Insurance
Home›Insurance›Reinsurance›J.P. Morgan sees reinsurance pricing pressure lasting…
J.P. Morgan sees reinsurance pricing pressure lasting into 2027
J.P. Morgan expects European reinsurers to keep reporting solid results through 2026 even as property catastrophe pricing remains soft, with lighter-than-expected H1 2026 losses lifting average pre-tax earnings by about 12%.
J.P. Morgan expects reinsurance pricing to remain under pressure through 2027, even though European reinsurers are likely to continue posting strong underwriting profitability, according to a new research report on the sector by the bank.
The firm said there is little indication that pricing conditions are close to improving, noting that property catastrophe pricing has softened significantly and that actual catastrophe loss experience, not profitability, remains the key driver of the reinsurance cycle.
J.P. Morgan pointed to weaker natural catastrophe loss activity during the first half of 2026, estimating that pre-tax earnings across major European reinsurers rose by around 12% on average. It attributed the outcome either to stronger reported earnings or to reinsurers building reserve buffers.
While J.P. Morgan expects the sector to stay highly profitable in 2026 unless catastrophe activity changes materially later in the year, it said reinsurers may eventually face decisions about whether to keep retaining excess earnings in reserves or return more capital to shareholders. The bank also said historical turning points in the market have tended to follow years of elevated catastrophe losses, citing 2011, 2017 and 2022 as examples.