Metlife Inc (MET), American International Group Inc (AIG): Why Life Insurers May Need Damage Control

Why should investors care
Though the payouts may hit the insurers’ bottom lines, it may be their reputations that sustain the greatest damage. With Metlife Inc (NYSE:MET)‘s commanding lead of the market (its closest competitor has a full 3% smaller share) it is certainly one of the biggest names in the segment. But if clients’ confidence in the insurer’s willingness to pay out benefits drops, the likelihood of adding new clients may be less. And with the market really looking for signs of revenue growth, the insurer’s stock may take a hit as well.

For long-term investors, this may be just another blip in the insurance market’s radar. But if reputation damage is any measure of how the stocks perform, you’ll want to see if there’s any backlash against the named companies. Otherwise, be on the lookout for any comments from the firms stating that they have adjusted their methods and will be complying with any new regulation that looks to squash the previously lopsided practices.

The article 1 More Reason Life Insurers May Need Damage Control originally appeared on Fool.com is written by Jessica Alling.

Fool contributor Jessica Alling has no position in any stocks mentioned. The Motley Fool recommends American International Group. The Motley Fool owns shares of American International Group and has the following options: Long Jan 2014 $25 Calls on American International Group.

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