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3 P&C Insurance Stocks That Have Outperformed the S&P 500 in a Year
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Key Takeaways
{\"0\":\"Fed cut rates by 25 bps to 4-4.25%, its first reduction since Dec 2024, with two more cuts expected in 2025.\",\"1\":\"Global commercial insurance rates fell 4% in Q2 2025.\\r\\n\",\"2\":\"Heavy investments in blockchain, telematics, and insurtech boost efficiency and long-term profitability.\\r\\n\"}
The Zacks Property and Casualty Insurance industry is placed within the top 17% of the 245 Zacks industries. It currently carries a Zack Industry Rank #42. The insurers remain well-poised for growth, riding on better pricing, prudent underwriting, increased exposure, an improving rate environment, a solid capital position, and ongoing economic expansion.
Price Performance
Though the property and casualty (P&C) insurance industry has returned 6.4% in the past year, compared with the Finance sector’s growth of 17.9% and the Zacks S&P 500 composite’s rise of 18.4%, here are three P&C insurance stocks that have performed well over the past year, riding on strong fundamentals. Stocks like Palomar Holdings, Inc. (PLMR - Free Report) , W.R. Berkley Corporation (WRB - Free Report) , and Axis Capital Holdings Limited (AXS - Free Report) have not only crushed the S&P 500 composite but also outperformed the industry and the sector in the past year. These stocks are poised to maintain the rally, given their solid prospects.
Image Source: Zacks Investment Research
Driving Forces
Global commercial insurance rates declined 4% in the second quarter of 2025. This marked the fourth consecutive decrease in the composite rate following seven years of increases, per the Marsh Global Insurance Market Index.
Price hikes, operational strength, higher retention, strong renewal, and the appointment of retail agents should help write higher premiums. Per Deloitte Insights, gross premiums are estimated to exceed $722 billion by 2030.
Non-life insurers are exposed to catastrophe losses, and their profitability is vulnerable to the same. According to the Swiss Re Institute, the global insured losses from natural catastrophes reached $80 billion in the first half of 2025. This is nearly double the 10-year average and more than half of the $150 billion (in 2025 prices) estimated for 2025, following the long-term annual growth trend of 5-7%. Insured losses from severe convective storms were $31 billion in the first half of 2025, per the Swiss Re Institute. According to Aon, global insured losses from natural catastrophe events reached $100 billion, the second-highest first-half total on record. Total global economic losses (including insured and uninsured) from natural catastrophes increased to $162 billion in the first half of 2025, per Aon. Higher catastrophe losses continue to provide impetus to policy renewal rates.
The insurance industry is rate-sensitive. An improving rate environment is a boon for insurers, especially long-tail insurers. In a recent meeting, the Federal Reserve lowered its benchmark interest rate by 25 bps to 4-4.25%. This marked the U.S. Fed's first reduction since December 2024. Fed also signals two more cuts in 2025. With a large invested asset base, investment income should remain healthy, even if the Fed cuts rates later this year. Also, the insurance players are investing heavily in technology to improve scale and efficiency. This should help them generate higher margins and improve profitability.
A solid capital level supports insurers in pursuing strategic mergers and acquisitions to gain market share, expand in niche areas, and diversify operations into new business lines and geography, as well as increase dividends, pay special dividends, and buy back shares.
Players in the insurance industry are investing heavily in technology to expedite business operations. Increased use of blockchain, artificial intelligence, advanced analytics, telematics, cloud computing, Chatbot, RoboAdvisory, and insurtech solutions curbs costs and improves basis points, scale, and efficiencies. Per the Deloitte FSI Predictions article, insurers are likely to generate around $4.7 billion in annual global premiums from AI-related insurance by 2032, yielding a CAGR of nearly 80%.
3 Insurers to Watch
Given the prospects of the industry, let’s look at a few stocks that have the potential to generate better returns. Here are the three P&C insurance stocks that hold a Zacks Rank #3 (Hold) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
La Jolla, CA-based Palomar Holdings is a rapidly growing and profitable company focused on the provision of catastrophe insurance for personal and commercial property. Focus on new business, strong premium retention rates for existing business and renewal of existing policies, strategic expansion of geographic and distribution footprint, and new partnerships, combined with better pricing, positions it well for growth.
PLMR should benefit from its solid product portfolio, as well as geographic expansion and rate increases. PLMR’s net investment income is expected to grow on the back of a higher average balance of investments. A higher return on capital indicates efficient utilization of shareholders’ value. Palomar Holdings expects adjusted net income to be in the range of $198 million to $205 million in 2025, which includes an estimate of $8 million to $12 million of catastrophe losses.
The Zacks Consensus Estimate for PLMR’s 2025 and 2026 revenues suggests 46.9% and 27.4% year-over-year growth, respectively, while the estimate for 2025 and 2026 earnings suggests 42.6% and 16.1% year-over-year growth, respectively. The consensus estimate for 2025 and 2026 has moved 1.5% and 0.3% north, respectively, in the past 60 days. It has a Growth Score of B and an impressive VGM Score of B.
The company’s return on equity in the trailing 12 months was 20.3%, better than the industry average of 7.6%. The company delivered an earnings surprise of 14.71%, on average, in the trailing four quarters. PLMR shares have rallied 21.1% in the past year.
Greenwich, CT-based W.R. Berkley is one of the nation’s largest commercial lines property casualty insurance providers. The company offers a variety of insurance services, from reinsurance to workers' comp third-party administrators.
WRB has consistently benefited from its insurance business, performing well on the increase in premiums written over the past many years. WRB has been investing in numerous startups since 2006 and establishing new units in growing international markets. WRB’s international business is poised for growth, supported by emerging markets. A solid capital position enables capital deployment. Investment in alternative assets should help improve investment income.
The Zacks Consensus Estimate for W.R. Berkley’s 2025 earnings per share indicates a year-over-year increase of 1.9%. The consensus estimate for revenues is pegged at $14.64 billion, implying a year-over-year improvement of 8.2%.
The consensus estimate for 2026 earnings per share indicates a year-over-year increase of 12%. The consensus estimate for 2026 revenues is pinned at $15.54 billion, implying a year-over-year improvement of 6.1%.
The consensus estimate for 2026 has moved 0.4% north in the past 60 days. Earnings have grown 27.8% in the past five years, better than the industry average of 20.9%. WRB earnings surpassed estimates in three of the last four quarters and matched in one, the average surprise being 5.8%. The company’s return on equity in the trailing 12 months was 18.8%. Shares of the property and casualty insurer have rallied 29.6% in the past year.
Bermuda-based AXIS Capital Holdings Limited provides a broad range of specialty insurance and reinsurance solutions to its clients on a worldwide basis through operating subsidiaries and branch networks based in Bermuda, the United States, Europe, Singapore, Canada, Latin America, and the Middle East.
Rate increases, improved new business opportunities, and a focus on driving growth in its most attractive lines, underwriting excellence, a compelling and diversified product portfolio, digital capabilities, and a solid capital position make this insurer well-poised for growth.
The Zacks Consensus Estimate for AXS’ 2025 earnings per share indicates a year-over-year increase of 6.8%. The consensus estimate for revenues is pegged at $6.43 billion, implying a year-over-year improvement of 5.5%. The consensus estimate for 2026 earnings per share indicates a year-over-year increase of 4.4%. The consensus estimate for 2026 revenues is pinned at $6.88 billion, implying a year-over-year improvement of 6.9%.
Earnings have grown 67.1% in the past five years, better than the industry average of 20.9%. The consensus estimate for 2025 and 2026 has moved 3.9% and 0.08% north, respectively, in the past 60 days. The stock currently has a Value Score of B. The company’s return on equity in the trailing 12 months was 18.7%. Shares of the property and casualty insurer have rallied 20.1% in the past year.
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3 P&C Insurance Stocks That Have Outperformed the S&P 500 in a Year
Key Takeaways
The Zacks Property and Casualty Insurance industry is placed within the top 17% of the 245 Zacks industries. It currently carries a Zack Industry Rank #42. The insurers remain well-poised for growth, riding on better pricing, prudent underwriting, increased exposure, an improving rate environment, a solid capital position, and ongoing economic expansion.
Price Performance
Though the property and casualty (P&C) insurance industry has returned 6.4% in the past year, compared with the Finance sector’s growth of 17.9% and the Zacks S&P 500 composite’s rise of 18.4%, here are three P&C insurance stocks that have performed well over the past year, riding on strong fundamentals. Stocks like Palomar Holdings, Inc. (PLMR - Free Report) , W.R. Berkley Corporation (WRB - Free Report) , and Axis Capital Holdings Limited (AXS - Free Report) have not only crushed the S&P 500 composite but also outperformed the industry and the sector in the past year. These stocks are poised to maintain the rally, given their solid prospects.
Image Source: Zacks Investment Research
Driving Forces
Global commercial insurance rates declined 4% in the second quarter of 2025. This marked the fourth consecutive decrease in the composite rate following seven years of increases, per the Marsh Global Insurance Market Index.
Price hikes, operational strength, higher retention, strong renewal, and the appointment of retail agents should help write higher premiums. Per Deloitte Insights, gross premiums are estimated to exceed $722 billion by 2030.
Non-life insurers are exposed to catastrophe losses, and their profitability is vulnerable to the same. According to the Swiss Re Institute, the global insured losses from natural catastrophes reached $80 billion in the first half of 2025. This is nearly double the 10-year average and more than half of the $150 billion (in 2025 prices) estimated for 2025, following the long-term annual growth trend of 5-7%. Insured losses from severe convective storms were $31 billion in the first half of 2025, per the Swiss Re Institute. According to Aon, global insured losses from natural catastrophe events reached $100 billion, the second-highest first-half total on record. Total global economic losses (including insured and uninsured) from natural catastrophes increased to $162 billion in the first half of 2025, per Aon. Higher catastrophe losses continue to provide impetus to policy renewal rates.
The insurance industry is rate-sensitive. An improving rate environment is a boon for insurers, especially long-tail insurers. In a recent meeting, the Federal Reserve lowered its benchmark interest rate by 25 bps to 4-4.25%. This marked the U.S. Fed's first reduction since December 2024. Fed also signals two more cuts in 2025. With a large invested asset base, investment income should remain healthy, even if the Fed cuts rates later this year. Also, the insurance players are investing heavily in technology to improve scale and efficiency. This should help them generate higher margins and improve profitability.
A solid capital level supports insurers in pursuing strategic mergers and acquisitions to gain market share, expand in niche areas, and diversify operations into new business lines and geography, as well as increase dividends, pay special dividends, and buy back shares.
Players in the insurance industry are investing heavily in technology to expedite business operations. Increased use of blockchain, artificial intelligence, advanced analytics, telematics, cloud computing, Chatbot, RoboAdvisory, and insurtech solutions curbs costs and improves basis points, scale, and efficiencies. Per the Deloitte FSI Predictions article, insurers are likely to generate around $4.7 billion in annual global premiums from AI-related insurance by 2032, yielding a CAGR of nearly 80%.
3 Insurers to Watch
Given the prospects of the industry, let’s look at a few stocks that have the potential to generate better returns. Here are the three P&C insurance stocks that hold a Zacks Rank #3 (Hold) at present. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
La Jolla, CA-based Palomar Holdings is a rapidly growing and profitable company focused on the provision of catastrophe insurance for personal and commercial property. Focus on new business, strong premium retention rates for existing business and renewal of existing policies, strategic expansion of geographic and distribution footprint, and new partnerships, combined with better pricing, positions it well for growth.
PLMR should benefit from its solid product portfolio, as well as geographic expansion and rate increases. PLMR’s net investment income is expected to grow on the back of a higher average balance of investments. A higher return on capital indicates efficient utilization of shareholders’ value. Palomar Holdings expects adjusted net income to be in the range of $198 million to $205 million in 2025, which includes an estimate of $8 million to $12 million of catastrophe losses.
The Zacks Consensus Estimate for PLMR’s 2025 and 2026 revenues suggests 46.9% and 27.4% year-over-year growth, respectively, while the estimate for 2025 and 2026 earnings suggests 42.6% and 16.1% year-over-year growth, respectively. The consensus estimate for 2025 and 2026 has moved 1.5% and 0.3% north, respectively, in the past 60 days. It has a Growth Score of B and an impressive VGM Score of B.
The company’s return on equity in the trailing 12 months was 20.3%, better than the industry average of 7.6%. The company delivered an earnings surprise of 14.71%, on average, in the trailing four quarters. PLMR shares have rallied 21.1% in the past year.
Greenwich, CT-based W.R. Berkley is one of the nation’s largest commercial lines property casualty insurance providers. The company offers a variety of insurance services, from reinsurance to workers' comp third-party administrators.
WRB has consistently benefited from its insurance business, performing well on the increase in premiums written over the past many years. WRB has been investing in numerous startups since 2006 and establishing new units in growing international markets. WRB’s international business is poised for growth, supported by emerging markets. A solid capital position enables capital deployment. Investment in alternative assets should help improve investment income.
The Zacks Consensus Estimate for W.R. Berkley’s 2025 earnings per share indicates a year-over-year increase of 1.9%. The consensus estimate for revenues is pegged at $14.64 billion, implying a year-over-year improvement of 8.2%.
The consensus estimate for 2026 earnings per share indicates a year-over-year increase of 12%. The consensus estimate for 2026 revenues is pinned at $15.54 billion, implying a year-over-year improvement of 6.1%.
The consensus estimate for 2026 has moved 0.4% north in the past 60 days. Earnings have grown 27.8% in the past five years, better than the industry average of 20.9%. WRB earnings surpassed estimates in three of the last four quarters and matched in one, the average surprise being 5.8%. The company’s return on equity in the trailing 12 months was 18.8%. Shares of the property and casualty insurer have rallied 29.6% in the past year.
Bermuda-based AXIS Capital Holdings Limited provides a broad range of specialty insurance and reinsurance solutions to its clients on a worldwide basis through operating subsidiaries and branch networks based in Bermuda, the United States, Europe, Singapore, Canada, Latin America, and the Middle East.
Rate increases, improved new business opportunities, and a focus on driving growth in its most attractive lines, underwriting excellence, a compelling and diversified product portfolio, digital capabilities, and a solid capital position make this insurer well-poised for growth.
The Zacks Consensus Estimate for AXS’ 2025 earnings per share indicates a year-over-year increase of 6.8%. The consensus estimate for revenues is pegged at $6.43 billion, implying a year-over-year improvement of 5.5%. The consensus estimate for 2026 earnings per share indicates a year-over-year increase of 4.4%. The consensus estimate for 2026 revenues is pinned at $6.88 billion, implying a year-over-year improvement of 6.9%.
Earnings have grown 67.1% in the past five years, better than the industry average of 20.9%. The consensus estimate for 2025 and 2026 has moved 3.9% and 0.08% north, respectively, in the past 60 days. The stock currently has a Value Score of B. The company’s return on equity in the trailing 12 months was 18.7%. Shares of the property and casualty insurer have rallied 20.1% in the past year.