Does Genworth Negotiate Changes to Policies in Claim Status

[scagnt83]

To: Never A dull... - you are ignorant, naive, an *** or any combination of the three - saw your attachment - anyone who would take what the company issues and buy it should move to planet lala - thank you to those who recognize only a fool doesn't challenge/question how companies got the reported numbers...

I can say my net worth is 16 billion but what is the market value???? degree of liquidity, etc???? Ever hear of domestic captives - the latest in the vehicles being utilized to improve balance sheets for public consumption - too many in sales have no clue as to how to analyze a company and make a judgment on its true financial strength and odds of doing what they profess they will do;

alterning,amending contracts have several components: legal and financial being two but not all and never forget stockholders come first plus it's what we can't or do not see andknow that really matters...

How about we use our time and energy to research companies and find those most likely to deliver on what they promise/sell...


HAGD,

MALinehan

While most of that is true (domestic captives and shady corporate accounting) and goes on plenty.
What NDM spoke of was actual reserves.

An insurance company has to put a certain percentage aside called "reserves" to pay claims from; this is a federal/state regulation.

The reserve account is required to have a high amount of liquidity.


If an insurance company was on the edge of not being able to pay claims or having "cash flow problems" they would be taken over by the state.

Also, if the IC ever did become totally insolvent; the SGA protection would kick in and pay claims up to the insured amount (usually around $300k depending on the state)


An insurance company and their assets is not like a regular corporation, especially when it comes to paying claims and their reserves. Sure they can play some of the same shenanigans; but its only for investors sake, they cant play with the reserves like that.


AIG got bailed out and almost collapsed; the one shinning star under the AIG umbrella was their life company, which was totally solvent and had plenty of offers to be bought.... this was because their reserves were strong.
- - - - - - - - - - - - - - - - - -

Reserves are NOT an asset. Reserves are on the books as a liability because they are nothing more than future claims payments.

Bondholders come second.
Stockholders are last on the list to be paid.

This is insurance 101.

Very true... wait a minute... do Scott and I actually agree on something????

Again, this is were an IC is different than your regular corporate titan; their first and foremost responsibility is to the policyholders, and their financials have to be in order that way.



But in his defense, in the corporate world in most companies the "investors" come first as a general statement, and its hard to disagree with that.

And when the sh*t really hits the fan, everybody takes a haircut... just look at the GM bailout... oh wait.... that wasnt a true free market and true contract provisions... it was a socialist gov intervening in a free market ..... lol
But either way my point is valid.

 

[Arthur Rudnick]

"To: Never A dull... - you are ignorant, naive, an *** or any combination of the three"

​

- - - - - - - - - - - - - - - - - -
"And when the sh*t really hits the fan, everybody takes a haircut"

Not true...............

In 2001, Conseco filed for bankruptcy. At the time, it was the 2nd largest bankruptcy in the country's history.

I had 3 Conseco policyholders on claim at that time. Not one policyholder missed a claim check.

They had the Reserves put aside and not one penny of those funds were used for for anything other than for paying claims.

 

[Mr_Ed]

"To: Never A dull... - you are ignorant, naive, an *** or any combination of the three"

​

- - - - - - - - - - - - - - - - - -

It reminded me of SNL:

 

[VolAgent]

But in his defense, in the corporate world in most companies the "investors" come first as a general statement, and its hard to disagree with that.

Actually, barring government intervention, the owners always come last. And that is what stockholders are, the owners. It secured creditors, unsecured creditors, employees and finally shareholders in the normal world.

 

[retread]

See attached.

Thanks for the attached info. Interesting: both John Hancock and Genworth had major restructuring in 2004. JH being bought by Manulife and GE spinning off Genworth.

The Genworth publication does not mention they came into existence in 2004, rather harks back to the history of one of GE's subsidiaries that was amalgamated into "Genworth".

Also, it seems to me they walk a fine line by discussing the Guaranty Association in their marketing material. I'm surprised they have not been sanctioned for this.

I realize this is "nit-picking"... and I realize most companies do this to promote themselves... but I would prefer they just stated the facts, rather than embellish. This would establish an ethic.

 

[Mr_Ed]

Thanks for the attached info. Interesting: both John Hancock and Genworth had major restructuring in 2004. JH being bought by Manulife and GE spinning off Genworth.

The Genworth publication does not mention they came into existence in 2004, rather harks back to the history of one of GE's subsidiaries that was amalgamated into "Genworth".

Also, it seems to me they walk a fine line by discussing the Guaranty Association in their marketing material. I'm surprised they have not been sanctioned for this.

I realize this is "nit-picking"... and I realize most companies do this to promote themselves... but I would prefer they just stated the facts, rather than embellish. This would establish an ethic.

Retread,

An insurance company's history does not start when it is purchased by a holding company.

To be frank, the holding company is essentially meaningless.

 

[retread]

LTC insurance was not sold by Viginia Life or whoever until GE pioneered it, if I am not mistaken.

I just had a "deja-vue" moment... IIRC GNW was trading at a low of $0.70 last quarter of 2007. The fact that they are at about $10 now (3 1/2 years later) is amazing, but if you look at their performance over time, they are still scary. I grant you, with the economy as it is, a lot of companies are in scary situations.... but their YTD high was about $14 just 6 months ago and have been going downhill all year. Seems to be a repeat of 2010. How much more volatility will it take to put them in a hole they can't get out of?

The point really is: Are any LTC insurance companies going to make it? It seems like they are not making much profit. That, I understand, was the reason GE spun off Genworth.

 

[Arthur Rudnick]

Scott,
Retread does make 2 good points:

1) Genworth claims that they go back over 30 years in the LTC business. As far as I know, the word "Genworth" didn't exist prior to 2004.
2) Not sure how their marketing brochure can mention the state guarantee fund. As agents, we've been told that we can't mention those words in order to sell or market a policy. It can only be brought up if we're questioned about it.

Genworth had to have that piece approved by the appropriate DOIs. Not sure how they can get away with that.

 

[Mr_Ed]

LTC insurance was not sold by Viginia Life or whoever until GE pioneered it, if I am not mistaken.

I just had a "deja-vue" moment... IIRC GNW was trading at a low of $0.70 last quarter of 2007. The fact that they are at about $10 now (3 1/2 years later) is amazing, but if you look at their performance over time, they are still scary. I grant you, with the economy as it is, a lot of companies are in scary situations.... but their YTD high was about $14 just 6 months ago and have been going downhill all year. Seems to be a repeat of 2010. How much more volatility will it take to put them in a hole they can't get out of?

The point really is: Are any LTC insurance companies going to make it? It seems like they are not making much profit. That, I understand, was the reason GE spun off Genworth.

Retread,

Genworth Life Ins. Co. is not traded on any stock exchange.

We addressed this almost 4 years ago.

Go back and re-read:


Is Genworth LTCi Block At Risk?


nadm

 

[retread]

Retread,

Genworth Life Ins. Co. is not traded on any stock exchange.

We addressed this almost 4 years ago.

Go back and re-read:


Is Genworth LTCi Block At Risk?


nadm

I did, that's where I got my "deja-vue" moment!

I realize that Genworth Financial is the holding company and Genworth Life manages the LTC product.... It is just that, in my mind, if you starve the head, you starve the whole body. Eventually, if GNW goes down, the subsidiary insurance companies will have to be sold off, and hopefully, someone will buy them. In the meantime, reserves will protect claims.... but what about premiums, new business, etc.?

I'm no financial guru... I don't even have a business major, much less a series 6/7 or whatever. I'm just asking questions, not giving advice.