Analysts at KBW expect risk-adjusted property catastrophe reinsurance rates to decline by 15–20% during the January 2026 reinsurance renewals, with the relatively “late” season pointing to overall decreases approaching 20%.
KBW stated that unchanging per-occurrence attachment points reflect generally sustained reinsurer discipline. Reinsurers broadly anticipate at least adequate catastrophe reinsurance results in 2026.
The analysts also observed that the devastating California wildfires in January 2025 had virtually no impact on property catastrophe reinsurance pricing during the subsequent June and July renewals, aside from loss-impacted California accounts.
During those renewals, risk-adjusted pricing fell by around 10% year over year, reflecting the widely perceived rate super-adequacy following dramatic rate and attachment point increases in 2023, which compounded more modest increases in preceding years.
Beyond catastrophe reinsurance pricing—which reportedly includes slightly larger decreases than the 15–20% range for non-wind lines, European catastrophe reinsurance, and retrocessional reinsurance—KBW anticipates little change in the predominantly proportional casualty reinsurance market, particularly in the U.S., across most other lines. As a result, reinsurers should see roughly the same pricing and loss trends as primary insurers for those lines.
KBW suggested that reinsurers should generate acceptable returns in 2026, assuming reasonably normal catastrophe losses. However, the broader trend of declining property catastrophe reinsurance rates implies declining year over year expected returns, likely mostly limiting share price upside.
