Global non-life premium growth is forecast to slow to 0.6% in real terms in 2026, reflecting competitive pricing conditions and moderating economic momentum, according to Swiss Re Institute, part of the global reinsurer.
The softening of non-life premium growth is well below the long-term trend of 3.6% (2015–2024 compound annual growth rate). Swiss Re Institute noted that advanced markets are driving the slowdown, while emerging markets remain relatively resilient.
“The longer the inflationary pressures from the Middle East conflict persist, the greater the risk that its effects feed through to repair, replacement and liability costs, thereby partially offsetting downward pressure on pricing. This suggests that the current cycle may be shallower than past soft markets, with insurers likely to reprice more sharply if large losses, inflation and capital signals deteriorate beyond expectations,” said the firm.
Nonetheless, Swiss Re Institute affirmed that non-life insurers remain profitable, forecasting return on equity of 11.4% in 2026, down from a peak of 14% in 2025, before declining further to 7.7% in 2028. Elevated investment returns are expected to provide the main cushion against the downturn in the underwriting cycle.
Meanwhile, life insurance growth is expected to remain robust at 2.3% in 2026. Higher yields continue to support savings and annuity business, while emerging markets benefit from favourable demographics, regulatory reforms and rising insurance penetration.
The profitability outlook for life insurers also remains positive, with higher reinvestment yields continuing to support investment income.
Swiss Re Institute also highlighted that the ongoing Middle East conflict is slowing economic activity, fuelling inflation and reinforcing a broader shift towards a more fragmented global economy. Against this backdrop, global insurance premium growth is expected to slow to 1.3% in real terms in 2026, from 3.9% in 2025.
In addition, Swiss Re Institute expects global inflation to average 4.0% in 2026, around one percentage point higher than pre-conflict expectations, while global GDP growth could slow to 2.5%.
Interest rates will likely remain higher for longer as investors demand greater compensation for inflation, fiscal and geopolitical risks.
At the same time, rapid investment in AI infrastructure is providing an important offset to the drag from supply shocks.
Swiss Re Institute estimates that capital expenditure on AI by hyperscalers—the technology companies building large-scale internet infrastructure—will reach USD 750 billion in 2026 (in nominal terms), contributing around 0.2–0.3 percentage points to US economic growth. These assets are increasing demand for protection across property, engineering, cyber, liability and business interruption insurance, reinforcing the importance of global re/insurance capacity.
Ivan Gonzalez, CEO Swiss Re Corporate Solutions, said, “As the global economy and supply chains become more fragmented, demand is increasing for specialist solutions that support international trade, investment and business continuity. Meanwhile, the AI boom is driving unprecedented infrastructure investment. Some of the largest AI data centres now carry total asset values exceeding USD 20 billion before technology installation, creating significant construction, operational and accumulation risks. These interconnected exposures call for solutions that go beyond traditional insurance, combining risk engineering, alternative risk transfer and financing to help businesses invest with greater resilience.”
