Willis Re, a specialised reinsurance broker, forecasts that in 2026 there will be continued new supply, alongside easing of conditions and greater competition between reinsurers for cessions.
The broker notes that almost all segments showed a softening in reinsurance pricing over 2025, with further softening evident at the ongoing Jan 1 renewals.
Low losses, rising capacity, and the reintroduction by reinsurers of previously limited aggregate excess of loss treaty capacity are all positives for buyers of protection, explained the firm.
Willis Re also stated that property catastrophe capacity was abundant in 2025 and continues to grow.
The 2024 and 2025 profitable reinsurance underwriting years have strengthened balance sheets, leaving more capital for deployment.
Meanwhile, robust market returns have attracted new capital through mergers and acquisitions (M&A) and the capitalisation of new carriers, as well as smaller new ventures, primary carriers, and fresh allocations to new and existing MGAs.
Additionally, the commentary highlights that competition from alternative capital sources has increased, particularly for retrocession exposures, in the form of catastrophe bonds, with 2025 a record year for the sector as issuance surpassed $20 billion for the first time, taking the outstanding market to new heights.
“We’ve counted more than $45 billion flowing into the reinsurance and commercial insurance sector in 2025, excluding retained earnings. Some has been returned to shareholders, and some of the money spent on acquisitions leaves the market, but the net influx is huge,” said Willis Re.
Discussing the catastrophe landscape in 2025, Willis Re expects that nat cat losses will cross $100 billion for a sixth consecutive year. However, Willis Research Network’s 2025 Natural Catastrophe Report says that all of the 2025 cat losses fell well within global reinsurers’ budgets, and were insufficient to halt the arrival of a buyers’ market for property catastrophe treaty reinsurance and retrocession, which is being played out during the 1.1 renewals.
