Based on key financial metrics such as the price-to-sales ratio, shareholder yield and the price-earnings ratio, the following 7 stocks made the list for top value stocks in the Insurance industry. Those looking for value stocks to add to their portfolio may want to use this list as a starting point for further investment research.

Why Focus on Undervalued Insurance Stocks?

Value investors seek to buy stocks at a discount to their intrinsic value. Long-term returns show that such strategies are advantageous. Value stocks, as a group, tend to outperform growth stocks over extended periods of time. Typically, value investors perform financial analysis of numerous metrics, don’t follow the herd and are long-term investors.

AAII’s A+ Investor Value Grade is derived from a stock’s Value Score. The Value Score is the percentile rank of the average of the percentile ranks of the price-to-sales ratio, price-earnings ratio, enterprise-value-to-EBITDA (EV/EBITDA) ratio, shareholder yield, price-to-book-value ratio and price-to-free-cash-flow ratio. The score is variable, meaning it can consider all six ratios or, should any of the six ratios not be valid, the remaining ratios that are valid. To be assigned a Value Score, stocks must have a valid (non-null) ratio and corresponding ranking for at least two of the six valuation ratios.

What Goes Into AAII’s Value Grade?

Stock evaluation requires access to huge amounts of data as well as the knowledge and time to sift through it all, make sense of financial ratios, read income statements and analyze recent stock movement. AAII created A+ Investor, a robust data suite that condenses data research in an actionable and customizable way suitable for investors of all knowledge levels, to help investors with that task.

AAII’s proprietary stock grades come with A+ Investor. These offer intuitive A–F grades for more than just value. It is possible for a stock to appear cheap based on one valuation metric but appear expensive on another. It is also possible for one valuation ratio to be associated with outperforming stocks during certain periods of time but not others. Some stocks may even have null values for certain metrics like the price-earnings ratio or the price-to-book ratio but not others. An example of this would be a company with losses instead of profits or a negative book value because of heavy borrowing. Negative earnings or book value result in non-meaningful ratios that are left blank or null.

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7 Undervalued Insurance Stocks

Of course, there are countless value stocks that are worth mentioning, but this is a concise list of the top 7 undervalued stocks in the Insurance industry for Thursday, October 24, 2024. Let’s take a closer look at their individual scores to see how they measure up against each other and the Insurance industry median.

The Value Grade is assigned based on how each stock’s composite valuation compares to all other stocks.

The process for assigning grades starts with each variable for a given stock. The percentile rankings for all valid ratios that a stock has are calculated. So, for instance, a stock could have a price-to-book ranking in the 43rd percentile, a price-earnings ranking in the 67th percentile, a price-to-sales ranking in the 23rd percentile, etc. Then, those rankings are averaged for each stock. (A minimum of two valid variables are required, though all six will be used if available.)

Once the average of the individual variables is calculated, that average is ranked against all stocks. Put another way, each stock’s composite valuation is compared to all other stocks. These ranks are then sorted into quintiles from the cheapest 20% (a grade of A) to the most expensive 20% (a grade of F).

As always, we recommend that you conduct proper due diligence and research before investing in any security. We also suggest that investors utilize numerous grades, not just value, when it comes to deciding whether a company is a good fit for their allocation needs.

Atlantic American Corporation’s Value Grade

Value Grade:

Atlantic American Corporation, through its subsidiaries, provides life and health, and property and casualty insurance products in the United States. It operates through American Southern and Bankers Fidelity segments. The company offers property and casualty insurance products, including commercial automobile insurance coverage for state governments, local municipalities, and other motor pools and fleets; general liability; and inland marine insurance products. It also provides surety bond coverage for subdivision construction; school bus contracts; and performance and payment bonds. In addition, the company offers individual and group whole life insurance products; Medicare supplement insurance products; and other accident and health insurance products comprising various individual and group policies for the payment of standard benefits for the treatment of diagnosed cancer and other critical illnesses, as well as various other products, such as short-term nursing facility care, accident only, hospital indemnity, and disability coverages. It markets its products through independent agents and brokers. The company was founded in 1937 and is based in Atlanta, Georgia. Atlantic American Corporation is a subsidiary of Atlantic American / Delta Group.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Atlantic American Corporation has a Value Score of 85, which is considered to be undervalued.

When you look at Atlantic American Corporation’s price-to-sales ratio at 0.18 compared to the industry median at 1.01, this company has a lower price relative to revenue compared to its peers. This could make Atlantic American Corporation’s stock more attractive for value investors.

Shareholder yield is the sum of a stock’s dividend yield (paid over previous 12 months minus special dividends) and the percentage of net share buybacks over the previous 12 months. Atlantic American Corporation’s shareholder yield is lower than its industry median ratio of 1.50%. Value investors may look for an attractive shareholder yield because it can be a powerful tool for identifying if the company has a good management team.

As one of the most common value metrics, the price-to-book ratio evaluates a company’s current market price relative to its book value. Atlantic American Corporation’s price-to-book ratio is lower than its industry median ratio of 1.55. This could make Atlantic American Corporation more attractive to investors looking for a new addition to their portfolio.

Lastly, let’s take a look at Atlantic American Corporation’s price-to-free-cash-flow ratio (P/FCF), which can indicate a company’s market value relative to its operating cash flow. Atlantic American Corporation’s price-to-free-cash-flow ratio is higher than its industry median ratio of 8.80. This could make Atlantic American Corporation less attractive because the higher P/FCF ratio indicates that Atlantic American Corporation is undervalued. The P/FCF ratio metric can also be viewed over a long-term time frame to see if the company's cash flow to share price value is generally improving or worsening.

Enstar Group Limited’s Value Grade

Value Grade:

Enstar Group Limited acquires and manages insurance and reinsurance companies and portfolios in run-off in Bermuda and internationally. It engages in the run-off property and casualty; other reinsurance; life and catastrophe; and legacy underwriting businesses; as well as investment activities. The company also provides consulting services, including claims inspection, claims validation, reinsurance asset collection, syndicate management, and IT consulting services to the insurance and reinsurance industry. In addition, it offers technical inspections of records and claims investigation, diligence services, finality solutions to Lloyd’s syndicates and management, as well as broker replacement, claims resolution, and incentive-based collection services for reinsurers and Lloyd’s syndicates. The company was formerly known as Castlewood Holdings Limited and changed its name to Enstar Group Limited in January 2007. Enstar Group Limited was founded in 1993 and is headquartered in Hamilton, Bermuda.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Enstar Group Limited has a Value Score of 85, which is considered to be undervalued.

Enstar Group Limited’s price-earnings ratio is 5.5 compared to the industry median at 14.9. This means that it has a lower price relative to its earnings compared to its peers. This makes Enstar Group Limited more attractive for value investors.

Enstar Group Limited’s price-to-book ratio is higher than its peers. This could make Enstar Group Limited less attractive for value investors when compared to the industry median at 1.55.

You can read more about Enstar Group Limited’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Fidelis Insurance Holdings Limited’s Value Grade

Value Grade:

Fidelis Insurance Holdings Limited, a specialty insurer, provides insurance and reinsurance solutions in Bermuda, the Republic of Ireland, and the United Kingdom. It operates in three segments: Specialty, Reinsurance, and Bespoke segments. The Specialty segment offers aviation and aerospace, energy, marine, property direct and facultative, and other specialty risk solutions. The Reinsurance segment provides property, retrocession, and whole account reinsurance solutions. The Bespoke segment offers customized risk solutions for clients that include credit and political risk, as well as other risk transfer opportunities, including political violence and terrorism, limited cyber reinsurance, tax liabilities, title, transactional liabilities, and other bespoke solutions. Fidelis Insurance Holdings Limited was incorporated in 2014 and is headquartered in Pembroke, Bermuda.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Fidelis Insurance Holdings Limited has a Value Score of 91, which is considered to be undervalued.

Fidelis Insurance Holdings Limited’s price-earnings ratio is 4.6 compared to the industry median at 14.9. This means that it has a lower price relative to its earnings compared to its peers. This makes Fidelis Insurance Holdings Limited more attractive for value investors.

Fidelis Insurance Holdings Limited’s price-to-book ratio is higher than its peers. This could make Fidelis Insurance Holdings Limited less attractive for value investors when compared to the industry median at 1.55.

You can read more about Fidelis Insurance Holdings Limited’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

MetLife, Inc.’s Value Grade

Value Grade:

MetLife, Inc., a financial services company, provides insurance, annuities, employee benefits, and asset management services worldwide. It operates through six segments: Retirement and Income Solutions; Group Benefits; Asia; Latin America; Europe, the Middle East and Africa; and MetLife Holdings. The company offers life, dental, group short-and long-term disability, individual disability, pet insurance, accidental death and dismemberment, vision, and accident and health coverages, as well as prepaid legal plans; administrative services-only arrangements to employers; and general and separate account, and synthetic guaranteed interest contracts, as well as private floating rate funding agreements. It also provides pension risk transfers, institutional income annuities, structured settlements, and capital markets investment products; and other products and services, such as life insurance products and funding agreements for funding postretirement benefits, as well as company, bank, or trust-owned life insurance used to finance nonqualified benefit programs for executives. In addition, it provides fixed, indexed-linked, and variable annuities; pension products; regular savings products; whole and term life, endowments, universal and variable life, and group life products; longevity reinsurance solutions; credit insurance products; and protection against long-term health care services. MetLife, Inc. was incorporated in 1999 and is based in New York, New York.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

MetLife, Inc. has a Value Score of 64, which is considered to be undervalued.

MetLife, Inc.’s price-earnings ratio is 22.9 compared to the industry median at 14.9. This means that it has a higher price relative to its earnings compared to its peers. This makes MetLife, Inc. less attractive for value investors.

MetLife, Inc.’s price-to-book ratio is lower than its peers. This could make MetLife, Inc. more attractive for value investors when compared to the industry median at 1.55.

You can read more about MetLife, Inc.’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Old Republic International Corporation’s Value Grade

Value Grade:

Old Republic International Corporation, through its subsidiaries, engages in the insurance underwriting and related services business primarily in the United States and Canada. It operates through three segments: General Insurance, Title Insurance, and Republic Financial Indemnity Group Run-off Business. The General Insurance segment offers aviation, commercial auto, commercial multi-peril, commercial property, general liability, home and auto warranty, inland marine, travel accident, and workers' compensation insurance products; and financial indemnity products for specialty coverages, including errors and omissions, fidelity, directors and officers, and surety. This segment provides its insurance products to businesses, state and local government, and other institutions in transportation, commercial construction, healthcare, education, retail and wholesale trade, forest products, energy, general manufacturing, and financial services industries. The Title Insurance segment offers lenders' and owners' policies to real estate purchasers and investors based upon searches of the public records. This segment also provides escrow closing and construction disbursement services; and real estate information products, national default management services, and various other services pertaining to real estate transfers and loan transactions. The Republic Financial Indemnity Group Run-off Business segment offers private mortgage insurance coverage that protects mortgage lenders and investors from default related losses on residential mortgage loans made primarily to homebuyers. Old Republic International Corporation was founded in 1923 and is based in Chicago, Illinois.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Old Republic International Corporation has a Value Score of 77, which is considered to be undervalued.

Old Republic International Corporation’s price-earnings ratio is 15.1 compared to the industry median at 14.9. This means that it has a higher price relative to its earnings compared to its peers. This makes Old Republic International Corporation less attractive for value investors.

Old Republic International Corporation’s price-to-book ratio is lower than its peers. This could make Old Republic International Corporation fairly attractive for value investors when compared to the industry median at 1.55.

You can read more about Old Republic International Corporation’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Principal Financial Group, Inc.’s Value Grade

Value Grade:

Principal Financial Group, Inc. provides retirement, asset management, and insurance products and services to businesses, individuals, and institutional clients worldwide. The company operates through Retirement and Income Solutions, Principal Asset Management, and Benefits and Protection segments. The Retirement and Income Solutions segment provides retirement, and related financial products and services. It offers products and services for defined contribution plans, including 401(k) and 403(b) plans, defined benefit plans, nonqualified executive benefit plans, employee stock ownership plans, equity compensation, and pension risk transfer services; individual retirement accounts; investment only products; and mutual funds, individual variable annuities, registered index-linked annuities, and bank products, as well as trust and custody services. The Principal Asset Management segment provides equity, fixed income, real estate, and other alternative investments, as well as asset allocation, stable value management, and other structured investment strategies. It also offers pension accumulation products and services, mutual funds, asset management, income annuities, and life insurance accumulation products, as well as voluntary savings plans in Brazil, Chile, Mexico, Asia, China, Hong Kong Special Administrative Region, and Southeast Asia. The Benefits and Protection segment provides specialty benefits, such as group dental and vision insurance, group life insurance, and group and individual disability insurance, as well as administers group dental, disability, and vision benefits; and individual life insurance products comprising universal, variable universal, indexed universal, and term life insurance products. It also offers insurance solutions for small and medium-sized businesses and their owners, as well as employees. Principal Financial Group, Inc. was founded in 1879 and is based in Des Moines, Iowa.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Principal Financial Group, Inc. has a Value Score of 77, which is considered to be undervalued.

Principal Financial Group, Inc.’s price-earnings ratio is 17.1 compared to the industry median at 14.9. This means that it has a higher price relative to its earnings compared to its peers. This makes Principal Financial Group, Inc. less attractive for value investors.

Principal Financial Group, Inc.’s price-to-book ratio is lower than its peers. This could make Principal Financial Group, Inc. more attractive for value investors when compared to the industry median at 1.55.

You can read more about Principal Financial Group, Inc.’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Sun Life Financial Inc.’s Value Grade

Value Grade:

Sun Life Financial Inc., a financial services company, provides savings, retirement, and pension products worldwide. The company operates in five segments: Asset Management, Canada, U.S., Asia, and Corporate. It offers various insurance products, such as term and permanent life; personal health, which includes prescription drugs, dental, and vision care; critical illness; long-term care; and disability, as well as reinsurance. The company also provides advice for financial planning and retirement planning services; investments products, such as mutual funds, segregated funds, and annuities; and asset and investment management products consisting of pooled funds, institutional portfolios, and pension funds. In addition, it offers real estate services; manages equity capital in various private and listed funds, as well as mezzanine debt, middle market direct lending, high-yield bonds, and syndicated loans; and operates as an investment grade fixed income investor, real estate investment management advisor, infrastructure investment manager, and alternative credit investment manager. The company was formerly known as Sun Life Financial Services of Canada Inc. and changed its name to Sun Life Financial Inc. in July 2003. Sun Life Financial Inc. was founded in 1871 and is headquartered in Toronto, Canada.

Stocks with a Value Score from 81 to 100 are considered deep value, those with a score between 61 and 80 are value and so on.

Sun Life Financial Inc. has a Value Score of 77, which is considered to be undervalued.

Sun Life Financial Inc.’s price-earnings ratio is 14.7 compared to the industry median at 14.9. This means that it has a lower price relative to its earnings compared to its peers. This makes Sun Life Financial Inc. more attractive for value investors.

Sun Life Financial Inc.’s price-to-book ratio is higher than its peers. This could make Sun Life Financial Inc. less attractive for value investors when compared to the industry median at 1.55.

You can read more about Sun Life Financial Inc.’s key financial metrics like shareholder yield, price-to-free-cash-flow and EV/EBITDA ratio, or learn more about its Momentum and Growth Grades, by subscribing to A+ Investor.

Other Insurance Stock Grades

Value is just one of the five Stock Grades included in our A+ Investor service. AAII members can see the top-graded stocks—those with grades of A or B for value, growth, momentum, earnings estimate revisions and quality—on the A+ Stock Grades Screener.

Also, if you want full access to all of AAII’s premium services, you can subscribe to one convenient bundled plan called AAII Platinum where you can try out A+ Investor, AAII Dividend Investing, the Stock Superstars Report, Growth Investing and VMQ Stocks. With the other premium services, you can dive deep into additional metrics, portfolios, commentary and information about Insurance stocks as well as other industrys.

Choosing Which of the 7 Best Insurance Stocks Is Right for You

Choosing which value stocks to invest in will ultimately depend on your individual goals and allocation; however, comparing similar value stocks in the same industry can help you analyze which might be better investments for you in the long run. So, let’s take a look at the Value Grade for all of our stocks.

• Atlantic American Corporation stock has a Value Grade of A.
• Enstar Group Limited stock has a Value Grade of A.
• Fidelis Insurance Holdings Limited stock has a Value Grade of A.
• MetLife, Inc. stock has a Value Grade of B.
• Old Republic International Corporation stock has a Value Grade of B.
• Principal Financial Group, Inc. stock has a Value Grade of B.
• Sun Life Financial Inc. stock has a Value Grade of B.

Now that you have a bit more background about each of the 7 undervalued stocks in the Insurance industry as well as their overall grades, it’s time for you to conduct additional research to see if these could fit your portfolio needs based on your goals and risk tolerance. AAII can help you figure out both and identify which investments align with what works best for you.

We do so through a program of education that teaches you to invest for yourself and become an effective manager of your own wealth—no more relying on others for your financial independence. You can rely on AAII for timeless articles on financial planning and stock-picking, unbiased research and actionable analysis that makes you a better investor.

A+ Investor adds to that qualitative teaching by giving you a powerful data suite that helps you whittle down investment decisions to find stocks, exchange-traded funds (ETFs) or mutual funds that meet your needs.

Additional Resources About Insurance Stocks

Want to learn more about Insurance stocks to see if they could be the right investment for you? Check out some additional resources and articles to help you on your financial journey.

• 7 Undervalued Insurance Stocks for Thursday, October 24
• 4 Undervalued Insurance Stocks for Wednesday, October 23
• 6 Undervalued Insurance Stocks for Tuesday, October 22
• 7 Undervalued Insurance Stocks for Monday, October 21

AAII Disclaimer

We make no representations or warranties that any investor will, or is likely to, achieve profits similar to those shown, because past, hypothetical or simulated performance is not necessarily indicative of future results. Before making an investment decision, you should consider your circumstances and whether the information on our content is applicable to your situation. This information was prepared in good faith and we accept no liability for any errors or omissions. The full disclaimer can be read here.