Is the U.S. insurance sector running out of gas? By the looks of the chart below, all indications are that the glorious run from the 2009 low may be over. The iShares US Insurance ETF (IAK) seems to be running out of steam just as it approaches the previous high set in 2007. A breakout to the upside is possible but not before taking a break to the downside.
The only consideration at this time is downside risk. The chart above outlines the Dow Theory downside targets with Edson Gould’s SRL extreme downside target of $16.81. Short-term, the downside target of $37.41 looms as a reasonable reaction from the recent peak before the sector potentially retests the prior high. The $30.91 level is considered the fair value for the IAK and should be assumed to be a required level for a retest if a full bear market ensues. As $11.38 was easily achieved from similar heights in the period from 2007 to 2009, so too should investors be willing to accept that $16.81 is possible.
Insurance Watch
| symbol | Name | Price | P/E | EPS | Yield | P/B | % from yr low |
| GLRE | Greenlight Capital Re, Ltd. | 30.24 | 10.46 | 2.89 | - | 0.98 | 1.24% |
| PNX | The Phoenix Companies Inc. | 33.3 | - | -37.09 | - | 0.61 | 1.68% |
| CRD-B | Crawford & Company | 8.25 | 15 | 0.55 | 2.2 | 2.61 | 2.61% |
| ACE | ACE Limited | 107.63 | 12.92 | 8.33 | 2.4 | 1.19 | 8.23% |
| RNR | RenaissanceRe Holdings Ltd. | 103.09 | 8.18 | 12.6 | 1.2 | 1.14 | 9.80% |
| BRO | Brown & Brown Inc. | 31.85 | 22.12 | 1.44 | 1.3 | 2.18 | 9.83% |
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