Market innovation, partnership, and growth
Briefing highlights
- Abundant capital creates exceptional choice for cedents – in both traditional reinsurance and broader solutions.
- Strong reinsurer ROE is predominantly driven by favorable investment income and a lower share of insured losses since 2023.
- Opportunity: With growing dedicated reinsurance capital of +6% in 2026 against a declining reinsurance premium base of -7% at H1 2026, there is opportunity for reinsurers who are willing to innovate and expand their product offering.
- Strong client engagement and multi-class appetite is paramount in the current conditions.
- M&A activity predicted to continue across the (re)insurance sector, with excess capital on insurer and investor balance sheets supporting strategic acquisitions.
- Evolving risk landscape together with macro environment means the reinsurance market must approach 2027 renewals with innovative, client-centric solutions, addressing risks such as:
- Changing complexion of insured losses. Significant drivers of insured losses since 2020 include wildfire, severe convective storm and flood – leading to demand for frequency protection, including aggregate and parametric solutions.
- Impact of AI on cyber: compressing timelines, scaling tactics and exploiting vulnerabilities quicker – leading to greater protections required.
- Data center boom: rapid build out of data centers has created a concentrated infrastructure risk class demanding fundamentally different responses from the market.
- Marsh Re is bridging the gap between cedents carrying a growing digital infrastructure book, and reinsurers and capital market investors seeking structured capacity — through custom capital architecture including variable quota share structures, portfolio-scale placements and sponsored facilities, ILS structuring, and data advisory.
- Geopolitics: Marsh Re war, terror and political violence teams have developed new structured quota share products, enabling clients to continue servicing volatile conflict zones.
- Cedents can maintain line sizes in support of their own local clients, offering additional indirect war coverages previously unavailable.