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Looking Beyond Tech? Here Are 3 Buy-Rated Insurance Stocks
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Key Takeaways
AIG's transformation is driving stronger underwriting and earnings growth.
AFG combines disciplined underwriting with solid capital returns.
Accelerant's AI-powered, capital-light model is fueling rapid specialty insurance growth.
While AI and technology remain major market themes, investors are increasingly broadening their focus to defensive sectors. Insurance stands out as an attractive option, offering stable earnings, pricing power and resilient cash flows. In an environment marked by sticky inflation, higher-for-longer interest rates, geopolitical tensions and ongoing supply chain disruptions, companies with dependable earnings have become increasingly appealing.
Where the Biggest Opportunities Are
Not every insurance company is benefiting equally, however. Investors are favoring insurers with disciplined underwriting, solid pricing power, fee-based revenues and exposure to specialized markets where competition is limited. At the same time, companies with heavy catastrophe exposure or weaker investment portfolios are drawing greater scrutiny.
Insurance brokers remain one of the industry's strongest long-term stories. Unlike insurers, brokers generate commissions without assuming underwriting risk. Demand for commercial insurance, employee benefits, cyber coverage and specialty products continues to rise, while industry consolidation is creating additional growth opportunities.
The broader commercial insurance market is also holding up well, even as pricing gradually normalizes after several years of sharp increases. According to Marsh & McLennan Companies, Inc.’s (MRSH - Free Report) Global Insurance Market Index, global commercial insurance rates declined 5% in the first quarter of 2026, marking the seventh straight quarter of easing prices. Even so, many commercial lines remain profitable, particularly property insurance, where favorable reinsurance conditions and ample capacity continue to support earnings.
Specialty & Excess-and-Surplus (E&S) insurance remains one of the fastest-growing niches. Businesses increasingly need protection against cyberattacks, professional liability claims, climate-related risks and other complex exposures. These policies are harder to underwrite, allowing insurers with specialized expertise to maintain stronger pricing and healthier margins.
Technology is Becoming a Competitive Edge
Technology investments are increasingly separating industry leaders from the rest. More insurers are using artificial intelligence to speed up claims processing, improve underwriting, detect fraud and enhance customer service. While adoption varies across the industry, companies investing in modern technology platforms could improve efficiency and profitability over time. InsurTech and AI-enabled platforms remain a long-term growth theme as insurers modernize legacy systems, though many pure-play InsurTech firms remain smaller and more volatile.
Insurance Stocks That Stand Out
Against this backdrop, three insurance companies stand out: American International Group, Inc. (AIG - Free Report) , American Financial Group, Inc. (AFG - Free Report) and Accelerant Holdings (ARX - Free Report) . The companies carry a Zacks Rank #2 (Buy) each, combine solid earnings momentum with favorable estimate revisions and are well positioned to benefit from current industry trends. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Let’s take a closer look at these three insurers and why they stand out.
American International Group continues to benefit from its multi-year transformation, which is driving stronger underwriting performance, disciplined capital allocation and consistent shareholder returns. In first-quarter 2026, General Insurance net premiums written increased 24% year over year, underwriting income more than tripled to $774 million, and the combined ratio improved to an excellent 87.3%, reflecting underwriting discipline across commercial and personal lines.
The company also benefits from a strong balance sheet. In February 2026, it completed minority investments in Convex and Onex, which are expected to be accretive to 2026 earnings and ROE. It is also expanding its commercial footprint through an agreement to acquire Everest’s insurance operations in Colombia, with closing expected in early 2027.
Based on short-term price targets offered by 22 analysts, the Wall Street average price target for AIG stands at $88.18 per share, suggesting a 17.4% upside from current levels.
The Zacks Consensus Estimate for AIG’s 2026 earnings is pegged at $7.98 per share, indicating 12.6% year-over-year growth. The estimate witnessed eight upward revisions over the past 60 days against no movement in the opposite direction. Its 2027 earnings estimate indicates a further 10.3% increase. It beat earnings estimates in each of the past four quarters with an average surprise of 15.1%. The consensus mark for 2026 revenues is pegged at $29.18 billion, indicating 6.3% year-over-year growth, while the same for 2027 suggests a further 7% increase.
American International Group, Inc. Price, Consensus and EPS Surprise
American Financial Group is well-positioned to benefit from sustained strength in the specialty property and casualty insurance market, supported by disciplined underwriting and a diversified commercial portfolio. In first-quarter 2026, net operating earnings increased 36.5% year over year, while Specialty P&C underwriting profit jumped 66%, driving an annualized return on equity of 15.8%.
The company continues to generate healthy investment income from its high-quality portfolio and maintains a shareholder-friendly capital allocation strategy. It returned $259 million through special dividends and share repurchases in the first quarter. Analysts' price targets currently range from $127 to $158, reflecting differing views on the stock's upside potential.
The Zacks Consensus Estimate for 2026 earnings is pegged at $11.37 per share, indicating a 10.5% year-over-year rise. The estimate has witnessed three upward revisions over the past 60 days against no movement in the opposite direction. Its 2027 earnings estimate suggests a further 5.2% increase. American Financial Group beat the consensus estimate for earnings in three of the past four quarters and missed once, with the average surprise being 7.3%. The consensus mark for 2026 revenues is pegged at $8.01 billion, while the same for 2027 indicates a further 8% jump.
American Financial Group, Inc. Price, Consensus and EPS Surprise
Accelerant Holdings is capitalizing on the growing specialty insurance market through its technology-enabled risk exchange that connects managing general agents or MGAs with diversified risk capital providers. In the first quarter of 2026, Exchange Written Premium increased 16% year over year to $1.14 billion, while operating revenues climbed 57% to $273.2 million. Fee-based Adjusted EBITDA more than doubled, reflecting the company's strategic shift toward capital-light, recurring revenue streams.
Accelerant also expanded its network to 296 members and reaffirmed strong full-year growth expectations. Its proprietary data, AI-driven underwriting tools and scalable marketplace model position the company to deliver profitable, long-term growth as specialty insurance adoption continues to expand. At the end of the first quarter, total assets stood at $8.6 billion. Based on short-term price targets offered by nine analysts, the Wall Street average price target for ARX is at $19.33 per share, suggesting a 53.1% upside from current levels.
The Zacks Consensus Estimate for ARX’s 2026 earnings is pegged at 73 cents per share, which has witnessed five upward estimate revisions over the past 60 days against no movement in the opposite direction. Its 2027 earnings estimate indicates a 24.2% jump. It beat earnings estimates in each of the past four quarters, with an average surprise of 32.6%. The consensus mark for 2026 revenues is pegged at $1.09 billion, implying 19% year-over-year growth, while the same for 2027 suggests a further 9.4% increase.
Accelerant Holdings Price, Consensus and EPS Surprise
View the Zacks #1 Rank List
Image: Bigstock
Looking Beyond Tech? Here Are 3 Buy-Rated Insurance Stocks
Key Takeaways
While AI and technology remain major market themes, investors are increasingly broadening their focus to defensive sectors. Insurance stands out as an attractive option, offering stable earnings, pricing power and resilient cash flows. In an environment marked by sticky inflation, higher-for-longer interest rates, geopolitical tensions and ongoing supply chain disruptions, companies with dependable earnings have become increasingly appealing.
Where the Biggest Opportunities Are
Not every insurance company is benefiting equally, however. Investors are favoring insurers with disciplined underwriting, solid pricing power, fee-based revenues and exposure to specialized markets where competition is limited. At the same time, companies with heavy catastrophe exposure or weaker investment portfolios are drawing greater scrutiny.
Insurance brokers remain one of the industry's strongest long-term stories. Unlike insurers, brokers generate commissions without assuming underwriting risk. Demand for commercial insurance, employee benefits, cyber coverage and specialty products continues to rise, while industry consolidation is creating additional growth opportunities.
The broader commercial insurance market is also holding up well, even as pricing gradually normalizes after several years of sharp increases. According to Marsh & McLennan Companies, Inc.’s (MRSH - Free Report) Global Insurance Market Index, global commercial insurance rates declined 5% in the first quarter of 2026, marking the seventh straight quarter of easing prices. Even so, many commercial lines remain profitable, particularly property insurance, where favorable reinsurance conditions and ample capacity continue to support earnings.
Specialty & Excess-and-Surplus (E&S) insurance remains one of the fastest-growing niches. Businesses increasingly need protection against cyberattacks, professional liability claims, climate-related risks and other complex exposures. These policies are harder to underwrite, allowing insurers with specialized expertise to maintain stronger pricing and healthier margins.
Technology is Becoming a Competitive Edge
Technology investments are increasingly separating industry leaders from the rest. More insurers are using artificial intelligence to speed up claims processing, improve underwriting, detect fraud and enhance customer service. While adoption varies across the industry, companies investing in modern technology platforms could improve efficiency and profitability over time. InsurTech and AI-enabled platforms remain a long-term growth theme as insurers modernize legacy systems, though many pure-play InsurTech firms remain smaller and more volatile.
Insurance Stocks That Stand Out
Against this backdrop, three insurance companies stand out: American International Group, Inc. (AIG - Free Report) , American Financial Group, Inc. (AFG - Free Report) and Accelerant Holdings (ARX - Free Report) . The companies carry a Zacks Rank #2 (Buy) each, combine solid earnings momentum with favorable estimate revisions and are well positioned to benefit from current industry trends. You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Let’s take a closer look at these three insurers and why they stand out.
American International Group continues to benefit from its multi-year transformation, which is driving stronger underwriting performance, disciplined capital allocation and consistent shareholder returns. In first-quarter 2026, General Insurance net premiums written increased 24% year over year, underwriting income more than tripled to $774 million, and the combined ratio improved to an excellent 87.3%, reflecting underwriting discipline across commercial and personal lines.
The company also benefits from a strong balance sheet. In February 2026, it completed minority investments in Convex and Onex, which are expected to be accretive to 2026 earnings and ROE. It is also expanding its commercial footprint through an agreement to acquire Everest’s insurance operations in Colombia, with closing expected in early 2027.
Based on short-term price targets offered by 22 analysts, the Wall Street average price target for AIG stands at $88.18 per share, suggesting a 17.4% upside from current levels.
The Zacks Consensus Estimate for AIG’s 2026 earnings is pegged at $7.98 per share, indicating 12.6% year-over-year growth. The estimate witnessed eight upward revisions over the past 60 days against no movement in the opposite direction. Its 2027 earnings estimate indicates a further 10.3% increase. It beat earnings estimates in each of the past four quarters with an average surprise of 15.1%. The consensus mark for 2026 revenues is pegged at $29.18 billion, indicating 6.3% year-over-year growth, while the same for 2027 suggests a further 7% increase.
American International Group, Inc. Price, Consensus and EPS Surprise
American International Group, Inc. price-consensus-eps-surprise-chart | American International Group, Inc. Quote
American Financial Group is well-positioned to benefit from sustained strength in the specialty property and casualty insurance market, supported by disciplined underwriting and a diversified commercial portfolio. In first-quarter 2026, net operating earnings increased 36.5% year over year, while Specialty P&C underwriting profit jumped 66%, driving an annualized return on equity of 15.8%.
The company continues to generate healthy investment income from its high-quality portfolio and maintains a shareholder-friendly capital allocation strategy. It returned $259 million through special dividends and share repurchases in the first quarter. Analysts' price targets currently range from $127 to $158, reflecting differing views on the stock's upside potential.
The Zacks Consensus Estimate for 2026 earnings is pegged at $11.37 per share, indicating a 10.5% year-over-year rise. The estimate has witnessed three upward revisions over the past 60 days against no movement in the opposite direction. Its 2027 earnings estimate suggests a further 5.2% increase. American Financial Group beat the consensus estimate for earnings in three of the past four quarters and missed once, with the average surprise being 7.3%. The consensus mark for 2026 revenues is pegged at $8.01 billion, while the same for 2027 indicates a further 8% jump.
American Financial Group, Inc. Price, Consensus and EPS Surprise
American Financial Group, Inc. price-consensus-eps-surprise-chart | American Financial Group, Inc. Quote
Accelerant Holdings is capitalizing on the growing specialty insurance market through its technology-enabled risk exchange that connects managing general agents or MGAs with diversified risk capital providers. In the first quarter of 2026, Exchange Written Premium increased 16% year over year to $1.14 billion, while operating revenues climbed 57% to $273.2 million. Fee-based Adjusted EBITDA more than doubled, reflecting the company's strategic shift toward capital-light, recurring revenue streams.
Accelerant also expanded its network to 296 members and reaffirmed strong full-year growth expectations. Its proprietary data, AI-driven underwriting tools and scalable marketplace model position the company to deliver profitable, long-term growth as specialty insurance adoption continues to expand. At the end of the first quarter, total assets stood at $8.6 billion. Based on short-term price targets offered by nine analysts, the Wall Street average price target for ARX is at $19.33 per share, suggesting a 53.1% upside from current levels.
The Zacks Consensus Estimate for ARX’s 2026 earnings is pegged at 73 cents per share, which has witnessed five upward estimate revisions over the past 60 days against no movement in the opposite direction. Its 2027 earnings estimate indicates a 24.2% jump. It beat earnings estimates in each of the past four quarters, with an average surprise of 32.6%. The consensus mark for 2026 revenues is pegged at $1.09 billion, implying 19% year-over-year growth, while the same for 2027 suggests a further 9.4% increase.
Accelerant Holdings Price, Consensus and EPS Surprise
Accelerant Holdings price-consensus-eps-surprise-chart | Accelerant Holdings Quote