After a 62% gain in 2013, the prices of U.S. life/annuity stocks fell three percent in the first quarter of 2014, according to the latest issue of Best’s Journal, the bi-weekly publication from A.M. Best. “Further underperformance is expected as stocks are trading at historically high valuations,” the ratings agency said in a release.
Investors continue to be bullish on U.S. health insurance stocks, with results up 3.5% in the first quarter of 2014, the release said. Cash management activity remains strong, however.
The life/health insurance segment returned $3.6 billion to investors through share repurchases and dividends in the first quarter. Health insurers repurchased almost USD $3.4 billion worth of shares, an increase of nearly 133% over the same period of 2013.
Other highlights in this issue of Best’s Journal include as follows:
- U.S. life/health industry continues to tread water in a benign economy:The current low interest rate environment has significantly curtailed near-term growth opportunities for the U.S. life/health insurance industry, according to a Best’s Special Report.
- U.S. health exchange enrollment results may lead to higher utilization: This Best’s Special Report takes a look at the first Affordable Care Act open enrollment numbers and what they may mean for insurance companies.
- Sustainable profitability is key for healthy capitalization of China’s non-life insurers: This Best’s Special Report looks at China’s new solvency framework and A.M. Best’s view of its impact on non-life insurers.
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