Conseco Answers Analyst.

Business Editors

INDIANAPOLIS--(BUSINESS WIRE)--May 8, 2001

Conseco (NYSE:CNC)

The attached letter and chart (3 pages) was sent this morning and is posted on Conseco's web site for shareholders and/or electronically distributed to them today.

Note on forward-looking statements: All statements, trend analyses and other information contained in this release and elsewhere (such as in filings by Conseco with the Securities and Exchange Commission, press releases, presentations by Conseco or its management or oral statements) relative to markets for Conseco's products and trends in Conseco's operations or financial results, as well as other statements including words such as "anticipate," "believe," "plan," "estimate," "expect," "intend," "should," "could," "goal," "target," "on track," "comfortable with," "optimistic" and other similar expressions, constitute forward-looking statements under the Private Securities Litigation Reform Act of 1995. These forward-looking statements are subject to known and unknown risks, uncertainties and other factors which may cause actual results to be materially different from those contemplated by the forward-looking statements. Such factors include, among other things: (1) general economic conditions and other factors, including prevailing interest rate levels, stock and credit market performance and health care inflation, which may affect (among other things) Conseco's ability to sell its products, its ability to make loans and access capital resources and the costs associated therewith, the market value of Conseco's investments, the lapse rate and profitability of policies, and the level of defaults and prepayments of loans made by Conseco; (2) Conseco's ability to achieve anticipated synergies and levels of operational efficiencies; (3) customer response to new products, distribution channels and marketing initiatives; (4) mortality, morbidity, usage of health care services and other factors which may affect the profitability of Conseco's insurance products; (5) performance of our investments; (6) changes in the Federal income tax laws and regulations which may affect the relative tax advantages of some of Conseco's products; (7) increasing competition in the sale of insurance and annuities and in the finance business; (8) regulatory changes or actions, including those relating to regulation of financial services affecting (among other things) bank sales and underwriting of insurance products, regulation of the sale, underwriting and pricing of products, and health care regulation affecting health insurance products; (9) the outcome of Conseco's efforts to sell assets and reduce, refinance or modify indebtedness and the availability and cost of capital in connection with this process; (10) actions by rating agencies and the effects of past or future actions by these agencies on Conseco's business; and (11) the risk factors or uncertainties listed from time to time in Conseco's filings with the Securities and Exchange Commission.

World Wide Web        http://www.conseco.com
Investor Hotline      800.4.CONSECO
Fax-on-Demand         800.344.6452

May 8, 2001

Mr. Colin Devine

Mr. William H. Ryan

SalomonSmithBarney

Via Fax

Gentlemen:

The attached explains the difference between 1Q00 and 1Q01 in the "Corporate Expense" line on page 3 of our 1Q01 Investor Guide. Since your "research" yesterday was both inflammatory and inaccurate, this response is being made available to our investors and the general public.

As you noted, the line item for "Corporate Expenses" was a credit of $8.5 million. This amount is correct. Your attempt to "normalize" our earnings by averaging the 2000 quarterly amounts for this line item is irresponsible for people in your position.

Why? Because it is generally well known that: Conseco is under new management; the structure of the company has been dramatically reorganized; and we are engaged in a significant cost cutting program. Therefore, any comparison to 2000 or any prior years, must take into account both cost reductions and business reorganization.

        Cost Reductions: As reflected in the detail of the attached
        1Q00 and 1Q01 comparisons, $19 million of the $24.3 million
        difference stems from reduced compensation expense and reduced
        marketing expense, chiefly advertising.

        Business reorganization: The old Conseco did not fully
        allocate its corporate expense. Why? First, because the
        holding company was doing other things besides running the
        businesses - e.g. investing in a riverboat casino. And,
        second, because it had a different philosophy about allocating
        corporate expenses. As you can see on the chart, net
        allocations to the business units are greater in 1Q01,
        reflecting our view that maximum allocation of recurring
        corporate expenses gives the most accurate view of operating
        earnings. In fact, we have actually slightly over-allocated to
        the businesses ($3.2 million). That occurred because expenses
        were allocated based on plan, but actual expenses were lower.
        This small over-allocation plus the riverboat profits resulted
        in the net credit in the corporate expense line.

In short, we are doing what we said we'd do. We are building a company that creates value by running our two businesses. We are doing that in Wendt style, which places a premium on productivity and accountability - thus cost cuts, small corporate staff, and maximum allocation of corporate expenses.

Finally, your criticism of Conseco Finance's whole loan sale as a component of operating earnings is completely off base. As you would know if you had bothered to attend the December 19, 2000 investor briefing or to read the accompanying 200 page slide presentation, whole loan sales are a planned source of income for the Finance business. The "New Business Opportunities" page in Bruce Crittenden's presentation clearly depicted excess capacity to originate loans, and an accompanying chart indicates that this excess capacity would be used to generate whole loan sales and additional fee income.

Your attempt to recast our 1Q earnings as "50% of their reported level" is a gross distortion - hardly the product of dispassionate analysis. Your attempt to deduct gains from whole loan sales ignores our articulated business strategy. We continue to wonder what motivates such behavior.

Sincerely,

R. Mark Lubbers

Executive Vice President

                                Detail
                        Corporate Expense line
                     page 3, 1Q 01 Investor Guide
                     ----------------------------

                                   1Q 00   1Q 01  Variance
                                    ----    ----    ----

      Compensation and Benefits    (15.0)   (3.0)   12.0

Marketing (chiefly advertising)    (16.0)   (9.0)    7.0
                                    ----    ----    ----
                                   (31.0)  (12.0)   19.0

        Allocations to Business
       Units net of other costs      6.0    15.2     9.2
                                    ----    ----    ----
                                   (25.0)    3.2    28.2

              Argosy River Boat
                   Profit Share      9.2     5.3     3.9
                                    ----    ----    ----
                                    ----    ----    ----

              Corporate Expense    (15.8)    8.5    24.3