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Harel Insurance Investments' Strong Q1 2026 Financial Performance

Harel Insurance Investments and Financial Services, a prominent player in the Israeli finance and insurance sector, recently unveiled its financial results for the first quarter of 2026, revealing notable growth and a positive outlook. This report emphasizes the strong momentum the company is experiencing, underscoring its resilience and strategic direction, particularly amid a fluctuating economic landscape.

Financial Highlights

In the first quarter of 2026, Harel reported a comprehensive income after tax of NIS 562 million, representing a 3.5% increase compared to the same period the previous year. This growth in profitability reflects the company's effective management strategies and robust performance across various sectors. The return on equity (ROE) stood at an impressive 18.5%, a testament to the group's commitment to generating value for its shareholders.

One of the standout figures from this quarter was the new sales of life and health products, which contributed substantially to the company's growth, generating NIS 514 million in new Contractual Service Margin (CSM). This marked a significant 26% increase compared to the corresponding quarter of the previous year, highlighting the effectiveness of Harel’s sales strategies in growing its market share. Furthermore, the total CSM saw an upward trend, amounting to NIS 17.5 billion as of March 31, 2026.

The total premiums, contributions, and proceeds from investment contracts rose by a noteworthy 18.2%, reaching NIS 12.6 billion in the first quarter, illustrating Harel’s strong capacity in bringing in new business and managing existing contracts effectively. The assets under management climbed to NIS 595 billion as of the end of the quarter, with projections indicating a growth to approximately NIS 630 billion around the time of this report’s publication.

Business Segment Performance

In dissecting the various business segments, the core profit before tax from insurance activities reached NIS 625 million for Q1 2026. Although this was a decrease from NIS 685 million the previous year, it was attributed to higher claims in life risk products, offset by better performance in non-life insurance, particularly within the motor insurance sector.

The Group's significant increase in future profit indicators is driven by new sales in high-demand products, particularly in life risks, medical coverage, and critical illness categories. Notably, the CSM for new business reached NIS 514 million, surpassing expectations and significantly outpacing the NIS 411 million CSM profit recorded for this quarter. This growth affirms the effectiveness of Harel's strategic focus on expanding its offerings in risk products.

Regarding its asset management and credit segments, Harel demonstrated remarkable progress. Core profits from asset management surged to NIS 97 million, a staggering 52% increase over the previous year, primarily propelled by growth in management fees and assets under management, which totalled NIS 463 billion. The credit segment also experienced a robust growth pattern, posting core profits of NIS 61 million, benefiting from enhanced mortgage activities leading to an overall credit portfolio of NIS 8.1 billion.

Health and Insurance Product Insights

In the health insurance segment, comprehensive income before tax stood at NIS 327 million in Q1 2026, showing a slight increase over the previous year. However, the underwriting profit decreased to NIS 192 million, signaling potential challenges in this competitive market. Conversely, non-life insurance showed resilience, with comprehensive income reaching NIS 305 million, reflecting a marked improvement driven primarily by developments in motor insurance lines.

Life insurance, however, experienced more challenges with a comprehensive income before tax of only NIS 24 million, a decrease from NIS 184 million in the prior year, necessitating a critical review of strategies in this segment. Despite these challenges, Harel continues to evolve and adapt its strategies, ensuring it remains a leader in multiple facets of the financial services domain.

Future Outlook

Looking forward, Harel Insurance Investments plans to maintain its trajectory of growth through diversification of its product offerings and strategic asset management. With a solid capital position and extensive market expertise, Harel is set to take advantage of the expanding Israeli economy, aiming to create sustainable value for its stakeholders in the long term.

In essence, Harel Insurance’s Q1 2026 results not only reflect a commitment to resilience and growth but also indicate a promising outlook for the future as it continues to refine its strategies and enhance its offerings across various sectors of insurance and financial services.

Conference Call Announcement

Harel will be holding a conference call for analysts and investors to discuss these results in further detail, scheduled for May 27, 2026. Investors are encouraged to review the company's presentation materials available on their investor relations website prior to the call to fully engage with the discussions.

Given Harel Insurance's robust performance, it continues to affirm its position as a leading figure in the Israeli financial landscape, poised for sustained growth and innovation in the insurance and investment sectors.