At the 68th annual meeting of the reinsurance industry in Monte Carlo, Swiss Re, an industry giant has emphasised that growing natural catastrophe risk remains a significant driver of reinsurance demand.
Insured natural catastrophe losses continue to follow a 5–7% annual growth rate, driven by increasing exposures, rising asset values, and changing hazard patterns, stated the reinsurer.
According to Swiss Re’s modelled scenarios, insured losses could reach around USD 320 billion in a 2026 peak loss scenario, highlighting that reinsurance protection against low-frequency, high-severity events is important.
The reinsurer warned, “Today, a cluster of hurricanes, such as Harvey, Irma and Maria (2017), can push annual insured losses above USD 120 billion, even without a single record-breaking event. The 2026 European wildfire season is one example of how natural catastrophe risks are evolving. Wildfire is the fastest-growing weather peril globally, including in Europe, where insured wildfire losses have increased by an estimated 8–11% annually over recent decades.”
Swiss Re stated that better data, modelling, prevention, and adaptation can improve understanding of changing risks and support more effective risk transfer. In an increasingly interconnected and rapidly changing risk landscape, the reinsurer is determined to support clients in identifying exposures and risk accumulations through data and analytics, underwriting expertise and tailored solutions.
Urs Baertschi, Chief Executive Officer, Property & Casualty Reinsurance, Swiss Re, commented, “The underlying need for protection continues to grow as the risk landscape evolves and becomes more interconnected. Our clients need more than reinsurance capacity from us – they need risk expertise, data and solutions that help them navigate an increasingly complex environment. We combine these capabilities to help our clients understand emerging exposures, manage volatility and build resilience.”
Additionally, the reinsurer believes that there is AI infrastructure investments can create opportunities for risk transfer. According to reports, cumulative investment in data centres is projected to exceed USD 6 trillion by 2030, with Swiss Re Institute estimating a related global insurance premium opportunity of USD 91 billion by the end of the decade.
The Institute’s also noted that around 40% of US data centre capacity is located in “significant-to-very-high” tornado day zones. “As data centres grow, their risk profile is also becoming more complex. High asset values combined with dependencies on electricity grids, water, technology supply chains and digital infrastructure create potential concentrations across individual sites and wider networks,” stated the report.
Meanwhile, Swiss Re has urged for underwriting discipline to be maintained in US liability risk, as commercial liability losses reached USD 174 billion in 2025. This exceeds the global insured natural catastrophe losses of USD 120 billion in the same year.
The reinsurer said, “The trend for elevated verdicts remains, while the broader litigation environment creates uncertainty around future claims severity. For re/insurers, these trends reinforce the importance of a continued focus on claims trends, legal developments, and careful risk selection.”
Another factor adding uncertainty to the risk landscape are geopolitical tensions. Disruption to global value chains can create recurring shocks to energy, commodities and supply chains, adding to inflationary pressure. For re/insurers, this can translate into higher repair and replacement costs and ultimately higher claims costs, there for there is a need to understand impacts and potential concentrations for strengthening resilience.
Gianfranco Lot, Chief Underwriting Officer, Property & Casualty Reinsurance, Swiss Re, added, “As risks become more complex, underwriting increasingly depends on understanding how exposures interact and where concentrations can develop. Our data, modelling and risk expertise help us identify accumulations, price risk appropriately and make portfolio decisions that support clients as established risks evolve and new ones emerge.”
The post Underlying need for reinsurance protection continues to grow: Swiss Re appeared first on ReinsuranceNe.ws.
