NEW YORK (TheStreet) -- With Berkshire Hathaway (BRK.A) holding its highly attended annual shareholders meeting this past weekend, we decided to check TheStreet Ratings to see what mid-cap insurance companies would be a good investments. After all, much of Berkshire's portfolio is concentrated in the sector, notably heavyweight GEICO.

Insurance companies derive the bulk of their revenues from premiums paid by members and most of their expenses from paid claims. In the life insurance sector, the claims come from deaths that more or less follow the actuarial tables with a great degree of accuracy. In the health insurance case, the expenses come from health benefits and cost of drugs. Cost of drugs is about 10% of medical benefits. Health insurance companies usually pay about 85% of their revenues for medical benefits and drug costs. The Affordable Care Act has added millions of new members paying premiums that increase the revenues of health insurance firms as well as revenues for hospitals as more people access the health care system.

So what are the best insurance companies investors should be buying? Here are the top three, according to TheStreet Ratings, TheStreet's proprietary ratings tool.

TheStreet Ratings projects a stock's total return potential over a 12-month period including both price appreciation and dividends. Based on 32 major data points, TheStreet Ratings uses a quantitative approach to rating over 4,300 stocks to predict return potential for the next year. The model is both objective, using elements such as volatility of past operating revenues, financial strength, and company cash flows, and subjective, including expected equities market returns, future interest rates, implied industry outlook and forecasted company earnings.

Buying an S&P 500 stock that TheStreet Ratings rated a "buy" yielded a 16.56% return in 2014 beating the S&P 500 Total Return Index by 304 basis points. Buying a Russell 2000 stock that TheStreet Ratings rated a "buy" yielded a 9.5% return in 2014, beating the Russell 2000 index, including dividends reinvested, by 460 basis points last year.

Check out which three insurance companies made the list. And when you're done be sure to read about which mid-cap oil companies to sell now. Year-to-date returns are based on May 1, 2015 closing prices. The highest-rated stock appears last -- read more to see which one is No. 1.

PRI ChartPRI data by YCharts
3. Primerica, Inc. 
( PRI)
Rating: Buy, A
Market Cap: $2.4 billion
Year-to-date return: -14%

Primerica, Inc., together with its subsidiaries, distributes financial products to middle income households in the United States and Canada. The company operates in three segments: Term Life Insurance; Investment and Savings Products; and Corporate and Other Distributed Products.

"We rate PRIMERICA INC (PRI) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, impressive record of earnings per share growth, increase in net income, notable return on equity and good cash flow from operations. We feel these strengths outweigh the fact that the company shows low profit margins."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • The revenue growth came in higher than the industry average of 3.2%. Since the same quarter one year prior, revenues slightly increased by 8.5%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • PRIMERICA INC has improved earnings per share by 27.3% in the most recent quarter compared to the same quarter a year ago. The company has demonstrated a pattern of positive earnings per share growth over the past two years. We feel that this trend should continue. During the past fiscal year, PRIMERICA INC increased its bottom line by earning $3.26 versus $2.77 in the prior year. This year, the market expects an improvement in earnings ($3.65 versus $3.26).
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Insurance industry. The net income increased by 22.2% when compared to the same quarter one year prior, going from $37.19 million to $45.47 million.
  • The return on equity has improved slightly when compared to the same quarter one year prior. This can be construed as a modest strength in the organization. Compared to other companies in the Insurance industry and the overall market, PRIMERICA INC's return on equity exceeds that of both the industry average and the S&P 500.
  • Net operating cash flow has slightly increased to $104.85 million or 7.71% when compared to the same quarter last year. The firm also exceeded the industry average cash flow growth rate of -5.26%.
Must Read:  3 Payments Companies to Add to Your Portfolio Right Now

SFG ChartSFG data by YCharts
2. StanCorp Financial Group, Inc. (SFG)

Rating: Buy, A
Market Cap: $3 billion
Year-to-date return: 3.6%

StanCorp Financial Group, Inc., through its subsidiaries, provides financial products and services in the United States. The company operates in two segments, Insurance Services and Asset Management.

"We rate STANCORP FINANCIAL GROUP INC (SFG) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures, attractive valuation levels, increase in stock price during the past year and increase in net income. We feel these strengths outweigh the fact that the company shows low profit margins."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • SFG's revenue growth has slightly outpaced the industry average of 3.2%. Since the same quarter one year prior, revenues slightly increased by 2.1%. Growth in the company's revenue appears to have helped boost the earnings per share.
  • Although SFG's debt-to-equity ratio of 0.22 is very low, it is currently higher than that of the industry average.
  • The stock has risen over the past year as investors have generally rewarded the company for its earnings growth and other positive factors like the ones we have cited in this report. Turning our attention to the future direction of the stock, it goes without saying that even the best stocks can fall in an overall down market. However, in any other environment, this stock still has good upside potential despite the fact that it has already risen in the past year.
  • The net income growth from the same quarter one year ago has significantly exceeded that of the S&P 500 and the Insurance industry. The net income increased by 17.5% when compared to the same quarter one year prior, going from $48.10 million to $56.50 million.
Must Read:  3 Mid-Cap Oil Companies You Should Sell Right Now

SYA ChartSYA data by YCharts
1. Symetra Financial Corporation (SYA)

Rating: Buy, A+
Market Cap: $2.8 billion
Year-to-date return: 3.5%

Symetra Financial Corporation, through its subsidiaries, provides products and services that serve the retirement, employee-based benefits, and life insurance markets in the United States and the District of Columbia.

"We rate SYMETRA FINANCIAL CORP (SYA) a BUY. This is based on the convergence of positive investment measures, which should help this stock outperform the majority of stocks that we rate. The company's strengths can be seen in multiple areas, such as its revenue growth, largely solid financial position with reasonable debt levels by most measures and solid stock price performance. We feel these strengths outweigh the fact that the company has had sub par growth in net income."

Highlights from the analysis by TheStreet Ratings Team goes as follows:

  • SYA's revenue growth has slightly outpaced the industry average of 3.2%. Since the same quarter one year prior, revenues slightly increased by 0.8%. This growth in revenue does not appear to have trickled down to the company's bottom line, displayed by a decline in earnings per share.
  • Although SYA's debt-to-equity ratio of 0.20 is very low, it is currently higher than that of the industry average.
  • Compared to its closing price of one year ago, SYA's share price has jumped by 25.09%, exceeding the performance of the broader market during that same time frame. Regarding the stock's future course, although almost any stock can fall in a broad market decline, SYA should continue to move higher despite the fact that it has already enjoyed a very nice gain in the past year.
  • SYMETRA FINANCIAL CORP has experienced a steep decline in earnings per share in the most recent quarter in comparison to its performance from the same quarter a year ago. This company has reported somewhat volatile earnings recently. We feel it is likely to report a decline in earnings in the coming year. During the past fiscal year, SYMETRA FINANCIAL CORP increased its bottom line by earning $2.19 versus $1.75 in the prior year. For the next year, the market is expecting a contraction of 15.5% in earnings ($1.85 versus $2.19).
  • The gross profit margin for SYMETRA FINANCIAL CORP is currently extremely low, coming in at 9.39%. It has decreased significantly from the same period last year. Regardless of the weak results of the gross profit margin, the net profit margin of 7.05% is above that of the industry average.
Must Read:  3 Mid-Cap Pharmaceutical Companies to Add to Your Portfolio

More from Opinion

Breaking: Bill Cosby Found Guilty on All Counts in Sexual Assault Retrial

Breaking: Bill Cosby Found Guilty on All Counts in Sexual Assault Retrial

Earnings Season Is Simply Out of Control Madness - How Are You Surviving?

Earnings Season Is Simply Out of Control Madness - How Are You Surviving?

Why Ether and Ripple -- But Not Bitcoin -- Prices Might Come Under Pressure Soon

Why Ether and Ripple -- But Not Bitcoin -- Prices Might Come Under Pressure Soon

Daily Chatter: Here's Where the Markets Stand After Tuesday's Beating

Daily Chatter: Here's Where the Markets Stand After Tuesday's Beating

3 New Investing Myths That Must Be Busted

3 New Investing Myths That Must Be Busted