Hot Picks: U.S. insurers advance as niche growth trends gain attention

U.S. insurance companies are drawing attention as investors look beyond broader financial sector concerns and focus on niche business models and growth opportunities.

BNN Bloomberg spoke with Andrew Kligerman, managing director and analyst at TD Cowen, who outlined how select insurers are benefiting from targeted markets, diversified revenue streams and evolving distribution strategies.

Key Takeaways

• Niche insurance markets, such as low face-value life policies, offer growth with limited competition and steady sales momentum.
• Retirement services and investment management remain key drivers for diversified insurers with large third-party asset bases.
• Fee-based and capital-light business segments are helping support stable earnings and long-term growth.
• Embedded insurance models are expanding, allowing customers to purchase coverage seamlessly through partner platforms.
• Strategic partnerships and digital distribution trends are reshaping how insurance products are marketed and sold.

Read the full transcript below:

ANDREW B.: On Hot Picks, our focus is three U.S. financials, and our guest has an outfit called Globe Life at the top of his list. We are joined by Andrew Kligerman, managing director and analyst at TD Cowen. Thanks very much indeed for joining us. Andrew, looks like you’ve got a nice day there.

ANDREW K.: Yeah, it’s beautiful. Thank you for having me.

ANDREW B.: Tell us off the top what Globe Life is. What attracts you to the name?

ANDREW K.: Sure, love the name. It is predominantly a provider of relatively low face amount life insurance to lower middle-income consumers, and then it also runs robust supplemental health and direct-to-consumer businesses.

ANDREW B.: Are they a niche player? A specialty player?

ANDREW K.: They are a niche in the sense that their policy sizes are approximately $40,000 to $50,000, an area where no one else has an interest, and they have a captive sales force of nearly 12,000 agents who focus exclusively on this product. So very light on competition and quite solid in the margins. So yeah, I would call that very unique.

ANDREW B.: And the small policies — there is a market for those, but I guess there’s just less profit as far as the other players are concerned?

ANDREW K.: 100 per cent. This area of the population is vastly underpenetrated. And they always say insurance is sold, it’s not bought. So if you’ve got a good, motivated sales force like Globe, the opportunity is fantastic. And what we see year in, year out is mid- to high-single-digit sales growth, mid- to high-single-digit recruiting growth. It’s kind of like clockwork.

ANDREW B.: Your next idea is also active in life insurance, Voya Financial. Tell us what their angle is, please.

ANDREW K.: Yeah, that’s an exciting one too, because Voya is — the crux, the major part of what they do is retirement savings record-keeping. And 401(k)s are the big area, but they also have a pretty sizable investment management business with $360 billion in AUM and a supplemental health business.

ANDREW B.: That’s interesting. So sorry, that portfolio of more than $300 billion — that’s simply shareholder or policyholder money that they’re investing?

ANDREW K.: Actually, a portion of it, maybe a third of it, is policyholder, but the bulk of it is third-party investments — equities, mutual funds, institutional money. It’s a terrific business.

ANDREW B.: Your final idea here — and they’re all fresh ideas for me — Baldwin Insurance. What do they do? What’s their main activity?

ANDREW K.: Yeah, and one last thing on Voya, which is interesting — they had a Financial Times article that cited them as a potential takeout. So there’s been a lot of info around that one. But Baldwin is exciting in that it is predominantly a commercial insurance broker with leading specialized areas of expertise in the middle and upper middle market. And Baldwin also boasts robust embedded insurance products that are deploying AI and will be a big beneficiary there.

ANDREW B.: What do you mean, embedded policies? How would that work?

ANDREW K.: Sure. So within one of their embedded areas, they work with 20 of the 25 largest homebuilders in the country, and because buyers of their homes input a lot of personal information, they can simply hit a button and get homeowners insurance. And Baldwin is at the forefront of that. They’ve got products with mortgage servicers, and they’re working with other new products. And that’s actually the smaller part, but the very exciting part of what Baldwin does.

ANDREW B.: That’s it — and home insurance, this is people will automatically buy home insurance from the homebuilder?

ANDREW K.: Yeah, the whole world is changing. We’re seeing these embedded products now at auto dealers and all kinds of places. The world as we know it is changing.

ANDREW B.: That’s interesting. I guess we’re all sick of bureaucracy and filling out forms, and if there’s an easier option, we might just buy it from the people who built our home.

ANDREW K.: 100 per cent.

ANDREW B.: I guess as consumers, you need to shop around, but that’s always been the case.

ANDREW K.: Correct, correct. And they get good prices. They are brokers, so they’re obligated to shop it around and get a good price.

ANDREW B.: Andrew, you gave us some fresh angles on the insurance business there. Thank you very much indeed, Andrew.

ANDREW K.: Thank you. Have a great one.

ANDREW B.: You too. Andrew Kligerman, managing director and analyst at TD Cowen.

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This BNN Bloomberg summary and transcript of the April 27, 2026 interview with Andrew Kligerman are published with the assistance of AI. Original research, interview questions and added context was created by BNN Bloomberg journalists. An editor also reviewed this material before it was published to ensure its accuracy and adherence with BNN Bloomberg editorial policies and standards.