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7 Best Insurance Stocks to Buy Now

With rising costs of everything becoming a harsh reality for American (and global) households, investors ought to focus their attention on the best insurance stocks to buy now. Historically, the relationship between the valuations of insurance providers and interest rates is directly correlated: as one rises, so does the other. Considering that the Federal Reserve is committed to combating inflation, the subject of this article makes plenty of sense.

According to FitchRatings, “rising interest rates allow insurers to invest new cash flows and maturing investments into a higher-rate environment, helping insurers offer competitive yields on interest-sensitive products. Earnings may benefit as insurers invest in assets with wider credit spreads than those prevalent in recent years, as the credit markets respond to higher interest rates and reduced liquidity.” Therefore, the best insurance stocks to buy are powerfully relevant.

The other factor to consider is the paradigm shift that the novel coronavirus pandemic imposed on society. Thus, more demand should spill into the best insurance stocks to buy as many Americans get back to normal.


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UnitedHealth Group















Prudential Financial



Sun Life Financial


Insurance Stocks to Buy: UnitedHealth Group (UNH)

The UnitedHealth (UNH) headquarters in Minnetonka, Minnesota.
The UnitedHealth (UNH) headquarters in Minnetonka, Minnesota.

Source: Ken Wolter / Shutterstock.com

UnitedHealth Group (NYSE:UNH) may be one of the biggest beneficiaries among the best insurance stocks to buy due to the pandemic.

Add in the fact that Covid-19 is churning out new variant after new variant, and this backdrop may inspire folks to acquire health coverage. Cynically, this bolsters UNH stock, which while a slow mover, is positive for the year, gaining 5% since the beginning of January. No, it’s nothing to write home about, except that the major indices themselves are down double digits.

In addition, stakeholders can enjoy a forward dividend yield of 1.3%. Again, nothing to write home about. But with UNH stock not losing ground in the capital market and providing some passive income, it’s one of the best insurance stocks to buy for stability.

MetLife (MET)

the MetLife logo displayed on the outside of a building
the MetLife logo displayed on the outside of a building

Source: Osugi / Shutterstock.com

Recognized as the largest life insurer in the U.S., MetLife (NYSE:MET) operates under a similar bullish thesis to UnitedHealth Group. Prior to the Covid-19 pandemic, many people’s biggest fundamental problem wasn’t exactly a deadly virus. But following the global health crisis, we all came to the realization that life can change in an instant.

Following some broader introspection, people are likely to consider adding or bolstering their life insurance coverage. According to BDO.com, “Momentum for life insurance applications in the U.S. picked up significantly during the second half of 2020, with a year-over-year increase of 9.2% during Q3 and record growth of 14.1% in July alone. Applications rose 4% for the year overall, marking the highest annual year-over-year growth rate on record.”

Again, with MetLife’s sector leadership in life insurance, MET is one of the best insurance stocks to buy. As well, the company features a forward yield of 3.3%, which is quite generous.

Insurance Stocks to Buy: Aflac (AFL)

the Aflac (AFL) logo on an office building
the Aflac (AFL) logo on an office building

Source: Ken Wolter / Shutterstock.com

A leader in the supplemental insurance category, Aflac (NYSE:AFL) is likely to get some long looks from both clients and investors alike. To use the government’s definition under the health coverage context, supplemental insurance refers to an “additional insurance plan that helps pay for healthcare costs that are not covered by a person’s regular health insurance plan. These costs include copayments, coinsurance, and deductibles.”

So, here’s why Aflac is so important. If you read the fine print in your particular coverage plan, you might notice service gaps. Well, if things go awry — and as we all know from Covid-19, that could easily happen — those gaps can add up to serious dollars. Therefore, to prevent financial hardship or even a catastrophe, Aflac can help cover these problematic vulnerabilities, making it one of the best insurance stocks to buy.

While AFL stock is down on a year-to-date (or YTD) basis, it’s been picking up momentum in recent trades. As well, the underlying company features a 2.9% forward yield.

Progressive (PGR)

A white car with the Progressive logo written across the doors in big blue letters
A white car with the Progressive logo written across the doors in big blue letters

Source: Shutterstock

As arguably the most lovable among the best insurance stocks to buy for its comical auto insurance commercials, Progressive (NYSE:PGR) is also getting plenty of positive attention on Wall Street. On a YTD basis, PGR stock is up around 8% while on a trailing-year basis, it’s up roughly 16%.

Fundamentally, it’s no surprise: the driving out there in the post-Covid environment is simply awful. In fact, according to the Los Angeles Times, evidence suggests that “the pandemic has made U.S. drivers more reckless — more likely to speed, drink or use drugs and leave their seat belts unbuckled.”

Indeed, the primary data source, the National Highway Traffic Safety Administration, disclosed that car crashes killed 38,824 people around the U.S. in 2020. And projections for 2021 demonstrate that this awful trend of fatalities is continuing.

In other words, there’s never been a more crucial time for drivers to get comprehensive auto insurance coverage. And thanks to many years of compelling marketing initiatives, Progressive enjoys a competitive edge in this arena.

Insurance Stocks to Buy: Allstate (ALL)

Allstate Insurance office
Allstate Insurance office

Source: Jonathan Weiss / Shutterstock.com

Among the most remarkable developments of the new normal was the housing boom. Per a CNN report from December 2021, the “US housing market has had a white hot year. Home sales are on track to reach the highest level in 15 years, with an estimated 6 million homes sold in 2021.”

With so many new homeowners in the fray, these folks now have to protect their investments with home insurance policies. And as the catchy commercials like to state, you’re in good hands with Allstate (NYSE:ALL). While closing escrow may be the most exciting transaction for families, the next thought has to be about protection.

As I’ve come to realize, so many things can go wrong when you own your home. In addition, the buck stops with you. Considering that we’ve gone through some unprecedented circumstances, consumers may be more predisposed to consider ramping up their coverage; for instance, flood or earthquake coverage. That’s a cynical plus for ALL stock, one of the best insurance stocks to buy for advantaging contemporary economic trends.

Prudential Financial (PRU)

Prudential logo
Prudential logo

Source: JHVEPhoto / Shutterstock.com

As one of the best insurance stocks to buy that’s levered to the retirement planning and investment management sectors, Prudential Financial (NYSE:PRU) ties in very well with demographic and economic trends. As the Pew Research Center noted, “Baby Boomers have always had an outsize presence compared with other generations. They peaked at 78.8 million in 1999 and remained the largest living adult generation until 2019.”

Although millennials have surpassed the boomers as the largest living generation, the latter still represents a sizable populace. Furthermore, they’re retiring in droves — but they’re doing so in one of the most complex times in American history. Put another way, these folks need expert guidance to help navigate the storm. In turn, that’s where Prudential comes in.

Second, everyone needs guidance to sift through this economic mess, which is where Prudential’s investment management arm will likely command significant relevance. And with a 5.1% forward yield, this is one of the best insurance stocks to buy now.

Insurance Stocks to Buy: Sun Life Financial (SLF)

A close-up shot of a hand choosing wooden blocks with emoticons related to health insurance. russell 2000 stocks
A close-up shot of a hand choosing wooden blocks with emoticons related to health insurance. russell 2000 stocks

Source: Shutterstock

If you want to have an everyman approach to the insurance sector, Sun Life Financial (NYSE:SLF) is an intriguing idea. Offering a broad range of services, including financial planning and health insurance, Sun Life is perfect for those folks that may have some trouble with moving forward with a particular decision.

As with the other names on this list of best insurance stocks to buy now, Sun Life caters to the behavioral shifts that the Covid-19 pandemic and the subsequent economic crisis have sparked. Households are clearly looking to protect their finances and personal interests, as evidenced by the increased spike for life insurance products and this tailwind could reach down to SLF.

To be fair, Sun Life is on the riskier side of the spectrum, having shed more than 20% YTD in the capital market. However, you’re getting quite a deal in terms of passive income, with the company featuring a forward yield of 4.8%.

On the date of publication, Josh Enomoto did not have (either directly or indirectly) any positions in the securities mentioned in this article. The opinions expressed in this article are those of the writer, subject to the InvestorPlace.com Publishing Guidelines.

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