Aon, a global professional services firm focused on risk, retirement and health solutions, reports in its Q1 2026 Global Insurance Market Insights that the insurance sector is experiencing broadly softer pricing conditions, supported by strong capacity and intensifying competition, alongside continued discipline in specific higher-risk and regulated areas.
Aon notes that pricing is falling across most regions and lines of business as insurers compete more aggressively and deploy increased capacity, with some large US property accounts seeing double-digit reductions.
According to Aon, certain insurers are also extending long-term agreements on selected risks, allowing clients to secure current pricing levels for longer periods.
However, Aon reports that the pace of reductions is slowing in several areas, with signs of stabilisation in lines such as directors and officers insurance and cyber.
In contrast, Aon highlights continued firmness in automobile and US-exposed casualty, where insurers are still seeking modest increases in response to claims experience, while Japan remains distinct due to regulatory pressure supporting firmer pricing conditions.
Aon describes overall market capacity as abundant, underpinned by strong insurer profitability and supportive reinsurance outcomes following the 1 January renewals. Competition is intense, with both established insurers and new market entrants seeking to grow their portfolios, particularly in property and non-US casualty business.
Aon also observes increased participation from international markets, including the London insurance market, especially for larger and more complex risks. While capacity is generally strong, Aon points out that constraints persist in US casualty, certain commercial motor risks, and selected property and casualty exposures in Japan.
On underwriting, Aon reports that insurers are broadly flexible in order to remain competitive, with greater willingness to adjust terms and conditions, increase limits and enhance coverage offerings.
However, Aon emphasises that underwriting discipline remains in place, with insurers continuing to align pricing and appetite closely with risk quality. Clients demonstrating strong risk management practices and effective loss prevention, according to Aon, are more likely to achieve improved terms.
At the same time, Aon notes that underwriting remains more restrictive in complex and higher-risk areas such as US casualty, motor and catastrophe-exposed property risks, with regulatory developments in Japan and China also contributing to tighter underwriting standards.
Aon highlights that insurers are increasingly willing to provide higher limits and sub-limits in competitive lines such as property, cyber and directors and officers insurance. Many clients are taking advantage of current conditions to restore limits that were reduced in prior harder market conditions and to align coverage more closely with exposure data and modelling insights.
However, Aon reports continued caution in US casualty, motor and certain catastrophe-exposed property risks, where insurers remain selective on higher limits and, in some cases, are reducing exposure.
Deductibles are largely stable, though Aon notes pressure in areas affected by adverse loss trends, particularly automobile and US excess casualty, while some clients are reassessing deductible strategies as part of wider cost of risk management.
In terms of coverage, Aon observes that most renewals are maintaining existing terms, although there is growing availability of broader coverage and enhancements across competitive lines including property, cyber and directors and officers. Aon also highlights opportunities for clients to reinstate previously reduced coverages and sub-limits, particularly in relation to climate, cyber and supply chain risks.
Innovation continues in the cyber market, with developments including coverage for artificial intelligence-related threats and supply chain exposures. At the same time, Aon notes ongoing restrictions in casualty markets relating to per- and polyfluoroalkyl substances and data privacy, while in Mexico, regulatory and enforcement changes linked to drug trafficking are expected to contribute to tighter conditions for strikes, riots and civil commotion cover.
