5 Best Insurance Stocks Under $70

3. Aflac Incorporated (NYSE:AFL)

Number of Hedge Fund Holders: 32 

Share Price as of October 13: $57.41   

Aflac Incorporated (NYSE:AFL) provides supplemental health and life insurance products. It is one of the premier insurance stocks to invest in. On August 18, the company announced that it would be adding mental health conditions to its individual short term disability insurance product coverage. This coverage comes after preliminary data revealed that 53 million adults in the US experienced mental illness in 2020, of which 46% of adults received treatment. 

Among the hedge funds being tracked by Insider Monkey, London-based firm Marshall Wace LLP is a leading shareholder in Aflac Incorporated (NYSE:AFL), with 1.1 million shares worth more than $61.7 million. 

In its Q2 2021 investor letter, Madison Funds, an asset management firm, highlighted a few stocks and Aflac Incorporated (NYSE:AFL) was one of them. Here is what the fund said:

“This quarter we are highlighting Aflac Incorporated (NYSE:AFL) as a relative yield example in the Financial sector. AFL is a leading provider of life and supplemental medical insurance in Japan and the U.S. AFL products offer financial protection against loss of income for policy holders based on qualifying health events. Aflac Japan generates approximately 70% of total revenues, and the company has dominant market share in Japan. In the U.S., AFL provides voluntary insurance for policy holders at businesses with products sold through payroll deduction by its large sales force which sells primarily through face-to-face interactions. We believe AFL’s dominant market position in Japan and its large U.S. sales force create a sustainable competitive advantage for the company.

Our thesis on AFL is that its sales will recover from the impact of the COVID pandemic, and it will return significant amount of capital to shareholders. Sales were negatively impacted in both Japan and the U.S. but appear to be in early stages of recovering. We believe sales will improve further as economies open and new products are introduced in Japan. In the U.S., agents will be able to return to face-to-face interactions as people get vaccinated, something that was restricted last year (…read more)