A buyers’ market is anticipated to continue throughout this year, and while some carriers are satisfied with the reinsurance programmes they secured during the January 1 renewal season, others are expected to look for additional protection later in 2026, J. Patrick Gallagher, President and CEO of Gallagher, predicts.
Following a year of robust underwriting results and a notably quiet 2025 US hurricane season, risk-adjusted property catastrophe pricing reduced by 10% to 20% on average at 1.1, according to reinsurance broker Gallagher Re.
Strong underwriting results in 2025 led to plenty of reinsurance capacity to support client demand. While previous renewals were defined by tight capacity and rising attachment points, the current environment is characterised by choice and opportunity for buyers.
“The property reinsurance market saw rate decreases in the teens, with lower layers holding up better than the top end of reinsurance towers. Gallagher saw some continued demand for more cover and increased purchasing by clients,” the executive stated.
Property reinsurance premiums were down mid-to-high single digits overall, with many buyers prioritising “downpricing” rather than “up risking,” Gallagher Re’s 1st View report noted.
Some cedents successfully negotiated a “rational tradeoff,” securing enhanced coverage at lower prices to better manage earnings volatility.
Gallagher said: “Despite double-digit price declines for property cat globally, property reinsurance premiums were down only mid-to-high single-digits relative to last year.
“Within specialty lines, marine and energy experienced increased carrier competition. Pricing across casualty lines continued to be broadly stable because most reinsurers remain very cautious of US-focused casualty risks.”
Despite the double-digit price declines in property catastrophe, the broker reports that market returns are still viewed as adequate by most sellers.
Gallagher concluded: “Looking ahead, we expect the buyers’ market will persist through 2026 absent any outsized current year or prior year loss activity.
“While clients are comfortable with their purchased reinsurance programs at 1.1, we believe it is likely that some carriers will explore buying additional protection to further reduce earnings volatility, or support growth throughout 2026.”
