European property-catastrophe rate reductions varied by territory at the January 1st 2026 reinsurance renewals, with softening of up to 20%, according to Howden’s latest renewal report, with the firm expecting further softening in this part of the market throughout 2026.
The global insurance and reinsurance broking group said rate reductions at these renewals were partly influenced by historical loss experience — including Bernd in Germany (2022) and the 2023 hailstorms in Italy — as well as strong broker advocacy on behalf of clients.
France, Italy, Switzerland and the UK recorded the largest rate reductions, ranging from down 10% to down 20%, while Germany, where direct placements are more prevalent, experienced more moderate softening of between down 8% and down 11%.
Howden noted that European property-catastrophe renewals at January 1st 2026 were shaped by low loss activity, an oversupply of capital and reinsurers’ desire to defend top lines. Capacity outpaced demand, as incumbent reinsurers drew on retained earnings to compete for signings and preserve market share.
“The renewal process ran later than in prior years, with many programmes issuing firm orders simultaneously, making it harder for reinsurers to adjust their deployment strategies. Smaller, less diversified cedents purchasing on a catastrophe-and-risk combined basis typically saw slightly smaller reductions (down 10% to 17.5%) whilst risk excess layers were down 10% on average,” said Howden.
The report revealed that reinsurer appetite was more segmented than in pre-hard years, resulting in less uniformity across programmes and layers. Some reinsurers maintained strict underwriting discipline, while others demonstrated greater flexibility, producing more nuanced renewal outcomes.
Despite some movement on terms, retentions remained largely unchanged, as the majority of cedents opted to take monetary savings rather than pursue lower attachment points.
“As a result, cedents have begun to explore ways to redeploy budget savings in late 2025 and early 2026 – targeting standalone sub- layers, reinstatement premium protection covers, new programme structures or other over-placement strategies – to better manage retentions. Reinsurers will respond with supplementary capacity as they seek to boost top-line income not secured during the main 1 January 2026 signing process,” Howden explained.
For the remainder of 2026, Howden expects the market to continue softening, although this could be tempered by increased scrutiny of margin sustainability or the occurrence of a major loss. Buyers are likely to continue benefiting as favourable market conditions spur further innovation and help close specific coverage gaps.
One such area is parametric protection, which Howden said is gaining traction among clients seeking to supplement core programmes or find solutions for risks not well covered by standard treaties.
