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Old 11-02-2012, 10:18 AM   #1
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Genworth Reports Higher LTCI Sales, Profits Genworth Reports Higher LTCI Sales, Profits
By Allison Bell

Genworth Financial (NYSE:GNW) says its long-term care insurance (LTCI) unit did well in the third quarter.

The Genworth Long Term Care unit is reporting $45 million in net operating income for the latest quarter on $809 million in revenue, up from compared with $17 million in net operating income on $785 in revenue for the third quarter of 2011.

In spite of the continuing low interest rate environment, net investment income increased to $266 million, from $244 million. Excluding the effects of unusual adjustments, the LTCI loss ratio increased to 74 percent, from 71 percent. "Claim termination rates were favorable versus the prior quarter from higher mortality and recoveries, offset in part by a higher average reserve cost on new claims," the company said.

Individual LTCI sales increased to $63 million, from $54 million.

Group LTCI sales rose to $6 million, from none.

LTCI sales were up because consumers were responding to pricing and portfolio actions that were announced in July. "Sales levels are expected to moderate in the fourth quarter," the company said in a discussion of its earnings.

The company reported that it already has implemented a previously announced 18 percent premium rate increase on a majority of the older LTCI policies. On Sept. 30, the company had received approvals for the increases in 45 states.

This year, the company announced another round of rate increases that will average 50 percent on older LTCI policies and 25 percent on "an earlier generation of new generation" policies.

The new round of increases should help offset the effects of low interest rates, an unfavorable business mix and a lower-than-expected lapse rate. On Oct. 26, the company had filed those rate increases in 18 states and received approvals from two states.

The company as a whole is reporting $70 million in net income on $2.5 billion in revenue, compared with $20 million in net income on $2.5 billion in revenue for the comparable quarter in 2011.

During a conference call with analysts, Martin Klein, the company's acting president, said Genworth thinks of meeting long-term care (LTC) planning needs as a core activity.

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Arthur Rudnick, LTCP, CLTC
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Old 11-02-2012, 11:08 AM   #2
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Genworth Reports Higher LTCI Sales, Profits Re: Genworth Reports Higher LTCI Sales, Profits
This is positive news. I hope it will continue.
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Old 11-02-2012, 07:02 PM   #3
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Genworth Reports Higher LTCI Sales, Profits Re: Genworth Reports Higher LTCI Sales, Profits
Do we get renewals on the premium increase??
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Old 11-06-2012, 07:54 AM   #4
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Genworth Reports Higher LTCI Sales, Profits Re: Genworth Reports Higher LTCI Sales, Profits
Originally Posted by csalter View Post
This is positive news. I hope it will continue.
Being a consumer of said product I get that it is good news that they are doing good with the line. But how can you read this and not feel slapped in the face?

"This year, the company announced another round of rate increases that will average 50 percent on older LTCI policies and 25 percent on "an earlier generation of new generation" policies."

They are making good profits and still feel the need for outrageous price increases. Shows who they care about more... stockholders >>>> policyholders.
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Old 11-06-2012, 08:11 AM   #5
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Genworth Reports Higher LTCI Sales, Profits Re: Genworth Reports Higher LTCI Sales, Profits
Business's exist to make money. It's free enterprise. The government is exactly the opposite. The government consumes money (from businesses that make money) and spends it, but never creates it. (except of course when it prints more, which is not the way money is intended to be made.)

If a business does not make a profit, it will cease to exist. The more businesses operating profitably, the more choices the consumer has.

An insurance company must not only make money each quarter to enable it to stay in business, but also must have provisions for plans that are effected by uncontrollable circumstances caused by the government's lack of planning and bad fiscal policies.

Business can not do all the things the consumer wants all the time, regardless of the cost. The government can.

Where all this leads, God only knows.
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Old 11-06-2012, 08:13 AM   #6
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Genworth Reports Higher LTCI Sales, Profits Re: Genworth Reports Higher LTCI Sales, Profits
Originally Posted by Chuckles21 View Post
Being a consumer of said product I get that it is good news that they are doing good with the line. But how can you read this and not feel slapped in the face?

"This year, the company announced another round of rate increases that will average 50 percent on older LTCI policies and 25 percent on "an earlier generation of new generation" policies."

They are making good profits and still feel the need for outrageous price increases. Shows who they care about more... stockholders >>>> policyholders.
I also look at it this way. A healthy profit making company that can sustain itself is a good thing so that it will be around to pay my claims in 30 plus years. With 10 pay I hope if there will be increases, it won't happen more than once if anything before the policy is paid up.
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Old 11-06-2012, 10:27 AM   #7
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Genworth Reports Higher LTCI Sales, Profits Re: Genworth Reports Higher LTCI Sales, Profits
Originally Posted by billberry12 View Post
Business's exist to make money. It's free enterprise. The government is exactly the opposite. The government consumes money (from businesses that make money) and spends it, but never creates it. (except of course when it prints more, which is not the way money is intended to be made.)

If a business does not make a profit, it will cease to exist. The more businesses operating profitably, the more choices the consumer has.

An insurance company must not only make money each quarter to enable it to stay in business, but also must have provisions for plans that are effected by uncontrollable circumstances caused by the government's lack of planning and bad fiscal policies.

Business can not do all the things the consumer wants all the time, regardless of the cost. The government can.

Where all this leads, God only knows.
Well of course they are in business to make money. I just feel it is a slap in the face to tout all this profitability and then do 50% rate increases. Especially on a product where most of these people don't have the option to get something else so they are stuck with limited options. Is it their right, of course, I just don't like it.
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Old 11-06-2012, 09:00 PM   #8
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Genworth Reports Higher LTCI Sales, Profits Re: Genworth Reports Higher LTCI Sales, Profits Arthur Rudnick is the thread starter for: Genworth Reports Higher LTCI Sales, Profits

previously posted by chuckles21

They are making good profits and still feel the need for outrageous price increases. Shows who they care about more... stockholders >>>> policyholders.
It has ALWAYS been about the shareholders. Whether it's the family bodega or a major corporation. Such is life in the corporate world.

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Old 11-07-2012, 09:26 PM   #9
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Genworth Reports Higher LTCI Sales, Profits Re: Genworth Reports Higher LTCI Sales, Profits
Originally Posted by billberry12 View Post
Do we get renewals on the premium increase??
Of course not, Bill.
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Old 11-13-2012, 02:40 AM   #10
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Genworth Reports Higher LTCI Sales, Profits Re: Genworth Reports Higher LTCI Sales, Profits
It's my understanding that agents WILL get renewal commissions on the increased premium. Genworth understands there will be a lot of work the agent has to do to field all of those calls from unhappy clients.
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