Cigna Corp. CEO David M. Cordani's total compensation more than doubled in 2010, his first year as leader of the nation's fourth-largest health insurer, and a period in which the company's earnings, revenue and enrollment all climb.
Cordani, 45, received compensation valued at $15.1 million last year from the Philadelphia managed-care company, according to an Associated Press analysis of a regulatory filing Friday.
That included a $1 million salary, a performance-related bonus totaling more than $7.3 million and stock and option awards adding up to $6.7 million.
Cordani's pay package also included $48,733 for the installation and operation of a security system, which was installed at the executive's home once he became CEO. Cordani, Cigna's former president and chief operating officer, was appointed CEO Dec. 25, 2009. He started his tenure Jan. 4, 2010, following the retirement of H. Edward Hanway.
Cordani's 2009 compensation package was valued at $6.5 million.
He saw healthy increases in several compensation categories compared to 2009, including the performance-related bonus, which climbed 49 percent. The 2010 total included a $5.1 million payment for the three-year period that ended last December and a payout of about $2.3 million for 2010.
Cigna operates health care, group disability and life segments in the United States. It trails only WellPoint Inc., UnitedHealth Group Inc. and Aetna Inc. in enrollment
The company said in its proxy statement filed with the Securities and Exchange Commission that Cigna "effectively executed" on its growth strategy under Cordani's leadership last year.
"Revenue rose significantly in 2010, reflecting strong premium growth in (Cigna's) ongoing business segments," the proxy said.
Cigna earned about $1.35 billion, or $4.89 per share, on $21.25 billion in revenue in 2010. That was up from $1.3 billion, or $4.73 per share, on $18.41 billion in revenue in 2009. The insurer's medical membership climbed 4 percent to 11.4 million people compared to the final quarter of 2009, when it fell more than 5 percent. That helped raise premiums and fees in health care, the insurer's largest segment.
Cigna also sells individual insurance policies in several countries and operates an expatriate business that provides coverage for people living outside their home countries. Earnings from that international segment, which is a big company priority, grew 33 percent to $243 million last year.
In August, the insurer acquired Belgium's Vanbreda International, which provides worldwide medical insurance and employee benefits to customers including humanitarian operations and corporate clients.
Cigna shares climbed 4 percent to close 2010 at $36.66, while the Standard & Poor's 500 index rose 12.8 percent.
Shares of Cigna and other insurers slid at the start of 2010, after Congress passed the health care overhaul, which aims to cover millions of uninsured people but will impose a host of taxes and restrictions on insurers. However, the sector's stocks have mostly climbed since last summer, as the overhaul started to unfold and investors saw minimal impact from the first few provisions.
The Associated Press executive compensation formula is designed to isolate the value the company's board placed on the executive's total compensation package during the last fiscal year. It includes salary, bonus, performance-related bonuses, perks, above-market returns on deferred compensation and the estimated value of stock options and awards granted during the year.
The calculations don't include changes in the present value of pension benefits, making the AP total different in most cases from the total reported by companies to the SEC.