The importance and demand for insurance are constantly growing as economic and geopolitical risks surge, accelerating the industry’s growth. Also, with advancements in technologies and rapid urbanization, the market is poised for expansion.

Against this backdrop, it could be wise to invest in fundamentally strong insurance stocks, The Travelers Companies, Inc. (TRV), The Progressive Corporation (PGR), and The Allstate Corporation (ALL) that are beating the market in 2024.

Amid rising economic risks, uncertainties, and mandatory requirements, the insurance market’s growth trajectory appears robust. The market’s overall growth remained largely positive during the third quarter through buyer-friendly conditions across most of the global insurance market.

Healthy insurer returns and improved reinsurance conditions restored insurer confidence, growth, and accelerated competition. Further, the recent half-point rate cut by the Federal Reserve is anticipated to benefit the insurance sector in different ways. The lower rate can stimulate borrowing and spending among consumers, offering expansion opportunities to the segment.

With this, the property & casualty insurance market size is expected to register a CAGR of 5.5% resulting in a market value of $3.02 trillion by 2032. Market drivers include growing urbanization worldwide, rising awareness, increasing product diversification, technological advancements, and evolving regulatory demands.

Artificial intelligence (AI) technology is transforming the insurance industry significantly, like many others. The advancement of AI has revolutionized various aspects like risk assessment, underwriting, claims processing, and customer service. The unique capabilities of AI are unveiling innovative ways to optimize business operations and encourage healthy competition.

Further, the insurance stocks discussed below have outperformed the S&P 500 year-to-date (YTD) return of 24.7%. In light of these favorable trends, let’s look at the fundamentals of the three Insurance – Property & Casualty stocks, beginning with number 3.

Stock #3: The Travelers Companies, Inc. (TRV)

TRV offers commercial and personal property, and casualty insurance products and services to businesses, government units, associations, and individuals internationally. The company operates in three segments: Business Insurance; Bond & Specialty Insurance; and Personal Insurance.

On August 1, TRV’s division, Travelers Canada, launched OPTIMA® Home, a new property insurance product that offers customizable coverage options for homeowners, tenants, condominiums, and landlord policies. Enshrined in a highly intuitive platform, the product allows brokers to seamlessly quote, issue, and adjust coverage.

On July 25, TRV released Quantum Boat 2.0, an enhanced boat insurance product that offers more personalized coverage options through an easy-to-use platform enabling agents to seamlessly quote and bind coverage. The product expanded customer eligibility and offered a better quoting experience for agents, resulting in increased efficiency and enhanced customer service.

During the third quarter that ended September 30, 2024, TRV’s net written premiums increased 7.9% year-over-year to $11.32 billion, and its total revenues rose 11.9% year-over-year to $11.90 billion. The company’s core income came in at $1.22 billion or $5.24 per share, up 168.3% and 168.7% from the prior year’s quarter, respectively.

Analysts expect TRV’s revenue and EPS for the first quarter (ending March 2025) to grow 8.5% and 25.8% year-over-year to $10.98 billion and $5.90, respectively. Also, the company topped the consensus EPS estimates in three of the four trailing quarters.

Shares of TRV have surged 17.9% over the past six months and 34.7% year-to-date to close the last trading session at $256.52.

TRV’s solid fundamentals are reflected in its POWR Ratings. The stock has an overall rating of B, which translates to a Buy in our proprietary rating system. The POWR Ratings are calculated by considering 118 different factors, each weighted to an optimal degree.

TRV has an A grade for Momentum. It also has a B grade for Stability. It is ranked #20 out of 55 stocks in the A-rated Insurance – Property & Casualty industry.

In addition to the POWR Ratings we’ve stated above, we also have TRV ratings for Value, Quality, Growth, and Sentiment. Get all TRV ratings here.

Stock #2: The Progressive Corporation (PGR)

PGR is an insurance holding company that offers personal and commercial auto, personal residential and commercial property, business-related general liability, and other specialty property-casualty insurance products and related services. The company operates through three segments: Personal Lines; Commercial Lines; and Property.

On August 5, PGR’s Board of Directors declared a $0.10 per common share dividend, paid on October 11, 2024, to shareholders of record at the close of business on October 3, 2024.

PGR pays an annual dividend of $0.40, which translates to a yield of 0.15% at the current share price. Its four-year average dividend yield is 2%. Also, the company’s dividend payouts have increased at a CAGR of 8.8% over the past ten years.

For the third quarter that ended September 30, 2024, PGR’s net premiums earned increased 22.8% year-over-year to $18.30 billion. The company’s net income amounted to $2.33 billion and $3.97 per share, reflecting growth of 108.1% and 110.1% from the prior year’s quarter, respectively.

Furthermore, as of September 30, 2024, the company’s total investments and total assets stood at $79.40 billion and $105.20 billion, respectively.

Street expects PGR’s revenue for the fourth quarter (ending December 2024) to increase 26.1% year-over-year to $19.08 billion, while its EPS is expected to grow 3.4% year-over-year to $3.08, respectively. Furthermore, the company surpassed the consensus revenue and EPS estimates in three of the trailing four quarters.

PGR’s stock has soared 20.5% over the past six months and 61.7% year-to-date to close the last trading session at $257.50.

PGR’s bright prospects are reflected in its POWR Ratings. It has an overall rating of B, translating to a Buy in our proprietary rating system.

The stock has an A grade for Momentum and a B for Quality and Sentiment. PGR is ranked #19 among 55 stocks in the same industry.

Click here to access PGR’s ratings for Stability, Growth, and Value.

Stock #1: The Allstate Corporation (ALL)

ALL provides property and, casualty, and other insurance products. The company operates through five segments: Allstate Protection; Protection Services; Allstate Health and Benefits; Run-off Property-Liability; and Corporate and Other segments.

On November 14, ALL’s division, Allstate Health Solutions, entered into a new partnership with Thatch and Ambetter Health, and Intuit QuickBooks to enhance its product offerings. This strategic collaboration introduces an Individual Coverage Health Reimbursement Arrangement (ICHRA), allowing businesses to directly reimburse employees for healthcare coverage.

The partnership reflects ALL’s commitment to helping people find the coverage they need. The solution will offer employees the flexibility to choose the best insurance plan according to their individual needs from a variety of coverage options.

On November 4, ALL and Arlo, a leading smart home security brand, unveiled a smarter way to protect homeowners with The Arlo Total Security bundle for Allstate. The new solution combines professional monitoring, hardware, and device protection and will benefit homeowners this holiday season.

ALL’s consolidated revenues increased 14.7% from the prior-year quarter to $16.63 billion during the third quarter that ended September 30, 2024. Its consolidated premiums written rose 10% from the year-ago value to $15.87 billion. The company’s adjusted net income came in at $1.05 billion and $3.19 per common share, indicating increases of 389.7% and 382.7% year-over-year, respectively.

Street expects ALL’s EPS for the first quarter (ending March 2025) to increase 7.7% year-over-year to $5.53 and its revenue for the same quarter is expected to grow 7% year-over-year to $16.32 billion. Also, the company has surpassed the consensus revenue and EPS estimates in all of the trailing four quarters, which is impressive.

ALL’s stock has gained 15.8% over the past six months and 39.9% year-to-date to close the last trading session at $195.78.

ALL’s POWR Ratings reflect its robust outlook. The stock has an overall rating of B, which equates to a Buy in our proprietary rating system.

The stock has an A grade for Momentum and Sentiment. It also has a B grade for Stability. Within the A-rated Insurance – Property & Casualty industry, ALL is ranked #4 among the 55 stocks.

Click here to access additional ratings of ALL for Growth, Value, and Quality.

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PGR shares were unchanged in after-hours trading Friday. Year-to-date, PGR has gained 61.61%, versus a 24.40% rise in the benchmark S&P 500 index during the same period.

About the Author: Rjkumari Saxena

Rajkumari started her career as a writer but gradually shifted her focus to financial journalism, leveraging her educational background in Commerce. Fascinated by the interplay of business and economic shifts in equities, she aspires to evolve as an analyst. With a knack for simplifying complex financial concepts, her mission is to empower investors with insights that lead to profitable decisions. More...

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