Howden’s renewal report at 1.1.2026: Re-balancing

• Risk-adjusted price reductions recorded at 1 January 2026 reinsurance renewals: global property-catastrophe: down 14.7%; property retrocession: down 16.5%; direct & facultative: down 17.5%%; London market casualty: down 5-10%
• With core programmes placed for less spend than anticipated at 1 January 2026 and with strong signings, some cedents secured supplementary coverage to manage retentions and reduce volatility whilst others plan to deploy their savings to purchase additional protection in the first half of 2026.

London, 2 January 2026 – Howden, the global (re)insurance intermediary group, today releases its 2026 renewal report, Re-balancing. Most areas of the market recorded price decreases at 1 January 2026 reinsurance renewals, bringing pricing back to levels last seen around four years ago, albeit with comparatively higher attachments and tighter terms.

Market performance remained strong across the value chain in 2025, with insurer and reinsurer returns exceeding costs of capital, even after the Los Angeles wildfires, one of the largest (re)insured losses on record. Buyers benefitted from ample supply and intense competition, creating opportunities for cedents to secure broader coverage at discounted pricing.

Figure 1: Howden pricing index for primary, reinsurance and retrocession markets – 2012 to 2026 (Source: Howden, NOVA)

1 January 2026 reinsurance renewal                                                                                                               

 Healthy balance sheets and retained earnings drove strong deployment appetite at the 1 January 2026 renewal, yielding accelerated risk-adjusted price decreases across most product lines. Reinsurers’ desire for growth meant supply was more than sufficient to absorb demand. Technical profits remained strong overall, supported by broadly adequate pricing levels following compounded price increases during the hard market.

With core programmes placed for less spend than anticipated at 1 January 2026 and with strong signings, some cedents purchased supplementary coverage to manage retentions and reduce volatility. Others plan to deploy their savings to purchase additional protection in the first six months of 2026.

Global property-catastrophe

Another year of elevated catastrophe activity, dominated by the largest insured wildfire loss ever in Los Angeles, did little to arrest placements from completing with sizeable rate decreases and improved terms. Risk-adjusted global property-catastrophe reinsurance rates-on-line decreased by 14.7% on average.[1] This compares with a fall of 8% in 2025 and is the largest reduction since 2014.

In the US, cedents benefitted from strong supply and reinsurers were willing to deploy capital at what remained attractive margins despite rate reductions. Programme-wide decreases generally ranged between 10% and 20% on a risk-adjusted basis.

In Europe, low loss activity, an oversupply of capital and reinsurers’ desire to defend top lines shaped renewals, with programmes recording rate decreases of between 10% and 20% on average. The degree of softening varied by market, with outcomes influenced by historical loss experience. France, Italy, Switzerland and the UK recorded the largest rate reductions (down 15% to 20%) whilst Germany, where direct placements are prevalent, experienced more moderate softening (down 8% to 11%).

Renewals in the Asia Pacific region were competitive at 1 January 2026. Building on mid-single-digit reductions in 2025, cedents capitalised on abundant capacity, with risk-adjusted pricing for loss-free non-proportional programmes generally falling by 10% to 20%.

Property retrocession

Capacity in the retrocession market was more than sufficient to meet demand at 1 January 2026, although dynamics were more evenly balanced as buyers explored the purchase of up to US$800 million of additional limit. Favourable supply dynamics were supported by retained earnings from several years of strong performance, as well as new entrants and ILS inflows. The loss environment remained manageable, with the Los Angeles wildfires affecting only a small number of programmes and impacts mitigated by expected subrogation recoveries.

A combination of these dynamics drove price softening at 1 January 2026, with risk-adjusted pricing falling by between 12.5% and 21%, although outcomes varied widely depending on coverage scope, attachment points and underwriting profitability. There was more limited movement on terms, with retrocessionaires typically unwilling to broaden coverage to include non-natural perils such as SRCC and terrorism.

Global direct & facultative

The global D&F reinsurance market’s long run of strong performance led to softening in 2025, which accelerated at 1 January 2026 renewals and resulted in average risk-adjusted price reductions of 15-20%.

Terms and conditions evolved (rather than shifted dramatically). Reinsurers showed greater willingness to participate lower in programmes, although these moves were measured and selective, with capacity at these levels also coming at a cost.

Despite high levels of competition, cedents looked to preserve long-term relationships and avoided over-reliance on a small number of reinsurers, recognising the market’s sensitivity to a future major loss.

Casualty reinsurance

Casualty reinsurance renewals at 1 January 2026 were marked by improved supply dynamics. In the US, outcomes were performance-driven against a backdrop of persistent long-tail loss development, ongoing reserving concerns and sustained demand for protection. Overall, capacity remained steady, meaning most treaties renewed at expiring terms at 1 January 2026. The trend towards greater syndication continued, reflecting typical line-size constraints and the high number of markets competing for shares on programmes. The expanding role of casualty ILS and sidecars was an additional important factor in the US renewal process.

The international casualty market experienced modest softening at renewal, with widespread price reductions due to increased capacity and a generally stable loss environment. Programmes with US exposures faced more challenging renewals with outcomes sensitive to loss volatility associated with nuclear verdicts.

Casualty buyers in the London market benefitted from strong supply, resulting in 5-10% risk-adjusted reductions for excess of loss programmes at 1 January 2026. Continental Europe also saw increased capacity at 1 January 2026, with strongly performing excess of loss programmes achieving similar risk-adjusted rate reductions of between 5% and 10%.

Specialty reinsurance

Despite heightened geopolitical risks, most specialty lines continued to perform well, which typically led to improved outcomes for cedents at the 1 January 2026 renewal. Increased clarity around losses from ongoing conflicts and other recent events, whilst painful for exposed carriers, removed an overhang of uncertainty, enabling buyers to capitalise on broadly favourable market conditions.

This dynamic across specialty was evident in credit and political risk, construction, cyber, marine and energy and political violence and terrorism, where strong underlying portfolios and abundant capacity benefitted buyers. Aviation bucked the softening trend, with a slight firming of conditions following a series of losses in 2025.

Tim Ronda, CEO of Howden Re, commented: “Healthy supply dynamics and increased competition, particularly in property-catastrophe, created a genuine re-balancing of the market at this renewal. This, in turn, created meaningful opportunities for Howden Re clients in securing broader coverage, improved structures and attractive pricing, even as risk remained structurally elevated. Howden Re’s role at this renewal was to help clients navigate a more competitive, but still disciplined environment. The best outcomes were achieved through working with markets and capital providers to execute holistic, data-led programme solutions that balanced pricing, structure and risk transfer across portfolios.”

David Flandro, Head of Industry Analysis and Strategic Advisory, Howden Re, added: “The 1 January 2026 renewal confirms that pricing momentum has turned decisively, with risk-adjusted reductions across most major lines bringing rates back towards levels last seen around four years ago. The shift has been driven by strong retained earnings and record ILS issuance, increasing capacity and competitive tension. This is not a return to the underwriting practices of the last soft market. Attachments remain elevated by historical standards, terms and conditions are tighter; capital is being deployed selectively. The result is a market that is softening but still rational – one that continues to price volatility appropriately and create economic value for investors.”

Outlook for 2026

Conditions are expected to persist into 2026 in the absence of major macro or sector-specific events, supported by strong capitalisation and reinsurers’ continued focus on defending market share. The market nevertheless remains sensitive to losses, financial volatility and elevated costs of capital, underscoring the fragility of conditions to any acute adverse development.

This backdrop brings opportunities across the value chain. Buyers are benefitting from rate reductions and improved terms as supply exceeds demand in most areas whilst underwriting performance remains strong, delivering healthy profits and returns on capital.

Buyers are well positioned to secure additional protection in a period of elevated risk, heightened shock potential and favourable market conditions. For carriers, the transition rewards underwriting excellence whilst incentivising innovation to unlock new risk pools and generate incremental premium volume. Figure 2 highlights selected areas expected to outpace the broader P&C market through to 2030 due to high levels of investment and risk transfer demand.

Figure 2: Fast growing P&C segments - GWP CAGR and total growth 2024-30E (Source: Howden, McKinsey, Turner & Townsend, Evercore, Lloyd’s, Global Market Insights)

David Howden, Founder & CEO, Howden, concludes: “The message coming from our analysis of (re)insurance markets is clear: this is a rare moment where everyone stands to benefit. We're in the midst of a softening market where prices are falling despite elevated political and economic volatility. By doing more to harness data, anticipate future risks, and innovate to respond to the needs of clients, (re)insurers can stay ahead of the curve and continue to be profitable. This will mean that clients will have even greater choice to better protect themselves from unexpected shocks – whether political, cyber-related, litigation-driven or property-based. So 2026 will be a year of enormous possibilities. It's up to both businesses and (re)insurers to take advantage."

ENDS

About Howden

Howden is a global insurance intermediary group with employee ownership at its heart. Founded in 1994, it provides insurance broking, reinsurance broking and underwriting services and solutions to clients ranging from individuals to the largest multinational companies. 

The group operates in 56 countries across Europe, the USA, Africa, Asia, the Middle East, Latin America, Australia and New Zealand, employing 23,000 people and handling $50bn of premium on behalf of clients. 

For more information, please visit www.howdengroup.com and www.howdengroupholdings.com 

About Howden Re

Howden Re is the global reinsurance and capital markets arm of Howden. Offering risk, capital, and strategic advisory, Howden Re is distinguished by its innovative service offering, entrepreneurial leadership approach, and commitment to excellence. With a broad suite of services and specialities, differentiated capital structure, and growing global team, Howden Re aims to deliver outsized value to reinsurance clients.

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