Know thy enemy

-Sun Tzu

• Bob Franchi• Clay Nedelka• Kristina Krupa• Allison Barbour• Todd Shannon

• Tim McKeever• Chad Yantorno• AJ Brisson• Ankur Arora• Sean Sills

•CEO – Mark T. Bertolini• Founded in 1850•History of products and services offered:–Life Insurance–Farm Mortgage Loans–Accident Policies–Liability Coverage–Automobile Insurance–Collision and Damage–Group Insurance Policies–Individual Life Insurance–Individual Health Insurance–Retirement Services–Healthcare Insurance – HMOS, PPOs, HSAs, and Medicaid

•Aetna–Sold international

business in 2000 focusing primarily on domestic and expat business

–Embraces the components of the Affordable Care Act by focusing on the Individual and Senior markets

•Cigna–Continues to expand

globally as a part of the Cigna strategy

–Individual insurance growing to 50% of Cigna’s global business by 2017

–Mergers and Acquisitions reflect Cigna’s global strategy and desire to expand into the Medicare market

Primary Customer Base

Primarily Domestic Based•employer groups

•Individuals

•college students

•health plans

•health care providers (“providers”)

•Governmental units

• government-sponsored plans

•labor groups

•expatriates

• 22 million medical members• 39% fully insured

• 61% ASC

• 14.1 million dental members• 14.2 million pharmacy members

Three business segments:Health Care, Group Insurance and Large Case Pensions

•Medicare

•Dental

•Behavioral

•Workers Compensation

•Group Disability

•Government Programs

• 2013 Growth due to acquisition of Coventry ($8.7 Billion to acquire, $4 Billion of Goodwill)

•Despite record growth and Cigna’s poor performance, Cigna still has a higher profit margin (4.56% Cigna, 4.05% Aetna)

•Aetna has more revenue and less assets, driven by a lower amount of cash on hand and a higher Equity Ratio (19.4% Cigna, 28.2% Aetna)

•Cigna Customers: 85 Million

•Aetna Customers: 44 Million

•Cigna Employees: 35,000

•Aetna Employees: 48,000

2013 Aetna Cigna Compared to Cigna

Total Revenue $ 47,294.60 $ 32,380.00 46.1%

Operating Income $ 2,940.50 $ 2,176.00 35.1%

SH Net Income $ 1,913.60 $ 1,476.00 29.6%

Diluted EPS $ 5.33 5.18 2.9%

Cash + Cash Equivalents $1,412.30 $2,795 -49.5%

Total Assets $49,871.80 $54,336 -8.2%

Total Liabilities $35,793.60 $43,659 -18.0%

Total SH Equity $14,025.50 $10,567 32.7%

Net Cash Operating (Cash Flow) $2,278.70 $719 216.9%

Net Cash Investing (Buying & Selling Assets) $1,919.80 $15 12698.7%

Net Cash Financing (Loans, Stocks & Dividends) $1,525.80 ($930) -264.1%

Cash EOY $1,412.30 $2,795 -49.5%