120
1 Confidential, unpublished property of Cigna. Do not duplicate or distribute. For internal use only. Use and distribution limited solely to authorized personnel. © 2017 Cigna
1 Confidential, unpublished property of Cigna. Do not duplicate or distribute. For internal use only. Use and distribution limited solely to authorized personnel. © 2017 Cigna
WELCOME
Will McDowell
Vice President, Investor Relations
Cigna Investor Day 2017
2
Cautionary note regarding forward-looking statements
3 © 2017 Cigna
This presentation, and oral statements made with respect to information contained in this presentation, may contain forward-looking statements within the meaning of
the Private Securities Litigation Reform Act of 1995. Forward-looking statements are based on Cigna's current expectations and projections about future trends,
events and uncertainties. These statements are not historical facts. Forward-looking statements may include, among others, statements concerning our projected
adjusted income (loss) from operations outlook for 2017, on both a consolidated and segment basis; projected total revenue growth and global medical customer
growth, each over year end 2016; projected growth in adjusted income (loss) from operations and total revenue beyond 2017; projected after-tax margins in 2017
and beyond; projected medical care and operating expense ratios and medical cost trends; future financial or operating performance, including our ability to deliver
personalized and innovative solutions for our customers and clients and future growth, business strategy, strategic or operational initiatives; economic, regulatory or
competitive environments, particularly with respect to the pace and extent of change in these areas; financing or capital deployment plans and amounts available for
future deployment; our prospects for growth in the coming years; and other statements regarding Cigna's future beliefs, expectations, plans, intentions, financial
condition or performance. You may identify forward-looking statements by the use of words such as “believe,” “expect,” “plan,” “intend,” “anticipate,” “estimate,”
“predict,” “potential,” “may,” “should,” “will” or other words or expressions of similar meaning, although not all forward-looking statements contain such terms.
Forward-looking statements are subject to risks and uncertainties, both known and unknown, that could cause actual results to differ materially from those expressed
or implied in forward-looking statements. Such risks and uncertainties include, but are not limited to: our ability to achieve our financial, strategic and operational
plans or initiatives; our ability to predict and manage medical costs and price effectively and develop and maintain good relationships with physicians, hospitals and
other health care providers; the impact of modifications to our operations and processes, including those in our disability business; our ability to identify potential
strategic acquisitions or transactions and realize the expected benefits of such transactions; the substantial level of government regulation over our business and the
potential effects of new laws or regulations or changes in existing laws or regulations; the outcome of litigation, regulatory audits, investigations, actions and/or
guaranty fund assessments; uncertainties surrounding participation in government-sponsored programs such as Medicare; the effectiveness and security of our
information technology and other business systems; unfavorable industry, economic or political conditions including foreign currency movements; acts of war,
terrorism, natural disasters or pandemics; uncertainty as to the outcome of the litigation between Cigna and Anthem, Inc. with respect to the termination of the
merger agreement, the reverse termination fee and/or contract and non-contract damages for claims each party has filed against the other, including the risk that a
court finds that Cigna has not complied with its obligations under the merger agreement, is not entitled to receive the reverse termination fee or is liable for breach of
the merger agreement; as well as more specific risks and uncertainties discussed in our most recent report on Form 10-K and subsequent reports on Forms 10-Q
and 8-K available on the Investor Relations section of www.cigna.com. You should not place undue reliance on forward-looking statements, which speak only as of
the date they are made, are not guarantees of future performance or results, and are subject to risks, uncertainties and assumptions that are difficult to predict or
quantify. Cigna undertakes no obligation to update or revise any forward-looking statement, whether as a result of new information, future events or otherwise,
except as may be required by law.
Non-GAAP measures and other key financial information
4 © 2017 Cigna
Throughout this presentation, the Company uses various financial measures when describing its financial results and outlook that are
not determined in accordance with accounting principles generally accepted in the United States of America (“GAAP”). Adjusted
income from operations is the Company’s principal measure of performance and, on a consolidated basis, is not determined in
accordance with GAAP. Throughout this presentation, the term “earnings” means adjusted income from operations and “earnings per
share” or “EPS” means adjusted income from operations on a fully diluted per share basis.
The slide titled “Definitions of Key Financial Terms” includes our definition of adjusted income from operations and an explanation of
why management uses this measure. Appendix I and II provide a reconciliation to the most directly comparable GAAP measure –
shareholders’ net income. The “Definitions of Key Financials Terms” slide also includes definitions of other financial or business metrics
referenced throughout this presentation, including medical customers, return on equity, operating revenues, after-tax margin and return
on invested capital.
Note Regarding Share Repurchases
The timing and actual number of shares repurchased will depend on a variety of factors, including price, general business and market
conditions, and alternate uses of capital. The share repurchase program may be effected through open market purchases or privately
negotiated transactions in compliance with Rule 10b-18 under the Securities Exchange Act of 1934, as amended, including through
Rule 10b5-1 trading plans. The program may be suspended or discontinued at any time.
5 © 2017 Cigna
TIME TOPIC
8:30 am–9:20 am Strategic Overview and Growth Path Forward: David Cordani, President and Chief Executive Officer
9:20 am–10:30 am
Business Leaders Roundtable/Q&A
• Matt Manders, President, Government & Individual Programs and Group Insurance
• Chris Hocevar, President, Strategy, Segments and Solutions
• Mike Triplett, President, U.S. Markets
• Jason Sadler, President, International Markets
10:30 am–10:40 am Break
Session 1:
10:40 am–11:10 am
Session 2:
11:15 am–11:45 am
Investor Breakout Sessions with Management (guests will select two to attend)
• Value-Based Care
• Consumer Engagement / Personalization
• Global Employer & Individual Needs
11:45 am–Noon Lunch
Noon–12:25 pm Financial Update: Eric Palmer, Chief Financial Officer
12:25 pm–12:50 pm Q&A Panel: David Cordani and Eric Palmer
12:50 pm–1:00 pm Closing Remarks: David Cordani
6 Confidential, unpublished property of Cigna. Do not duplicate or distribute. For internal use only. Use and distribution limited solely to authorized personnel. © 2017 Cigna
STRATEGIC OVERVIEW AND GROWTH PATH FORWARD David Cordani President and Chief Executive Officer, Cigna Corporation
7
8 © 2017 Cigna
Proven track record of value creation
Dynamic environment and market forces
Customer, client and partner needs
Strategy, capabilities and positioning of businesses
Path forward for sustained growth
Identity and mission
9 © 2017 Cigna
To improve the health, well-being and sense of security of the people we serve
Our Mission
To be champions for our customers and our communities
Our Role
We are a Global Health Service Company
Who We Are
Fulfilled our promises
10 © 2017 Cigna
Delivered growth
Entered new markets
Diversified our portfolio
Built financial strength
Achieving strong performance
11 © 2017 Cigna
Estimated 2017 Total Revenue and 2017 Earnings Per Share1 represent the mid-point of Cigna’s estimated guidance range.3
8-Year Revenue CAGR
$18.3 $21.1 $21.9
$29.1 $32.4
$34.9 $37.9 $39.7 $41.1
2009 2010 2011 2012 2013 2014 2015 2016 2017
$4.07 $4.53 $5.11
$6.49 $7.29
$7.87 $8.66 $8.10
$9.60
2009 2010 2011 2012 2013 2014 2015 2016 2017
Double-digit growth of top and bottom-line financials
Total Revenue Earnings Per Share1
8-Year EPS CAGR 11% 11%
2017E 2017E
($ in billions)
Strong record of total shareholder return
© 2017 Cigna 12
2009–2016 Average annual TSR*
Cigna delivered cumulative TSR of 280% from YE 2009 – YE 2016
Managed Care** S&P 500 Cigna
15%
24%
34%
Cigna vs. Peers vs. S&P 500
Peer Group***
19%
* Annual average TSRs are presented for full years 2009 through 2016. 280% TSR is cumulative, from YE 2009 through YE 2016.
** Managed Care includes: Aetna, Anthem, Humana and UnitedHealth.
*** Broader peer group includes: Aetna, Aflac, Anthem, The Hartford, HealthNet (through 2015), Humana, Manulife, MetLife, Unum and UnitedHealth.
13 © 2017 Cigna
Affordability and
accessibility challenges
Regulatory and
legislative climate
Global market forces
Aging population Eroding health status Changing role
of consumers
Technological innovation
Greater affordability
and productivity
Value-based
partnering and
care delivery
Key needs emanating from global market forces
14 © 2017 Cigna
Personalized,
affordable solutions
Access and
affordability
solutions
Health Care
Professionals Clients Government Customers
Improved health,
vitality and
productivity
Communities
Tremendous need for personalization, affordability and predictability
Cigna’s enterprise strategy delivered strong results
15 © 2017 Cigna
Go Deep Go Global Go Individual
Evolution of Cigna’s enterprise strategy captures new opportunities
16 © 2017 Cigna
Go Deeper Go Local Go Beyond To expand and deepen our
customer, client and partner
relationships; depth in targeted
sub-segments, geographies
To ensure our solution suite
and services meet customer,
client and partner needs at a
local market level
To innovate and further
differentiate our businesses,
the experiences we deliver,
and overall social impact
Evolved strategy expands avenues for growth and performance
Growth priorities
17 © 2017 Cigna
EXPAND CAPABILITIES AND PURSUE ADJACENCIES
NEW GROWTH THROUGH CAPITAL DEPLOYMENT
CAPTURE HEADROOM
Capturing headroom
18 © 2017 Cigna
SENIORS COMMERCIAL GLOBAL MIDDLE CLASS GLOBALLY MOBILE
Expanding capabilities and pursuing adjacencies
© 2017 Cigna 19
DISTRIBUTION CHANNELS
GEOGRAPHIES SEGMENTS SOLUTIONS
Accelerating new growth through capital deployment
23 © 2017 Cigna
Entered 2017 expecting
$7-$14B in capital available for
deployment during the year
• Support growth of existing business
• Strategic M&A
– Global expansion
– U.S. Seniors
– Pharmacy and physician
engagement capabilities
– Retail capabilities
– Government risk-based programs
How we will win – Focus on differentiated strengths
© 2017 Cigna 24
Affordability
Personalization
Customer
Value
Be the Undisputed Partner of Choice
Accelerating Next Generation Integration
Make the Complex Simpler
How we will win – Talent
25 © 2017 Cigna
Collaborative Experience Agile Passion Localized
High engagement scores • High retention levels
Succeeding for shareholders
26
$16 EPS by
2021
SUSTAINABLE
VALUE
CREATION
FRAMEWORK
© 2017 Cigna
Strong track record of delivering value
Go Beyond for all stakeholders
27 © 2017 Cigna
Clear forward strategy
Strong path for sustained growth
Commitment to innovation
Attractive long-term outlook
U.S. BUSINESS UPDATE Matt Manders
President, Government & Individual Programs and Group Insurance
28
29 © 2017 Cigna
U.S. portfolio
of businesses U.S.
Commercial
Employer
Health Care
Seniors (Cigna-
HealthSpring)
Group
Disability
& Life
Strong track record of results due to focused execution of our strategy
U . S . B U S I N E S S E S : D E L I V E R I N G S T R O N G R E S U LT S T O D AY
30 © 2017 Cigna
Deepest degree
of integration
of medical
and specialty
products in
the market.
8TH YEAR IN A ROW OF
GROWTH IN MEDICAL
CUSTOMERS – the only
company in our peer group
to achieve that result.
Record levels of customer and
client retention.
Growth in Commercial Employer Medical Customers 2009–2016
31 .© 2017 Cigna
2,000
2,500
3,000
3,500
4,000
4,500
5,000
5,500
6,000
2009 2010 2011 2012 2013 2014 2015 2016
National Accounts:
Maintaining share in a stable market
4,000
5,000
6,000
7,000
8,000
9,000
10,000
11,000
12,000
2009 2010 2011 2012 2013 2014 2015 2016
Regional Segment:
4% average annual growth
500
600
700
800
900
1,000
1,100
1,200
1,300
1,400
1,500
2009 2010 2011 2012 2013 2014 2015 2016
Select Segment:
14% average
annual growth
# of customers4 (000) # of customers4 (000)
# of customers4 (000)
Delivering value through an integrated approach to care
32 © 2017 Cigna
ASO clients are
85% of our
U.S. Commercial
customer base
MEDICAL PHARMACY
DENTAL BEHAVIORAL
Focus on going deeper in local markets where we compete
33 © 2017 Cigna
Investments in innovative solutions and
partnerships to grow and meet community needs
Local market strategies that ensure we’re delivering the
full value of our enterprise capabilities
Affordability and personalization are at the center of everything we do
~80% of growth comes from
“Go Deep” markets
Driving growth at the local market level
34 © 2017 Cigna
IA
Cigna Collaborative Care: Leading the way
35 © 2017 Cigna
182 large physician group
relationships – more than any
competitor*
68 specialist groups in
five disciplines
129 hospital
arrangements
Cigna internal analysis of existing arrangements as of July 2017. Subject to change. Map is illustrative
*Becker’s Hospital Review, “A year of mixed results, continued growth for ACOs,” November 2014.
Solid growth. Steadfast commitment.
4 delivery system
joint ventures
Large physician group
Specialist group
Hospital
Delivery system joint venture
Our provider collaboration models
36 © 2017 Cigna
Traditional network partner
Enhanced network partner
Delivery system alliance
Proprietary delivery system
Low High
Areas of focus
Degree of collaboration / Provider risk / Clinical and operational integration with Cigna
Clinical collaborator
Delivery system
organizer
Helping providers move toward a greater value orientation.
Athena Health
PayerView 2016 survey
Making it easier for our provider partners
37 © 2017 Cigna
Cigna ranked first for provider satisfaction
among 214 companies surveyed
50/90 is a key value-based payment goal for the end of 2018
38 © 2017 Cigna
90%
50% We’re different
in words,
actions and
outcomes
50% of medical payments
in alternative payment models,
including population-based
(e.g., capitation, episodes of care)
90% of medical payments
in value-based arrangements
(i.e., FFS payment linked to quality)
Our focus is the ‘50’ goal because of benefits across health care ecosystem
Scalable Medical cost
position
Quality
1 2 3
Delivering value
© 2017 Cigna
Top 5 performing
CACs have 7%
better than
market quality
performance
250 collaborative
arrangements
across large
physician and
specialty practices
spanning 32 states
Top 5 performing
CACs have a
medical cost
position that
is 14% better
than market
39
Leading U.S. total medical cost trend results
40 © 2017 Cigna
Trends represent total book of business, all funding arrangements.
Reported results for Cigna consistent with external disclosure; for 2013 and 2016, final disclosure was less than 5% and less than 4% respectively.
3%
5%
7%
9%
2010 2011 2012 2013 2014 2015 2016
2010-2016 Reported Medical Cost Trend
CI
AET
ANTM
UNH
• Lowest reported medical cost trend every year since 2010
• 2010-2016 Cigna average trend <5%; all others average trend >6%
• Lowest medical cost trend guidance for 2017
CI AET ANTM UNH
8%
7%
6%
5%
4%
3%
6% - 7% 6.5% - 7%
2017 Medical Cost Trend Guidance
4.5% - 5.5%
9%
7%
5%
3%
~6%
Drivers of total medical cost trend
41 © 2017 Cigna
Strong management
of fee-for-service
expenses
Complementary
capabilities that
enable providers to
achieve their goals
Aligned incentives for
customers, clients
and provider partners
Affordability and Personalization
42 © 2017 Cigna
P E R S O N AL I Z AT I O N AF F O R D A B I L I T Y
Expansive reach of Collaborative Care
43 © 2017 Cigna
Cigna medical customers, in top 40 U.S. markets, within 15 miles radius (zip code to zip code distance) of large physician group primary care
physicians. It is not guaranteed that the physician is taking new patients. Cigna analysis as of October 1, 2016.
88% of customers
are within 15 miles
of a Collaborative
Care provider. Large physician group
Specialist group
Hospital
Delivery system joint venture
IA
Bringing our approach to personalization to life
44 © 2017 Cigna
Making the complex simpler to
improve the customer experience
Personal care delivered by local
value-based providers
Today: Operating from a position of strength
45 © 2017 Cigna
Industry-
leading client
retention
Integrated
approach to
deliver greater
value to clients
Undisputed
partner of choice
in local markets
Looking ahead: Growth trajectory in U.S. markets
46 © 2017 Cigna
Partnerships Solutions
Competitive differentiators
Talent
OUR INTEGRATED APPROACH Mike Triplett
President, U.S. Markets
47
48 Confidential, unpublished property of Cigna. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel. © 2017 Cigna
Cross Selling Integration Bundling
Improve
quality and
manage
medical
costs
Competitors Cigna
Multiple products
Pricing structure
Holistic data, insights,
engagement, interactions
Cigna’s Integrated Approach
© 2017 Cigna 48
The Cigna health service portfolio
49 © 2017 Cigna
Core Medical
Pharmacy
Dental
Behavioral
Health Mgmt
and Coaching
Disability
Accident
Voluntary
Vision
Global
Customer &
Client Needs
© 2017 Cigna
Consultative
Approach
Customer
Interactions
Provider
Collaboration
Successful integration model
Talented
Clinical
Team
Data & Insights
50
Interactions lead to differentiated value
51 © 2017 Cigna
Appropriate treatment of gum
disease drives lower medical
costs for those with diabetes,
heart disease, and stroke
Dental
Reduces medical costs
by helping people quit
smoking and manage
weight & stress
Behavioral
Medical cost savings
through alignment of
data and insights
Pharmacy
Strong penetration with room for growth
52 © 2017 Cigna
Low-Mid High
Penetration Rates – Book of Business
Low
• Vision
• EAP
• Disability
• Oncology
50-70% Less than 30% 30-50% Over 70%
Mid-High
• Stop Loss
• Prenatal
Program
• Behavioral
• Utilization &
Case Mgmt.
• Pharmacy
• Dental
• Chronic
Condition
Management
Growth through:
Innovation in existing solutions
New solutions
Increased penetration
Growth through:
Penetration rates as a percentage of total medical customer base; does not include non-medical customers.
Integration of specialty solutions drives higher client persistency
53 © 2017 Cigna
of clients have
Medical +
3 or more
Specialty Solutions
*Compared to medical-only persistency.
+3% to +5% greater client
persistency*
50%
Full suite of capabilities today; innovate and grow for tomorrow
54 © 2017 Cigna
Integrated solutions are
at the heart of leading
medical cost trend
Opportunities for
future growth through added
sales, innovation and new
solutions
Broad array of capabilities
provide value to clients
and fuel persistency
and earnings
SELECT SEGMENT GROWTH STORY
Chris Hocevar
President, Strategy, Segments and Solutions
55
Select Segment growth trends
56 © 2017 Cigna
0
200,000
400,000
600,000
800,000
1,000,000
1,200,000
1,400,000
1,600,000
2009 2010 2011 2012 2013 2014 2015 2016
Select Segment Membership Growth
• Total U.S. market size is ~20 million customers
• Cigna has demonstrated a growth track record and meaningful growth opportunity
0
500
1000
1500
2000
2009 2010 2011 2012 2013 2014 2015 2016
Stop Loss Revenue ($ millions) CAGR
2009-2016
~14%
CAGR
2009-2016
21%
Select Segment customer growth Stop loss revenue
$ in millions In thousands
1,600
1,400
1,200
1,000
800
600
400
200
0
Buyer needs
57 © 2017 Cigna
Affordable Solutions More Choice Simplifying the
Complex
Funding agnostic to satisfy differentiated market needs
Select Segment differentiators
58 © 2017 Cigna
F O C U S A N D
E X P E R I E N C E
driven by deep insights about
smaller employers
A L I G N M E N T A N D
T R A N S PA R E N C Y
Share core belief around
alignment and transparency,
including health improvement
and wellness resources
D E D I C AT E D A N D
S C A L A B L E M O D E L
that makes “large employer”
strategies and flexibility
available to smaller
client segments
Select Segment successes
59 © 2017 Cigna
100% Select Segment
ASO clients with integrated
Stop Loss
100%
Select Segment Clients
with integrated medical,
and pharmacy.
~80’s percent
Consistent client retention rate
range, with almost 2% increase
in overall persistency seen in
last 3 years.
Millions of
biometric indicators and
>30,000 Client
Health Improvement
interactions.
100% Select Segment
Clients with a Cigna health
engagement resource
assigned.
Ample headroom for future growth
60 © 2017 Cigna
Capture
Additional
Share in a
Growing
Market
Market opportunity ~20 million customers
Continue to Innovate, Expand Capabilities
and Enhance our Model
BUILDING FOR THE FUTURE SENIORS SEGMENT AND
GROUP DISABILITY & LIFE INSURANCE
Matt Manders
President, Government & Individual Programs and Group Insurance
61
Provider engagement model is a differentiator
62 © 2017 Cigna
• Partner with providers
• Pioneer in value based care
• Help physicians remain
independent
Over 85% of our customers are cared for by a provider
in a value-based arrangement
Strong historic growth
63 . © 2017 Cigna
Medicare Advantage & Medicare Prescription Drug Coverage
Medicare Prescription Drug Coverage
Medicare Advantage expansion since acquisition.
Medicare Prescription Drug Coverage also included
• Market and geographic expansion
• 11% customer growth entering 2016
• Star rating improvement from
2014-2017 plan years
Star ratings
64 © 2017 Cigna
2016
60%
40%
75%
Percent of Medicare Advantage customers in 4-star or higher plans
2015 2017E
(All numbers are approximate)
Moving Forward
65 © 2017 Cigna
Accepting new
enrollments for plans
effective July 1st
In 2018 we expect 60% of
our Medicare Advantage
customers will be in a
4 Star or greater plan
More effective operating platform
Even stronger business
Team committed to
customer-centricity
and compliance
Improved positioning for future success
66 . © 2017 Cigna
Positioned for strong sustained customer growth
Delivering a positive customer experience
67 © 2017 Cigna
Positive customer
satisfaction
Year-over-year improvements
in clinical quality measures
• 2016 performance resulted in
75% of all HEDIS measures
meeting or exceeding prior
year rates
• Strength in customer
likelihood to recommend, as
transactional NPS of 70
NPS is net promoter score; HEDIS stands for Health Care Effectiveness Data and Information Set.
Important to enterprise growth
68 Confidential, unpublished property of Cigna. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel. © 2017 Cigna
• Attractive, rapidly growing market
• Existing and new market growth
opportunities
• Leverage strength of value-based
arrangements across enterprise
Cigna-HealthSpring revenue growth target
of high single digits over long-term
GROUP DISABILITY & LIFE BUSINESS UPDATE
69 69
We view disability as a health event | Productivity and return to work focus | Earlier clinical intervention
Differentiated approach; proven results
70 © 2017 Cigna
Cigna consistently exceeds the industry median
for resolution rates by over 20%
9.6% 9.9% 9.3%
10.1% 10.4% 9.5%
2011 2012 2013 2014 2015 2016
Disability resolution rates Cigna Industry Median
71 © 2017 Cigna
That’s
40 million hours
of additional
productivity over
the lifetime
Clients have
1.2 million extra
hours of
productivity in
the first year
Driving productivity
Differentiated business that delivers value
72 © 2017 Cigna
CONSISTENT
HIGH-PERFORMING
BUSINESS
TOTAL REVENUE
GROWTH AND
ATTRACTIVE
MARGINS
WELL-POSITIONED
FOR FUTURE
GROWTH
Expect average annual revenue growth in
mid-single digit percent over the long term
Expect average annual revenue growth in
mid-single digit percent over the long term Expect average annual revenue growth in
mid-single digit percent over the long-term
Our clear strategy will drive future growth
73 © 2017 Cigna
Our U.S. businesses are well positioned to capture growth opportunities Our U.S. businesses are well positioned to capture growth opportunities
Improved alignment
Continue to retain,
expand and add client and
customer relationships
Customer-focused
talent committed to
delivering results
CIGNA INTERNATIONAL MARKETS Jason Sadler
President, International Markets
74
EMPLOYER GROUPS INDIVIDUAL CUSTOMERS
GLOBAL HEALTH BENEFITS GLOBAL SUPPLEMENTAL BENEFITS
12 million+ customer relationships | 5,000+ employers | 200+ countries
Serving customers around the world
75 © 2017 Cigna
GLOBAL INDIVIDUAL PRIVATE MEDICAL INSURANCE LOCAL EMPLOYEE HEALTH CARE
Strong Track Record
76
REVENUE
18% CAGR $1.1B $3.4B
© 2017 Cigna
2009 2016
Deeply
understanding
customers’
health needs
Localized, affordable,
personalized products
and services
The best
local talent
in the market
The reassurance
of a globally trusted
brand
Key Growth Drivers
Global Supplemental Benefits
EARNINGS
16% CAGR $106M $294M
Global trends create opportunity
77 © 2017 Cigna
ACCESSIBLE,
AFFORDABLE,
HIGH QUALITY
HEALTH CARE
Rapid growth in Asia’s middle class
Health protection gaps
Rise in chronic disease
Strategic focus areas across International Markets
78 © 2017 Cigna
CAPTURE HEADROOM
EXPAND
CAPABILITIES AND PURSUE ADJACENCIES
SEEK NEW
GROWTH OPPORTUNITIES
Growing middle class, protection gaps and chronic diseases fuel demand Enabled by Talent, Technology and Partners
SUPPLEMENTAL BENEFITS
• Health, Life and Accident benefits for individuals in
Asia-Pacific and Europe
• Medicare Supplement plans in U.S.
INDIVIDUAL PRIVATE MEDICAL INSURANCE
• Private medical insurance for high net worth
globally mobile individuals
Serving individual customers
79 © 2017 Cigna
Global Supplemental Benefits I Global Individual Private Medical Insurance
China • Hong Kong • India • Indonesia • New Zealand • Singapore •
South Korea • Taiwan • Thailand • Turkey • UK • USA
INSIGHTS &
ANALYTICS PRODUCT INNOVATION DISTRIBUTION INNOVATION
Telemarketing
Bancassurance
Individual Agent/Broker
Direct to Consumer
68% 12%
1% 19%
Evolving supplemental benefits distribution models
80 © 2017 Cigna
2016 New Sales
Continued evolution of distribution channels
2009 New Sales
Telemarketing
Bancassurance
Individual Agent / Broker
Direct to Consumer
34%
29%
17%
20%
CAGR 16%
Cigna in Korea: Track record
81 © 2017 Cigna
Consistent, strong revenue growth over the long term
REVENUES
Revenue amounts for 2009 – 2015 have been converted to USD
using 2016 exchange rates for consistency.
2011 2012 2013 2014 2015 2016
$2.0
$1.5
$1.0
$0.5
USD billions
$1.0 $1.1 $1.2
$1.4 $1.5
$1.7
$0.6
$0.8
2009 2010
Cigna in Korea: Competitively attractive returns
82 © 2017 Cigna
Consistently strong after-tax margins and returns on capital
2016 ROE5
23%
Cigna
Korea
30%
20%
10%
0%
-10%
-20%
-30%
Allianz ChubbLife
AIA
MetLife
Prudential
Cigna owns a 50% interest in China joint venture. Revenue is presented above
on a 100% basis for the China joint venture for informational purposes.
Cigna in China: Revenue growth
83 © 2017 Cigna
Consistent, strong revenue growth over the long term
REVENUES
2011 2012 2013 2014 2015 2016 2009 2010
$1.0
$0.8
$0.6
$0.4
$0.2
USD billions
$0.3
$0.4 $0.5
$0.6
$0.8
$1.0
$0.1 $0.2
Cigna in China: Driving continued growth
84 © 2017 Cigna
Shandong
(2010)
Jiangsu
(2007)
Zhejiang
(2006)
Sichuan
(2008) Hubei
(2008)
Guangdong
(2010)
Jiangxi
Hebei
Liaoning
(2011)
Heilongjiang
Shaanxi
(2014)
Hunan
(2015)
Henan
(2015)
Sales capability in 2016
(13 provinces)
Planned entry in 2017
(4 provinces)
Beijing
2005
Shanghai
(2005)
Tianjin
Chong
Qing
(2015)
SERVING CLIENTS GLOBALLY
Market leader in global health benefits for employer groups
85 © 2017 Cigna
• Corporations
• Intergovernmental organizations
• Nongovernmental organizations
• China, Hong Kong, Singapore
• UK, Spain
2009 2016
GLOBAL HEALTH BENEFITS PREMIUMS
Cigna: the recognized leader in health benefits for the globally mobile
$1.46
Billion $1.86
Billion
+12% CAGR
LOCALLY BASED HEALTH CARE
$1.9
USD billions
$0.9
Global provider network &
Best in class service model
More flexible and
customized solutions
Enhancing global health solutions and capabilities
86 © 2017 Cigna
Care management
and coordination
Cigna International Markets: Well positioned for sustained growth
87 © 2017 Cigna
Substantial growth potential across
targeted markets
Capabilities aligned to evolving customer
and client needs
Focused strategy to drive differentiated
value creation
FINANCIAL UPDATE Eric Palmer
Chief Financial Officer
88
Agenda
89 © 2017 Cigna
• Strong track record of financial performance
• Significant growth expectations for 2017
• Positioned for sustainable revenue and earnings growth over long term
• Value creation through capital deployment
• Long-term EPS growth target
Delivered
growth
Entered
new markets
Diversified
our portfolio
Strategic execution
90 © 2017 Cigna
Built financial
strength
Consolidated revenue growth
91 . © 2017 Cigna
$18.3 $21.1 $21.9
$29.1 $32.4
$34.9 $37.9
$39.7 $41.1
$0
$5
$10
$15
$20
$25
$30
$35
$40
$45
2009 2010 2011 2012 2013 2014 2015 2016 2017E
Select Segment Membership Growth $ amounts in billions
2017E*
*Estimated 2017 consolidated revenue represents the mid-point of Cigna’s guidance range.
1 Represents the midpoint of expected 2017 revenue
Revenue growth – Global Health Care segment
92 © 2017 Cigna
$13.7
$31.2
13% CAGR
5% CAGR
2016 2009
$ amounts in billions
Government
Commercial
8%
Commercial Employer
Revenue Growth
CAGR
2009 – 2016
8% CAGR excludes business lines that Cigna has exited since 2009, including Intracorp, limited benefits, and employers with under 50 employees.
Commercial medical customer growth
93 © 2017 Cigna
11.7
15.3
2009 2017E*
Consistent strong organic growth in Select, Middle Market and International
International
Individual
Select
Middle Market
National
*Estimated 2017 medical customer growth represents the mid-point of Cigna’s guidance range.
millions of medical customers4
Specialty customer relationship growth
94 © 2017 Cigna
Dental 1Q17 2009
16.0
Pharmacy 1Q17
2009
millions of customer relationships
Behavioral
8.5
1Q17 2009
Strong growth in Specialty relationships - exceeding medical customer growth
9.9
15.8
6.5
8.9
17.6
26.0
Revenue growth by segment
95 © 2017 Cigna
Amounts above are operating revenues6 for each segment.
$1.1
$3.4
Global Supplemental Benefits
18% CAGR
2016 2009
$3.2
$4.4
Disability & Life
5% CAGR
2016 2009
$ amounts in billions
$13.7
$31.2
Global Health Care
13% CAGR
2016 2009
Government
Commercial
Anthem
4.0%
Humana Cigna Aetna
4.6%
3.0%
United
4.6%
6.1%
Strong margins and ROIC drive financial flexibility
96 © 2017 Cigna
2009 - 2016
After-tax margins
After-tax margins7 and returns on invested capital8 are annual averages for 2009–2016.
Aetna
11%
Anthem Cigna Humana
12%
7%
United
12%
14%
2009 - 2016
Returns on invested capital
Operating strength enabling capital flexibility
97 © 2017 Cigna
49% Share Repurchase
and Dividends
51% Strategic M&A
External Capital Deployment
2009 - 2016
Strong margins
Higher returns on equity
Robust cash flow
generation
Disciplined internal and
external capital deployment
$4.07
$9.60
2009 EPS 2017E EPS
Select Segment Membership Growth
Earnings per share growth
98 © 2017 Cigna
11% average EPS growth rate from 2009–2017E
11% CAGR
*Estimated 2017 EPS1,3 reflects the mid-point of Cigna’s guidance range.
2017E EPS*
Total shareholder return
99 © 2017 Cigna
more than double s&P return Cigna delivered TSR of 280% from YE 2009 – YE 2016
Average annual TSR, 2009-2016
Aetna
22%
27%
20%
27%
34%
Anthem Cigna Humana United
10% 11%
8%
20%
Manulife Cigna MetLife The Hartford Aflac
34%
Annual average TSRs are presented for full years 2009 through 2016.
280% TSR is cumulative, from 12/31/09 through 12/31/16.
Medical customer growth
100 © 2017 Cigna
Medical customer growth of 500,000 to 600,000 lives in 2017
Strong customer and client retention
Expansion of relationships
Net customer growth across all market segments
Consultative approach
Organic specialty relationship growth – 2017 expectations
101 © 2017 Cigna
Dental
1Q17 1Q16
14.8
15.0
16.0
Pharmacy
8.5
1Q17
1Q16
millions of customers
15.8
8.4
15.8 8.9 8.9
Increasing
penetration
Deepening
relationships
Expanding suite
of solutions
Key Growth Drivers
Best projected trend in our peer group
Aetna
6%–7%
Medical cost trend – 2017 expectations
102 © 2017 Cigna
Anthem United Humana
5.5%–6.5%
6.5%–7%
~ 6%
4.5%–5.5%
Cigna
$ amounts in billions
20162 2017E2,3
Consolidated earnings growth – 2017 expectations
103 © 2017 Cigna
8.9
2017 EPS in the
range of $9.35 to
$9.85 per share,
an increase of
15% to 22%
over 2016
Share repurchase program
104 © 2017 Cigna
Expect at least $2B to be deployed
to share repurchases in 2017
$0.8B
in YTD repurchases
through today
At least $1.2B
in additional
repurchases in 2017
Business Long Term Target Revenue Growth
Commercial Employer High single digits
Medicare Advantage
High single digits
Global Supplemental Benefits Mid teens
Group Disability & Life Mid single digits
Cigna Enterprise Total High single digits
Business Long Term Target Revenue Growth
Commercial Employer High single digits
Medicare Advantage
High single digits
Global Supplemental Benefits Mid teens
Group Disability & Life Mid single digits
Business Long Term Target Revenue Growth
Commercial Employer High single digits
Medicare Advantage
High single digits
Global Supplemental Benefits Mid teens
Long-term target revenue growth rate in High Single Digits
105 © 2017 Cigna
Additional potential long-term growth opportunities: U.S. Individual and Medicaid
Business Long Term Target Revenue Growth
Commercial Employer High single digits
Medicare Advantage High single digits
Business Long Term Target Revenue6 Growth
Commercial Employer High single digits
Group Disability & Life Mid to high single digits
Global Supplemental
Benefits High single digits
Medicare Advantage Low to mid single digits
Business
Commercial Employer
Long Term Target
After - Tax Margins7
Mid to high single digits
Long Term Target
Revenue6 Growth
High single digits
High single digits
Mid teens
Mid single digits
Long-term target margins
106 Confidential, unpublished property of Cigna. Do not duplicate or distribute. Use and distribution limited solely to authorized personnel. © 2017 Cigna
Additional potential long-term growth opportunities: U.S. Individual and Medicaid
Balance sheet strength and flexibility
107 © 2017 Cigna
35% 33%
32% 30% 27%
25%
34% 32%
34% 38%
42%
39%
YE2012 YE2013 YE2014 YE2015 YE2016 1Q2017
Cigna debt to total capitalization ratio in mid-20s%
Peer
average
Cigna
Peer average includes Aetna, Anthem, Humana and United
Exceptional capital deployment flexibility
Parent Cash available for deployment at 12/31/2016* $2.5B
+ 2017 additions to deployable cash,
Including normalized leverage & break fee ~ $4.5B
= Projected Parent Cash available for deployment in 2017* ~ $7B
Additional leverage capacity for Strategic M&A TBD
108 © 2017 Cigna
Capital deployment position
*Parent cash available for deployment is defined as parent company total cash and investments, less $250M held at the parent for liquidity
purposes. Projected parent cash available for 2017 does not reflect aggregate amount expected to be deployed for share repurchases.
Capital deployment priorities – forward view
109 © 2017 Cigna
1
Reinvesting in
businesses
to support
long-term growth
2
Strategic M&A to
enhance capabilities
and scale in targeted
areas of focus
3
Returning capital
to shareholders
Strategic M&A priorities
• Global expansion
• U.S. Seniors
• Pharmacy and physician engagement capabilities
• Retail capabilities
• Government risk-based programs
CAGR
2009-2017E
Long Term
EPS Outlook
7 – 9% Earnings2 Contribution 9%
3 – 4% Actual / Normalized
Capital Deployment 2%
Long-term EPS growth target
110 © 2017 Cigna
10 – 13% 11% Earnings per Share1,3
$16 EPS by 2021
plus additional impact of warehoused capital
Strong track record of delivering value
Going Beyond for all stakeholders
111 © 2017 Cigna
Clear forward strategy
Strong path for sustained growth
Innovative and resilient culture
Attractive long-term outlook
CLOSING REMARKS David Cordani President and Chief Executive Officer, Cigna Corporation
112
113 © 2017 Cigna
Proven track record of value creation
Dynamic environment and market forces
Customer, client and partner needs
Strategy, capabilities and positioning of businesses
Path forward for sustained growth
Identity and mission
114 © 2017 Cigna
To improve the health, well-being and sense of security of the people we serve
Our Mission
To be champions for our customers and our communities
Our Role
We are a Global Health Service Company
Who We Are
Track record of significant value creation
115 © 2017 Cigna
11% 8-year EPS
CAGR
34% average
annual TSR
(2009-2016)
11% 8-year revenue
CAGR
Evolution of Cigna’s enterprise strategy captures new opportunities
116 © 2017 Cigna
Go Deeper Go Local Go Beyond To expand and deepen our
customer, client and partner
relationships; depth in targeted
sub-segments, geographies
To ensure our solution suite
and services meet customer,
client and partner needs at a
local market level
To innovate and further
differentiate our businesses,
the experiences we deliver,
and overall social impact
Evolved strategy expands avenues for growth and performance
Growth priorities
117 © 2017 Cigna
EXPAND CAPABILITIES AND PURSUE ADJACENCIES
NEW GROWTH THROUGH CAPITAL DEPLOYMENT
CAPTURE HEADROOM
Succeeding for shareholders
118
$16 EPS
by
2021
SUSTAINABLE
VALUE
CREATION
FRAMEWORK
© 2017 Cigna
Strong track record of delivering value
Going Beyond for all stakeholders
119 © 2017 Cigna
Clear forward strategy
Strong path for sustained growth
Innovative and resilient culture
Attractive long-term outlook
THANK YOU
Definitions of key financial terms
121 © 2017 Cigna
1. The earnings per share (EPS) measure used in this presentation is defined as adjusted income from operations (as defined below) divided by the reported
(historical periods) or estimated (future periods) weighted average shares.
2. Adjusted income (loss) from operations is defined as shareholders’ net income (loss) excluding the following after-tax adjustments: net realized investment
results, net amortization of other acquired intangible assets and special items and, from 2009-2013, also excludes the impact of the Guaranteed Minimum
Income Benefits (GMIB) business. Special items are identified in Exhibit 2 of the company’s quarterly earnings releases. Adjusted income (loss) from operations
is a measure of profitability used by Cigna’s management because it presents the underlying results of operations of Cigna’s businesses and permits analysis of
trends in underlying revenue, expenses and shareholders’ net income. This consolidated measure is not determined in accordance with accounting principles
generally accepted in the United States (GAAP) and should not be viewed as a substitute for the most directly comparable GAAP measure, shareholders’ net
income.
3. Management is not able to provide a reconciliation to shareholders’ net income (loss) on a forward-looking basis because we are unable to predict, without
unreasonable effort, certain components thereof including (i) future net realized investment results and (ii) future special items. These items are inherently
uncertain and depend on various factors, many of which are beyond our control. As such, any associated estimate and its impact on shareholders’ net income
could vary materially.
4. Medical customers include individuals who meet any one of the following criteria: are covered under a medical insurance policy, managed care arrangement, or
service agreement issued by Cigna; have access to Cigna's provider network for covered services under their medical plan; or have medical claims and services
that are administered by Cigna.
5. Return on equity is presented on a statutory basis and is defined as statutory net income as a percentage of average statutory basis capital and surplus. The
average is computed using the beginning of year and end of year values for total statutory capital and surplus.
6. Operating revenues are defined as total revenues excluding realized investment results.
7. After-tax margin for Cigna is calculated by dividing adjusted income (loss) from operations by total revenues. Presentation of competitors is based on the
competitor’s consolidated adjusted earnings measure divided by revenues.
8. Return on invested capital is calculated by dividing adjusted income (loss) from operations by of the average of the company’s shareholders’ equity and debt
outstanding. Each year’s average is computed using the company’s reported beginning and ending values for shareholders’ equi ty and debt.
Appendix I
122 © 2017 Cigna
Reconciliation of GAAP to Non-GAAP Financial Measures(Dollars in millions)
12/31/2009 12/31/2010 12/31/2011 12/31/2012
CONSOLIDATED EARNINGS:
Shareholders' net income 1,291$ 1,279$ 1,260$ 1,623$
Results of guaranteed minimum income benefits (209) 24 135 (29)
Net realized investment losses (gains) 26 (50) (41) (31)
Amortization of other acquired intangible assets 35 36 41 144
Special items (21) (42) 7 171
Adjusted income from operations 1,122$ 1,247$ 1,402$ 1,878$
CONSOLIDATED EARNINGS: 12/31/2013 12/31/2014 12/31/2015 12/31/2016
Shareholders' net income 1,476$ 2,102$ 2,094$ 1,867$
Results of guaranteed minimum income benefits (25) - - -
Net realized investment losses (gains) (141) (106) (40) (109)
Amortization of other acquired intangible assets 144 119 80 94
Special items 622 - 122 252
Adjusted income from operations 2,076$ 2,115$ 2,256$ 2,104$
YEAR ENDED
YEAR ENDED
Appendix II
123 © 2017 Cigna
Reconciliation of GAAP to Non-GAAP Financial Measures
12/31/2009 12/31/2010 12/31/2011 12/31/2012
EPS (DILUTED):
Shareholders' net income 4.69$ 4.65$ 4.59$ 5.61$
Results of guaranteed minimum income benefits (0.76) 0.09 0.49 (0.10)
Net realized investment losses (gains) 0.09 (0.18) (0.15) (0.11)
Amortization of other acquired intangible assets 0.13 0.13 0.15 0.50
Special items (0.08) (0.16) 0.03 0.59
Adjusted income from operations 4.07$ 4.53$ 5.11$ 6.49$
12/31/2013 12/31/2014 12/31/2015 12/31/2016
EPS (DILUTED):
Shareholders' net income 5.18$ 7.83$ 8.04$ 7.19$
Results of guaranteed minimum income benefits (0.09) - - -
Net realized investment losses (gains) (0.49) (0.40) (0.15) (0.42)
Amortization of other acquired intangible assets 0.51 0.44 0.30 0.36
Special items 2.18 - 0.47 0.97
Adjusted income from operations 7.29$ 7.87$ 8.66$ 8.10$
YEAR ENDED
YEAR ENDED
