SpEp The State of (Re)insurance 2026

Mark Geoghegan (0:03)

I'm Mark Geoghegan and welcome to a special documentary episode of the Voice of Insurance podcast produced in association with Stephens Rickard. This is the fifth episode of its kind. The first saw a historic, chaotic, dramatic hard market renewal unfold. At the next, stability and a return to orderliness was craved and was granted. The year after that, animal spirits started to be talked of in hushed tones. Last year, the industry had its mojo well and truly back, and the real questions were philosophical. Is it possible for everyone to grow profitably without changing the nature of the market? Is it better to buy or build? Should excess capital be returned or deployed in M&A?

This year, the answer to most of these questions had already arrived, and it arrived faster than almost anybody expected.

Twelve months ago, I stood in these same streets and heard re-insurers tell me almost to a person that they were happy to give up a little rate in exchange for growth. Well, they gave up more than a little. The renewal at 1126 delivered what many have called two years of softening compressed into one. Today, capital is even more abundant. Profits are still real, but yet, for the first time in a while, I heard the word fragile used more than once, and not always by the people you'd expect.

So, join me as I wander the streets, dodge the supercars, cross the squares, and elbow my way through the crowded bars and lobbies of Monte Carlo to meet a representative cross-section of the reinsurance buying and selling public and find out what's really happening in the state of reinsurance as we look towards 1127 Before we get into the room by room detail, it's worth looking at the big picture through the eyes of one of the people whose job it is to analyze the whole market rather than any single deal. Over to David Plandro, head of industry analysis and strategic advisory at Howden Re.

David Flandro (1:57)

If you look more broadly, if you zoom out, you can see that country risk premia are increasing, bond yields are increasing, inflation is increasing. The world is actually a very risky place. 2025 was sadly the year of the most combat deaths since 1994 We've got two hot wars happening. The capital markets are quite volatile, but if you look over here on this other side of the page, re-insurance pricing is falling. It's a paradox.

Mark Geoghegan (2:23)

Plenty to unpick here.

We know re-insurance often operates in a capital bubble of its own making, but what David has just said is pretty remarkable. Every other form of capital is getting more expensive, while re-insurance is getting cheaper. This has to make buyers pretty happy. Buying more and better quality re-insurance surely has to be good economics for sedents today. But will it pan out that way? Most of the answers are coming up in the next hour.

After our big opener, it's time to get into detail. As usual, I opened up almost every interview this week by asking how people would characterize the state of the market today. Let's run through some of the most representative opening remarks and then take stock. Since most people agree it's a buyer's market, we'll start with Alessa Quain, CEO of International Markets at SOMPO.

Alessa Quain (3:07)

From a buyer's perspective, I would say that the market as we see both in the re-insurance and the insurance side of it, we see a softening in the market. I think people are still quite focused on terms and conditions. We don't see a lot of movement there. It's really sort of a price at this point in time, and it varies certainly by line of business. So I wouldn't say that it's a seller's market or a buyer's market. I think there's a pretty balanced demand, if you will. I think it's a market where there's ample capacity right now, and that's driving some of what we see from a rate perspective. But I do think that buyers like myself are focused on the kind of capacity that's there and making sure that it's part of what I would call longer-term relationship as we go through the market cycle, the ebbs and flows of the market.

Mark Geoghegan (3:51)

Of course, only the best buyers would never describe the market as a buyer's market. But Alessa is painting a picture of plenty of capacity and choice for buyers, albeit with some terms and conditions remaining firm.

Over to Alex Maloney, CEO of Lancashire Insurance.

Alex Maloney (4:06)

It's clearly healthy. There's clearly a lot of capsules that have been generated in the last few years, so I'd say that's a positive. I think we all believe there's going to be more competition that we see at the 1st of January renewals, but on a relative basis, I still think most products are in a really good space. So I think people should be cautiously optimistic as we go into 2027 and let's not get too depressed about it. You know, the industry's had a number of really good years and we've built some really good returns for our shareholders. And prior to that, it was difficult. So I'm still on the positive end of the Monte Carlo messaging.