By Arasu Kannagi Basil and Ateev Bhandari
(Reuters) -Insurance companies' first-time share sales on Wall Street hit a 20-year high this year as investors flocked to firms that were insulated from U.S. President Donald Trump's trade war.
Predictable cash flows and resilient business model gave private equity firms an opportunity to sell some portfolio companies and offered investors a safe haven as other industries got whipsawed by escalating tariffs, sticky inflation, labor market cracks and geopolitical
turmoil.
Apollo-backed Aspen Insurance and American Integrity Insurance were among the first IPOs to trade after Trump initiated a trade war, which sent the markets sideways and derailed other debuts. Aspen and American Integrity raised nearly $457 million and $127 million, respectively, in their initial public offerings.
STABLE EARNINGS
"The tariff impact and the resulting volatility pushed many investors towards companies with more stable earnings, cash flows. Insurance is one of those niche areas that fits that profile," said Mike Bellin, IPO services leader at PwC U.S.
Insurtech Exzeo was the latest to tap public markets earlier this month, raising $168 million, in a pivot away from parent HCI Group's previous plan to pursue a spin-off.
"The sector has benefited from being a bit more insulated from tariff pressure than others," said Andy Mertz, head of equity capital markets at Citizens, which has underwritten five insurance IPOs this year.
TWO-DECADE HIGH
The number of insurance-related IPOs on U.S. exchanges has hit its highest levels since 2005, according to Dealogic data.
"We're seeing an above-average number of insurance IPOs in a below-average year," said Matt Kennedy, senior strategist at Renaissance Capital, a provider of IPO-focused research and ETFs.
U.S.-listed insurance IPOs have raised $2.64 billion combined this year as of November 5, the most since the 2021 boom, Dealogic data showed, and they have performed well.
American Integrity has soared nearly 30% since its debut, while Aspen is about 23% higher. Neptune Insurance and Ategrity Specialty have gained 16% and roughly 8%, respectively.
Kennedy said insurers are generally doing well as a group as many have seen their investment portfolios returns and premiums increase.
While there have been some concerns in the sector over falling insurance prices and tariff-driven higher claims, bankers expect the industry's strong growth will continue to attract investors.
"Despite pricing pressures in the sector, investors remain focused on company-specific growth strategies for management teams exploring a public listing," Mertz said.
LOOKING AHEAD
PwC's Bellin said there is a pipeline of insurers ready to go public, many of which are owned by PE firms and have spent the last two years building scale.
Still, the lingering effects of the longest-ever U.S. government shutdown are causing short-term delays as the Securities and Exchange Commission works on clearing its IPO backlog after operating with skeletal staffing during the gridlock.
"It's definitely going to impact the number of IPOs that we see in 2025," Bellin said. "That really pushes the momentum into the first half of 2026."
(Reporting by Ateev Bhandari and Arasu Kannagi Basil in Bengaluru. Editing by Dawn Kopecki and Shilpi Majumdar)
