Best’s Journal: Insurance Equity Performance 1Q 2014: U.S. Life/Annuity Stocks Slip

Health Sector Companies on a Continuous Crescendo

Business Wire

OLDWICK, N.J.--(BUSINESS WIRE)--

U.S. life/annuity stocks fell 3% in the first three months of 2014, following a 62% gain in 2013, and further underperformance is expected as stocks are trading at historically high valuations. Meanwhile, investors continue to be bullish on U.S. health insurance stocks, with results up 3.5% in the first quarter of 2014. Cash management activity remains strong, however. The life/health insurance segment returned USD 3.6 billion to investors through share repurchases and dividends in the first quarter. Health insurers repurchased almost USD 3.4 billion worth of shares, an increase of nearly 133% over the same period of 2013. These first-quarter 2014 equity performance reviews are the centerpiece of the latest Best’s Journal, a biweekly publication that presents A.M. Best’s original research, analysis and commentary on the global insurance industry, available exclusively as part of a subscription to the Best’s Insurance News & Analysis service.

Other highlights in this issue of Best’s Journal include as follows:

  • U.S. Life/Health Industry Continues to Tread Water in a Benign Economy: The current low interest rate environment has significantly curtailed near-term growth opportunities for the U.S. life/health insurance industry, according to a Best’s Special Report.
  • U.S. Health Exchange Enrollment Results May Lead to Higher Utilization: This Best’s Special Report takes a look at the first Affordable Care Act open enrollment numbers and what they may mean for insurance companies.
  • Sustainable Profitability Is Key for Healthy Capitalization of China’s Non-Life Insurers: This Best’s Special Report looks at China’s new solvency framework and A.M. Best’s view of its impact on non-life insurers.
  • Recent noteworthy Best’s Credit Rating Actions, rating rationales and more.

Best’s Journal is delivered every two weeks as a bound, printed publication and in digital format via the Best’s Insurance News & Analysis website. Each issue is an installment in a cumulative business resource that provides insight from A.M. Best’s perspective as a credit rating agency, data provider and news publisher with a unique focus on the insurance industry. Best’s Journal provides original content available only from A.M. Best.

To learn more about Best’s Journal, watch a brief video at www.ambest.com/sales/aboutbestsjournal.html. More information about the Best’s Insurance News & Analysis subscription service is available at www.ambest.com/sales/bina/default.asp. To order, contact Customer Service at (908) 439-2200, ext. 5742 or at (800) 424-2378 when calling from the U.S. and Canada.

A.M. Best Company is the world's oldest and most authoritative insurance rating and information source. For more information, visit www.ambest.com.

Copyright © 2014 by A.M. Best Company, Inc. ALL RIGHTS RESERVED.

Contact:
A.M. Best Company, Inc.
Jim Peavy, 908-439-2200, ext. 5644
Assistant Vice President, Public Relations
james.peavy@ambest.com
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