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Can P&C Insurers Keep the Q3 Winning Streak Alive in Q4?

A slew of catastrophe events hounded the previous quarter, disrupting results of insurers, particularly the property and casualty insurers. Successive hurricanes like Harvey, Irma, Maria and two Mexican earthquakes have badly affected the underwriting results for the non-life insurers. While many incurred underwriting losses, others faced slump in underwriting profit.

However, capital reserve, built by insurers owing to a not-so-active catastrophe environment, is helping companies meet insurance claims.

In fact performance of the insurance industry impacted by hurricanes-related losses dragged the results of the Finance sector in the third quarter. The current year is estimated to be the costliest in terms of cat loss.

There is no end to insurers' worries as the fourth quarter has already witnessed wildfires in California. This is expected to further dent the fourth-quarter underwriting results.

The industry has underperformed the S&P 500 index quarter to date. While the index has clocked a gain of 2.8%, th industry has grown 1%.

Donegal Group Inc.DGICA provides property and casualty insurance to businesses and individuals in the Mid-Atlantic, Midwestern, New England and the Southern states. The company pulled off a 78.57% earnings surprise in the last quarter. The Zacks Consensus Estimate for 2017 has moved up 32.7% while the same for 2018 has risen 8.7% in the last 30 days. The stock carries a Zacks Rank #2 (Buy).

Shares of Donegal Group have gained 9.4% quarter to date, outperforming the industry as well as the S&P 500 index.

NMI Holdings Inc.NMIH provides private mortgage guaranty insurance services in the United States. Last quarter, the company came up with a 42.86% earnings surprise. The stock has seen the Zacks Consensus Estimate for current-year earnings being revised 11.9% upward while the same for 2018 grew 9.7% over the last 30 days. The stock carries a Zacks Rank of 2.

Shares of NMI Holdings have surged 32.7% quarter to date, outperforming the industry as well as the S&P 500 index.

The Allstate CorporationALL provides property-liability insurance and life insurance coverages in the United States and Canada. The company delivered an 81.82% earnings surprise in the previous quarter. The Zacks Consensus Estimate for 2017 has climbed up 15.1% while the same for 2018 improved 3.5% in the last 30 days. The stock carries a Zacks Rank #3 (Hold).

Shares of Allstate have increased 9.2% quarter to date, coming in above the industry as well as the S&P 500 index's tally.

The Hanover Insurance Group, Inc.THG provides various property and casualty insurance products and services in the United States and internationally. The company pulled off a 121.15% earnings surprise in the preceding quarter. The Zacks Consensus Estimate for 2017 has jumped 12.6% while the same for 2018 has inched up 2.1% in the last 30 days. The stock carries a Zacks Rank of 3.

Shares of The Hanover Insurance Group have gained 9.4% of its value quarter to date, ahead of the industry as well as the S&P 500 index.

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Allstate Corporation (The) (ALL): Free Stock Analysis Report

Donegal Group, Inc. (DGICA): Free Stock Analysis Report

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Infinity Property and Casualty Corporation (IPCC): Free Stock Analysis Report

NMI Holdings Inc (NMIH): Free Stock Analysis Report

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The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.


The views and opinions expressed herein are the views and opinions of the author and do not necessarily reflect those of Nasdaq, Inc.

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