Markel Group $MKL-Interesting competitor $UNH

Hello, investors,

I believe Markel showed very disciplined and improving underwriting in the third quarter. Their combined ratio improved to roughly 93 % versus 97% last year, as they stated on the earnings call. This is crucial for an insurance company, because lower combined costs mean more of the premium should remain as margin for profit and investment. On top of that, their investment income is rising — within insurance operations Markel reports higher yields thanks to fixed income in the portfolio. Additionally, in the first three quarters of the year they accumulated over 2 miliardy USD in operating cash flow and also executed share buybacks for 344 milionů USD.

Their international division also shows very strong combined ratio results — for that segment it’s reportedly around 84 % according to the transcript of their call. That indicates Markel can manage risks relatively efficiently even outside its home market and has a solid operating model across different segments. From my point of view this means a stable base and potential for further growth, especially if the underwriting cycle is favorable.

On the other hand, UnitedHealth reported massive revenues in Q3/2025 — revenues over 113 miliard USD, a year-over-year increase of about 12%. That’s impressive and shows their business model is very strong in terms of scale. However, margins are suffering. Their medical care ratio (MCR) in that quarter reached 89,9 %, which is quite high and means a large portion of premiums goes directly into care costs. Moreover, their net operating margin is very low according to the reports — net margin amounted to only 2,1 %.

UnitedHealth generates massive revenues and has a broad reach in insurance and healthcare services (through the Optum segment), so it is very sensitive to cost pressures related to healthcare. A higher MCR suggests rising care expenses could threaten their profitability, especially if the cost trend continues. Some analysts also point to potential market and regulatory risks that could further squeeze margins. Besides that, what attracts me to Markel is its capital discipline — buybacks and solid cash flow provide shareholders with real returns and indicate management’s confidence in the business. With UnitedHealth, although they raised their 2025 outlook (adjusted EPS to at least 16,25 USD), they still face pressure from operating costs and will find it challenging to sustain strong margins if healthcare spending does not ease.