Genworth Financial Inc. (GNW), the biggest seller of long-term care coverage, paid Chief Executive Officer Tom McInerney $12 million for his first year on the job as the insurer’s stock doubled.
The package included a $3 million bonus, $7.06 million of stock options and a salary of almost $1 million, the insurer said today in a regulatory filing.
Profit has been recovering at Genworth as the insurer raises prices for long-term care policies and a recovery in home values bolsters the mortgage-insurance unit. McInerney, 57, started on Jan. 1, 2013 and announced 400 job cuts in June that the company said will save it as much as $90 million annually.
“We expect the company to generate strong earnings growth and return on equity expansion over the next few years,” Suneet Kamath, an analyst at UBS AG, said in a March 19 research note. Genworth “is positioned to begin returning capital to shareholders in the year ahead.”
Genworth advanced 17 percent this year through yesterday. The Richmond, Virginia-based firm jumped 107 percent in 2013. McInerney, a former executive at ING Groep NV, joined Genworth from Boston Consulting Group, where he served as an adviser. Genworth said McInerney’s target bonus was $2 million when the firm hired him.
He replaced Michael Fraizer, who departed on May 1, 2012, after overseeing a share decline of more than 80 percent since 2006. Fraizer got a $2.25 million payment after he resigned from the insurer.
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