Aflac Incorporated

(New York Stock Exchange)
Back to all articles
Somewhat Bullish +50

Zacks Industry Outlook Highlights Aflac, Unum, Globe Life, Trupanion and Employers

AI-generated analysis

📈 The Zacks Accident and Health Insurance industry is expected to benefit from increased underwriting exposure and demand for group insurance.

⚠️ Higher inflation, rising medical costs, and soft pricing over recent quarters could offset some of the industry's positive drivers.

💰 The $300 billion A&H insurance market in 2024 is projected to expand to approximately $420 billion by 2033.

📉 Pricing pressure is expected to continue due to inflation, demographic changes, and efforts to retain market share.

🤖 Accelerated adoption of AI, data analytics, and telemedicine is helping insurers gain a competitive edge and reduce claim expenses.

🏆 The Zacks Accident and Health Insurance industry currently holds a Rank #102, placing it in the top 42% of all Zacks industries.

📊 The industry has outperformed its Finance sector year-to-date with a 5.5% gain against the sector's 0.9% decline.

💵 Aflac (AFL) is expected to benefit from strategic growth investments and the Argus buyout, though 2026 earnings estimates show a slight decrease.

📈 Unum Group (UNM) expects adjusted operating income per share between $8.60 and $8.90 for 2026 with premium growth of 4-7%.

🐾 Trupanion (TRUP), a pet insurer, delivered a trailing four-quarter earnings surprise of 250% on average with strong long-term growth potential.

🏭 Globe Life (GL) is driven by positive revenue trends in its Life and Health Insurance segments, particularly from Liberty National.

🛡️ Employers Holdings (EIG), the 19th largest workers' compensation provider, expects a significant 139.8% increase in 2026 earnings estimates.

📉 The industry trades at a trailing 12-month price-to-book ratio of 1.68X, significantly lower than the S&P 500 composite's 8.08X.

🔮 Analyst confidence is gradually increasing as aggregate earnings estimate revisions show positive growth potential for constituent companies.

Bullish Signals
  • The Accident and Health Insurance industry is projected to expand from $300 billion in 2024 to approximately $420 billion by 2033, reflecting strong long-term growth potential.
  • Aflac delivered a trailing four-quarter earnings surprise of 7.86% on average, demonstrating robust performance ahead of expectations.
  • Unum Group expects adjusted operating income per share between $8.60 and $8.90 for 2026, with premium growth anticipated in the 4-7% band driven by persistence and new sales.
  • Trupanion delivered a trailing four-quarter earnings surprise of 250% on average and holds a Growth Score of A, indicating strong upside potential.
  • Employers Holdings consensus estimates suggest a significant 139.8% year-over-year increase in earnings for 2026, followed by a 5.6% increase in 2027.
  • Globe Life's Liberty National division is expected to drive top-line growth with net life and health sales projected to grow in the mid-teens.
  • The industry benefits from increasing adoption of technology, including AI which could reduce workers' compensation claim expenses by about 45%.
  • Unum Group has an impressive dividend track record, having increased dividends 17 times in the last 16 years with an estimated 10-15% increase going forward.
Risk Factors
  • The Zacks Consensus Estimate for Aflac's 2026 earnings implies a year-over-year decrease of 4.9%, indicating near-term earnings contraction.
  • The consensus estimate for Aflac's 2026 earnings has moved south in the past 30 days, reflecting deteriorating analyst sentiment.
  • Higher inflation and rising medical costs are expected to offset industry positives, creating headwinds for profitability.
  • Soft pricing is anticipated to persist over the coming quarters, which could constrain premium growth and margins.
  • Efforts to retain market share will further increase pricing pressure, which might curb top-line growth.
  • The industry currently trades at a price-to-book ratio of 1.68X, significantly below the S&P 500 composite's 8.08X and the sector's 4.28X, suggesting potential undervaluation or market skepticism.
  • Over the past five years, the industry has traded as low as 0.97X, indicating significant volatility and downside risk in valuation multiples.
Full Analysis
Zacks Equity Research highlights five stocks within the Accident and Health Insurance industry, including Aflac Inc. (AFL), Unum Group (UNM), Globe Life (GL), Trupanion (TRUP), and Employers Holdings (EIG). The firm expects the sector to benefit from increased underwriting exposure and growing demand for group insurance, though it notes that higher inflation and rising medical costs could offset these positives. Soft pricing is anticipated to persist over the coming quarters, but a rise in lower-severity claims and the adoption of technology are expected to support industry operations. The Accident and Health Insurance market, valued at approximately $300 billion in 2024, is projected to expand to roughly $420 billion by 2033. While pricing pressure remains due to inflation and demographic shifts like an aging population, the industry maintains profitability through solid reserves and prudent claims management. Technology adoption, particularly artificial intelligence and telemedicine, is expected to reduce claim expenses and improve risk profiling, although it may increase expense ratios. Specific company outlooks include Aflac, which delivered a 7.86% earnings surprise on average and has an expected long-term earnings growth rate of 8.1%. Unum Group expects adjusted operating income per share between $8.60 and $8.90 for 2026 with premium growth of 4-7%, and it boasts a dividend yield better than the industry average. Globe Life anticipates mid-teens growth in net life and health sales driven by its Liberty National division. Trupanion, a pet insurer, shows strong analyst confidence with expected earnings increases of 17.8% for 2026 and 33% for 2027, following a 250% trailing four-quarter earnings surprise. Employers Holdings is noted as the 19th largest provider of workers' compensation insurance to small businesses in low-to-medium hazard industries, with consensus estimates suggesting a significant 139.8% increase in earnings for 2026 followed by a 5.6% increase in 2027. The industry currently trades at a price-to-book ratio of 1.68X, compared to the S&P 500 composite's 8.08X.