2 Insurance Stocks with Promising Prospects and 1 We Turn Down

August 28, 2025 at 00:37 AM EDT

TRV Cover Image

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 1.8% over the past six months. This return lagged the S&P 500’s 8.8% climb.

Despite the lackluster result, a few diamonds in the rough can produce earnings growth no matter what, and we started StockStory to help you find them. With that said, here are two resilient insurance stocks at the top of our wish list and one best left ignored.

One Insurance Stock to Sell:

Selective Insurance Group (SIGI)

Market Cap: $4.81 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 Do We Avoid SIGI?

Annual sales declines of 4% for the past two years show its products and services struggled to connect with the market during this cycle
Sales are expected to decline once again over the next 12 months as it continues working through a challenging demand environment
Earnings per share lagged its peers over the last two years as they only grew by 11.7% annually

At $79.04 per share, Selective Insurance Group trades at 1.4x forward P/B. Read our free research report to see why you should think twice about including SIGI in your portfolio.

Two Insurance Stocks to Watch:

Travelers (TRV)

Market Cap: $61.28 billion

Tracing its roots back to 1853 when it insured travelers against accidents on steamboats and railroads, Travelers (NYSE: TRV) provides a wide range of commercial and personal property and casualty insurance products to businesses, government units, associations, and individuals.

Why Do We Like TRV?

10.3% annualized net premiums earned expansion over the last two years exceeded the sector average as its policies appealed to customers
Incremental sales significantly boosted profitability as its annual earnings per share growth of 52.8% over the last two years outstripped its revenue performance
Exciting book value per share outlook for the upcoming 12 months calls for 24.2% growth, an acceleration from its two-year trend

Travelers’s stock price of $270.98 implies a valuation ratio of 2x forward P/B. Is now a good time to buy? Find out in our full research report, it’s free.

HCI Group (HCI)

Market Cap: $2.12 billion

Starting as a Florida "take-out" insurer that assumed policies from the state-backed Citizens Property Insurance Corporation, HCI Group (NYSE: HCI) provides property and casualty insurance, primarily homeowners coverage, while leveraging proprietary technology to improve underwriting and claims processing.

Why Is HCI a Good Business?

Market penetration was impressive this cycle as its net premiums earned expanded by 26.7% annually over the last two years
Annual book value per share growth of 63.4% over the last two years was superb and indicates its capital strength increased during this cycle
Book value per share outlook for the upcoming 12 months is outstanding and shows it’s on track to build significant equity value

HCI Group is trading at $163.79 per share, or 2.6x forward P/B. Is now the time to initiate a position? See for yourself in our in-depth research report, it’s free.

Stocks We Like Even More

Donald Trump’s April 2025 "Liberation Day" tariffs sent markets into a tailspin, but stocks have since rebounded strongly, proving that knee-jerk reactions often create the best buying opportunities.

The smart money is already positioning for the next leg up. Don’t miss out on the recovery - 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 183% over the last five years (as of March 31st 2025).

Stocks that made our list in 2020 include now familiar names such as Nvidia (+1,545% between March 2020 and March 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 for free. Find your next big winner with StockStory today. Find your next big winner with StockStory today

StockStory is growing and hiring equity analyst and marketing roles. Are you a 0 to 1 builder passionate about the markets and AI? See the open roles here.

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