Genworth Financial boosting LTCi prospects via CareScout, rate hikes

Genworth Financial made giant positive steps in 2025 toward reclaiming its positioning in the troubled long-term care insurance market.

The insurer is executing on a multi-pronged plan to revitalize its LTC business through its CareScout subsidiary. Activity ramped up in recent weeks, with CareScout bringing its first standalone LTC product to market.

CareScout Care Assurance is now approved in 37 states, with more approvals pending, CEO Tom McInerney said Thursday on a conference call with Wall Street analysts.

“This marks a foundational milestone for CareScout's insurance business," he added. "Our next product will be an innovative hybrid LTC design that pairs a minimum LTC benefit with low-cost equity funds for accumulation.”

A leader in the LTC market for several decades, Genworth faced significant losses in the 2010s due to actuarily unsound policies and increasing claims. The insurer pursued major rate increases and financial restructuring, part of long-term strategies to stabilize its in-force block.

McInerney touched on several other initiatives during the quarterly earnings call:

• CareScout is acquiring the senior living platform and adviser network Seniorly in a $20 million transaction expected to close during Q4. Seniorly’s platform connects families to more than 3,000 senior living communities through a network of local advisers.
• A new Care Plans product, launched in the second quarter, “continues to gain momentum,” McInerney said. For a fee of $250, consumers receive a virtual evaluation with a licensed nurse and a personalized care plan outlining aging strategies and local resources. An in-person evaluation option is being added during the fourth quarter.
• Genworth is also advancing worksite and association group offerings to “broaden distribution through employers and other partners,” McInerney explained, “and we hope to bring these products to market in the near term.”

In Other News

Rate-increase activity. Chief Financial Officer Jerome T. Upton gave an update of ongoing rate hike activity. Through Q3, Genworth received a collective $31.8 billion of enforced rate actions on a net present value basis, he said. Rate increase approvals this year have been lower than recent years.

“We do anticipate higher approvals in the fourth quarter,” Upton said. “As part of the [rate hikes], we offer a suite of options to help policyholders manage premium increases while maintaining meaningful coverage and to enable us to reduce our exposure to certain higher cost-benefit features, such as 5% compound benefit inflation options and large lifetime benefit amounts.”

The insurer is reducing its risk in other “innovative” ways, Upton said, including through the CareScout Quality Network and our Live Well, Age Well intervention program. Genworth is “committed” to managing the life insurance companies as “a closed system,” Upton said, leveraging existing reserves and capital to cover future claims.

But the LTC rate crisis is far from over, he said.

“We continue to see claims go up, and we continue to see pressure from benefit utilization,” Upton said. “There is no doubt there is pressure from a long-term care perspective because of the claims. Those claims will continue to increase over the next several years because we have some large blocks that are maturing.”

Enact. Genworth’s third-quarter results were boosted by strong performance from Enact, its mortgage insurance subsidiary, which contributed $134 million to overall adjusted operating income.

Enact recorded net investment income of $68 million, up from $62 million in the prior year, supported by higher yields and increased invested assets. Primary insurance in-force for Enact rose 2% from the prior-year quarter to $272.3 billion.

Quarterly Snapshot

• Delivered 950 matches with home care providers in the CareScout Quality Network in the quarter with over 95% home care coverage of the aged 65-plus census population in the United States.
• Life insurance companies reported a risk-based capital ratio of 303%, down slightly from the prior quarter.
• Net investment gains, net of taxes, increased net income by $78 million in the quarter, compared with net investment losses of $22 million in the prior quarter and net investment gains of $52 million in the prior year.
• Reported "favorable" mortality results in both the life insurance and annuities segments.

Management Perspective

“Santander's request for an appeal in the AXA-Santander litigation has been granted. If the appeal is favorably resolved, Genworth still expects to recover at that time approximately $750 million, subject to movements in foreign exchange rates. We do not expect to pay taxes on this recovery.”

CFO Jerome T. Upton on a litigation award announced last quarter

By The Numbers

• Revenue: $1.94 billion ($1.88 billion in Q3 2024)
• Net Income: $116 million ($85 million in Q3 2024)
• Adjusted Operating Income: $17 million ($48 million in Q3 2024)
• Earnings Per Share: 4 cents per share (11 cents in Q3 2024)
• Share Repurchases: $76 million in Q3 2025
• Stock Price Movement: Shares level at $8.60 on Friday morning

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InsuranceNewsNet Senior Editor John Hilton has covered business and other beats in more than 20 years of daily journalism. John may be reached at [email protected]. Follow him on Twitter @INNJohnH.