JPMorgan analysts said the price falls reported by European reinsurers so far have been far less severe than those reported by reinsurance brokers, thanks to diversified portfolios that have helped cushion the impact.
JPMorgan’s report notes that European reinsurers are in a tough spot at the start of 2026, with an average decline of 4.2% (worse than SXIP’s 2% decline). Hannover Re and Munich Re were the biggest losers, down 7% and 6% respectively, while Swiss Re was down less and SCOR actually posted a year-to-date share price gain.
“We believe the main driver is positioning in the sector, with top-down themes driving performance. Reinsurance fell out of favor after reinsurance brokers reported the highest price falls since the late 1990s, with Guy Carpenter noting a 12% price fall at renewal in January,” JPMorgan explained.
Reinsurance brokers reported significant price falls in the property catastrophe business, with prices in the global property catastrophe business down 12%, down 15% in Europe and 12% in the United States, although this was off a higher base.
According to data from Guy Carpenter, real estate prices fell the most since the last “soft cycle” (2013-2017), reaching 11.2%. Real estate prices have not experienced a major annual decline since 1998, when they fell by 15%.
Analysts say current pricing levels are still higher than in 2022 (before the sharp rise in 2023), but the difference has narrowed to around 7% from the ~30% gap observed in 2024.
“Broker reports suggest attachment points have remained largely unchanged, so profitability may still be better than pricing levels suggest, but has declined significantly over the past two years,” analysts said.
European reinsurers tend to report price changes in a more diverse manner than reinsurance brokers, and these changes are never as dramatic as those reported by brokers.
SCOR and Hannover Re recently announced price adjustments, with SCOR reporting a 1.9% price drop and Hannover Re reporting a 3.2% price drop. These price cuts raise questions about revenue growth potential, as lower prices typically make growth more challenging.
SCOR achieved revenue growth of nearly 15%, well exceeding its target of 4-6%. This was driven by growth of 4.7% in its traditional book business and more than 80% growth in its alternative solutions business.
Hannover Re’s premiums increased by 3.3% at renewal in January 2026. Analysts noted that the figure was below the company’s 2026 guidance, which expected mid-single-digit growth.
JPMorgan concluded: “We view the price decline relative to brokerage headlines as reassuring. But we did not expect anything different. However, the revenue picture is more complicated, with Hannover Re maintaining mid-single-digit growth guidance despite delivering 3.3% growth at renewals in January.”
