Executive compensation surges at CNO Financial Group

CNO Financial Group Inc. had a good year last year. But its CEO and other top brass had an even better one.

The Carmel-based life and health insurer more than doubled CEO Jim Prieur’s compensation, and also gave increases ranging from 44 percent to 89 percent to other top executives, according to CNO’s proxy statement filed Tuesday with the U.S. Securities and Exchange Commission.

The company, formerly known as Conseco Inc., saw its stock price soar nearly 36 percent last year. And its profits, before factoring in investments, interest and taxes, rose 7 percent.

Prieur pulled in $6.7 million in salary, bonus, stock and perks—up 102 percent from the $3.3 million in compensation he received in 2009.

Chief Financial Officer Ed Bonach saw his pay package surge 89 percent, to $2.9 million.

The leaders of CNO’s two main business units—Bankers Life chief Scott Perry and Washington National boss Steve Stecher—enjoyed pay increases of 44 percent and 46 percent, respectively.

Perry received $2.2 million in pay, stock and perks. Stecher was awarded $1.7 million.

Eric Johnson, who heads up CNO’s investment arm, called 40|86 Advisors, enjoyed a 56-percent boost in compensation, to a total of $2.2 million. CNO’s investments enjoyed a big year in 2010, as the markets continued their recovery.

Whereas the company had realized investment losses of $61 million in 2009, last year, it had realized investment gains of $30 million. Both figures are before accounting for taxes.

In the cases of all five execs, the increases were driven primarily by larger stock awards and larger long-term-incentive compensation, which is a cash bonus based on specific performance measures.

Those measures include earnings per share based on continuing operations of the company, operating earnings before investments, interest and taxes, operating expenses and the value of new business.

Concerning Prieur, the proxy statement says: “Mr. Prieur’s base salary, target incentive, and equity compensation awards for fiscal 2010 were determined in accordance with the compensation philosophy described above, including the policy of targeting our compensation within our ‘competitive market’ as described above. In setting his salary, target incentive and equity compensation, the committee relied on market competitive pay data and the strong belief that the chief executive officer significantly and directly influences our overall performance.”

CNO's stock was down 1.9 percent Tuesday morning, to $7.66 per share.