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GE · Forward model · Insurance (run-off) · Culp 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 $481.20 all other verticals held in this portfolio case
Final-quarter revenue $475M 2% of company revenue
Explicit segment contribution $2.41B EBITDA less segment capex, before corporate items

Culp's own framing, taken literally: the constraint is material input, not demand, and the job is converting a backlog of more than $210 billion. Supplier material input rose double digits both sequentially and year on year, orders were $16.5 billion in the quarter, and the contracted services backlog alone is $178,705m with only 12% of it due inside a year. If supply keeps loosening at this pace the backlog converts faster than any guided growth rate implies. At 1.8 points a quarter of extra growth, 1.8 points of margin and a 27x exit, fair value is $481.20, 43.3% above the traded price. What it does not do is make the exit multiple conservative: 27x is above every large-cap aerospace comparable except Heico, and stripping it back to the base case's 20x removes about $75 a share of this case on its own.

Insurance (run-off)

Basis quarter$715M
Final quarter$475M
Implied CAGR−8%
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: $475M (2031Q2E)

Period Value
2026Q1 $778M
2026Q2 $715M
2026Q3E $695M
2026Q4E $677M
2027Q1E $659M
2027Q2E $643M
2027Q3E $628M
2027Q4E $614M
2028Q1E $601M
2028Q2E $588M
2028Q3E $576M
2028Q4E $565M
2029Q1E $554M
2029Q2E $543M
2029Q3E $534M
2029Q4E $524M
2030Q1E $515M
2030Q2E $506M
2030Q3E $498M
2030Q4E $490M
2031Q1E $482M
2031Q2E $475M

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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