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                                                                  Exhibit 10.1.2

                              EMPLOYMENT AGREEMENT

     EMPLOYMENT AGREEMENT, dated as of January 1, 1998, as amended and restated
as of May 26, 1999, and as further amended and restated as of December 15, 1999
and April 6, 2000, between CONSECO, INC. (hereinafter called the "Company"), and
STEPHEN C. HILBERT (hereinafter called "Executive").

                                    RECITALS

     WHEREAS, the Company and Executive were parties to an Employment Agreement
dated January 1, 1987, as amended by Amendment No. 1 dated February 28, 1988 (as
amended, the "Prior Employment Agreement"); and

     WHEREAS, the Prior Employment Agreement was replaced by a new employment
agreement dated as of January 1, 1998 and subsequently amended as of May 14,
1999 and as amended and restated as of May 26, 1999 and December 15, 1999 (as so
amended, the "Existing Employment Agreement") and the Company and Executive
desire to make certain modifications to the Existing Employment Agreement;

     NOW THEREFORE, in consideration of the foregoing and the mutual covenants
contained herein, the parties agree that the Existing Employment Agreement be
amended and restated in its entirety to be as follows:

     1. Employment. The Company hereby employs Executive, and Executive hereby
accepts employment upon the terms and conditions hereinafter set forth.

     2. Term. This Agreement shall be deemed to have become effective (and the
Prior Employment Agreement terminated) as of January 1, 1998. On May 14, 1998
(the "Approval Date") the Company's shareholders approved the performance-based
compensation provisions hereof (i.e., Section 5(b)) as then in effect. Subject
to provisions for termination as provided in Section 9 hereof, the term of this
Agreement shall be five (5) years from and after January 1, 1998, and it shall
be automatically renewed for successive five (5) year periods on January 1 of
each year thereafter, unless either party elects not to renew this Agreement by
serving written notice of such intention not to renew on the other party at
least one hundred eighty (180) days prior to January 1 of each year. If such an
election is made, this Agreement shall be in full force and effect for the
remaining portion of the then current five (5) year period, subject to the
provisions for termination as provided in Section 9 hereof. The term Basic
Employment Period as used in this Agreement shall mean the five (5) year period
commencing with the most recent annual renewal pursuant to this section.

     3. Duties. Executive is engaged by the Company in an executive capacity as
its chief executive officer. Executive's position with the Company shall be
Chairman of the Board of Directors and Chief Executive Officer, and such other
positions (not inconsistent with the aforementioned responsibilities) as may be
determined from time to time by the Board of Directors of the Company.



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     4. Extent of Services. Executive, subject to the direction and control of
the Board of Directors of the Company, shall have the power and authority
commensurate with his executive status and necessary to perform his duties
hereunder. The Company agrees to provide to Executive such assistance and work
accommodations as are suitable to the character of his positions with the
Company and adequate for the performance of his duties. Executive shall devote
substantially all of his employable time, attention and best efforts to the
business of the Company, and shall not, without the consent of the Company,
during the term of this Agreement be actively engaged in any other business
activity, whether or not such business activity is pursued for gain, profit or
other pecuniary advantage; but this shall not be construed as preventing
Executive from investing his assets in such form or manner as will not require
any material services on the part of Executive in the operation of the affairs
of the companies in which such investments are made. For purposes of this
Agreement, full-time employment shall be the normal work week for individuals in
senior executive positions with the Company.

     5. Compensation.

          (a) As compensation for services hereunder rendered during the term
     hereof, Executive shall receive a base salary of One Million Dollars
     ($1,000,000) per year payable in equal installments in accordance with the
     Company's payroll procedure for its salaried employees (but in no event
     less than twice a month), it being understood that for 1998 a lump sum
     payment shall be made promptly after the approval of this Agreement by the
     shareholders of the Company to cause the salary payments to Executive in
     1998 to such date in 1998 to at least equal the pro rata portion (based on
     the number of days in 1998 then elapsed through the end of the most recent
     pay period then ended) of One Million Dollars ($1,000,000). Salary payments
     shall be subject to withholding of taxes and other appropriate and
     customary amounts. In addition to the base salary above, Executive may
     receive additional annual salary increases based upon his performance in
     his executive and management capacity. The amounts of such salary increases
     shall be determined by the Board of Directors of the Company or the
     Compensation Committee thereof (the "Compensation Committee").

          (b) In addition to base salary, Executive shall be entitled to receive
     annually a bonus to be calculated and paid for each fiscal year as follows:


               (i) First, the maximum potential bonus to Executive for such year
          (the "Maximum Bonus") shall be computed. The Maximum Bonus for a
          fiscal year shall be equal to three percent (3%) of the annual Net
          Profits (as defined below) for such fiscal year of the Company. The
          bonus shall be calculated from the books and records of the Company
          which shall be kept in accordance with generally accepted accounting
          principles applied by the Company in the preparation of its financial
          statements. The Maximum Bonus for a fiscal year shall be payable,
          without reference to any other tests, to the extent it does not exceed
          the Non-Discretionary Amount (as determined pursuant to clause (v)
          below, the "Non-Discretionary Amount") applicable to such year. "Net
          Profits" shall mean the Company's Income from Continuing Operations
          (as defined below), as adjusted to add back, in each case to the
          extent such items were deducted in

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          the computation of Income from Continuing Operations, (x) income taxes
          and (y) bonuses to Executive and the Company's Executive Vice
          Presidents. "Income from Continuing Operations" shall mean the
          Company's income from continuing operations, which shall exclude for
          this computation the effect (in each case net of applicable tax) of
          (i) extraordinary items, (ii) discontinued operations and (iii) the
          cumulative effects of changes in accounting principles.

               (ii) If the Maximum Bonus exceeds the Non-Discretionary Amount
          for such fiscal year a separate calculation shall be made to determine
          what portion, if any, of the Maximum Bonus in excess of the
          Non-Discretionary Amount could be paid and still permit the Company's
          ROE (as determined pursuant to clause (iii) below, the "ROE") for such
          fiscal year to be at least 15% for such fiscal year (such amount
          exceeding the Maximum Bonus and meeting such 15% ROE test for such
          fiscal year being referred to as the "Additional Potential Bonus").
          The Additional Potential Bonus for a fiscal year would then be payable
          to Executive for such fiscal year subject to the discretion of the
          Compensation Committee to reduce or eliminate (in whole or in part)
          the payment of the Additional Potential Bonus for such year in its
          discretion.

               (iii) The ROE for a fiscal year shall be determined by dividing
          (x) the Company's Income from Continuing Operations for such fiscal
          year, reduced by any dividends paid with respect to such fiscal year
          on the Company's preferred stock (it being understood that any amounts
          paid to induce the conversion of preferred stock are not to be
          considered dividends on preferred stock) by (y) the arithmetic average
          of the Company's Average Common Equity (as defined below) for the four
          quarters of such fiscal year. The "Average Common Equity" of the
          Company for a quarter shall mean the arithmetic average of the common
          shareholders equity of the Company shown on its financial statements
          (adjusted to exclude unrealized appreciation or depreciation of fixed
          maturity securities net of any applicable deferred income taxes, as so
          adjusted "Common Shareholders Equity") as of the end of such fiscal
          quarter (as adjusted as provided below, the "Quarter End Equity") and
          the end of the preceding quarter (the "Quarter Start Equity");
          provided, that if one or more Significant Transactions (as defined
          below) has occurred during the fiscal quarter as to which Average
          Common Equity is being determined, then the impact of each such
          Significant Transaction on the Quarter End Equity shall be reduced by
          a fraction, the numerator of which shall be the number of days in such
          quarter elapsed before said Significant Transaction occurred (it being
          understood that with respect to a Significant Transaction which
          includes a series of transactions which closed or were otherwise
          consummated over a period of time the Company shall select a
          reasonable midpoint for purposes of this calculation) and the
          denominator of which shall be the total number of days in such
          quarter, and the Quarter End Equity shall be computed taking into
          account such reductions. "Significant Transaction" with respect to a
          quarter shall mean any event (such as a share issuance, share
          repurchase, conversion, acquisition, disposition, merger,
          consolidation or change in accounting principles) the effect of which
          event, or series of related events, is to cause the Quarter End Equity
          to change by at least 10% of the Quarter Start Equity from what it
          would otherwise have been absent such event or series of related
          events.

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               (iv) The Company agrees to give notice to the Compensation
          Committee as promptly as practicable after the end of each fiscal year
          of the respective amounts of Maximum Bonus, Additional Potential Bonus
          and, if it has been adjusted with respect to such fiscal year,
          Non-Discretionary Amount for such fiscal year. The Compensation
          Committee shall then have fifteen (15) days from the date such notice
          is sent by the Company to determine the extent, if any, to which the
          Additional Potential Bonus with respect to such fiscal year shall have
          been reduced or eliminated. The Company shall give notice to Executive
          not later than five (5) days after the expiration of such 15-day
          period of the Incremental Bonus to be paid for such fiscal year.

               (v) The Non-Discretionary Amount for each of 1998 and 1999 shall
          be $13.5 million. The Non-Discretionary Amount shall be adjusted for
          2000 and the last year of each consecutive three-year period that
          follows (each an "Adjustment Year"), as described in the following
          sentence. For an Adjustment Year the Non-Discretionary Amount shall be
          adjusted to be the lesser of (i) one-half of the average of the
          Maximum Bonus for the two fiscal years immediately preceding such
          Adjustment year and (ii) the arithmetic average of the
          Non-Discretionary Amount and the Additional Potential Bonus, in each
          case regardless of the amount of bonus actually paid, for such two
          fiscal years. The Non-Discretionary Amount as so adjusted shall remain
          the same with respect to the two fiscal years following such
          Adjustment Year.

               (vi) The cumulative accrued amount of the bonus shall be
          calculated as of the end of each of the first three quarters of the
          Company's fiscal year based on the year-to-date Net Profits, and such
          accrued bonus, minus accrued bonus payments made for previous quarters
          of the same fiscal year, shall be paid to Executive as soon as
          practicable, but in no event more than forty-five (45) days after the
          end of the quarter; provided, that the cumulative maximum bonus
          payable with respect to the (i) first quarter may not exceed 25% of
          the Non-Discretionary Amount, (ii) first two quarters shall not exceed
          50% of the Non-Discretionary Amount and (iii) first three quarters
          shall not exceed 75% of the Non-Discretionary Amount for such fiscal
          year. The aggregate bonus for the fiscal year, minus the quarterly
          accrued payments made for the year, shall be paid to Executive soon as
          practicable, but in no event more than ninety (90) days, after the
          fiscal year end. If the quarterly payments for the first three
          quarters of any fiscal year exceed the aggregate bonus payable for the
          entire year, the amount of such excess shall be repaid to the Company
          by Executive.

               (vii) A bonus payment of $3,375,000 with respect to the first
          quarter of 1999 has been made in cash. With respect to the remainder
          of 1999 the bonus (the "Remaining Bonus") shall not exceed the lesser
          of (x) the remainder of the Non-Discretionary Amount (i.e.,
          $10,125,000) for 1999 and (y) the difference between the Maximum Bonus
          for all of 1999 and $3,375,000. At the time all or any part of the
          Remaining Bonus is being determined, if the Market Price of the
          Company's common stock is less than $50 per share, the payment that
          would otherwise be made shall be reduced by multiplying such amount by
          a fraction the numerator of which shall be such Market

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          Price and the denominator of which shall be $50. A portion of the
          resulting payment of the Remaining Bonus (whether or not reduced
          pursuant to the preceding sentence) shall be paid in cash to provide
          for the payment of Executive's estimated Federal, state and local
          income, unemployment, social security, Medicare and similar income or
          payroll taxes at maximum rates (such tax estimate to be made by
          Executive subject to the approval of the Company, which approval will
          not be unreasonably withheld). The remaining part of such resulting
          payment shall be satisfied by the issuance to Executive of a number of
          shares of the Company's common stock determined by dividing such
          remaining part by the Market Price of such common stock. The "Market
          Price" of the common stock for purposes of this clause (vii) shall be
          the average of the high and low trading price of the common stock on
          the New York Stock Exchange Composite Tape on the day of computation
          or if no such trading has occurred on such day on the last preceding
          day on which such trading has occurred. If Executive subsequently is
          required to return any portion of the bonus payable pursuant to the
          last sentence of clause (vi) of this Section 5(b) Executive shall
          return cash and stock to the Company on a last-paid, first-returned
          basis. This clause (vii) shall apply to Executive's bonus only for
          1999. Notwithstanding that Executive's bonus for 1999 may be reduced
          below the Non-Discretionary Amount as provided in this clause (vii)
          based upon the Market Price of the common stock, Executive shall, for
          purposes of Sections 9(b) 9(c), 10(a) and 11 be treated as having
          earned the Non-Discretionary Amount for 1999 to the extent it would
          have paid if such reduction had not occurred.

     6. Fringe Benefits.

          (a) Executive shall be entitled to participate in such existing
     employee benefit plans and insurance programs offered by the Company, or
     which it may adopt from time to time for its executive management or
     supervisory personnel generally, at such time as Executive shall have
     fulfilled the eligibility requirements for participation therein. Nothing
     herein shall be construed so as to prevent the Company from modifying or
     terminating any employee benefit plans or programs, or employee fringe
     benefits, it may adopt from time to time.

          (b) During the term of this Agreement, the Company shall pay Executive
     a monthly automobile allowance in the amount of Six Hundred Dollars
     ($600.00) and shall pay directly or shall reimburse Executive for the cost
     of fuel he incurs in using his automobile.

          (c) Executive shall be entitled to four (4) weeks vacation with pay,
     for each year during the term hereof.

          (d) Executive may incur reasonable expenses for promoting the
     Company's business, including expenses for entertainment, travel, and
     similar items. The Company shall reimburse Executive for all such
     reasonable expenses upon Executive's periodic presentation of an itemized
     account of such expenditures.

          (e) The Company shall, upon periodic presentation of satisfactory
     evidence and to a maximum of Ten Thousand Dollars ($10,000) per year of
     this Agreement, reimburse



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     Executive for reasonable medical expenses incurred by Executive and his
     dependents which are not otherwise covered by health insurance provided to
     Executive under Section 6(a).

          (f) During the term of this Agreement, the Company shall at its
     expense maintain a term life insurance policy or policies on the life of
     Executive in the face amount of One Million Dollars ($1,000,000), payable
     to such beneficiaries as Executive may designate.

     7. Disability. If Executive shall become physically or mentally disabled
during the term of this Agreement to the extent that his ability to perform his
duties and services hereunder is materially and adversely impaired, his salary,
bonus and other compensation provided herein shall continue while he remains
employed by the Company; provided, that if such disability (as confirmed by
competent medical evidence) continues for at least twelve (12) consecutive
calendar months, the Company may terminate Executive's employment hereunder in
which case the Company shall immediately pay Executive a lump sum payment equal
to the sum of his salary and bonus as provided herein with respect to the most
recent fiscal year then ended and, provided, further that no such lump sum
payment shall be required if such disability arises primarily from: (a) chronic
depressive use of intoxicants, drugs or narcotics, or (b) intentional
self-inflicting injury or intentionally self-induced sickness; or (c) a proven
unlawful act or enterprise on the part of Executive.

     8. Disclosure of Information. Executive acknowledges that in and as a
result of his employment hereunder, he will be making use of, acquiring and/or
adding to confidential information of the Company of a special and unique nature
and value. As a material inducement to the Company to enter into this Agreement
and to pay to Executive the compensation stated in Section 5, as well as any
additional benefits stated herein, Executive covenants and agrees that he shall
not, at any time during or following the term of his employment, directly or
indirectly, divulge or disclose for any purpose whatsoever, any confidential
information that has been obtained by or disclosed to him as a result of his
employment by the Company, except to the extent that such confidential
information (a) becomes a matter of public record or is published in a
newspaper, magazine or other periodical available to the general public, other
than as a result of any act or omission of Executive, (b) is required to be
disclosed by any law, regulation or order of any court or regulatory commission,
department or agency, provided that Executive gives prompt notice of such
requirement to the Company to enable the Company to seek an appropriate
protective order or confidential treatment, or (c) is necessary to perform
properly Executive=s duties under this Agreement. Upon the termination of this
Agreement, Executive shall return all materials obtained from or belonging to
the Company which Executive may have in his possession or control.

     9. Termination.

          (a) Either the Company or Executive may terminate this Agreement at
     any time for any reason upon written notice to the other. This Agreement
     shall also terminate upon (i) the death of Executive and (ii) termination
     by the Company pursuant to Section 7.

          (b) In the event this Agreement is terminated by the Company pursuant
     to the first sentence of Section 9(a) and such termination does not
     constitute a Control Termination as




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     defined in (d) below, Executive shall be entitled to receive not later than
     ten (10) days after termination of Executive's employment (i) a severance
     distribution consisting of (A) the assignment, without any warranty (except
     as to good title) or recourse, by the Company to the Executive or his
     designee of all of its interest in (1) the Promissory Note made by
     Executive to the order of Company dated April 6, 2000 (the "Note"), (2) all
     indebtedness (unpaid principal, interest and expenses) evidenced by the
     Note at the time (the "Debt"), and (3) all documents executed to secure
     repayment of the Note (the "Collateral Documents") (and all rights
     thereunder) or, if the Debt exceeds the Nominal Section 9 Severance (as
     defined below) an undivided fractional interest (determined as described
     below), on a "last out" participation basis in (1) the Note, (2) the Debt,
     and (3) Collateral Documents, and (B) a cash payment by the Company to the
     Executive equal to the positive difference, if any, of (x) an amount equal
     to five (5) times the sum of Executive's base salary, as determined
     pursuant to Section 5(a) hereof for the fiscal year in which such
     termination occurs, and the Non-Discretionary Amount as defined in Section
     5(a)(iv) applicable for such fiscal year (regardless of whether the
     Company's results for such fiscal year would have resulted in a bonus being
     paid to Executive) (the "Nominal Section 9 Severance") minus (y) the amount
     of the Debt assigned to Executive and (ii) all other unpaid amounts
     previously accrued or awarded pursuant to any other provision of this
     Agreement. For purposes of determining the "undivided fractional interest"
     in sub-section (i)(A) above the numerator will be the dollar amount of the
     Nominal Section 9 Severance and the denominator will be the dollar amount
     of the Debt.

          (c) In the event this Agreement is terminated upon the death of
     Executive, or is terminated by Executive and such termination does not
     constitute a Control Termination as defined in (d) below, Executive shall
     be entitled to receive his base salary as provided in Section 5(a) accrued
     but unpaid (i) as of the date of termination, (ii) a pro rata share of the
     bonus provided for in Section 5(b) based on the number of months during
     which he performed duties hereunder in the calendar year of his death, and
     (iii) all other unpaid amounts previously accrued or awarded pursuant to
     any other provision of this Agreement.

          (d) The term "Control Termination" as used herein shall mean (1)
     termination of this Agreement by the Company in anticipation of or not
     later than two years following a "change in control" of the Company (as
     defined below), or (2) termination of this Agreement by Executive following
     a "change in control" of the Company (as defined below) upon the occurrence
     of any of the following events:

               (i) a significant change in the nature or scope of Executive's
          authorities or duties from those in existence immediately prior to the
          change in control, a reduction in total compensation from that in
          existence immediately prior to the change in control, or a breach by
          the Company of any other provision of this Agreement; or

               (ii) the reasonable determination by Executive that, as a result
          of a change in circumstances significantly affecting his position, he
          is unable to exercise Executive's authorities, powers, functions or
          duties in existence immediately prior to the change in control; or


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               (iii) the Company's principal executive offices are moved outside
          the geographic area comprised of Marion County, Indiana, and the seven
          contiguous counties; or

               (iv) the giving of notice of termination by Executive to the
          Company during the 6-month period commencing six (6) months after the
          change in control.

     The term "change in control" shall mean a change in control of a nature
that would be required to be reported in response to Item 6(e) of Schedule 14A
of Regulation 14A promulgated under the Securities Exchange Act of 1934 (the
"1934 Act" if such Item 6(e) were applicable to the Company as such Item is in
effect on May 26, 1999; provided that, without limitation, such a change in
control shall be deemed to have occurred if and when (A) any "person" (as such
term is used in Sections 13(d) and 14(d)(2) of the 1934 Act) is or becomes a
beneficial owner, directly or indirectly, of securities of the Company
representing 25% or more of the combined voting power of the Company's then
outstanding securities or (B) in connection with or as a result of a tender
offer, merger, consolidation, sale of assets or contest for election of
directors, or any combination of the foregoing transactions or events,
individuals who, as of the date hereof, constitute the Board of Directors of the
Company (the "Incumbent Board") cease to constitute at least a majority of such
Board; provided, however, that any individual who becomes a director of the
Company subsequent to the date hereof whose election was approved by a vote of
at least a majority of the directors then comprising the Incumbent Board, shall
be deemed to have been a member of the Incumbent Board; and provided further,
that no individual who was initially elected as a director of the Company as a
result of an actual or threatened election contest, as such terms are used in
Rule 14a-11 of Regulation 14A promulgated under the Act, or any other actual or
threatened solicitation of proxies or consents by or on behalf of any person
other than the Board of Directors shall be deemed to have been a member of the
Incumbent Board, or (C) any reorganization, merger or consolidation or the
issuance of shares of common stock of the Company in connection therewith unless
immediately after any such reorganization, merger or consolidation (i) more than
60% of the then outstanding shares of common stock of the corporation surviving
or resulting from such reorganization, merger or consolidation and more than 60%
of the combined voting power of the then outstanding securities of such
corporation entitled to vote generally in the election of directors are then
beneficially owned, directly or indirectly, by all or substantially all of the
individuals or entities who were the beneficial owners, respectively, of the
outstanding shares of common stock of the Company and the outstanding voting
securities of the Company immediately prior to such reorganization, merger or
consolidation and in substantially the same proportions relative to each other
as their ownership, immediately prior to such reorganization, merger or
consolidation, of the outstanding shares of common stock of the Company and the
outstanding voting securities of the Company, as the case may be, and (ii) at
least a majority of the members of the board of directors of the corporation
surviving or resulting from such reorganization, merger or consolidation were
members of the Board of Directors of the Company at the time of the execution of
the initial agreement or action of the Board of Directors providing for such
reorganization, merger or consolidation or issuance of shares of common stock of
the Company. Upon the occurrence of a change in control, the Company shall
promptly notify Executive in writing of the occurrence of such event (such
notice, the "Change in Control Notice"). If the Change in Control Notice is not
given within 10 days after the occurrence




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of a change in control the period specified in clause (d)(A) of this Section 9
shall be extended until the second anniversary of the date such Change in
Control Notice is given.

     10. Payments for Control Termination. In the event of a Control Termination
     of this Agreement, the Company shall pay Executive and provide him with the
     following:

          (a) During the remainder of the Basic Employment Period, the Company
     shall continue to pay Executive his salary on a monthly basis at the same
     rate as payable immediately prior to the date of termination plus the
     estimated amount of any bonuses to which he would have been entitled had he
     remained in the employ of the Company and a change in control of the
     Company had not occurred, which estimate shall be reasonable and made by
     the Company in good faith (the "Section 10 Termination Payments").
     Notwithstanding the foregoing, if Executive does not make the Election
     provided for in Section 11 the Company may assign to the Executive or his
     designee, without any warranty (except as to good title) or recourse, all
     of its interest in (1) the Note, (2) the Debt, and (3) the Collateral
     Documents or, if the then existing Debt exceeds the amount of the Section
     10 Termination Payments, an undivided fractional interest (determined as
     described below), on a "last out" participation basis, in (1) the Note, (2)
     the Debt, and (3) the Collateral Documents; in which case the amount of the
     Debt assigned to Executive or the undivided fractional interest in the Debt
     assigned shall serve as a credit against any such Section 10 Termination
     Payments otherwise payable. For purposes of determining the "undivided
     fractional interest" above the numerator will be the dollar amount of the
     Section 10 Termination Payments and the denominator will be the dollar
     amount of the Debt.

          (b) During the remainder of the Basic Employment Period, Executive
     shall continue to be treated as an employee under the provisions of all
     incentive compensation arrangements applicable to the Company's executive
     employees. In addition, Executive shall continue to be entitled to all
     benefits and service credit for benefits under medical, insurance and other
     employee benefit plans, programs and arrangements of the Company as if he
     were still employed under this Agreement and a change in control of the
     Company had not occurred.

          (c) If, despite the provisions of paragraph (b) above, benefits under
     any employee benefit plan shall not be payable or provided under any such
     plan to Executive, or Executive's dependents, beneficiaries and estate,
     because he is no longer an employee of the Company, the Company itself
     shall, to the extent necessary to provide the full value of such benefits
     and service credits to Executive, Executive's dependents, beneficiaries and
     estate, pay or provide for payment of such benefits and service credit for
     such benefits to Executive, his dependents, beneficiaries and estate.

          (d) If, despite the provisions of paragraph (b) above, benefits or the
     right to accrue further benefits under any stock option or other long-term
     incentive compensation arrangement shall not be provided under any such
     arrangement to Executive, or his dependents, beneficiaries and estate,
     because he is no longer an employee of the Company, the Company shall, to
     the extent necessary, pay or provide for payment of such benefits to
     Executive, his dependents, beneficiaries and estate.



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     11. Severance Allowance. In the event of a Control Termination of this
     Agreement, Executive may elect (the "Election"), within 60 days after such
     Control Termination, to receive a distribution as a severance allowance, in
     lieu of the termination payments provided for in Section 10 above,
     consisting of:

          (a) the assignment, without any warranty (except as to good title) or
     recourse, by the Company to the Executive or his designee of all of its
     interest in (1) the Note, (2) the Debt, and (3) the Collateral Documents
     or, if the then existing Debt exceeds the Nominal Section 11 Severance (as
     defined below), an undivided fractional interest (determined as described
     below), on a "last out" participation basis, in (1) the Note, (2) the Debt,
     and (3) the Collateral Documents; and

          (b) A lump sum payment equal to the positive difference, if any, of
     (A) the sum of (x) an amount equal to the aggregate of the salary payments
     for 60 calendar months at the rate which Executive would have been entitled
     to receive in accordance with Section 5(a) plus a pro rata share of the
     estimated amount of any bonus which would have been payable for the bonus
     period which includes the termination date, and (y) an amount equal to five
     times the greater of (aa) the highest annual bonus payable under Section
     5(b) hereof for the last three (3) fiscal years of the Company ended prior
     to such Control Termination, or (bb) the estimated amount of the annual
     bonus payable under Section 5(b) hereof for the fiscal year of the Company
     which includes the date of such Control Termination (with such sum of (x)
     and (y) being referred to as the "Nominal Section 11 Severance") minus (B)
     the amount of the Debt assigned to Executive.

     For purposes of determining the "undivided fractional interest" in
     sub-section (a) above the numerator will be the dollar amount of the
     Nominal Section 11 Severance and the denominator will be the dollar amount
     of the Debt.

     In the event that Executive makes an election pursuant to this Section to
receive a lump sum severance allowance of the amount described in clauses (a)
and (b), then, in addition to such amount, he shall receive (i) in addition to
the benefits provided under any retirement or pension benefit plan maintained by
the Company, the benefits he would have accrued under such benefit plan if he
had remained in the employ of the Company and such plan had remained in effect
for 60 calendar months after his termination, which benefits will be paid
concurrently with, and in addition to, the benefits provided under such benefit
plan, and (ii) the employee benefits (including, but not limited to, coverage
under any medical insurance and split-dollar life insurance arrangements or
programs) to which he would have been entitled under all employee benefit plans,
programs or arrangements maintained by the Company if he had remained in the
employ of the Company and such plan, programs or arrangements had remained in
effect for 60 calendar months after his termination; or the value of the amounts
described in clauses (i) and (ii) next preceding. The amount of the payments
described in the preceding sentence shall be determined and such payments shall
be distributed as soon as it is reasonably possible.





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<PAGE>   11


     12. Tax Indemnity Payments. (a) Anything in this Agreement to the contrary
notwithstanding, in the event it shall be determined that any payment or
distribution by the Company or its affiliated companies to or for the benefit of
Executive, whether paid or payable or distributed or distributable pursuant to
the terms of the Agreement or otherwise but determined without regard to any
additional payments required under this Section 12 (a "Payment"), would be
subject to the excise tax imposed by Section 4999 of the Internal Revenue Code
of 1986 (as amended the "Code"), or any successor provision (collectively,
"Section 4999"), or any interest or penalties are incurred by Executive with
respect to such excise tax (such excise tax, together with any such interest and
penalties, are hereinafter collectively referred to as the "Excise Tax"), then
Executive shall be entitled to receive an additional payment (a "Gross-Up
Payment") in an amount such that after payment by Executive of all taxes
(including any interest or penalties imposed with respect to such taxes),
including, without limitation, any Federal, state or local income and employment
taxes and Excise Tax (and any interest and penalties imposed with respect to any
such taxes) imposed upon the Gross-Up Payment, Executive retains an amount of
the Gross-Up Payment equal to the Excise Tax imposed upon the Payments.

          (b) Subject to the provisions of Section 12(c), all determinations
     required to be made under this Section 12, including whether and when a
     Gross-Up Payment is required and the amount of such Gross-Up Payment and
     the assumptions to be utilized in arriving at such determination, shall be
     made by the Company's public accounting firm (the "Accounting Firm") which
     shall provide detailed supporting calculations both to the Company and
     Executive within fifteen (15) business days of the receipt of notice from
     Executive that there has been a Payment, or such earlier time as is
     requested by the Company. In the event that the Accounting Firm is serving
     as accountant or auditor for the individual, entity or group effecting the
     Change in Control, Executive shall appoint another nationally recognized
     public accounting firm to make the determinations required hereunder (which
     accounting firm shall then be referred to as the Accounting Firm
     hereunder). All fees and expenses of the Accounting Firm shall be borne
     solely by the Company. Any Gross-Up Payment, as determined pursuant to this
     Section 12, shall be paid by the Company to Executive within five (5) days
     of the receipt of the Accounting Firm's determination. If the Accounting
     Firm determines that no Excise Tax is payable by Executive, it shall
     furnish Executive with a written opinion that failure to report the Excise
     Tax on Executive's applicable federal income tax return would not result in
     the imposition of a negligence or similar penalty. Any determination by the
     Accounting Firm shall be binding upon the Company and Executive. As a
     result of the uncertainty in the application of Section 4999 at the time of
     the initial determination by the Accounting Firm hereunder, it is possible
     that Gross-Up Payments which will not have been made by the Company should
     have been made ("Underpayment"), consistent with the calculations required
     to be made hereunder. In the event that the Company exhausts its remedies
     pursuant to Section 12(c) and Executive thereafter is required to make a
     payment of any Excise Tax, the Accounting Firm shall determine the amount
     of the Underpayment that has occurred and any such Underpayment shall be
     promptly paid by the Company to or for the benefit of Executive.


          (c) Executive shall notify the Company in writing of any claim by the
     Internal Revenue Service that, if successful, would require the payment by
     the Company of, or


                                       11
<PAGE>   12


     change in the amount of the payment by the Company of, the Gross-Up
     Payment. Such notification shall be given as soon as practicable after
     Executive is informed in writing of such claim and shall apprise the
     Company of the nature of such claim and the date on which such claim is
     requested to be paid; provided that the failure to give any notice pursuant
     to this Section 12(c) shall not impair Executive's rights under this
     Section 12 except to the extent the Company is materially prejudiced
     thereby. Executive shall not pay such claim prior to the expiration of the
     30-day period following the date on which Executive gives such notice to
     the Company (or such shorter period ending on the date that any payment of
     taxes with respect to such claim is due). If the Company notifies Executive
     in writing prior to the expiration of such period that it desires to
     contest such claim, Executive shall:

          (1) give the Company any information reasonably requested by the
     Company relating to such claim,

          (2) take such action in connection with contesting such claim as the
     Company shall reasonably request in writing from time to time, including,
     without limitation, accepting legal representation with respect to such
     claim by an attorney reasonably selected by the Company,

          (3) cooperate with the Company in good faith in order effectively to
     contest such claim, and

          (4) permit the Company to participate in any proceedings relating to
     such claim;

provided, however, that the Company shall bear and pay directly all costs and
expenses (including additional interest and penalties) incurred in connection
with such contest and shall indemnify and hold Executive harmless, on an
after-tax basis, for any Excise Tax or income, employment or other tax
(including interest and penalties with respect thereto) imposed as a result of
such representation and payment of costs and expenses. Without limitation on the
foregoing provisions of this Section 12(c), the Company shall control all
proceedings taken in connection with such contest and, at its sole option, may
pursue or forgo any and all administrative appeals, proceedings, hearings and
conferences with the taxing authority in respect of such claim and may, at its
sole option, either direct Executive to pay the tax claimed and sue for a refund
or contest the claim in any permissible manner, and Executive agrees to
prosecute such contest to a determination before any administrative tribunal, in
a court of initial jurisdiction and in one or more appellate courts, as the
Company shall determine; provided further, that if the Company directs Executive
to pay such claim and sue for a refund, the Company shall advance the amount of
such payment to Executive on an interest-free basis and shall indemnify and hold
Executive harmless, on an after-tax basis, from any Excise Tax or income,
employment or other tax (including interest or penalties with respect to any
such taxes) imposed with respect to such advance or with respect to any imputed
income with respect to such advance; and provided further, that any extension of
the statute of limitations relating to payment of taxes for the taxable year of
Executive with respect to which such contested amount is claimed to be due is
limited solely to such contested amount. Furthermore, the Company's control of
the contest shall be limited to issues with respect to which a Gross-Up Payment
would be payable




                                       12
<PAGE>   13

hereunder and Executive shall be entitled to settle or contest, as the case may
be, any other issue raised by the Internal Revenue Service or any other taxing
authority.

(d) If, after the receipt by Executive of an amount advanced by the Company
pursuant to Section 12(c), Executive becomes entitled to receive, and receives,
any refund with respect to such claim, Executive shall (subject to the Company's
complying with the requirements of Section 12(c)) promptly pay to the Company
the amount of such refund (together with any interest paid or credited thereon
after taxes applicable thereto). If, after the receipt by Executive of an amount
advanced by the Company pursuant to Section 12(c), a determination is made that
Executive shall not be entitled to any refund with respect to such claim and the
Company does not notify Executive in writing of its intent to contest such
denial of refund prior to the expiration of thirty (30) days after such
determination, then such advance shall be forgiven and shall not be required to
be repaid and the amount of such advance shall offset, to the extent thereof,
the amount of Gross-Up Payment required to be paid.

     13. Payment for Options. In the event of a Control Termination of this
Agreement, Executive may elect, within sixty (60) days after such Control
Termination, to receive (in addition to any other amounts owed to Executive
under this Agreement) a lump sum payment in cash equal to the sum of the
following: (i) all or any portion of the number of shares of common stock of the
Company which may be acquired pursuant to options granted by the Company and
held by Executive at the time of such election, multiplied by the Conseco Put
Price; plus (ii) all or any portion of the number of Successor Securities which
may be acquired pursuant to options (which options were granted to Executive in
exchange or substitution for options to acquire the common stock of the Company)
held by Executive at the time of such election, multiplied by the Successor
Security Put Price; plus (iii) the number of shares of common stock of the
Company which were acquired pursuant to options granted by the Company which
were exercised, or which were discharged and satisfied by the payment to
Executive of cash or other property (other than options for Successor
Securities), in connection with the change in control subsequent to the first
public announcement of the transaction or event which led to the change in
control, multiplied by the respective per share exercise prices of such
exercised or discharged options. For purposes of calculating the above lump sum
payment, the options described in clauses (i) and (ii) shall include all such
options, whether or not then exercisable, and, to compensate Executive for the
loss of the potential future speculative value of unexercised options, there
shall not be any deduction of the respective per share exercise prices for any
of the options described in such clauses (i) and (ii). The cash payment due from
the Company pursuant to this Section 13 shall be made to Executive within ten
(10) days after the date of such election hereunder, against the execution and
delivery by Executive to the Company of an appropriate agreement confirming the
surrender to the Company of the options in respect of which the lump sum cash
payment is being made to Executive.

     "Successor Securities" means any securities of any person received by the
holders of the common stock of the Company in exchange, substitution or payment
for, or upon conversion of, the common stock of the Company in connection with a
change in control.

     "Conseco Put Price" means the greater of (i) the Change in Control Price or
(ii) the Current Market Price of the common stock of the Company.





                                       13
<PAGE>   14


     "Successor Security Put Price" means the greater of (i) the Change in
Control Price divided by the Exchange Ratio or (ii) the Current Market Price of
the Successor Securities.

     "Current Market Price" for any security means the average of the daily
Prices per security for the twenty (20) consecutive trading days ending on the
trading day which is immediately prior to Executive's election under this
Section 13.

     "Price" for any security means the average of the highest and lowest sales
price of such security (regular way) on a trading day as shown on the Composite
Tape of the New York Stock Exchange (or, if such security is not listed or
admitted to trading on the New York Stock Exchange, on the principal national
securities exchange on which such security is listed or admitted to trading) or,
in case no sales take place on such day, the average of the closing bid and
asked prices on the New York Stock Exchange (or, if such security is not listed
or admitted to trading on the New York Stock Exchange, on the principal national
securities exchange on which such security is listed or admitted to trading) or,
if it is not listed or admitted to trading on any national securities exchange,
the average of the highest and lowest sales prices of such security on such day
as reported by the NASDAQ Stock Market, or in case no sales take place on such
day, the average of the closing bid and asked prices as reported by NASDAQ, or
if such security is not so reported, the average of the closing bid and asked
prices as furnished by any securities broker-dealer of recognized national
standing selected from time to time by the Company (or its successor in
interest) for that purpose.

     "Change in Control Price" means (i) in the case of a change in control
which occurs solely as a result of a change in the composition of the Board of
Directors of the Company or which occurs in a transaction, or series of related
transactions, in which the same consideration is paid or delivered to all of the
holders of common stock of the Company (or, in the event of an election by
holders of the common stock of the Company of different forms of consideration,
if the same election is offered to all of the holders of common stock of the
Company), the Price per share of the common stock of the Company on the date on
which the change in control occurs, or if such date is not a trading day, then
the trading day immediately prior to such date, or (ii) in the case of a change
in control effected through a series of related transactions, or in a single
transaction in which less than all of the outstanding shares of common stock of
the Company is acquired, the highest price paid to the holders of common stock
of the Company in the transaction or series of related transactions whereby the
change in control takes place. In determining the highest price paid to the
holders pursuant to clause (ii) of the immediately preceding sentence, in the
case of Successor Securities paid or delivered to the holders of common stock of
the Company in exchange, payment or substitution for, or upon conversion of, the
common stock of the Company, the price paid to such holders shall be the Price
of such security at the time or times paid or delivered to such holders.

     "Exchange Ratio" means, in connection with a change in control, the number
of Successor Securities to be paid or delivered to the holders of common stock
of the Company in exchange, payment or substitution for, or upon conversion of,
each share of such common stock.


     14. Character of Termination Payments. The amounts payable to Executive
upon any termination of this Agreement shall be considered severance pay in
consideration of past services




                                       14
<PAGE>   15



rendered on behalf of the Company and his continued service from the date hereof
to the date he becomes entitled to such payments. Executive shall have no duty
to mitigate his damages by seeking other employment and, should Executive
actually receive compensation from any such other employment, the payments
required hereunder shall not be reduced or offset by any such other
compensation.

     15. Grant of Stock Option. On the Approval Date, the Company shall grant to
Executive, a nonqualified stock option under the Code to purchase One Million
Five Hundred Thousand (1,500,000) shares of common stock at the fair market
value per share of common stock on the Effective Date. Such stock option shall
expire ten (10) years after the Approval Date of grant and shall become
exercisable with respect to one-half of the shares covered on the third
anniversary of the Approval Date, with respect to one-quarter of such shares on
the fourth anniversary of the Approval Date and with respect to the remaining
one-quarter of such shares on the fifth anniversary of the Approval Date.

     16. Arbitration of Disputes; Injunctive Relief.

          (a) Except as specified in paragraph (b) below, any controversy or
     claim arising out of or relating to this Agreement or the breach thereof,
     shall be settled by binding arbitration in the City of Indianapolis,
     Indiana, in accordance with the laws of the State of Indiana by three
     arbitrators, one of whom shall be appointed by the Company, one by
     Executive and the third of whom shall be appointed by the first two
     arbitrators. If the first two arbitrators cannot agree on the appointment
     of a third arbitrator, then the third arbitrator shall be appointed by the
     Chief Judge of the United States District Court for the Southern District
     of Indiana. The arbitration shall be conducted in accordance with the rules
     of the American Arbitration Association, except with respect to the
     selection of arbitrators which shall be as provided in this Section.
     Judgment upon the award rendered by the arbitrators may be entered in any
     court having jurisdiction thereof. In the event that it shall be necessary
     or desirable for Executive to retain legal counsel and/or incur other costs
     and expenses in connection with the enforcement of any and all of his
     rights under this Agreement, the Company shall pay (or Executive shall be
     entitled to recover from the Company, as the case may be) his reasonable
     attorneys' fees and costs and expenses in connection with such rights,
     regardless of the final outcome, unless the arbitrators shall determine
     that under the circumstances recovery by Executive of all or a part of any
     such fees and costs and expenses would be unjust.

          (b) Executive acknowledges that a breach or threatened breach by
     Executive of Section 8 of this Agreement will give rise to irreparable
     injury to the Company and that money damages will not be adequate relief
     for such injury. Notwithstanding paragraph (a) above, the Company and
     Executive agree that the Company may seek and obtain injunctive relief,
     including, without limitation, temporary restraining orders, preliminary
     injunctions and/or permanent injunctions, in a court of proper jurisdiction
     to restrain or prohibit a breach or threatened breach of Section 8 of this
     Agreement. Nothing herein shall be construed as prohibiting the Company
     from pursuing any other remedies available to the Company for such breach
     or threatened breach, including the recovery of damages from Executive.





                                       15
<PAGE>   16


     17. Notices. Any notice required or permitted to be given under this
Agreement shall be sufficient if in writing and if sent by certified registered
mail to his residence, in the case of Executive, or to its principal offices in
the case of the Company.

     18. Waiver of Breach and Severability. The waiver by either party of a
breach of any provision of this Agreement by the other party shall not operate
or be construed as a waiver of any subsequent breach by either party. In the
event any provision of this Agreement is found to be invalid or unenforceable,
it may be severed from the Agreement and the remaining provisions of the
Agreement shall continue to be binding and effective.

     19. Entire Agreement. This instrument contains the entire agreement of the
parties. It may not be changed orally, but only by an agreement in writing
signed by the party against whom enforcement of any waiver, change,
modification, extension or discharge is sought. This Agreement supersedes and
replaces all prior employment and compensatory agreements, understandings and
arrangements between Executive and the Company or any subsidiary of the Company.

     20. Binding Agreement and Governing Law. This Agreement shall be binding
upon and shall insure to the benefit of the parties and their successors in
interest and shall be construed in accordance with and governed by the laws of
the State of Indiana. This Agreement is personal to each of the parties hereto,
and neither party may assign nor delegate any of its rights or obligations
hereunder without the prior written consent of the other.





                                       16
<PAGE>   17

     IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first above written.

CONSECO, INC.



By: /s/ Rollin M. Dick                            /s/ Stephen C. Hilbert
    ---------------------------                   ------------------------------
    Rollin M. Dick                                Stephen C. Hilbert

           "Company"                                       "Executive"




                                       17