Allstate (NYSE:ALL), Hanover (NYSE:THG), Travelers (NYSE:TRV), Arch Capital (Nasdaq:ACGL), Everest Re (NYSE:RE), ACE (NYSE:ACE), PartnerRe (NYSE:PRE)

The property-casualty insurance sector is expected to be under strong pressure in the fourth quarter of 2010, and insurers Allstate (NYSE:ALL), Hanover (NYSE:THG), Travelers (NYSE:TRV), Arch Capital (Nasdaq:ACGL), Everest Re (NYSE:RE), ACE (NYSE:ACE) and PartnerRe (NYSE:PRE) all had their EPS estimates lowered by Barclays.

Barclays said, "The fourth quarter 2010 earnings season is expected to be challenging for the property-casualty insurance sector. This is because P&C insurers are likely to suffer the first quarterly decline in linked-quarter book value since the 2008 financial crisis due to mark-to-market investment losses, and the outlook for 2011 is expected to be uninspiring. Also, 4Q10 EPS estimates appear too high in some cases due the risk of elevated catastrophe losses. In 2010, the Barclays Capital P&C Insurance Index modestly outperformed both the S&P 500 and S&P Financials. Currently, we recommend investors take profits in P&C insurance stocks (especially the insurance brokers) due to our outlook for challenged near-term results for P&C and concerns about a lack of pricing power."

"We are reducing our 4Q10 EPS estimates for Allstate, Hanover Insurance Group, Travelers due to our expectations of elevated U.S. storm losses, and we are lowering our 4Q EPS outlook for Arch Capital & Everest Re to reflect our concern that New Zealand earthquake loss estimates could rise beyond our existing catastrophe load."

"Within the P&C insurance sector, we prefer the shares of primary commercial P&C insurers and select diversified reinsurers over the personal lines P&C insurers and insurance brokers. Broadly, we favor the high-quality names with strong balance sheets, excess capital, and attractive valuations: TRV, ACE Ltd, ACGL, and PartnerRe ."