On Thursday, the 7th of March 2019, the General Electric Co., an American multinational conglomerate, headquartered in Boston, said that their current reserves for long-term insurances were sufficient and they had been exploring options of increasing premiums in order to cover their raising expenses.
In a presentation last week, the Boston-based conglomerate said that they had achieved a lump-sum of $500 million worth of premium increases and had been pressing for a further raise up to as little as $1.2 billion to cover losses of about 3,00,000 long-term care insurance policies, which had been supporting costs of in-home as well as nursing home care.
As the US conglomerate has been attempting a histrionic breakthrough under its new Chief Executive, Larry Culp, to curb losses, restore profits and surge share prices, insurance losses were among major problems the 127-year-old company had met in recent past.
Apart from the insurance losses, the General Electric Co.’s powerplant business had been draining cash and experiencing major issues over declined sales and technical glitches, as the company had been exploring stake selling options to pay-off its copious debt-pile.
Since 2018, General Electric had reduced the amount of insurance reserves it planned to put aside to $14.5 billion over the next five years, although analysts were saying that the GE might need to double the amount, as the assumptions were used to calculate the figures had been highly optimistic.