Reinsurance pricing declined by an average of 22.8% across Gallagher Re’s portfolio at the June 2026 Florida renewal, reflecting a sharp softening driven by abundant capacity, improved terms and conditions, and the continuing impact of 2022 legislative reforms, according to Adam Schwebach, the firm’s Head of North American Property.
Providing an overview of the 2026 Florida reinsurance placement, Schwebach highlighted that the reforms achieved in 2022 have had a “monstrous impact” on the overall insurance and reinsurance market in the state of Florida.
“Hats off to our legislators and regulators for taking necessary steps. This was a huge part of conversations with reinsurers this year, who have the information and, really, the resolve to price according to a new environment in the state,” the executive added.
Schwebach continued, “It is a factor that we have a hard time quantifying.
“We’re very good as reinsurance brokers at quantifying changes in risk, but understanding what loadings were previously put into pricing models to account for litigation that was, quite frankly, out of control for a period of time is difficult. Overall, though, it had a major impact on pricing in 2026.”
Gallagher Re’s Head of North American Property noted that clients and reinsurance buyers within the state used the softening market to buy improved coverage during the June renewal.
Schwebach said some market participants questioned whether risk levels were lower this year, but explained that clients took the opposite view.
He pointed to 1992, when there was only a single event but a significant loss in Hurricane Andrew, as a reminder that additional protection remains important regardless of loss frequency.
He added, “Companies are also still cognisant that 2004 and 2005-level loss activity can happen in multiple landfalls. So, we saw our clients returning to the market with some price savings and using those savings to buy aggregate, multiple-event coverage, and drop-down coverage, all of which was afforded by reduced overall pricing within the market.
“Terms and conditions continued to improve for clients, given oversubscriptions, and both the ILS and traditional markets played a massive role in this.”
Schwebach said the 2026 quoting process was very orderly, with most reinsurers quoting in a 5–10% reduction range. He noted that some reinsurers quoted up to twice to secure line sizes, with pricing outcomes broadly aligning with an average 22.8% reduction across Gallagher Re’s portfolio.
He added that results were tightly clustered in a 20–25% range across clients and layers, describing it as a very positive outcome overall.
Schwebach went on, “In addition, we saw a willingness from reinsurers to continue to move down programs. That was to protect market share at the top of programs, but also very indicative of their belief that the reforms were going to have a significant impact on the bottom of programs.
“In many softening markets, we tend to see more softening at the top of programs and less towards the bottom. We didn’t see that this year. We saw very consistent softening in that 20–25% range across reinsurance towers from top to bottom, which was again a sign of abundant capacity.”
“Catastrophe bonds, as I mentioned, played a very significant role in the price levels for this year, and that is a market that continues to play a larger role in overall risk transfer strategies in Florida.
“We are at about $4.3 billion of issuance in 2026, relative to $4.6 billion in 2025, so slightly down year on year. But the thing to remember is that a lot of this is multiyear coverage; there is a lot of capacity from 2024 and 2025 issuances still sitting in reinsurance towers for many Florida carriers.”
Schwebach highlighted that catastrophe bond pricing continued to converge with traditional reinsurance pricing, which he described as a positive development.
He emphasised that this convergence is increasing optionality for reinsurance buyers in how they choose to access the market.
Schwebach concluded, “It is too early to tell what 1.1 2027 looks like, but it is an interesting and very positive trend for reinsurance buyers.
“What does this mean in terms of the overall cat pricing index? Mid-year 2026 results bring us back to pre-2023 pricing, which is positive to see.
“If you go further back historically, it gets closer to roughly 2010 pricing, which saw significant declines thereafter. So time will tell if this is the direction of the cycle.”
