P&C stocks suffer worst month of 2025 as global equities extend recovery in October

By Carlos Pallordet

(The Insurer) - Insurance sector benchmarks continued to underperform the broader market in October on both sides of the Atlantic.

Global equities continued the recovery trend seen since mid-year, with markets responding positively to easing inflation pressures, resilient corporate earnings and signs of progress in international trade relations. While geopolitical risks and policy uncertainty remained in focus, investor sentiment improved as macroeconomic data pointed to a more stable outlook.

The S&P 500 recorded its sixth consecutive monthly gain with an increase of 2.3%, bringing its year-to-date advance to 16.3%. The rally was led by technology and consumer discretionary stocks, with earnings from major firms broadly exceeding expectations. Investors welcomed signs of moderating inflation and a more measured tone from the Federal Reserve, which cut interest rates by 25 basis points at its October meeting.

Geopolitically, markets reacted to the Trump-Xi summit in South Korea, where the two leaders agreed on a one-year deal covering rare earths and critical minerals.

European markets also posted robust gains. The Stoxx Europe 600 rose 2.5% – its strongest monthly performance since May – reflecting improved sentiment across the region. Optimism around U.S. growth, easing trade tensions and a stable interest rate environment helped lift equities, particularly in consumer and industrial sectors.

Among regional indexes, the UK’s FTSE 100 rose 3.9%, supported by strength in energy and financials, while the FTSE 250 rose 0.7%. In continental Europe, the French CAC 40 gained 2.9% while Germany’s DAX edged up 0.3%, held back by weaker industrial output and cautious corporate guidance.

As in the previous two months, Europe-listed P&C (re)insurers underperformed the broader market, with the sector-specific Stoxx 600 Insurance index declining by 1.6% in October.

Seventeen of the 21 listed European (re)insurers tracked by The Insurer ended the month in negative territory, with five of them recording losses of more than 6%.

Shares in French reinsurer Scor, which hit a yearly peak on October 8, plunged on Friday to close down 12.4% for the month — the steepest drop across the cohort. The fall followed the publication of third-quarter results that beat consensus but prompted investor concerns about underlying trends.

Axa, which posted its nine-month results on Thursday, closed down 7.4% for October.

Norwegian peers Protector Forsikring and Gjensidige fell 7.0% and 6.8%, respectively, with profits at the latter hit by one-off costs from ending a major IT project in its pension segment.

Shares in German group Talanx fell 6.8%, while Mapfre ended the month 4.9% lower – though it remains up 56.7% year to date, the second-best performance across the cohort.

At the other end of the spectrum, Norwegian insurer Storebrand and Ireland-based FBD Holdings both recorded gains of 3.2%.

The other two risers during the month were London-listed peers Beazley and Hiscox, which added 2.6% and 0.4%, respectively.

THE PICTURE IN THE US

Across the Atlantic, most P&C insurance stocks declined in October,following a mixed performance in the previous month.

The sector-specific S&P 500 Insurance dropped 8.0%, adding to a 1.2% loss in Q3. In contrast, the broader S&P 500 added 2.3% in October and 7.4% in Q3.

Out of 46 carriers tracked by The Insurer, 34 retreated in October, with 19 falling more than 5%.

Newly listed Accelerant led the losses with a fall of 22.0%. This followed a drop of 25.7% in September and 27.2% in August.

Large-cap personal lines insurer Progressive recorded the second-largest fall among U.S. carriers, with its shares down 16.2%.

On October 15, the Mayfield, Ohio-based auto insurer reported a steep September earnings miss, hit by a $950 million Florida policyholder credit that sharply inflated expenses and pushed its combined ratio above 100%.

Kemper fell 12.7% in the month and remains the worst performer on a year-to-date basis with a fall of 32.3%. The company announced in mid-October that its president and CEO Joseph Lacher was stepping down from the role after nearly 10 years and would also leave its board.

Allstate lost 10.8% in the month. The personal lines insurer disclosed an estimated $161 million of catastrophe losses in September 2025, with the hit coming from eight wind and hail events during the period.

Shares in Everest Group fell 10.2% in October as investors reacted to the announcement of a retail commercial insurance renewal rights sale, a $1.2 billion adverse development cover and a Q3 earnings miss.

The disclosure, which included $478 million in reserve charges in the third quarter primarily related to its retail commercial insurance business, prompted AM Best to revise the group’s outlook to negative.

Meanwhile, shares in insurtech Root were down 10.0% for the month while American Financial Group and RLI both fell by 9.6%.

Other significant fallers in the month included Mercury General, down 8.8%, Old Republic and Selective, both down 7.1%, and WR Berkley and The Hartford, each down 6.9%.

Arch Capital and Berkshire Hathaway declined 4.9% and 5.1%, respectively.

Among the few risers, coastal insurer Universal Insurance Holdings led the gains with a 17.2% increase, after the Fort Lauderdale-based homeowners carrier reported a sharp rebound in profitability, helped by benign weather and improving market conditions in Florida.

Peers HCI Group and American Coastal also benefited from a benign hurricane season, with shares rising 6.3% and 4.0%, respectively.

With a rise of 12.2%, insurtech Lemonade posted the second-largest monthly gain in the cohort and remains the third-best performer in the year to date.

Recently listed American Integrity Insurance Group rose 6.8% in October, following gains of 11.6% in September and 7.1% in August.

BROKERS FALL

Among intermediaries, The Baldwin Group remained under pressure, falling 21.7% in October after a 34.1% decline in Q3, continuing the downward trajectory that started mid-year.

Arthur J Gallagher ended the month 19.5% lower. The broker reported third-quarter organic growth of 4.8% across its combined brokerage and risk management segments, a sequential slowdown from 5.4% in Q2 2025 and below the 6% recorded in Q3 2024.

Gallagher’s fall was followed by Brown & Brown, which lost 15.0% in October and remains the second-largest faller on a year-to-date basis. The intermediary disclosed organic revenue growth of 3.5% in Q3 2025, a slowdown compared with both the preceding quarter and Q3 2024.

Marsh McLennan’s shares came under pressure following the release of its Q3 results and declined 11.6% in the month.

WTW lost 9.4% despite beating Q3 earnings estimates on strong organic growth and margin expansion.

Meanwhile Aon and Ryan Specialty were down 4.5% and 2.8%, respectively.