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Harel Insurance Reports Impressive Q2 2026 Results

Harel Insurance Investments and Financial Services, a prominent player in the Israeli insurance and financial sector, released its remarkable second quarter and first half results for 2026. The company demonstrated significant growth, with comprehensive income reaching NIS 1.024 billion, marking a robust 30% increase compared to the same quarter from the previous year. This impressive performance highlights the effectiveness of Harel's operational strategies and the resilience of its business model.

Financial Highlights

The surge in comprehensive income in Q2 can be attributed to various factors, including an uptick in investment income and a notable expansion in core profits. Specifically, the core profits in the asset management, credit, and equity segments saw a remarkable rise of 68%, fueled by continuous growth in assets under management (AUM) and the credit portfolio.

In the first half of 2026, Harel recorded a comprehensive income after tax of NIS 1.59 billion, a 19% increase compared to the same period last year, with a return on equity (ROE) of 27%. This financial growth is evidence of Harel's strong market position and effective capital management strategies.

Life and Health Insurance

A significant part of Harel's growth comes from its life and health insurance sectors, where the Contractual Service Margin (CSM) from new sales increased by 23% to NIS 992 million in the first half. The CSM for life and health insurance signifies future profitability from new insurance contracts, which now stands at NIS 17.7 billion as of June 30, 2026.

Dividend Distribution

In conjunction with its solid financial results, Harel's Board announced a change in its dividend policy, moving from semi-annual to quarterly distributions. The company plans to distribute a dividend of NIS 400 million, adding to the total dividends and share buybacks approximating NIS 1.5 billion since the year's start. This revised policy not only reflects confidence in sustained earnings but also aims to enhance shareholder value.

Business Segment Performance

Core Profits Analysis

Overall, Harel's core profits after tax for Q2 2026 rose by 17% to NIS 637 million from NIS 546 million in the previous year. This growth is indicative of effective management across various business segments. Moreover, core profits from insurance activities improved to NIS 699 million, enhancing Harel's stability.

Asset Management

In the asset management division, core profits climbed by 58% in Q2 2026 to NIS 131 million, reflecting rising assets under management and an increase in management fees. With total AUM reaching NIS 498 billion, the company continues to capitalize on favorable market conditions to drive profitability.

Credit Sector Growth

The credit segment also showed a healthy 32% increase in core profits to NIS 79 million, underscoring the ongoing demand for credit services. The credit portfolio grew to NIS 8.8 billion, showcasing Harel’s strategic positioning in the financial services sector.

Health and Life Insurance Improvement

The health insurance sector reported a substantial improvement, with pre-tax comprehensive income rising to NIS 389 million, while life insurance reported pre-tax income of NIS 503 million. This progress can be attributed to effective underwriting practices and strategic product offerings aimed at meeting customer needs.

Conclusion

Harel Insurance Investments and Financial Services continues to showcase robust growth and resilience in an evolving market landscape. With proactive strategies, a diverse product range, and strong financial leadership, Harel is well-positioned to capitalize on future opportunities, further solidifying its reputation as a leader in the insurance and financial services industry. Investors and analysts will be watching closely as Harel adapts to market demands and drives sustainable growth in the years to come.

For more detailed insights into Harel's performance and future outlook, follow upcoming conference calls and investor presentations available on their investor relations platform.