
0 USD
CY2019Q2 us-gaap Long Term Debt Maturities Repayments Of Principal In Year Five
LongTermDebtMaturitiesRepaymentsOfPrincipalInYearFive
0 USD
CY2019Q2 us-gaap Long Term Debt Maturities Repayments Of Principal After Year Five
LongTermDebtMaturitiesRepaymentsOfPrincipalAfterYearFive
1000000000.0 USD
CY2019Q2 us-gaap Long Term Debt
LongTermDebt
1000000000.0 USD
cno Number Of Insurance Subsidiaries That Are Members Of The Federal Home Loan Bank
NumberOfInsuranceSubsidiariesThatAreMembersOfTheFederalHomeLoanBank
3 subsidiary
CY2019Q2 cno Stock Repurchase Program Remaining Repurchase Authorized Amount
StockRepurchaseProgramRemainingRepurchaseAuthorizedAmount
182600000 USD
us-gaap Dividends Common Stock Cash
DividendsCommonStockCash
33700000 USD
us-gaap Common Stock Dividends Per Share Cash Paid
CommonStockDividendsPerShareCashPaid
0.21
CY2019Q2 us-gaap Common Stock Dividends Per Share Cash Paid
CommonStockDividendsPerShareCashPaid
0.11
us-gaap Common Stock Dividends Per Share Cash Paid
CommonStockDividendsPerShareCashPaid
0.10
us-gaap Deferred Sales Inducements Additions
DeferredSalesInducementsAdditions
14400000 USD
us-gaap Deferred Sales Inducements Additions
DeferredSalesInducementsAdditions
2800000 USD
us-gaap Deferred Sales Inducements Amortization Expense
DeferredSalesInducementsAmortizationExpense
2500000 USD
us-gaap Deferred Sales Inducements Amortization Expense
DeferredSalesInducementsAmortizationExpense
5100000 USD
CY2019Q2 us-gaap Deferred Sales Inducements Net
DeferredSalesInducementsNet
55400000 USD
CY2018Q4 us-gaap Deferred Sales Inducements Net
DeferredSalesInducementsNet
43500000 USD
CY2019Q1 us-gaap Available For Sale Securities Debt Securities
AvailableForSaleSecuritiesDebtSecurities
18443700000 USD
CY2019Q1 cno Deferred Income Tax Assets Net Including Netof Current Income Tax Payable
DeferredIncomeTaxAssetsNetIncludingNetofCurrentIncomeTaxPayable
630900000 USD
CY2019Q1 us-gaap Assets
Assets
31436700000 USD
CY2019Q1 us-gaap Retained Earnings Accumulated Deficit
RetainedEarningsAccumulatedDeficit
193500000 USD
CY2019Q1 us-gaap Stockholders Equity
StockholdersEquity
3367800000 USD
us-gaap Loss Contingency Disclosures
LossContingencyDisclosures
<div style="line-height:120%;text-align:left;text-indent:36px;font-size:10pt;"><span style="font-family:inherit;font-size:10pt;font-weight:bold;">LITIGATION AND OTHER LEGAL PROCEEDINGS</span></div><div style="line-height:120%;font-size:10pt;"><span style="font-family:inherit;font-size:10pt;"><br/></span></div><div style="line-height:120%;text-align:left;text-indent:36px;font-size:10pt;"><span style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Legal Proceedings</span></div><div style="line-height:120%;font-size:10pt;"><span style="font-family:inherit;font-size:10pt;"><br/></span></div><div style="line-height:120%;text-align:left;text-indent:36px;font-size:10pt;"><span style="font-family:inherit;font-size:10pt;">The Company and its subsidiaries are involved in various legal actions in the normal course of business, in which claims for compensatory and punitive damages are asserted, some for substantial amounts.  We recognize an estimated loss from these loss contingencies when we believe it is probable that a loss has been incurred and the amount of the loss can be reasonably estimated. Some of the pending matters have been filed as purported class actions and some actions have been filed in certain jurisdictions that permit punitive damage awards that are disproportionate to the actual damages incurred.  The amounts sought in certain of these actions are often large or indeterminate and the ultimate outcome of certain actions is difficult to predict.  In the event of an adverse outcome in one or more of these matters, there is a possibility that the ultimate liability may be in excess of the liabilities we have established and could have a material adverse effect on our business, financial condition, results of operations and cash flows.  In addition, the resolution of pending or future litigation may involve modifications to the terms of outstanding insurance policies or could impact the timing and amount of rate increases, which could adversely affect the future profitability of the related insurance policies.  Based upon information presently available, and in light of legal, factual and other defenses available to the Company and its subsidiaries, the Company does not believe that it is probable that the ultimate liability from either pending or threatened legal actions, after consideration of existing loss provisions, will have a material adverse effect on the Company's consolidated financial condition, operating results or cash flows. However, given the inherent difficulty in predicting the outcome of legal proceedings, there exists the possibility that such legal actions could have a material adverse effect on the Company's consolidated financial condition, operating results or cash flows.</span></div><div style="line-height:120%;font-size:10pt;"><span style="font-family:inherit;font-size:10pt;"><br/></span></div><div style="line-height:120%;text-align:left;text-indent:36px;font-size:10pt;"><span style="font-family:inherit;font-size:10pt;">In addition to the inherent difficulty of predicting litigation outcomes, particularly those that will be decided by a jury, some matters purport to seek substantial or an unspecified amount of damages for unsubstantiated conduct spanning several years based on complex legal theories and damages models. The alleged damages typically are indeterminate or not factually supported in the complaint, and, in any event, the Company's experience indicates that monetary demands for damages often </span></div><div style="line-height:120%;text-align:left;font-size:10pt;"><span style="font-family:inherit;font-size:10pt;">bear little relation to the ultimate loss. In some cases, plaintiffs are seeking to certify classes in the litigation and class certification either has been denied or is pending and we have filed oppositions to class certification or sought to decertify a prior class certification. In addition, for many of these cases: (i) there is uncertainty as to the outcome of pending appeals or motions; (ii) there are significant factual issues to be resolved; and/or (iii) there are novel legal issues presented. Accordingly, the Company cannot reasonably estimate the possible loss or range of loss in excess of amounts accrued, if any, or predict the timing of the eventual resolution of these matters.  The Company reviews these matters on an ongoing basis.  When assessing reasonably possible and probable outcomes, the Company bases its assessment on the expected ultimate outcome following all appeals.</span></div><div style="line-height:120%;text-align:left;font-size:10pt;"><span style="font-family:inherit;font-size:10pt;"><br/></span></div><div style="line-height:120%;text-align:left;text-indent:36px;font-size:10pt;"><span style="font-family:inherit;font-size:10pt;">On September 29, 2016, Washington National and Bankers Conseco Life Insurance Company ("BCLIC") commenced an arbitration proceeding seeking compensatory, consequential and punitive damages against Beechwood Re Ltd. ("BRe") based upon BRe’s incurable material breaches of the long-term care reinsurance agreements, conversion, fraud, and breaches of fiduciary duties and the obligation to deal honestly and in good faith. BRe filed a counterclaim against Washington National and BCLIC in the arbitration alleging damages relating to the reinsurance agreements and their termination. In addition, on September 29, 2016, a complaint was filed by BCLIC and Washington National in the United States District Court for the Southern District of New York, Bankers Conseco Life Insurance Company and Washington National Insurance Company v. Moshe M. Feuer, Scott Taylor and David Levy, alleging, among other claims, fraud/fraudulent concealment, and violation of the Racketeer Influenced and Corrupt Organizations Act. These allegations relate to the long-term care reinsurance agreements between BRe and Washington National and BCLIC, respectively, and emanate from the undisclosed relationships between and among the defendants (who were the principal owners and officers of BRe) and Platinum Partners, LP and its affiliates. On April 27, 2017, an amended complaint was filed adding Beechwood Capital Group, LLC as a defendant. On March 13, 2018, the District Court granted defendants' motion to compel arbitration of Washington National's and BCLIC's claims and the litigation is now stayed pending the outcome of the arbitration. Washington National and BCLIC intend to vigorously pursue their claims for damages and other remedies in the arbitration and the litigation described above.</span></div><div style="line-height:120%;text-align:left;text-indent:36px;font-size:10pt;"><span style="font-family:inherit;font-size:10pt;"><br/></span></div><div style="line-height:120%;text-align:left;text-indent:36px;font-size:10pt;"><span style="font-family:inherit;font-size:10pt;">By public notice dated July 26, 2017, the Cayman Islands Monetary Authority advised that, effective July 25, 2017, </span><span style="font-family:inherit;font-size:10pt;"><span>two</span></span><span style="font-family:inherit;font-size:10pt;"> individuals (the "Controllers") had been appointed pursuant to Section 24(2)(h) of the Cayman Islands Insurance Law to assume control of the affairs of BRe.  According to the public notice, effective with their appointment, the Controllers assumed immediate control of the affairs of BRe and have all the powers necessary to administer the affairs of BRe including power to terminate its insurance business.  The Controllers are responsible for assessing the financial position of BRe and submitting a report to the Cayman Islands Monetary Authority.  On August 10, 2018, the Cayman Islands Monetary Authority filed a public petition in the Grand Court of the Cayman Islands to officially wind up BRe, concluding that BRe was now of doubtful solvency. On November 27, 2018, the Grand Court of the Cayman Islands granted the petition to officially wind up BRe and appointed the current Controllers of BRe to be its Joint Official Liquidators.</span></div><div style="line-height:120%;text-align:left;text-indent:36px;font-size:10pt;"><span style="font-family:inherit;font-size:10pt;"><br/></span></div><div style="line-height:120%;text-indent:36px;font-size:10pt;"><span style="font-family:inherit;font-size:10pt;">On December 19, 2018, Melanie Cyganowski, as Equity Receiver for Platinum Partners Credit Opportunities Master Fund, LP and other Platinum entities (the "PPCO Receiver") brought an action in the United States District Court for the Southern District of New York, </span><span style="font-family:inherit;font-size:10pt;font-style:italic;">Cyganowski v. Beechwood Re Ltd, et al.</span><span style="font-family:inherit;font-size:10pt;">, alleging, among other claims, fraud, aiding and abetting fraud, fraudulent transfer and violation of the Racketeer Influenced and Corrupt Organizations Act against numerous defendants, including BRe and many of its affiliates, CNO Financial Group, Inc., BCLIC, Washington National and 40|86 Advisors, Inc. The PPCO Receiver alleges that Platinum insiders conspired with BRe and its principals and affiliates in a massive fraudulent scheme to enrich the Platinum and BRe insiders to the detriment of Platinum investors and creditors. The PPCO Receiver alleges that CNO Financial Group, Inc., BCLIC, Washington National and 40|86 Advisors, Inc. have liability for the fraudulent scheme of the Platinum and BRe insiders under a theory that they turned a blind eye to the fraudulent scheme due to their desire to transfer unprofitable legacy portfolios of long-term care insurance via the reinsurance transactions with BRe. On January 24, 2019, the court consolidated the PPCO Receiver action with </span><span style="font-family:inherit;font-size:10pt;"><span>two</span></span><span style="font-family:inherit;font-size:10pt;"> other cases (to which the CNO companies are not parties) before it for at least discovery purposes.  The court set a scheduling order under which all </span><span style="font-family:inherit;font-size:10pt;"><span>three</span></span><span style="font-family:inherit;font-size:10pt;"> of the consolidated actions are to be trial-ready by September 20, 2019. CNO Financial Group, Inc., BCLIC, Washington National and 40|86 Advisors, Inc. are vigorously contesting the PPCO Receiver’s claims.</span></div><div style="line-height:120%;text-indent:36px;font-size:10pt;"><span style="font-family:inherit;font-size:10pt;"><br/></span></div><div style="line-height:120%;text-indent:36px;font-size:10pt;"><span style="font-family:inherit;font-size:10pt;">On March 27, 2019, BCLIC and Washington National brought cross-claims and third-party claims in the PPCO Receiver Action against BRe and a number of its affiliates, as well as many Platinum and BRe insiders, alleging that they secretly funded, controlled and operated the BRe enterprise for the benefit of Platinum.  BCLIC and Washington National have also brought third-party claims against Lincoln International LLC, which provided valuation services to the BRe enterprise.  BCLIC and Washington National are vigorously pursuing their cross-claims and third-party claims in that action.</span></div><div style="line-height:120%;text-align:left;text-indent:36px;font-size:10pt;"><span style="font-family:inherit;font-size:10pt;"><br/></span></div><div style="line-height:120%;text-align:left;text-indent:36px;font-size:10pt;"><span style="font-family:inherit;font-size:10pt;">On April 9, 2019, BCLIC and Washington National commenced an action entitled</span><span style="font-family:inherit;font-size:10pt;font-style:italic;"> Bankers Conseco Life Insurance Company and Washington National Insurance Company v. Wilmington Trust, National Association</span><span style="font-family:inherit;font-size:10pt;">, in the Supreme Court of the State of New York, County of New York, Commercial Division (the "Wilmington Action").  In the Wilmington Action, BCLIC and Washington National assert claims against Wilmington Trust, National Association ("Wilmington") for breaching its express contractual obligations under four trust agreements pursuant to which Wilmington was the trustee in regard to trust assets ceded as part of reinsurance agreements with BRe, as well as for breaching its fiduciary duties to BCLIC and Washington National.</span></div><div style="line-height:120%;text-align:left;font-size:10pt;"><span style="font-family:inherit;font-size:10pt;"><br/></span></div><div style="line-height:120%;text-align:left;text-indent:36px;font-size:10pt;"><span style="font-family:inherit;font-size:10pt;">On June 7, 2019, the Joint Official Liquidators of Platinum Partners Value Arbitrage Fund L.P. (in Official Liquidation) and Principal Growth Strategies, LLC, commenced suit against, among others, BCLIC, Washington National, 40|86 Advisors, Inc. and CNO Financial Group, Inc. (collectively, the "CNO Parties") in Delaware Chancery Court.  Plaintiffs allege that the CNO Parties were unjustly enriched when they terminated BCLIC and Washington National's reinsurance agreements with BRe and recaptured assets from reinsurance trusts, in particular, Agera securities.  Plaintiffs contend that the Agera securities were fraudulently transferred to the Reinsurance Trusts by other Platinum-related entities and they are seeking to claw back those Agera securities, or the value of those assets, from the CNO Parties.  The CNO Parties have removed the case to the United States District Court for the District of Delaware and are vigorously contesting the plaintiff's claims.</span></div><div style="line-height:120%;text-align:left;text-indent:36px;font-size:10pt;"><span style="font-family:inherit;font-size:10pt;"><br/></span></div><div style="line-height:120%;text-align:left;text-indent:36px;font-size:10pt;"><span style="font-family:inherit;font-size:10pt;">On June 28, 2019, BCLIC and Washington National commenced an action entitled </span><span style="font-family:inherit;font-size:10pt;font-style:italic;">Bankers Conseco Life Insurance Company and Washington National Insurance Company v. KPMG LLP</span><span style="font-family:inherit;font-size:10pt;">, in the Supreme Court of the State of New York, County of New York, Commercial Division (the "KPMG Action").  In the KPMG Action, BCLIC and Washington National assert claims against KPMG LLP ("KPMG") for aiding and abetting fraud, constructive fraud and negligent misrepresentation arising from KPMG's alleged role in the Platinum Partners' scheme to defraud BCLIC and Washington National into reinsuring its long-term care business with BRe.</span></div><div style="line-height:120%;text-align:left;text-indent:36px;font-size:10pt;"><span style="font-family:inherit;font-size:10pt;"><br/></span></div><div style="line-height:120%;text-align:left;text-indent:36px;font-size:10pt;"><span style="font-family:inherit;font-size:10pt;font-style:italic;font-weight:bold;">Regulatory Examinations and Fines</span></div><div style="line-height:120%;font-size:10pt;"><span style="font-family:inherit;font-size:10pt;"><br/></span></div><div style="line-height:120%;text-align:left;text-indent:36px;font-size:10pt;"><span style="font-family:inherit;font-size:10pt;">Insurance companies face significant risks related to regulatory investigations and actions.  Regulatory investigations generally result from matters related to sales or underwriting practices, payment of contingent or other sales commissions, claim payments and procedures, product design, product disclosure, additional premium charges for premiums paid on a periodic basis, denial or delay of benefits, charging excessive or impermissible fees on products, procedures related to canceling policies, changing the way cost of insurance charges are calculated for certain life insurance products or recommending unsuitable products to customers.  We are, in the ordinary course of our business, subject to various examinations, inquiries and information requests from state, federal and other authorities.  The ultimate outcome of these regulatory actions (including the costs of complying with information requests and policy reviews) cannot be predicted with certainty.  In the event of an unfavorable outcome in one or more of these matters, the ultimate liability may be in excess of liabilities we have established and we could suffer significant reputational harm as a result of these matters, which could also have a material adverse effect on our business, financial condition, results of operations or cash flows.</span></div><div style="line-height:120%;text-align:left;font-size:10pt;"><span style="font-family:inherit;font-size:10pt;"><br/></span></div><div style="line-height:120%;text-align:left;text-indent:36px;font-size:10pt;"><span style="font-family:inherit;font-size:10pt;">In August 2011, we were notified of an examination to be done on behalf of a number of states for the purpose of determining compliance with unclaimed property laws by the Company and its subsidiaries.  Such examination has included inquiries related to the use of data available on the U.S. Social Security Administration's Death Master File ("SSADMF") to identify instances where benefits under life insurance policies, annuities and retained asset accounts are payable. We are continuing to provide information to the examiners in response to their requests. A total of </span><span style="font-family:inherit;font-size:10pt;color:#000000;text-decoration:none;"><span>40</span></span><span style="font-family:inherit;font-size:10pt;"> states and the District of Columbia participated in this examination. In November 2018, we entered into a Global Resolution Agreement for compliance with laws and regulations concerning the identification, reporting and escheatment of unclaimed contract benefits or abandoned funds. Under the terms of the Global Resolution Agreement, a third-party auditor acting on behalf of the signatory jurisdictions will compare expanded matching criteria to the SSADMF to identify deceased insureds and contract holders where a valid claim has not been made.</span></div>
CY2017Q3 cno Numberof Individuals Appointedto Assume Immediate Controland Power Over Affairs
NumberofIndividualsAppointedtoAssumeImmediateControlandPowerOverAffairs
2 individual
cno Number Of States Participating In Examination Of Compliance With Unclaimed Property Laws
NumberOfStatesParticipatingInExaminationOfComplianceWithUnclaimedPropertyLaws
40 state
us-gaap Net Income Loss
NetIncomeLoss
89400000 USD
us-gaap Net Income Loss
NetIncomeLoss
186500000 USD
us-gaap Depreciation Depletion And Amortization
DepreciationDepletionAndAmortization
122000000.0 USD
us-gaap Depreciation Depletion And Amortization
DepreciationDepletionAndAmortization
146700000 USD
us-gaap Increase Decrease In Accrued Income Taxes Payable
IncreaseDecreaseInAccruedIncomeTaxesPayable
27200000 USD
us-gaap Increase Decrease In Accrued Income Taxes Payable
IncreaseDecreaseInAccruedIncomeTaxesPayable
21000000.0 USD
us-gaap Increase Decrease In Insurance Liabilities
IncreaseDecreaseInInsuranceLiabilities
329100000 USD
us-gaap Increase Decrease In Insurance Liabilities
IncreaseDecreaseInInsuranceLiabilities
94400000 USD
cno Change In Accrued Investment Income And Amortization Of Premium Or Discount On Investments
ChangeInAccruedInvestmentIncomeAndAmortizationOfPremiumOrDiscountOnInvestments
-130900000 USD
cno Change In Accrued Investment Income And Amortization Of Premium Or Discount On Investments
ChangeInAccruedInvestmentIncomeAndAmortizationOfPremiumOrDiscountOnInvestments
-58900000 USD
us-gaap Increase Decrease In Deferred Policy Acquisition Costs
IncreaseDecreaseInDeferredPolicyAcquisitionCosts
143000000.0 USD
us-gaap Increase Decrease In Deferred Policy Acquisition Costs
IncreaseDecreaseInDeferredPolicyAcquisitionCosts
125600000 USD
cno Gain Losson Investments Excluding Cash Expenses
GainLossonInvestmentsExcludingCashExpenses
21400000 USD
cno Gain Losson Investments Excluding Cash Expenses
GainLossonInvestmentsExcludingCashExpenses
-4200000 USD
us-gaap Gains Losses On Extinguishment Of Debt
GainsLossesOnExtinguishmentOfDebt
-7300000 USD
us-gaap Gains Losses On Extinguishment Of Debt
GainsLossesOnExtinguishmentOfDebt
0 USD
cno Gain Loss On Extinguishment Of Debt Variable Interest Entities
GainLossOnExtinguishmentOfDebtVariableInterestEntities
0 USD
cno Gain Loss On Extinguishment Of Debt Variable Interest Entities
GainLossOnExtinguishmentOfDebtVariableInterestEntities
-3800000 USD
us-gaap Other Operating Activities Cash Flow Statement
OtherOperatingActivitiesCashFlowStatement
38000000.0 USD
us-gaap Other Operating Activities Cash Flow Statement
OtherOperatingActivitiesCashFlowStatement
-28400000 USD
us-gaap Net Cash Provided By Used In Operating Activities
NetCashProvidedByUsedInOperatingActivities
317700000 USD
us-gaap Net Cash Provided By Used In Operating Activities
NetCashProvidedByUsedInOperatingActivities
243700000 USD
cno Share Based Compensation Noncash Portion
ShareBasedCompensationNoncashPortion
10400000 USD
cno Share Based Compensation Noncash Portion
ShareBasedCompensationNoncashPortion
14100000 USD
CY2019Q2 us-gaap Operating Lease Cost
OperatingLeaseCost
6300000 USD
us-gaap Operating Lease Cost
OperatingLeaseCost
12400000 USD
CY2019Q2 us-gaap Operating Lease Payments
OperatingLeasePayments
6100000 USD
us-gaap Operating Lease Payments
OperatingLeasePayments
12100000 USD
CY2019Q2 us-gaap Right Of Use Asset Obtained In Exchange For Operating Lease Liability
RightOfUseAssetObtainedInExchangeForOperatingLeaseLiability
10400000 USD
us-gaap Right Of Use Asset Obtained In Exchange For Operating Lease Liability
RightOfUseAssetObtainedInExchangeForOperatingLeaseLiability
14700000 USD
CY2019Q2 us-gaap Lessee Operating Lease Liability Payments Remainder Of Fiscal Year
LesseeOperatingLeaseLiabilityPaymentsRemainderOfFiscalYear
12100000 USD
CY2019Q2 us-gaap Lessee Operating Lease Liability Payments Due Year Two
LesseeOperatingLeaseLiabilityPaymentsDueYearTwo
22200000 USD
CY2019Q2 us-gaap Lessee Operating Lease Liability Payments Due Year Three
LesseeOperatingLeaseLiabilityPaymentsDueYearThree
17500000 USD
CY2019Q2 us-gaap Lessee Operating Lease Liability Payments Due Year Four
LesseeOperatingLeaseLiabilityPaymentsDueYearFour
14000000.0 USD
CY2019Q2 us-gaap Lessee Operating Lease Liability Payments Due Year Five
LesseeOperatingLeaseLiabilityPaymentsDueYearFive
10200000 USD
CY2019Q2 us-gaap Lessee Operating Lease Liability Payments Due After Year Five
LesseeOperatingLeaseLiabilityPaymentsDueAfterYearFive
4100000 USD
CY2019Q2 us-gaap Lessee Operating Lease Liability Payments Due
LesseeOperatingLeaseLiabilityPaymentsDue
80100000 USD
CY2019Q2 us-gaap Lessee Operating Lease Liability Undiscounted Excess Amount
LesseeOperatingLeaseLiabilityUndiscountedExcessAmount
4300000 USD
CY2019Q2 us-gaap Operating Lease Liability
OperatingLeaseLiability
75800000 USD
CY2019Q2 us-gaap Operating Lease Weighted Average Remaining Lease Term1
OperatingLeaseWeightedAverageRemainingLeaseTerm1
P3Y10M24D
CY2019Q2 us-gaap Operating Lease Weighted Average Discount Rate Percent
OperatingLeaseWeightedAverageDiscountRatePercent
0.0285
CY2018Q4 us-gaap Operating Leases Future Minimum Payments Due Current
OperatingLeasesFutureMinimumPaymentsDueCurrent
22200000 USD
CY2018Q4 us-gaap Operating Leases Future Minimum Payments Due In Two Years
OperatingLeasesFutureMinimumPaymentsDueInTwoYears
18700000 USD
CY2018Q4 us-gaap Operating Leases Future Minimum Payments Due In Three Years
OperatingLeasesFutureMinimumPaymentsDueInThreeYears
14300000 USD
CY2018Q4 us-gaap Operating Leases Future Minimum Payments Due In Four Years
OperatingLeasesFutureMinimumPaymentsDueInFourYears
11000000.0 USD
CY2018Q4 us-gaap Operating Leases Future Minimum Payments Due In Five Years
OperatingLeasesFutureMinimumPaymentsDueInFiveYears
8700000 USD
CY2018Q4 us-gaap Operating Leases Future Minimum Payments Due Thereafter
OperatingLeasesFutureMinimumPaymentsDueThereafter
1400000 USD
CY2018Q4 us-gaap Operating Leases Future Minimum Payments Due
OperatingLeasesFutureMinimumPaymentsDue
76300000 USD
CY2019Q2 cno Variable Interest Entity Amortized Cost Securities Held
VariableInterestEntityAmortizedCostSecuritiesHeld
1236700000 USD
CY2019Q2 cno Variable Interest Entity Gross Unrealized Gains Fixed Maturity Securities
VariableInterestEntityGrossUnrealizedGainsFixedMaturitySecurities
1800000 USD
CY2019Q2 cno Variable Interest Entity Gross Unrealized Losses Fixed Maturity Securities
VariableInterestEntityGrossUnrealizedLossesFixedMaturitySecurities
23300000 USD
CY2019Q2 cno Variable Interest Entity Fixed Maturity Securities Fair Value
VariableInterestEntityFixedMaturitySecuritiesFairValue
1215200000 USD
cno Variable Interest Entities Net Realized Gain Loss On Investments
VariableInterestEntitiesNetRealizedGainLossOnInvestments
-14500000 USD
cno Variable Interest Entities Net Gain Loss From Sale Of Fixed Maturity Investments
VariableInterestEntitiesNetGainLossFromSaleOfFixedMaturityInvestments
-9400000 USD
cno Variable Interest Entity Investments Gross Investment Losses From Sale Before Tax
VariableInterestEntityInvestmentsGrossInvestmentLossesFromSaleBeforeTax
9600000 USD
cno Variable Interest Entities Investments Sold
VariableInterestEntitiesInvestmentsSold
267700000 USD
cno Variable Interest Entities Net Realized Gain Loss On Investments
VariableInterestEntitiesNetRealizedGainLossOnInvestments
-2900000 USD
cno Variable Interest Entity Investments Gross Investment Losses From Sale Before Tax
VariableInterestEntityInvestmentsGrossInvestmentLossesFromSaleBeforeTax
3100000 USD
cno Variable Interest Entities Investments Sold
VariableInterestEntitiesInvestmentsSold
36000000.0 USD
CY2019Q2 cno Number Of Investments Held By Variable Interest Entities In Default
NumberOfInvestmentsHeldByVariableInterestEntitiesInDefault
0 investment
CY2019Q2 cno Investments Held In Limited Partnerships
InvestmentsHeldInLimitedPartnerships
568300000 USD
CY2019Q2 cno Unfunded Commitmentsto Limited Partnerships
UnfundedCommitmentstoLimitedPartnerships
113100000 USD
cno Fair Value Fixed Maturity Securities Valued Using Broker Quotes Percentage
FairValueFixedMaturitySecuritiesValuedUsingBrokerQuotesPercentage
0.34
CY2019Q2 cno Available For Sale Fixed Maturities With Significant Unobservable Inputs Investment Grade Percent
AvailableForSaleFixedMaturitiesWithSignificantUnobservableInputsInvestmentGradePercent
0.67
CY2019Q2 cno Available For Sale Maturities With Significant Unobservable Inputs Corporate Securities Percent
AvailableForSaleMaturitiesWithSignificantUnobservableInputsCorporateSecuritiesPercent
0.82

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