And more gains may be on the way: The three are poised to climb another 12% to 18%, according to Credit Suisse analyst Michael Zaremski.

The industry is benefiting from a new pricing mindset that has more to do with interest rates than Sandy. As Warren Buffett pointed out in his recent letter to Berkshire Hathaway shareholders, price competition in the insurance industry is such that firms tend to operate at an underwriting loss in most years. Many companies end up with a "combined ratio," or losses and expenses as a percentage of premiums collected, of over 100%. That doesn't mean they lose money; they can make up the difference in returns on their vast investment portfolios.

But as savers know well, healthy, predictable investment returns have become difficult to find. The 10-year Treasury bond yields 1.9%, less than one-third its historic average and below the latest yearly reading on inflation. If that were a short-term condition, insurers would be able to ignore it. But the Federal Reserve has kept its core Fed funds rate near zero for more than four years in an effort to spur economic growth and hiring. It shows little sign of relenting.

Mutual insurers have begun raising prices to acknowledge that investment returns can no longer be counted on to offset underwriting losses. That has cleared the way for publicly traded insurers to do the same. Mutual insurers are owned by their policyholders, so they're not under shareholder pressure to earn profits. That gives them a pricing advantage and usually puts them in the role of spoiler for publicly traded firms that wish to raise rates. No longer.

The group is benefitting from some other shifts, too. Some firms are trimming risky geographic exposure or changing policy terms to protect profitability. Strong recent stock returns have bolstered insurer assets. And while Sandy brought steep losses, it gave companies cover to raise rates, at least in the affected areas. Plus, the current quarter has been unusually benign. U.S. catastrophe costs are trending 45% below the historical average, according to Zaremski.

Insurance price hikes from last year will carry through to this year's profit statements. Allstate, for example, wrote policies last year with a gross average premium of $1,104 – up 7.1% from the prior year, according to Deutsche Bank analyst Joshua Shanker. Three months ago, Wall Street predicted the company would earn $4.52 this year, up from $4.36 last year. Since then, the forecast has been raised to $4.66. That puts Allstate stock at just 10 times earnings. Shanker predicts the company will buy back a "minimum" of $2 billion worth of its shares this year. That's 9% of its stock market value. Shares also carry a dividend yield of 2.1%.

Ace and Travelers go for 11 and 12 times earnings, respectively. Both yield 2.2%.