Genworth to Launch Senior Care Provider Network Business
What You Need to Know
The Genworth long-term care insurance business recorded a profit in the fourth quarter.
The company says it is now healthy enough to use some of its cash to buy back shares of its own stock.
To return to selling new long-term care insurance, it needs a higher rating.
Genworth Financial is preparing to start a fee-based senior care services business by July 1.
The new CareScout business will start by offering clients help with finding nursing homes, assisted living facilities and other resources.
CareScout is setting up a “preferred network of quality senior care providers,” Genworth CEO Thomas McInerney told securities analysts Tuesday, during a conference call the company held to go over earnings for the fourth quarter of 2022.
McInerney said Genworth could resume writing new long-term care insurance or other types of long-term care funding arrangements by 2024, if the company can increase its ratings to A-. Today, its highest-rated life insurer, Genworth Life and Annuity Insurance Company, has a B- rating.
What It Means
Genworth’s return to the long-term care market could increase clients’ awareness of and interest in long-term care planning.
It could also raise questions about the cost and stability of older long-term care insurance policies.
Genworth
Genworth is a Richmond, Virginia-based insurer descended from the GE Capital insurance operations. It was a large life insurance and annuity issuer and one of the major players in the U.S. long-term care insurance market.
The company continues to sell some long-term care insurance business, and its Enact affiliate is a major player in the mortgage insurance market.
Genworth ran into financial problems because of problems with designing and pricing long-term care insurance policies, and it gives detailed notes about its efforts to increase long-term care insurance premiums when it releases its quarterly earnings.
The Earnings
Genworth reported $202 million in net income for the latest quarter on $1.9 billion in revenue, up from $192 million in net income on $1.7 billion in revenue for the fourth quarter of 2021.
The long-term care insurance business is reporting $24 million in adjusted operating income on $1.1 billion in revenue, compared with $119 million in net income on $1.3 billion in revenue for the year-earlier quarter.
