Bermuda-based insurer and reinsurer Lancashire Insurance Holdings is “very pleased” with its inward and outward reinsurance renewal results on January 1, 2026, chief underwriting officer (CUO) Paul Gregory said, as the company used the opportunity to tailor better structured products to help manage its earnings volatility at this stage of the cycle.
Gregory and Lancashire Chief Executive Officer (CEO) Alex Maloney commented on the company’s experience in the 1.1 2026 reinsurance renewal season during a recent conference call with analysts following the release of strong FY2025 results.
Maloney said in his opening remarks: “Looking at the broader market context, we have always believed that markets are cyclical, and while we have seen a more competitive market, the portfolio we acquired at renewal on January 1 remains one of the best we have ever had in terms of rate adequacy.”
He went on to highlight that the group retail price index (RPI) at end-2025 was 96%, still above pre-2023 levels, adding, “This reflects the market’s increased capital supply as existing players deploy more retained earnings after several profitable years.”
“At the same time, demand has not kept pace with increased capital supply. But I do want to highlight that margins remain favorable, particularly at a net level, given reinsurance costs. This gives us confidence as we look at profitability in 2026 and beyond,” he continued.
In his opening remarks, CUO Gregory delved into the company’s experience in 2026 and highlighted the strong results from the company’s reinsurance purchases in the coming year.
“To sum up the recent 1.1 renewal season, we are very pleased with our performance, we have managed the more competitive environment well and ensured results in line with our expectations. This positions us well to execute our plans for the remainder of the year.
“As always, we are grateful to our clients and brokers for their continued support and look forward to building on these valuable relationships,” said Gregory.
Lancashire, also a buyer of reinsurance, was also “very pleased” with the outcome of its 2026 tranche 1.1 reinsurance renewal.
Gregory explained: “As we said, one benefit of the softening market is that the products we purchase to protect earnings and balance sheets are also more efficient. We can manage our reinsurance spend, which helps relieve some of the margin pressure on the internal books.
“Equally important, we have better aligned our reinsurance structure to limit our risk exposure and thereby better manage our return volatility. For example, the catastrophe product totals we described last year were updated to 1.1, with lower attachment points and higher limits. This provides greater certainty in underwriting results in active catastrophe loss years.”
In 2025, Lancashire decided to use some of the headroom to buy out Syndicate 2010’s remaining names, and while this increased share meant the company took on more catastrophe risk, Gregory highlighted continued withdrawals from the inward-looking retro portfolio, driven by market conditions, as well as the benefits of a more efficient reinsurance program.
During the Q&A, Gregory was asked about reinsurance costs in 2026 and whether the company would increase purchases or seek to further reduce risk limits.
“We expect RI to be lower in US dollars compared to 2025 Expenditures will be broadly stable. So, you’re right, we’re definitely seeing benefits from the softening of the reinsurance market and lower premium expenses. And as I mentioned in the script, there’s also the opportunity to tailor better structured reinsurance products to help manage our earnings volatility. So we’ve saved some of that money and used it to build more comprehensive reinsurance protection for the business, very simply, very similar year-over-year expenses,” he said.
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