Insurer to Transfer Senior-Health Unit
In a move to break away from the ailing Conseco Senior Health Insurance Co., Conseco Inc. announced plans to transfer the senior-health-insurance unit to an independent trust.
The insurance company said the transfer to the trust, to be named Senior Health Care Oversight Trust, will aid the unit's long-term care policyholders and give Conseco “greater flexibility” in serving its policyholders, said Conseco Chief Executive Jim Prieur.
Under the plan, the unit's $2.9 billion in assets will be transferred to the trust. Just prior to the transfer, Conseco will contribute $175 million in additional capital.
Conseco said it will record $1.2 billion in accounting charges related to the transfer, with approximately $500 million of the charge expected to be recognized in its second-quarter results. In light of the transfer, Conseco said it will delay in releasing second-quarter earnings results until next week.
Last April Moody's Investors Service put Conseco on review for a possible ratings downgrade in April in light of "subpar earnings results over the last year and our expectation that earnings challenges, especially at Conseco Senior Health Insurance Co. will persist."
Published on August 12, 2008
Are you retail Agent Looking for a Quote?