Genworth Financial Inc. ( GNW - Analyst Report ) reported fourth-quarter 2012 operating income of 18 cents per share. The result missed the Zacks Consensus Estimate of 26 cents and was 28% below the year-ago level.

Including a favorable adjustment of $78 million associated with the finalization of the new Government Guarantee framework in Canada, net income came in at 34 cents, up 17% year over year.

The fourth-quarter results benefited from better performances at Global Mortgage Insurance and U.S. Life Insurance.

Quarterly Operational Performance

Genworth’s total revenues increased 3.3% year over year to $2.54 billion in the quarter. Top line improved primarily due to net investment gains. It was almost in line with the Zacks Consensus Estimate.

Premium revenue at Genworth declined 2.5% year over year to $1.3 billion in the quarter.

Net investment income improved 1.6% year over year to $840 million.

Full Year highlights

Net income 2012 was 65 cents, much ahead of 10 cents earned in 2011.

Total revenues decreased 3.3% year over year to $2.54 billion in the quarter.

Quarterly Review by Segment

In the beginning of the fourth quarter of 2012, the company changed its financial presentation for divisions. Now, it operates through three divisions: U.S. Life Insurance, Global Mortgage Insurance and Corporate and Other.

U.S. Life Insurance: Net operating income dipped 19.1% year over year to $76 million.

Genworth closed its second life block transaction in the fourth quarter of 2012. The transaction generated more than $175 million in initial after-tax capital benefits for U.S. life insurance.

Global Mortgage Insurance: The segment’s net operating income of $131 million in the quarter recovered from a loss of $13 million in the year-ago quarter. A substantially lower loss at U.S. Mortgage Insurance and higher income from International Mortgage Insurance aided the improvement.

Corporate and Run-Off: Net operating loss was $40 million in the quarter under review, compared with an operating income of $43 million in the prior-year period.

Financial Update

Genworth exited the 2012 with cash, cash equivalents and invested assets of $78.7 billion, up nearly 2.3% from 2011-end.

Genworth’s long-term borrowings stood at $4.8 billion at quarter end, up 1.1% from 2011-end level.

Performance of few other Life Insurers

StanCorp Financial Group Inc. ( SFG - Analyst Report ) reported fourth-quarter 2012 operating earnings of 89 cents per share, which exceeded the Zacks Consensus Estimate of 83 cents and 85 cents earned in the prior-year quarter.

Reinsurance Group of America Inc. ( RGA - Analyst Report ) reported fourth-quarter 2012 operating earnings of $2.44 per share, significantly ahead of the Zacks Consensus Estimate of $1.80 per share. Earnings were also up by 48.8% on a year-over-year basis

Zacks Rank

Genworth currently carries a Zacks Rank #3 (Hold). Manulife Financial Corporation ( MFC - Analyst Report ) , another life insurer with a Zacks Rank #2 (Buy), is scheduled to release its fourth-quarter results on Feb 7.