NEW YORK ( TheStreet) -- For the week ended Aug. 26, the S&P 500 Insurance Index gained 2.9%, while the KBW Insurance Index was up 3.4%. In comparison, the broader S&P 500 Index rose 4.7%. Meanwhile, at close yesterday, the S&P 500 Insurance Index ended 4.8% higher, while KBW Insurance Index moved up 5.7%. The S&P 500 rose 2.8%.

Insurance stocks are on a relief rally as estimates that show Hurricane Irene's cost to insurers was less than expected. Catastrophe modelers expected insurers to pay almost $14 billion towards Irene's damages. However, a ballpark estimate is loss of only $2.6 billion. Industry analysts say that insurers have not been able to raise rates during the past three years amid strong competition and readily available supply. Now, even a small storm could be the catalyst to trigger across-the-board premium increases. Analysts believe that this latest storm could lead to significant firming in the insurance industry, after years of weakness.

These eight insurance stocks are adequately capitalized with more than $1.4 billion. Based on the hurricane damage, latest quarterly results and analysts' buy and hold ratings for attractive future returns, these stocks have potential upsides ranging from 7% to 25%. On average, analysts' surveyed by Bloomberg have buy recommendation of 56% and hold rating of 35% for these stocks.

We have listed these stocks in ascending order of upside implied by average analyst price target.

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