Insurance Daily News

Genworth Financial CEO Tom McInerney to Retire

Genworth Financial has announced that chief executive Tom McInerney will step down from his role and depart the board on December 31. McInerney, who has led the company for 14 years, will be succeeded by Jerome Upton, the current chief financial officer. The board intends to appoint Upton as president, CEO, and a member of the board. Additionally, Angela Simmons, who has served as CFO of the company's closed block since 2020, is expected to transition into the role of executive vice president and CFO.

McInerney’s tenure was largely defined by the management of Genworth’s legacy long-term care insurance portfolio, which ranks among the largest in the United States. The company previously struggled with significant losses after underestimating policyholder longevity and the rising costs of care, necessitating frequent applications to state regulators for premium hikes. McInerney cited the strengthening of the company’s financial foundation, the return of capital to shareholders, and the launch of the care services business, CareScout, as key accomplishments during his time at the firm.

The incoming CEO, Jerome Upton, has been with Genworth and its predecessor organizations since 1998, holding various operational and finance positions. According to board chair Melina Higgins, Upton has worked in close collaboration with McInerney to enhance the company’s operating and financial standing. Simmons is credited with maintaining the self-sustaining nature of the closed block, ensuring it functions independently from the rest of the company’s operations.

This leadership transition signals a commitment to continuity regarding the management of Genworth’s legacy long-term care policies. For industry observers, the company’s history serves as a reminder of the complexities involved in pricing long-tail health risks. As newer market participants develop products with more conservative underwriting assumptions, the ongoing management of these older, legacy policies remains a critical area for advisors and policyholders to monitor, particularly regarding future premium adjustments and benefit reduction strategies.

Why it matters

The internal promotion of the CFO suggests that Genworth will maintain its current strategy for managing its legacy long-term care block, which remains a key area of concern for advisors and policyholders navigating premium adjustments.

FAQ

Who will replace Tom McInerney as CEO?
The board expects to name Jerome Upton, who has served as Genworth’s CFO since March 2023, as the new president and CEO.

What is the status of Genworth's legacy long-term care business?
The legacy business, which is part of a closed block, has faced years of losses due to underestimated policyholder longevity and care costs, leading to repeated requests for premium increases.

What role will Angela Simmons play in the new leadership structure?
Angela Simmons is expected to become the executive vice president and CFO.

Source: Insurance Business America. See the original source for full details.