CSI / CSO Medicare Supplement Update

As we covered in 2018, CSI entered into an agreement with CSO to run their Medicare Supplement. There is some news out of AM BEST this week on CSO. And, they are still outsourcing their new business, underwriting, support, and agent services. See more: For this reason, we are no longer selling or recommending agents to sell CSI/CSO. See the announcement from 2018 about the CSI/CSO deal here. Excerpt: (From AIMC) "We are excited to announce Central States Indemnity Co. of Omaha (CSI) has entered into a business partnership with Central States Health and Life Co. of Omaha (CSO) regarding their current Medicare Supplement business of CSI and CSI Life. Policyholders coverage will not change, and plans will continue to be CSI and CSI Life policies but reinsured and managed by CSO. IAS will continue to be the administrator for CSO. This change brings a fresh new approach to the CSI Life book of business and we are looking forward to the new opportunities it will create for our agents. In the coming months, we will be communicating out these exciting new opportunities to the field via 'The Edge.'" New report from AM BEST is at this link. Excerpt: "July 30, 2019 02:52 PM Eastern Daylight Time OLDWICK, N.J.--(BUSINESS WIRE)--AM BESThas revised the outlooks to negative from stable and affirmed the Financial Strength Rating of A- (Excellent) and the Long-Term Issuer Credit Ratings (Long-Term ICR) of “a-” of Central States Health & Life Co. of Omaha (Omaha, NE) and its subsidiaries, Censtat Life Assurance Company (Phoenix, AZ) and Censtat Casualty Company (Omaha, NE), collectively known as CSO.... The negative outlooks reflect an increasingly challenging operating environment within its core credit insurance product line mainly due to intense competition from other products that compete for shelf space in the auto dealer market, unfavorable auto industry trends and regulatory changes. These negative trends have resulted in a significant decline in CSO’s premiums over the past five years and has led to a decreased market share in the credit insurance market. ... However, AM BEST views the Medicare Supplement business to be highly competitive and commoditized, and CSO is not expected to be profitable on this block for the next several years. " We thought you should know...

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