Harel Insurance Reports 30% Quarterly Profit Surge, Declares 400 Million Shekel Dividend

Harel Insurance completed the second quarter with a total profit of 1.02 billion shekels, marking a 30% increase compared to the same quarter last year. This growth occurred despite nearly unchanged insurance service revenues, which totaled 3.55 billion shekels. The return on equity rose to 37% this quarter from 33% previously. Core pre-tax profits reached 991 million shekels, up 17% from 849 million shekels in the prior year quarter.

Within core operations, insurance business profits amounted to 699 million shekels, divided among life insurance (270 million), health insurance (266 million), and general insurance (163 million). Additionally, excess investment income, representing returns above the assumed core profit yield, contributed 661 million shekels. Harel and other insurers have benefited significantly from the local market rally over the past two years, though future market downturns will test their profitability and business diversification.

General insurance revenues totaled 1.15 billion shekels, down 7% from 1.23 billion shekels a year earlier, with pre-tax profits of 294 million shekels. This decline is mainly due to lower car insurance prices. Harel remains the largest player in health insurance, its biggest revenue segment, with revenues steady at 1.45 billion shekels and profits rising 58% to 389 million shekels.

Harel manages assets worth 638 billion shekels, up 10% since the start of the year and 17% year-over-year, aiming to reach 780 billion shekels by 2028. Its stock price has surged 640% over three years, valuing the company at nearly 38 billion shekels. The controlling Hamburger family holds 42.3%, with a stake valued around 16 billion shekels.

The company announced a dividend distribution of 400 million shekels this quarter, adding to 1.4 billion shekels paid since the start of the year. Harel updated its dividend policy to quarterly payments instead of semi-annual, distributing 45% of annual profits as dividends.