Long-term care and mortgage insurer Genworth Financial received 11 long-term care rate increase approvals from eight states in the first quarter of 2017, the company said.
The rate filings represent a weighted-average increase of 22 percent on about $98 million in annualized in-force premiums, the company said.
In addition, the company submitted 18 new rate filings in 18 states in the first quarter on about $24 million in annualized in-force premiums, Genworth said.
Many rate increases apply to older policies written before 2002, but the company said it plans to raise rates on newer policies.
“We are also requesting premium rate increases on newer blocks of business, as needed, some of which may be significant,” the company said.
As part of Genworth’s strategy to cut costs and return to profitability, the company announced in February 2016 that it would suspend sales of traditional life insurance and fixed annuity products.
The company also announced the suspension of older, underpriced long-term care policies in some states.
New sales of Privileged Choice Flex 2 were suspended last month in Hawaii, for example. Stabilizing Genworth’s long-term care insurance business remains a long-term goal.
“We will continue to execute against this objective primarily through our multi-year long-term care insurance rate action plan,” the company said.
Genworth Delivers 1Q Earnings Beat
On Tuesday, the Richmond-Va.-based company reported first-quarter net income of $155 million.
On a per-share basis, the company said it had net income of 31 cents. Earnings, adjusted for one-time gains and costs, were 29 cents per share.
The financial services company posted revenue of $2.17 billion in the first quarter. Its adjusted revenue was $2.14 billion.
The company did not hold an earnings conference call with analysts this quarter.
The last few years have been difficult ones for Genworth and the long-term care market as insurers struggle with low interest rates.
Some Wall Street analysts have even questioned whether it is possible for long-term care insurers to remain profitable.
In response to the challenges, insurers have suspended sales, raised prices on new and in-force policies or pulled out altogether.
Last year, Genworth announced its sale to China Oceanwide in exchange for a large capital infusion to be used to reduce Genworth’s debt obligations.
InsuranceNewsNet Senior Writer Cyril Tuohy has covered the financial services industry for more than 15 years. Cyril may be reached at [email protected]
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