Insurance stocks are publicly traded securities that represent ownership interests in insurance companies, and they can make a great addition to any investor’s stock portfolio. Not only does the insurance business have the potential to deliver excellent long-term returns, but it also can perform well in good times and bad.
With that in mind, here’s an overview of how the insurance business works, some important concepts to know, and three insurance stocks that investors should keep on their radar in 2026 and beyond.
3 top insurance stocks for 2026
| Name and ticker | Current price | Market cap | Dividend yield |
|---|---|---|---|
| Progressive (NYSE:PGR) | $201.28 | $117.7 billion | 6.91% |
| Markel Group (NYSE:MKL) | $1,772.47 | $22.2 billion | 0.00% |
| Kinsale Capital Group (NYSE:KNSL) | $323.61 | $7.5 billion | 0.23% |
1. Progressive
NYSE: PGR
Key Data Points
Progressive (PGR +0.32%) is a great option for investors seeking insurance exposure with low volatility. It is the largest publicly traded auto insurance company in the United States and has a long history of excellent profitability and growth.
Because it's been around for so long, many investors don't realize how much of a technology leader Progressive is. The company launched the first mass-market telematics device over a decade ago and has been innovating ever since. It has a massive data advantage over peers, which has allowed it to underwrite more effectively and produce outsized returns. In fact, Progressive has generated a total return of about 700% over the past 10 years, handily outperforming the S&P 500.
2. Markel
NYSE: MKL
Key Data Points
NYSE: KNSL
Key Data Points
Kinsale Capital Group (KNSL -2.24%) could be a great insurance stock for investors who want something a bit more exciting than a large, long-established insurance company.
If you aren't familiar with the company, Kinsale is the only pure-play specialty insurance company (in insurance terms, excess and surplus) in the market. This means the company specializes in assessing high-risk situations and complex challenges. For example, if you wanted to open a high-risk business like a demolition company, you would probably need a specialty insurer like Kinsale.
Specialty insurance is a difficult business, but there is a lot of money to be made if you're good at it -- and Kinsale definitely is. The average company in Kinsale's peer group has generated an 8.3% underwriting profit margin over the past three years, and Kinsale's was about three times that.
Warren Buffett chose the insurance industry as the backbone of his empire.
How to invest in insurance stocks
The process of investing in insurance stocks is pretty straightforward:
- Open your brokerage account: Log in to your brokerage account where you handle your investments. If you don't have one yet, take a look at our favorite brokers and trading platforms to find the right one for you.
- Search for the stock: Enter the ticker or company name into the search bar to bring up the stock's trading page.
- Determine the number of shares to purchase: Consider your investment objectives and the percentage of your portfolio you wish to allocate to this stock.
- Select order type: Choose between a market order to buy at the current price or a limit order to specify the maximum price you're willing to pay.
- Submit your order: Confirm the details and submit your buy order.
- Review your purchase: Check your portfolio to ensure your order was filled as expected and adjust your investment strategy accordingly.
Benefits and risks of investing in insurance stocks
There are some excellent reasons to invest in insurance stocks:
- Insurance stocks can be a great way to build wealth over time without excessive risk.
- Insurance companies generate revenue not only from profitable underwriting but also from investments, and therefore can be excellent total return investments.
- Insurance is a recession-resistant business, as paying for insurance is largely considered an essential expense, even during tough times.
- Insurance is also an inflation-resistant business, as premiums tend to rise over time along with the cost of living.
However, there's no such thing as a risk-free stock investment, and insurance stocks aren't an exception:
- By nature, insurance has an element of unpredictability -- after all, the definition of insurance is transferring risk from one party (customers) to another (the insurance company).
- Insurance profits can be lumpy, meaning they aren't always consistent.
- Insurance companies make less money from their investments if interest rates fall..
The bottom line
Insurance companies have highly attractive economics. Other people give them money to hold until a claim needs to be paid, and the insurer can invest it in the meantime for its own benefit. This is why Warren Buffett is so attracted to insurance and chose it as the backbone of Berkshire Hathaway’s empire.
Insurance is also a recession-resistant business. During tough times, people still need to maintain auto and homeowners coverage, for example. In short, insurance is a business that can deliver excellent long-term returns with relatively low volatility.
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FAQ
Insurance stock FAQ
About the Author
Matt Frankel, CFP has positions in Berkshire Hathaway, Kinsale Capital Group, and Markel Group. The Motley Fool has positions in and recommends Berkshire Hathaway, Kinsale Capital Group, and Markel Group. The Motley Fool has a disclosure policy.
