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Genworth Posts LTCI Rate Hike Update

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Genworth Financial Inc. today told investors it’s continuing to get approvals from state insurance regulators for substantial long-term care insurance (LTCI) rate increases.

The Richmond, Virginia-based insurer said it had received approvals for 75 increases by Sept. 30. That compares with an LTCI rate increase approval total of 96 for all of 2016, and 69 approvals for all of 2015.

(Related: Saving LTCI and 9 Other Top Treasury Life and Annuity Projects)

Genworth included the rate increase approval data in a slide it presented today at the company’s 2017 annual meeting.

Investors have been concerned about whether Genworth has been able to increase LTCI premiums enough, and quickly enough, to compensate for the effects of low interest rates and inaccurate assumptions about policyholder behavior.

The increases approved during the first three quarters of the year affected $457 million in in-force premium.

The increases approved in 2016 affected a total of $719 million in in-force premium.

But the weighted average size of the increases approved so far this year have been similar to the size of the increases approved in the past two years.

The average increase has edged lower, to 27%, from 29% in 2016, and from 29% in 2015.

Genworth filed 131 increase requests, potentially affected $828 million in-force premium, during the first three quarters of this year.

The company filed 79 increase requests, affecting $834 million in in-force premium, in 2016, and 79 increase requests, affecting $546 million in premiums in 2015. 

—Read Genworth Talks About May 2018 on ThinkAdvisor.

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