1 Insurance Stock with Impressive Fundamentals and 2 Facing Challenges

Insurance firms play a critical role in the financial system, offering everything from property coverage to life insurance and specialized risk solutions. But worries about an economic slowdown and potential claims deterioration have kept sentiment in check, and over the past six months, the industry’s return was flat while the S&P 500 climbed by 18.6%.

The elite companies can churn out earnings growth under any circumstance, however, and our mission at StockStory is to help you find them. Taking that into account, here is one insurance stock boasting a durable advantage and two we’re swiping left on.

Two Insurance Stocks to Sell:

Root (ROOT)

Market Cap: $1.41 billion

Pioneering a data-driven approach that rewards good driving habits, Root (NASDAQ:ROOT) is a technology-driven auto insurance company that uses mobile apps to acquire customers and data science to price policies based on individual driving behavior.

Why Do We Think Twice About ROOT?

1. Policy losses and capital returns have eroded its book value per share this cycle as its book value per share declined by 158% annually over the last five years
2. Negative return on equity shows that some of its growth strategies have backfired

At $91.95 per share, Root trades at 4.4x forward P/B. Dive into our free research report to see why there are better opportunities than ROOT.

Assurant (AIZ)

Market Cap: $10.82 billion

With roots dating back to 1892 when it was founded by a Civil War veteran, Assurant (NYSE:AIZ) provides specialized insurance products and services that protect major consumer purchases like mobile devices, vehicles, homes, and appliances.

Why Does AIZ Worry Us?

1. Large revenue base makes it harder to increase sales quickly, and its annual revenue growth of 4.4% over the last five years was below our standards for the insurance sector
2. Outsized scale creates growth headwinds as its 4.7% annualized net premiums earned increases over the last five years underperformed other financial institutions
3. Sizable asset base leads to capital growth challenges as its 1.4% annual book value per share increases over the last five years fell short of other insurance companies

Assurant’s stock price of $214.45 implies a valuation ratio of 1.9x forward P/B. To fully understand why you should be careful with AIZ, check out our full research report (it’s free).

One Insurance Stock to Buy:

Progressive (PGR)

Market Cap: $143.3 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 Should You Buy PGR?

1. Strong 20.3% annualized net premiums earned expansion over the last two years shows it’s capturing market share this cycle
2. Annual book value per share growth of 41.7% over the past two years was outstanding, reflecting strong capital accumulation this cycle
3. Expected book value per share growth of 24.9% for the next year suggests its capital position will strengthen considerably

Progressive is trading at $242.28 per share, or 4.1x forward P/B. Is now the time to initiate a position? Find out in our full research report, it’s free.

Stocks We Like Even More

Trump’s April 2025 tariff bombshell triggered a massive market selloff, but stocks have since staged an impressive recovery, leaving those who panic sold on the sidelines.

Take advantage of the rebound by checking 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-small-cap company Comfort Systems (+782% 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

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