Gallagher Re claims July renewals show conditions still favouring buyers

Gallagher Re, the global reinsurance broking and advisory firm, has released the latest edition of its First View report, covering the July 1 renewals.

According to the company the report highlights a reinsurance market where strong reinsurer performance and record capital levels are driving pricing improvements while enabling a renewed focus on more creative and efficient risk transfer solutions.

Mid-year renewals saw conditions increasingly favour buyers, with risk-adjusted rate reductions across many classes and geographies. More importantly, cedants were able to reshape programs and improve long-term portfolio resilience, supported by greater reinsurer flexibility on structure as well as price.

This has led to a return of more innovative approaches, including multi-line, multi-year and aggregate structures, now available at more attractive price points.

Dedicated reinsurance capital reached $648 billion at year-end 2025, up 11% year on year, while premium growth remained limited at just over 1%, widening the imbalance between supply and demand and intensifying competition. These dynamics have continued into 2026.

Reinsurer returns remain strong, with estimated ROEs of 14% to 15% for 2026 following a near-19% return in 2025, supporting a sustained willingness to deploy capacity.

Against this backdrop, cedants are increasingly implementing tailored solutions to manage earnings volatility and optimize capital efficiency, using improved market conditions to enhance structure alongside achieving rate reductions.

Property renewals provided the clearest evidence of this, with programs attracting significant excess capacity and reinsurers competing on both price and terms.

Property catastrophe saw the most pronounced pricing movement, with reductions of 20% to 25% or more for the best performing accounts in North America and similar trends across other regions.

With natural catastrophe losses of $38 billion in H1 2026, as of June 15, below the 10-year average, reinsurers enter the second half of the year with healthy catastrophe budgets and continued capacity to deploy.

Alternative capital continued to expand, with non-life ILS capital reaching $135 billion and catastrophe bond issuance at USD15.6 billion by mid-June, putting 2026 on track for another record year.

In casualty, outcomes were more stable, reflecting ongoing caution around loss trends, particularly in the US, but with increased adaptability for well-performing portfolios. And across specialty lines, abundant capacity persists, although recent loss activity in areas such as aviation and cyber is prompting closer scrutiny of performance.

Tom Wakefield, Global chief executive of Gallagher Re, commented: “The data shows a market defined by strong capital, healthy returns and increasing competition, all of which are improving outcomes for clients.

“Importantly, this is not only about price. The same forces are enabling clients to access more tailored and efficient reinsurance solutions, often at price points that would not have been achievable in recent years.

“The focus now is on how effectively clients use these conditions to optimize their programs and build more resilient portfolios for the future.”

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