NEW YORK (AP) -- Insurers rode a booming stock market all year long in 2013, plowing premiums paid by customers into a market that rarely seemed to look back.
Most easily outpaced the Standard & Poor's 500 index, with companies like MetLife surging more than 50 percent to highs not seen since the economic crisis pummeled the U.S.
Heading in to 2014, Janney Capital Markets is advising clients that a little more discretion may needed.
"Perhaps due to the result of a rising tide (i.e. rising valuations across the board) in combination with our own internal lack of consensus on the macroeconomic outlook, our current sector weightings are somewhat agnostic," analysts with Janney said in a report Friday. "As we look into 2014, we view the opportunities to be much more stock specific than in the past."
Analysts Larry Greenberg, Robert Glasspiegel and Ryan Byrnes laid out their best picks for the year, using a theoretical $100 bill to demonstrate how they think investors can best allocate their money.
Using that $100, Janney pushed $30 to property-casualty insurers, $30 to life insurers, $25 to insurance brokers, and $15 to title insurers.
In the life and annuity space, Janney upgraded MetLife Inc. to a 'buy,' from 'neutral,' but stripped Prudential of its 'buy' rating, giving the Newark, N.J., company a 'neutral' rating.
The analysts say part of the reason is valuation. Shares of Prudential Financial Inc. have jumped more than 60 percent over the past 12 months.
"With a higher percentage of market sensitive businesses, the operational environment for (Prudential) over the last year could not have been better," the analysts wrote.
But they now see more risk potential ahead for Prudential as well.
Fidelity National was also upgraded, largely because of its $2.9 billion acquisition of Lender Processing Services, a deal approved last month by federal regulators.
The company also hired JP Morgan as it considers the potential sale of some non-core assets.
"We think that these assets are a distraction for investors and believe the Fidelity National Financial story becomes clearer without these assets," wrote Byrnes, who raised his rating on the company to 'buy' from 'neutral."
In addition to Prudential, Janney downgraded Chubb Corp. to 'neutral' from 'buy,' saying that they favor less expensive, quality underwriters such as Ace Ltd., The Travelers Cos. Inc. and XL Group Plc.
The analysts also downgraded Endurance Specialty Holdings Ltd. and White Mountains Insurance Group Ltd. to "Neutral" from "Buy."
The shares of every company in the report save for White Mountains has hit a 52-week high within the past two months.
White Mountains hit a six-year high in July.