Insurance companies serve as the backbone of risk management, providing essential protection and financial security for individuals and businesses. But concerns about claims severity and tightening regulations have tempered enthusiasm, limiting the industry’s gains to 5.4% over the past six months. This return lagged the S&P 500’s 10.5% climb.
Only some companies are subject to these dynamics, however, and a handful of high-quality businesses can deliver earnings growth in any environment. With that said, here is one insurance stock boasting a durable advantage and two best left ignored.
Two Insurance Stocks to Sell:
Selective Insurance Group (SIGI)
Market Cap: $5.16 billion
Founded in 1926 during the early days of automobile insurance, Selective Insurance Group (NASDAQ: SIGI) is a property and casualty insurance company that sells commercial, personal, and excess and surplus lines insurance products through independent agents.
Why Are We Hesitant About SIGI?
- Operational productivity has decreased over the last five years as its combined ratio worsened by 2.3 percentage points
- Performance over the past two years shows its incremental sales were less profitable, as its 9.2% annual earnings per share growth trailed its revenue gains
- Annual book value per share growth of 6.4% over the last five years was below our standards for the insurance sector
Selective Insurance Group is trading at $85.12 per share, or 1.5x forward P/B. Read our free research report to see why you should think twice about including SIGI in your portfolio.
Reinsurance Group of America (RGA)
Market Cap: $13.3 billion
Operating behind the scenes of the insurance industry since 1973, Reinsurance Group of America (NYSE: RGA) provides life and health reinsurance services to insurance companies, helping them manage risk and meet regulatory requirements.
Why Does RGA Worry Us?
- Scale presents growth limitations compared to smaller competitors, evidenced by its below-average 7.3% annualized growth in net premiums earned for the last two years
- Performance over the past two years shows its incremental sales were less profitable, as its 5.1% annual earnings per share growth trailed its revenue gains
- Book value per share is projected to decrease by 10.1% over the next 12 months as capital generation weakens
At $202.10 per share, Reinsurance Group of America trades at 1x forward P/B. Dive into our free research report to see why there are better opportunities than RGA.
One Insurance Stock to Buy:
Progressive (PGR)
Market Cap: $125 billion
Starting as a small auto insurance company in 1937 with a pioneering focus on high-risk drivers, Progressive (NYSE: PGR) is a major auto, property, and commercial insurance provider that offers policies through independent agents, online platforms, and over the phone.
Why Do We Love PGR?
- Net premiums earned surged by 19.5% annually over the past two years, reflecting strong market share gains this cycle
- Incremental sales over the last two years have been highly profitable as its earnings per share increased by 93.9% annually, topping its revenue gains
- Impressive 44.7% annual book value per share growth over the last two years indicates it’s building equity value this cycle
Progressive’s stock price of $212.76 implies a valuation ratio of 3.5x forward P/B. Is now the right time to buy? See for yourself in our comprehensive research report, it’s free.
Stocks We Like Even More
If your portfolio success hinges on just 4 stocks, your wealth is built on fragile ground. You have a small window to secure high-quality assets before the market widens and these prices disappear.
Don’t wait for the next volatility shock. Check out our Top 9 Market-Beating Stocks. This is a curated list of our High Quality stocks that have generated a market-beating return of 244% over the last five years (as of June 30, 2025).
Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,326% between June 2020 and June 2025) as well as under-the-radar businesses like the once-micro-cap company Tecnoglass (+1,754% five-year return). Find your next big winner with StockStory today.
