Should You Invest in the iShares U.S. Insurance ETF (IAK)?

Launched on 05/01/2006, the iShares U.S. Insurance ETF (IAK) is a passively managed exchange traded fund designed to provide a broad exposure to the Financials - Insurance segment of the equity market.

An increasingly popular option among retail and institutional investors, passively managed ETFs offer low costs, transparency, flexibility, and tax efficiency; they are also excellent vehicles for long term investors.

Additionally, sector ETFs offer convenient ways to gain low risk and diversified exposure to a broad group of companies in particular sectors. Financials - Insurance is one of the 16 broad Zacks sectors within the Zacks Industry classification. It is currently ranked 3, placing it in top 19%.

Index Details

The fund is sponsored by Blackrock. It has amassed assets over $769.59 million, making it one of the average sized ETFs attempting to match the performance of the Financials - Insurance segment of the equity market. IAK seeks to match the performance of the Dow Jones U.S. Select Insurance Index before fees and expenses.

The Dow Jones U.S. Select Insurance Index includes companies providing a range of specialized financial services, including securities brokers & dealers, online brokers & securities or commodities exchanges.

Costs

Cost is an important factor in selecting the right ETF, and cheaper funds can significantly outperform their more expensive counterparts if all other fundamentals are the same.

Annual operating expenses for this ETF are 0.39%, making it on par with most peer products in the space.

It has a 12-month trailing dividend yield of 1.67%.

Sector Exposure and Top Holdings

It is important to delve into an ETF's holdings before investing despite the many upsides to these kinds of funds like diversified exposure, which minimizes single stock risk. And, most ETFs are very transparent products that disclose their holdings on a daily basis.

This ETF has heaviest allocation in the Financials sector--about 100% of the portfolio.

Looking at individual holdings, Progressive Corp (PGR) accounts for about 17.41% of total assets, followed by Chubb Ltd (CB) and Travelers Companies Inc (TRV).

The top 10 holdings account for about 67.19% of total assets under management.

Performance and Risk

The ETF has added roughly 7.23% so far this year and it's up approximately 18.03% in the last one year (as of 05/12/2025). In that past 52-week period, it has traded between $111.16 and $138.47.

The ETF has a beta of 0.68 and standard deviation of 18.41% for the trailing three-year period, making it a medium risk choice in the space. With about 59 holdings, it effectively diversifies company-specific risk.

Alternatives

IShares U.S. Insurance ETF carries a Zacks ETF Rank of 3 (Hold), which is based on expected asset class return, expense ratio, and momentum, among other factors. Thus, IAK is a reasonable option for those seeking exposure to the Financials ETFs area of the market. Investors might also want to consider some other ETF options in the space.

Invesco KBW Property & Casualty Insurance ETF (KBWP) tracks KBW Nasdaq Property & Casualty Index and the SPDR S&P Insurance ETF (KIE) tracks S&P Insurance Select Industry Index. Invesco KBW Property & Casualty Insurance ETF has $468.79 million in assets, SPDR S&P Insurance ETF has $899.89 million. KBWP has an expense ratio of 0.35% and KIE charges 0.35%.

Bottom Line

To learn more about this product and other ETFs, screen for products that match your investment objectives and read articles on latest developments in the ETF investing universe, please visit Zacks ETF Center.

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This article originally published on Zacks Investment Research (zacks.com).

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