But that might not hold true anymore. The life and annuity firm, which just missed the Fortune 500 by a couple of notches, has survived the recession and recently announced that it completed a 45-million-share stock offering at a better price than predicted. The $200 million raised will pay down debt.
What makes Conseco interesting is that its shares have risen more than 50 percent this year, closing at $4.92 on Friday. Standard & Poor's, apparently happy with the stock offering and the lower debt load, has raised its credit rating by two notches to B minus, which is still six levels below investment grade, but out of disaster range.
Conseco was the pet project of financial empire builder Stephen Hilbert, who purchased one company too many in 1998 when he bought Greentree Financial, a backer of mobile homes, just before the previous recession hit. Conseco went into bankruptcy in 2002.
Credit for saving the insurer goes mainly to savvy CEO Jim Prieur, who joined Conseco in 2006 from Canada's Sun Life Financial. Prieur has labored long and hard and seen many quarterly losses before he could rid the insurer of much of its money-losing long-term care business, and beef up its financing. This was done with the help of a cash infusion from hedge fund manager John Paulson, who now owns roughly 11 percent of the insurer.
It's anyone guess what the future holds in store, since Conseco still sells shaky products like universal life insurance, which is vulnerable to the life settlements industry. But in a year when so much else in the insurance business has gone wrong, it appears to have done something right.