Guy Carpenter experts from the Asia Pacific region have shared their insights on the reinsurance renewals for January 1, 2026, highlighting the region’s favourable results for the year with lower than average cat losses.
Tony Gallagher, CEO Asia Pacific noted that for the past three years, Guy Carpenter has seen a heightened interest in expanding market share across the region, supported by robust balance sheets.
The company expected APAC’s capacity index to exceed 130%, a surplus that has driven double-digit rate drops across much of the territory.
While program structures remain stable, there has been a broadening of terms and conditions. However, Thailand remains a significant exception due to recent earthquake and flood events.
“The recent earthquake and floods in Thailand remind the market of the potential cat exposure in the region. Subsequently, rates have increased double digits on loss effect programs,” Gallagher said.
Adding: “Some of the insurers take advantage of these opportunities to purchase buy down covers. Others are looking to drive growth and we expect to see an increase in merger acquisition activities as companies seek to enhance scale and diversify risk profiles.
“And finally, MGA has continued to attract significant interest due to their specialised expertise and ability to provide tailor made underwriting solutions for each market.”
The timing for this year’s renewal cycle has been later than usual. Stella Geng, Head of Distribution for Asia Pacific, attributed this delay to the abundance of market capacity and recent localised weather events, such as hail storms and floods, which have extended negotiations.
Geng observed a clear distinction in pricing: loss-free property programs are seeing double-digit risk adjusted increases.
She also noted a growing appetite for structured solutions that allow clients to manage risk over longer horizons, offering greater certainty and financial stability.
“Reinsurance companies are adapting a client focusing approach,” Geng noted. “They’re offering greater flexibility in pricing and a more open to package deals that cross multiple line of business with strategic partners. While these negotiations tend to be more complex and time consuming, early conversation with the reinsurers is critical.
“Starting discussion well ahead of renewal deadlines significantly improves the chances of securing favourable signage. We have seen new market interest in APAC,” the executive stated.
In the retrocession market, there is abundant supply, according to Ben Dunnett, Managing Director, Head of Specialty, Asia Pacific, with the market being at around $37 billion a purchase limit.
“There are markets within our industry that could cover that limit themselves tenfold. As such, supply in general has never been an issue in the retro market. Rather the mix of supply area and price. This renewal retro demand grew by one and a quarter billion dollars or roughly 6% compared with prior year. However, supply is growing even faster with dedicated reinsurance capital increasing by 8% through 2025,” said Dunnett.
This has resulted in a rapidly softening market, with risk-adjusted pricing settling around minus 15%.
Dunner pointed out a shift in product preferences, with a 14% increase in demand for aggregate covers and a renewed interest in lower deductibles as clients look to reinsvest premium savings into earnings protection.
On the international stage, the trend of oversubscription is particularly prevalent in Catastrophe Excess of Loss (Cat XL) placements.
Amber Tcheang, Head of Property Centre of Excellence, noted that while some cedents opted for “pricing discovery” rather than formal quoting, the quotes received ranged from flat to 15% decreases.
Demand for Cat XL has risen as some insurers seek additional limits at the top end of their programs or purchase new buy-downs for 2026, Tcheang noted.
“Although we did see some restructuring, retention levels have remained fairly stable and Risk XL structures have also remained largely unchanged. We’ve seen double digit risk adjusted price reductions for Cat XL, If a Risk XL firm order terms seen are in the range of flat to double digit reductions,” said the executive.
She continued: “Pro-rata have generally experienced improved commission terms, but this very much depends on performance of the individual treaty. When it comes to coverage changes, there’s really been no major market movement to check mate these changes and they are very much case by case depending on cedent requirements.”
Concluding: “However, we have seen some examples of our clause expansion and change from paid to prepaid reinstatements for some cedents, and so far we’ve seen large oversubscription on CAT XL placements. For Risk XL capacity is a bit less abundant, but still no issues to complete these placements.
“Reinsurers have been willing to write across the board to secure sign-ins, including on first layers and frequency covers.”
