In the days between when polls for the 2020 election closed and former Vice President Joe Biden was named the president-elect, health insurance stocks were largely unaffected by the uncertainty. In fact, many health insurance stocks saw big gains.
Mainly, this happened because investors looked to whether Democrats or Republicans would control Congress as an indicator of how likely it would be for new health initiatives to become law.
It appears Democrats will retain control of the House of Representatives, but both parties had tied for 48 seats in the Senate as of Nov. 9. Four races still hadn't been called, though Republican candidates currently lead in Alaska and North Carolina's Senate races, according to the APM Research Lab.
John Barnidge, an analyst for investment banking company Piper Sandler, told S&P Global Market Intelligence that control of Congress will be the most important outcome for health insurers. It will likely be challenging for progressive healthcare legislation to pass both chambers, meaning insurers can expect relatively small changes to their business under the new president-elect.