Insurance companies collect premiums and pay claims, investing the float between premium collection and claim payment. Property & casualty (P&C) insurers cover homes, autos, and businesses against physical damage. Life and health insurers manage mortality and morbidity risk. The sector benefits from rising interest rates that improve investment income on float portfolios, but faces headwinds from catastrophic weather events that drive unexpected losses.
Combined ratio below 100% signals underwriting profitability. Watch catastrophe loss estimates during hurricane season. Rising interest rates are a structural tailwind for investment income. Premium rate increases signal hard market conditions with improving future profitability.