Jul. 15 at 8:38 PM
Piper Sandler said investors should rotate within the U.S. property and casualty insurance sector rather than exit it as commercial insurance pricing enters a softer phase, marking the first overall decline in P&C premiums since 2017. The firm expects earnings growth to shift away from rate increases and become increasingly dependent on underwriting discipline, cost controls, and capital allocation.
The broker upgraded Arthur J. Gallagher to Overweight, citing its nearly 20% share-price decline despite solid execution and a strong acquisition pipeline. It downgraded Aon, AIG, Hartford, Hanover, and Universal Insurance Holdings to Neutral, arguing that their valuations already reflect operational strengths or recent favorable industry conditions. Piper also noted that diversified commercial insurers are losing some of their defensive appeal as pricing weakness spreads across insurance lines.
$PIPR