UPDATE: CEO's Blood-Alcohol Level Almost 3 Times The Limit--Police

Louis Lower, the insurance company executive found guilty of drunk driving in Florida last week, had "difficulty standing," was "swaying in all directions" and later fell to the ground as police investigated the May 29 car crash that led to his arrest, according to police records.

Lower, chief executive of Horace Mann Educators Corp. (HMN), refused to take a field sobriety test or submit to a police breathalyzer after he drove on the wrong side of the road and crashed head-on into another car in Vero Beach, Fla., according to the police file. He insisted instead on having a lawyer present.

When police obtained a search warrant from a judge to test his blood more than three hours later, a laboratory found he had a blood-alcohol content of 0.21 -- nearly three times the legal limit.

Lower struck an oncoming Chevrolet Tahoe after a "sudden swerve," causing about $30,000 worth of damage to the two vehicles, according to the report. Two teenagers in the other car reported they were uninjured at the scene.

Police said Lower smelled strongly of alcohol and initially had a "blank stare" when they approached him after the crash. Later, "Lower lost his balance and fell against his vehicle and then on the ground."

Lower's arrest came to light Monday, when the board of directors at Horace Mann announced they had learned Lower was in a Florida jail. He declined to enter a plea, was found guilty and was given a 60-day sentence on Sept. 8. He began serving the sentence in a county jail that day.

Lower had told some company executives about his arrest in mid-July, but the board was first notified of the incident after he was convicted, a company spokesman said Monday. The board decided to put Lower on leave over the weekend, and announced the news after the close of trading Monday.

"It's a shocking turn of events," said Dean Evans, an insurance analyst at Keefe, Bruyette & Woods. "I find it a little strange that it took that long to bring this to the attention to the board. It's a unique, strange one-off situation...but this can't be glossed over or taken lightly."

David Dodd, a prosecutor in the judicial circuit covering Vero Beach, said he felt the sentence was appropriate for several reasons, including the seriousness of the crash and Lower's high blood-alcohol level. Also, he said, prosecutors took into account the fact that Lower "was not cooperative at the scene" when he refused to perform basic exercises such as touching his nose and giving a breath sample after being informed that, under Florida law, any driver on its road implicitly agrees to such tests.

Along with the jail time, Lower will be on probation until next September, must pay a $1,000 fine and court costs and must abstain from alcohol while on probation, among other conditions.

Lower's lawyer in the matter, Andrew Metcalf, argued for some combination of a probationary sentence and house arrest. "He's a decent and good man with absolutely no history of anything remotely related to this drunk-driving offense," Metcalf said. "He took accountability and responsibility."

Lower is scheduled to be released on Oct. 26, according to the website of the Indian River County sheriff. Horrace Mann, in a statement that referred to a "situation" involving its CEO, said late Monday that the board was considering whether to impose further disciplinary actions on Lower.

Still, the statement said, Lower is expected to return to his job in late October or November. Chief Financial Officer Peter Heckman will serve as interim CEO.

"There are no excuses to offer other than a lapse of personal character for which I take full responsibility," Lower said in the company's statement. The statement said it was Lower's first offense.

Horace Mann, based in Springfield, Ill., sells auto, home and life insurance to teachers.

Lower has been Horace Mann's CEO since 2000. He was previously CEO of Allstate Corp.'s (ALL) life-insurance operation, and serves as a board member of mortgage insurer PMI Group Inc. (PMI).

Bill Horning, a spokesman for PMI, didn't respond to several phone calls and voicemail messages seeking comment Monday and Tuesday.

Horace Mann shares fell 0.8% to $17.63 on Tuesday on more than twice the average volume. The stock earlier in the day fell to as low as $16.92.

-By Erik Holm, Dow Jones Newswires; 212-416-2892; [e-mail]