Adam Schwebach, the company’s head of North America property, said Gallagher Re’s reinsurance pricing had declined by an average of 22.8% at June 2026 renewals in Florida, reflecting sharp weakness due to ample capacity, improving terms and conditions and the continued impact of legislative changes in 2022.
Schwebach outlined Florida’s reinsurance landscape for 2026, emphasizing that reforms implemented in 2022 will have a “tremendous impact” on Florida’s overall insurance and reinsurance markets.
“Hats off to our legislators and regulators for taking the necessary steps. This is an important part of the conversation this year with reinsurers who have the information and do have the determination to price based on the new environment in the state,” the executive added.
Schwebach continued: “This is a factor that is hard for us to quantify.
“As reinsurance brokers, we are very good at quantifying risk changes, but frankly it’s difficult to understand what loads are being put into pricing models ahead of a period of out-of-control litigation. Overall, though, it has a significant impact on pricing in 2026.”
Gallagher Re’s head of North America property noted that clients and reinsurance buyers in the state took advantage of the soft market and purchased improved coverage during the June renewal period.
Schwebach said some market participants questioned whether risk levels would be lower this year, but explained that clients took the opposite view.
He pointed to Hurricane Andrew, a single event in 1992 that caused significant damage, as a reminder that regardless of the frequency of damage, additional protection is still important.
He added, “The company continues to recognize that 2004 and 2005 levels of loss activity are likely to occur over multiple landfalls. As a result, we are seeing our customers return to the market with some price savings and using those savings to purchase aggregate, multi-event coverage and pull-down coverage, all through lower overall pricing within the market.”
“Terms and conditions for customers continue to improve due to oversubscription, with ILS and traditional markets playing a huge role in this.”
Schwebach said the 2026 quoting process was very orderly, with most reinsurers quoting downwards in the 5% to 10% range. He noted that some reinsurers were quoting up to twice as much to secure coverage, with pricing results broadly consistent with Gallagher Re’s average portfolio drawdown of 22.8%.
He added that results across customers and tiers were tightly clustered in the 20-25% range, which overall was a very positive result.
Schwebach continued, “In addition, we are seeing reinsurers’ willingness to continue to downgrade plans. This is to protect the market share of top plans, but is also very much indicative of their belief that reforms will have a significant impact on bottom plans.
“In many soft markets, we tend to see more softening at the top of projects and less softening at the bottom. We’re not seeing that this year. We’re seeing very consistent softening in the 20-25% range from top to bottom of the reinsurance tower, which again suggests there’s ample capacity.”
“As I mentioned, catastrophe bonds have played a very important role in price levels this year, and this market will continue to play a larger role in Florida’s overall risk transfer strategy.
“Our 2026 issuance volume is approximately $4.3 billion, which is down slightly year-over-year compared to $4.6 billion in 2025. But keep in mind that a large portion of this is multi-year insurance; many Florida insurers still have significant capacity remaining in their reinsurance towers for 2024 and 2025 issuance.”
Schwebach emphasized that catastrophe bond pricing continues to converge with traditional reinsurance pricing, which he called a positive development.
He emphasized that this integration increases the options for reinsurance buyers to enter the market.
Schwebach concluded: “It is too early to tell what 1.1 2027 will look like, but for reinsurance buyers this is an interesting and very positive trend.
“What does this mean for the overall cat pricing index? The mid-2026 results bring us back to pre-2023 pricing, which is positive.
“If you go back historically, it’s closer to pricing in 2010, and prices have dropped significantly since then. So time will tell whether that’s the direction of the cycle.”
