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GE · Forward model · Insurance (run-off) · Bull case

What has to happen in Insurance (run-off)

Model as of

This page changes Insurance (run-off) inside the complete GE model. Every other vertical, corporate programme and valuation assumption stays in the selected portfolio case.

GE forward model
Horizon
Consolidated fair value $394.49 all other verticals held in this portfolio case
Final-quarter revenue $422M 2% of company revenue
Explicit segment contribution $2.23B EBITDA less segment capex, before corporate items

The guided second-half deceleration does not happen. GE guided low double digits for 2026 as recently as January and delivered 27% adjusted revenue growth in the first half; it beat the Street's adjusted revenue by 6.5% and adjusted EPS by 8.6% in the very quarter it raised guidance. First-half CES services revenue grew 32%, and the LEAP-1B durability kit is certified with roughly double the time-on-wing and full cutover from the beginning of 2027, which raises the value of each shop visit and lengthens the annuity behind it. Add 1.2 points a quarter of growth and 1.2 points of margin, exit at 25x, and fair value is $394.49 - 17.5% above the traded price. What this case does NOT reach is the tape's implied 28.0x exit on the base path: even here the multiple has to stay a full turn above the aerospace peer band.

Insurance (run-off)

Basis quarter$715M
Final quarter$422M
Implied CAGR−10%
Final revenue mix2%

A closed long-term care and structured settlement reinsurance book GE has written no new business in for decades and excludes from its own adjusted revenue. It is not an operating business; it is a liability that still passes revenue and a little profit through the income statement while it shrinks. It has to be modelled because GAAP total revenue - the basis of every series on this site - includes it.

Last four quarters
2026 Q1 $778M Reported
2026 Q2 $715M Reported
Run-off long-term care and structured settlement reinsurance premiums and investment income
Sequential growth −4.5%/qtr decaying toward −3.0% Run-off: $715m against $872m a year earlier, an 18% annual decline, is -4.8% a quarter.
Insurance (run-off)

Latest: $422M (2031Q2E)

Period Value
2026Q1 $778M
2026Q2 $715M
2026Q3E $691M
2026Q4E $669M
2027Q1E $648M
2027Q2E $628M
2027Q3E $610M
2027Q4E $593M
2028Q1E $576M
2028Q2E $561M
2028Q3E $546M
2028Q4E $532M
2029Q1E $519M
2029Q2E $506M
2029Q3E $494M
2029Q4E $483M
2030Q1E $471M
2030Q2E $461M
2030Q3E $450M
2030Q4E $440M
2031Q1E $431M
2031Q2E $422M

Assumptions & reasoning

  • The 23.9% EBITDA margin is not an estimate: it is the disclosed Insurance profit of $171m over the disclosed Insurance revenue of $715m in the basis quarter. It is held flat because a closed book's margin is set by reserve development, not by operations, and GE gives no forward view of it.
  • Capex is exactly zero. A run-off insurance book buys no property, plant or equipment, and GE excludes this line from operating profit altogether - which is why the model's operating-profit cross-check against guidance strips it out again.
  • This line is shrinking about 18% a year and quietly subtracts roughly half a point from consolidated revenue growth every year, which is precisely why GE reports adjusted revenue without it and why consensus comparisons must strip it out too.
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