In its latest report on global and Bermuda reinsurers, Fitch Ratings has disclosed that non-life reinsurers reported improved underwriting profitability year over year in the first half of 2026, driven by lower catastrophe losses.
However, Fitch emphasises that the global reinsurance sector is “challenging, with abundant capacity, and intense competition”, which is driving price declines across most lines and looser policy terms and conditions. Despite this, reinsurers are expected to maintain favourable returns in 2026.
The report includes results from 18 Fitch-tracked reinsurers that disclosed a combined ratio of 86.1% in H1’26, down from 92.7% in H1’25.
However, the report warned that non-life reinsurance net premiums fell by 6% year over year in H1’26, reflecting accelerating softening market conditions. This included reduced catastrophe losses of 3.5pp, compared to 10.9pp in H1’25.
Fitch said, “Underlying underwriting results are expected to continue to deteriorate into 2027, reducing margins, and weakening overall returns.”
Meanwhile, the group of Fitch-tracked life and health (L&H) reinsurance operations reported a 12% increase in pre-tax income and a 9.5% increase in net revenue in H1’26, as market conditions remain favourable and provide diversification from property and casualty.
Fitch’s group of seven Bermuda-based re/insurers reported an “exceptional” 85.3% combined ratio in H1’26, with all companies posting underwriting profits. This was supported by a very strong net income return on equity of 15.7% in H1’26, although down from 18.6% in 2025.
Meanwhile, Fitch explained that shareholders’ equity declined slightly in H1’26 from end-2025 as underwriting gains, investment income, and equity market gains were “offset by increased capital returned to shareholders and by unrealised gains on fixed-income securities.”
Fitch stated, “Companies will continue to maintain very strong capitalisation, even as capital management remains active with limited growth opportunities.”
