The situation has become all the more pressing as worries about GE’s finances deepen. In the past year, the company’s woes have wiped out more than $90 billion from its stock market value, called into question the sustainability of its debt burden and cost Flannery his job. Under Flannery, the industrial giant tried in vain to appease Wall Street by selling various businesses, like its energy finance and industrial gas-engine units, to shore up its balance sheet.

The insurance business itself came to the fore in spectacular fashion earlier this year after GE disclosed a $6.2 billion charge for the fourth quarter of 2017. It led to an ongoing regulatory investigation of GE’s accounting practices and shined a light on how precarious GE Capital’s situation had become.

And just this week, Gordon Haskett analyst John Inch flagged a potential trouble spot within one of the more profitable parts of the finance unit -- GE’s aircraft leasing arm. The division, which Inch sees as vulnerable to a pullback in the energy industry following a rival’s bankruptcy, has been the subject of intensifying deal speculation. In August, Singapore’s sovereign wealth fund expressed interest in buying some or all of GE Capital Aviation Services, people familiar with the matter said.

Standing Out

While GE is hardly alone when it comes to the headaches caused by long-term care policies, it stands out because of the sheer size of its reserve deficit. Complicating matters is the fact that, as a reinsurer of roughly 300,000 long-term care policies, GE is on the hook for payouts tied to those policies but has no power to increase rates itself and must rely on the primary insurers to raise them. (Some are held by Genworth Financial, a GE unit spun off in 2004.)

GE has a plan to plug the deficit. It will set aside the $15 billion it needs over seven years and has already contributed $3.5 billion of that this year. A sustained jump in interest rates could reduce GE’s deficit. Blackstone Group LP and Guggenheim Partners have expressed interest in managing its insurance assets, people familiar with the matter said, which could also help GE narrow its shortfall if they can produce higher returns. The firms declined to comment.

Keep Growing

But the worry is that the liabilities will just keep growing as America’s health-care costs outpace those of every other developed nation. GE has warned there’s a risk the amount of its contributions could change. The open-ended nature of the obligations could ultimately stand in the way of a potential deal. Industry insiders say they expect GE will need to cover a substantial part of its hole before buyers entertain any serious offers over price.

“Long-term care is hard to ring-fence,” UBS analyst Steven Winoker wrote in a report to clients last month.

How GE will come up with the money is another issue. While it has more than $20 billion in cash and $40 billion in credit lines, worries about the company’s finances continue to grow. In the first nine months of the year alone, GE’s cash balance fell by $17 billion. It also has $18 billion in debt coming due in 2020, data compiled by Bloomberg show. As funding costs rise, analysts are watching closely to see whether GE will need to tap its credit lines and put some of its more attractive assets on the block.