Health Insurers Weather Storms Heading Into 2010

"All of the publicly traded companies have far more reserves than are required by the government," he said.

They also may not be hurt as badly by a federal health care overhaul as many analysts first worried. Congress is debating ways to cover the uninsured and reduce costs, and health insurance stocks have been sensitive to this debate for months.

Shares sank at the start of the year when the reform debate picked up steam, but they have recovered for the most part as the threat of a strong public option that would compete with insurers faded.

A possible tax on insurers based on their market share remains a concern. But overall, analysts say the sector remains on sound footing heading into the next few quarters.

"I think they're getting a really bad shake in the current environment," Costa said. "But the core businesses are there."

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