1276520--2/27/2006--GENWORTH_FINANCIAL

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Risks Relating to Our Businesses Interest rate fluctuations could adversely affect our business and profitability. Downturns and volatility in equity markets could adversely affect our business and profitability. Defaults in our fixed-income securities and commercial mortgage loan portfolio may reduce our earnings. A downgrade or a potential downgrade in our financial strength or credit ratings could result in a loss of business and adversely affect our financial condition and results of operations. The ratings of our insurance subsidiaries are not evaluations directed to the protection of investors in our securities. If our reserves for future policy claims are inadequate, we may be required to increase our reserve liabilities, which could adversely affect our results of operations and financial condition. As a holding company, we depend on the ability of our subsidiaries to transfer funds to us to pay dividends and to meet our obligations. Some of our investments are relatively illiquid. Intense competition could negatively affect our ability to maintain or increase our market share and profitability. We may be unable to attract and retain independent sales intermediaries and dedicated sales specialists. Reinsurance may not be available, affordable or adequate to protect us against losses. If the counterparties to our reinsurance arrangements or to the derivative instruments we use to hedge our business risks default or fail to perform, we may be exposed to risks we had sought to mitigate, which could adversely affect our financial condition and results of operations. Fluctuations in foreign currency exchange rates and international securities markets could negatively affect our profitability. Our insurance businesses are heavily regulated, and changes in regulation may reduce our profitability and limit our growth. Legal and regulatory investigations and actions are increasingly common in the insurance business and may result in financial losses and harm our reputation. We have significant operations in India that could be adversely affected by changes in the political or economic stability of India or government policies in India, the U.S. or Europe. Our computer systems may fail or their security may be compromised, which could damage our business and adversely affect our financial condition and results of operation. The occurrence of natural or man-made disasters or a disease pandemic could adversely affect our financial condition and results of operation. Risks Relating to Our Protection and Retirement Income and Investments Segments We may face losses if morbidity rates, mortality rates or unemployment rates differ significantly from our pricing expectations. We may be required to accelerate the amortization of deferred acquisition costs and the present value of future profits, which would increase our expenses and reduce profitability. We may be required to recognize impairment in the value of our goodwill, which would increase our expenses and reduce our profitability. Our reputation in the long-term care insurance market may be adversely affected if we were to raise premiums on our in-force long-term care insurance products. Medical advances, such as genetic research and diagnostic imaging, and related legislation could adversely affect the financial performance of our life insurance, long-term care insurance and annuities businesses. We may face losses if there are significant deviations from our assumptions regarding the future persistency of our insurance policies and annuity contracts. Regulation XXX may have an adverse effect on our financial condition and results of operations by requiring us to increase our statutory reserves for term life and universal life insurance or incur higher operating costs. If demand for long-term care insurance continues to decline, we will not be able to execute our strategy to expand our long-term care business. Changes in tax laws could make some of our products less attractive to consumers. Changes in U.S. federal and state securities laws may affect our operations and our profitability. Risks Relating to Our Mortgage Insurance Segment Fannie Mae, Freddie Mac and a small number of large mortgage lenders exert significant influence over the U.S. mortgage insurance market. Results from investigations into Fannie Mae s and Freddie Mac s accounting practices, disclosures and other matters may result in legislative or regulatory changes governing the operations of Freddie Mac, Fannie Mae and other government-sponsored enterprises, which could adversely affect the results of our U.S. mortgage insurance business. A decrease in the volume of high loan-to-value home mortgage originations or an increase in the volume of mortgage insurance cancellations could result in a decline in our revenue. Continued increases in the volume of simultaneous second mortgages could have an adverse effect on the U.S. market for mortgage insurance. The amount of mortgage insurance we write could decline significantly if other alternatives to private mortgage insurance are used to protect against default risk or lower coverage levels of mortgage insurance are selected. Our claims expenses would increase and our results of operations would suffer if the rate of defaults on mortgages covered by our mortgage insurance increases or the severity of such defaults exceeds our expectations. A deterioration in economic conditions or a decline in home price appreciation may adversely affect our loss experience in mortgage insurance. A significant portion of our risk in-force consists of loans with high loan-to-value ratios, which generally result in more and larger claims than loans with lower loan-to-value ratios. We cede a portion of our U.S. mortgage insurance business to mortgage reinsurance companies affiliated with our mortgage lending customers, and this reduces our profitability. If efforts by Fannie Mae and Freddie Mac to reduce the need for mortgage insurance are successful, they could adversely affect the results of our U.S. mortgage insurance business. Changes in the policies of the Federal Home Loan Banks could reduce the demand for U.S. mortgage insurance. We compete with government-owned and government-sponsored entities in our mortgage insurance business, and this may put us at a competitive disadvantage on pricing and other terms and conditions. Changes in regulations that affect the mortgage insurance business could affect our operations significantly and could reduce the demand for mortgage insurance. Our U.S. mortgage insurance business could be adversely affected by legal actions under RESPA. Our U.S. mortgage insurance business could be adversely affected by legal actions under the Federal Fair Credit Reporting Act. Potential liabilities in connection with our U.S. contract underwriting services could have an adverse effect on our financial condition and results of operations. If the European mortgage insurance market does not grow as we expect, we will not be able to execute our strategy to expand our business into this market. Risks Relating to Our Separation from GE We only have the right to use the GE brand name and logo for a limited period of time. If we fail to establish a new, independently recognized brand name with a strong reputation in a timely manner, our revenue and profitability could decline. The terms of our arrangements with GE may be more favorable than we would be able to obtain from an unaffiliated third-party. We may be unable to replace the services GE provides us in a timely manner or on comparable terms. We have agreed to make payments to GE based on the projected amounts of certain tax savings we expect to realize as a result of the IPO. We will remain obligated to make these payments even if we do not realize the related tax savings and the payments could be accelerated in the event of certain changes in control. If certain of our service agreements with affiliates of GE are not extended on terms not materially less favorable to us when they are scheduled to expire in the next few years, our results of operations could be adversely affected. We derive a significant portion of the premiums in our payment protection insurance business from transactions with GE. Risks Relating to Our Common Stock Provisions of our certificate of incorporation and by-laws and our Tax Matters Agreement with GE may discourage takeover attempts and business combinations that stockholders might consider in their best interests.

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1276520--2/27/2006--GENWORTH_FINANCIAL_INC