Aon said in its January 2026 Reinsurance Market Dynamics report that insurers will return to the market post-renewal to take advantage of favorable conditions and explore additional protections to reduce earnings volatility, including integrated products and structured solutions.
Insurers are currently in the driver’s seat, the company said. Those who take a strategic approach to the update process and timing and are able to take advantage of over-placement achieve excellent results.
“Reinsurance buyers achieved good results for property renewals on January 1 based on positive momentum for 2025 renewals and a mild U.S. hurricane season,” Aon explained.
As reported earlier this week, Aon said global reinsurer capital rose more than 6% to $760 billion as of September 30, 2025, from the end of 2024, with growth in both traditional and alternative capital driven by retained earnings, unrealized gains and new inflows into the sidecar and catastrophe bond markets.
Insurers received deep discounts and improved terms at renewals on January 1, as reinsurers and third-party capital providers seek to grow and deploy their abundant capital.
Aon’s report also showed that competition at January renewals was significantly more intense and widespread compared with the same period last year, with reinsurers showing greater flexibility and being more willing to underwrite risks that had previously been outside or at the fringe of their interest.
“Competition is particularly fierce in the U.S., where non-loss-impact accounts typically achieve significant double-digit rate cuts. Property rate cuts across non-loss-impact accounts across Europe, the Middle East and Africa, Latin America and Asia-Pacific are also generally in the double-digit range,” Aon said.
The company continued, “Demand for reinsurance is generally stable, with purchase limits at 1/1 renewals increasing by an average of 5% year-on-year.
“The main exceptions were Italy and Greece, which saw demand increase by 10% to 20% following recent changes to natural disaster insurance schemes. Purchase limits in Turkey also increased by 10% to 20% due to inflation and increased risk exposure, partially offset by changes in foreign exchange rates.
“Post-renewal, insurers are expected to take advantage of favorable market conditions and premium savings to purchase additional cover.
