My Top Life Insurance Stock to Buy in October

Investing in the stock market has been increasing worrisome in 2022, with the S&P 500 and Dow Jones Industrial Average recently hitting new 52-week lows. But not all stocks are falling. The stock of employee benefits provider General Group (NYSE: UNM) is skyrocketing in 2022, up over 67% so far this year.

This insurer admittedly struggled early in the pandemic, but now the business is thriving as headwinds from the pandemic greatly ease. The stock price is already up significantly, but here’s why you should consider adding it to your portfolio even now.

The top employee benefits provider struggled in the pandemic

Unum Group provides employee benefit policies covering dental, vision, and life insurance. The past few years have been a roller coaster for the insurer.

When the COVID-19 virus emerged, widespread lockdowns in unemployment rates skyrocketing. The US unemployment rate reached nearly 15% in April 2020. This reduced the number of customers Unum Group could serve since there was a smaller pool of employees.

Its business faced more struggles in the months that followed as morbidity rates and claims costs on life insurance policies jumped due to the virus. From 2019 to 2021, Unum saw group life claims jump 23% to 49,000 and disability claims increase 40% to 700,000. Two older people meet with a business person in a living room.

Image source: Getty Images.

Unum’s impressive turnaround story

With the worst of the pandemic mostly behind us, Unum Group’s business now has tailwinds working in its favor. As of September, the unemployment rate is 3.5%, and employee wage growth is solid at around 5%. This is good news for Unum, as rising wages allow it to increase the amount it charges on its policies. Rising wages increase Unum’s premiums collected, up 5% and double its growth seen before the pandemic.

The company also expects to see improvements from fewer claims

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