Insurance stocks you can explore in October

Highlights

• The cost of getting insurance against Credit Suisse defaulting on its debt surged to a record high level on Monday.
• While a sell-off was going on in the bank’s shares and bonds, investors went instead towards buying credit default swaps.
• At a point on Monday, Credit Suisse CDS climbed to 355 basis points, hitting a record high measure of its default risk.

The cost of getting insurance against Credit Suisse defaulting on its debt surged to a record high level on Monday. This happened amidst the rising concerns in markets regarding the strength of the internationally significant Swiss bank’s balance sheet.

While a sell-off was going on in the bank’s shares and bonds, investors went instead towards buying credit default swaps (CDS), which is basically insurance against banks failing to take up on their debts.

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At a point on Monday, Credit Suisse CDS climbed to 355 basis points, hitting a record high measure of its default risk. On the same day, its shares plunged by as much as 11.5%. However, losses came down slightly during the course of the day.

This happened after the bank’s CEO, Ulrich Körner, published a memo to the staff in an effort to reassure them regarding the financial situation of the bank. On 27 October, the bank is set to unveil a strategy to get itself out of this financial hole, which may consist of staff reductions, asset sales and requesting investors for a fresh cash infusion.  

Amid these developments, let’s look at some of the insurance stocks trading on the London Stock Exchange and evaluate their performances.

Beazley Plc (LON: BEZ)

Beazley plc is a group of globally operating insurance professionals. BEZ shares were witnessing a rise of 3.76% on Tuesday at around 12:30 PM (GMT+1), at GBX 579.00. As of 4 October, the company’s return on YTD (year-to-date) basis stands at 24.17%. Meanwhile, its annual return stands at 52.49%. The company enjoys a market capitalisation of £3,404.52 million and currently holds a positive EPS (earning per share) of 0.51. At present, its turnover (on book) is £1,125,549.65.

Aviva plc (LON: AV.)

Aviva plc is a UK-based internationally functioning insurance business. AV. shares were witnessing a surge of 2.54% on Tuesday at around 12:30 PM (GMT+1), at GBX 407.50. As of 4 October, the company’s return on a YTD basis stands at 7.9%. Meanwhile, its annual return stands at 3.8%. At present, the FTSE 100 constituent's market cap stands at £11,139.04 million. The EPS is in the positive territory at 0.50, and its turnover (on book) stands at £6,769,006.74.

Hiscox Ltd (LON: HSX)

Hiscox Ltd is an Anglo-Bermudan insurance providing firm. HSX shares were witnessing a rise of 2.69% on Tuesday at around 12:30 PM (GMT+1), at GBX 887.40. As of 4 October, the company’s return on a YTD basis stands at 3.14%. Meanwhile, its annual return stands at 6.32%. At the time of writing, the market capitalisation of the FTSE 250 company stands at £2,994.76 million. The company has a positive EPS of 0.55, and its turnover (on book) stands at £678,081.76.