cyber insurance market<\/a>\u201d \u2013 with the associated cyber reinsurance market \u201cforecast to grow from $6bn (\u00a34.35bn) gross written premium (GWP) to $9bn (\u00a36.52bn) by 2029\u201d.<\/p>\nThe report added that firms which employed \u201cspeed and agility\u201d to \u201cexpand in new risk categories\u201d \u2013 such as the cyber market \u2013 had the potential to secure \u201cfirst mover advantages with lasting financial benefits\u201d.<\/p>\n
It continued: \u201cAddressing the cyber protection gap remains the biggest challenge for the cyber insurance market. Despite increasing digitalisation and growing awareness of cyber risk among businesses, the value of cyber insurance is still underappreciated.<\/p>\n
\u201cOrganisations report insurance is in place to cover only 19% of information assets compared to 60% for property, plant and equipment. Further, the likelihood of an intangible asset cyber event occurring is estimated by risk managers to be six times more likely than an event impacting property.<\/p>\n
\u201cReinsurance capacity is poised to support growth in the global cyber insurance market, which is expected to reach $24bn (\u00a317.4bn) by 2029, up from around $15bn (\u00a310.9bn) today.\u201d<\/p>\n
Appetite around this line of business was certainly seen during the 1\/7 renewal period, with Aon\u2019s report noting that \u201ccyber insurers experienced a buyers\u2019 market for reinsurance at midyear renewals, with ample capacity and further product innovation\u201d.<\/p>\n
Furthermore, Gallager Re\u2019s 1st view: Challenging the status quo report \u2013 published in July 2025 \u2013 agreed that \u201cthere was growing demand, and supply, of turnkey solutions for international cyber, especially in the Asia-Pacific region\u201d.<\/p>\n
It added that during the 1\/7 renewal window, there were \u201crisk adjusted rate improvements in favour of reinsurance and retro purchasers\u201d of cyber cover, which Gallagher Re believes is the \u201cexpected consequences of a market experiencing excess supply of reinsurance capacity, coupled with a slowdown in organic growth\u201d.<\/p>\n
Nick Pomeroy, head of reinsurance and broking at Lloyd\u2019s broker QRG Specialty, told Insurance Times that the reinsurance market\u2019s diversification focus on emerging markets could be described as \u201cthe flavour of the moment\u201d, presenting the market\u2019s greatest opportunity \u2013 and challenge.<\/p>\n
He explained: \u201cThe whole mantra behind the [reinsurance market], in a global sense, [is that firms are] all looking to diversify. Let\u2019s go and write something new, like cyber business, which nobody knows anything about.<\/p>\n
\u201c[In comparison,] you\u2019ve got a property market that\u2019s been going effectively since the 17th century. You pretty much know how many buildings burned down. You [have] the ability to model. You\u2019ve got a pretty good idea where your book is going to go and what you\u2019re looking at. And you buy your reinsurance accordingly.<\/p>\n
\u201cCyber business is growing exponentially because as the perpetrators of cyber crimes get more sophisticated, what you tend to find is the insurance and reinsurance markets are closing the door after the horse has bolted. \u2018Oh, there\u2019s been another big loss. We\u2019ll exclude that\u2019 or approach it [in] a different way. Everywhere you turn there\u2019s another loss you haven\u2019t seen before.<\/p>\n
\u201cIt is not necessarily an accident waiting to happen, but [firms are] rolling the dice [on] a very immature market. The insurers are quite a long way behind the perpetrators. Things are inherently much more volatile, yet it ticks all the boxes commercially, so all our eggs aren\u2019t in one basket.\u201d<\/p>\n
Another developing market that is enticing reinsurer appetite, yet needs greater consideration, is renewable energy, continued Pomeroy.<\/p>\n
He noted that although moving into this line of business is conceptually a good idea, it is vital that products are well defined because renewable energy storage is not as developed a proposition as the creation of renewable energy.<\/p>\n
He explained: \u201cIf anything goes wrong between a wind turbine and the storage battery, you\u2019ve got a massive business interruption loss. You\u2019ve then got to discuss what you do with all the defunct wind turbines that are all made of amusing composite material.<\/p>\n
\u201cThere are all these things that are being spawned off on what are embryonic markets. You build something new that\u2019s going to help people [and] there\u2019s going to be a potential downside to it.\u201d<\/p>\n
Supply versus demand<\/p>\n
Undoubtedly, the biggest overarching trend impacting the reinsurance market this year is cyclical softening conditions \u2013 which are underpinning reinsurers\u2019 drive for diversification and the uptick in new entrants across a multitude of business lines, as firms seek to branch out.<\/p>\n
Tom Wakefield, global chief executive at Gallagher Re, said: \u201cBuyers generally experienced a more competitive reinsurance market at the 1 July renewal compared to recent years, with capacity available even where demand increased and reinsurers looking to grow.<\/p>\n
\u201cWith these conditions in place, clients had the opportunity to challenge the status quo and secure improvements to the structure and terms of their property and specialty reinsurance programmes.<\/p>\n
\u201c2025\u2019s renewals are showing a consistent trend \u2013 a growing market in which the balance of supply and demand has tilted back towards reinsurance buyers.\u201d<\/p>\n
Wakefield observed that rate reductions were currently being seen across property treaties, while pricing remained \u201cbroadly flat\u201d in casualty lines.<\/p>\n
This view is broadly supported by other market commentators, with credit agency Fitch Ratings and Pomeroy both confirming that property rates have fallen by around 10% to 15% at the 1\/7 renewals.<\/p>\n
A briefing note published by Fitch Ratings on 15 July 2025 stated: \u201cThe global reinsurance market has ample capacity as rising supply outpaces incremental demand from cedants.<\/p>\n
\u201cThis is shifting pricing power to be in favour of reinsurance buyers, particularly in property lines, while the balance remains more even in casualty. Competition is generally focused on price rather than terms and conditions (T&Cs).\u201d<\/p>\n
Pomeroy added: \u201cPrimarily, you\u2019ve got supply outstripping demand, which means you\u2019re going to compromise your underwriting ideals [and] ethics or your business doesn\u2019t work because, like it or not, every year is a new year.<\/p>\n
\u201cIf your income goes from X million to naught because you\u2019re not prepared to follow the rates down, well that\u2019s the end of that because the overheads and the staff costs and everything else still carry on.\u201d<\/p>\n
What about the small print?<\/p>\n
A knock-on effect arising from these softer market circumstances is that \u201cT&Cs are beginning to loosen\u201d, according to Fitch Ratings.<\/p>\n
It explained: \u201cT&Cs are beginning to loosen as reinsurers become more willing to provide protection lower down on programmes, including at lower attachment points and for more frequent return periods.<\/p>\n
\u201cWorking layer and aggregate reinsurance protection are making a comeback and reinsurers are becoming more open to negotiating T&Cs. The first signs of less stringent T&Cs are emerging, driven by heightened competition and a very gradual relaxation of underwriting discipline.\u201d<\/p>\n
Aon\u2019s aforementioned report confirmed this market movement: \u201cThe property catastrophe market continued to benefit from increased supply across the board [during the 1\/7 renewal window], leading to more flexible terms and conditions and greater pricing competition in all regions.<\/p>\n
\u201cThe midyear renewal was notable for a further shift in the market\u2019s appetite, with reinsurers more willing to provide protection lower down on programmes. Products that were not widely available at previous recent renewals were up for discussion, including aggregate covers.\u201d<\/p>\n
Nat cat will determine 1\/1<\/p>\n
Looking ahead to 2026 and the upcoming 1\/1 reinsurance renewals, Huw Evans, partner and head of insurance at professional services firm KPMG UK, noted that the next few months up until October will be the decider in terms of whether the market has a \u201cvery, very difficult year\u201d or \u201ca manageable year\u201d \u2013 influenced, of course, by the \u201ccritical\u201d hurricane season in the US.<\/p>\n
Evans emphasised that hurricane activity in this jurisdiction will carry more weight than usual this year following \u201ca pretty heavy first half of the year for reinsurers to bear in terms of natural catastrophe\u201d losses.<\/p>\n
This is because of the impact of wildfires hitting Los Angeles back in January 2025, as well as a series of severe convective storms (SCS) \u2013 such as tornadoes \u2013 that have been more rife than is the norm up until mid-May.<\/p>\n
Gallagher Re\u2019s H1 natural catastrophe and climate report, published in July 2025, confirmed that total insured global losses across this class of business reached $84bn (\u00a360.9bn) in the first six months of the year \u2013 a record H1 high since 2011. It added that 92% of this activity stemmed from the US, thanks to SCS and wildfire activity.<\/p>\n
Weather related events, meanwhile, added $56bn (\u00a340.6bn) to Gallagher Re\u2019s global insured losses total for H1 2025 \u2013 an increase of 176% on the report\u2019s 10-year average figure.<\/p>\n
Overall, however, Evans is optimistic about the reinsurance market\u2019s stability \u2013 with Fitch Ratings classing the sector\u2019s outlook as \u201cneutral\u201d in July 2025 and both Evans and Pomeroy agreeing that the 1\/7 renewal window did not reveal any great or drastic change in clients\u2019 reinsurance programmes, strategies or provisions.<\/p>\n
Evans continued: \u201cThe reinsurance market has operated in a pretty orderly way for the last two years or so. Obviously, it had a very bumpy period in 2022 [and] 2023, but it\u2019s been much more orderly since then in terms of price adjustments and capacity.\u201d<\/p>\n","protected":false},"excerpt":{"rendered":"Amid broadly softening primary insurance and reinsurance market conditions, where supply and capacity are increasingly outstripping demand, a…\n","protected":false},"author":2,"featured_media":43036,"comment_status":"","ping_status":"","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[12],"tags":[84,467,56,54,55],"class_list":{"0":"post-43035","1":"post","2":"type-post","3":"status-publish","4":"format-standard","5":"has-post-thumbnail","7":"category-markets","8":"tag-business","9":"tag-markets","10":"tag-uk","11":"tag-united-kingdom","12":"tag-unitedkingdom"},"_links":{"self":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/43035","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/users\/2"}],"replies":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/comments?post=43035"}],"version-history":[{"count":0,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/posts\/43035\/revisions"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media\/43036"}],"wp:attachment":[{"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/media?parent=43035"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/categories?post=43035"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.newsbeep.com\/uk\/wp-json\/wp\/v2\/tags?post=43035"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}
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