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Third-party reinsurance capital projected to reach $130 billion by 2026
AM Best and Guy Carpenter raised their end-2025 third-party capital estimate to $123 billion from $120 billion, citing faster accumulation across cat bonds and ILS.
Third-party capital in reinsurance is projected to grow about 6.0% through calendar year 2026 to about $130 billion, according to new data from AM Best and reinsurance broker Guy Carpenter.
The agencies said the outlook for end-2025 was revised upward, with the estimate for third-party reinsurance capital increased to $123 billion from the previous $120 billion. They also pointed to a stronger 2025 outcome, saying third-party capital across cat bonds, insurance-linked securities and reinsurance sidecars grew about 15%.
AM Best and Guy Carpenter projected traditional reinsurance capital to rise by almost 6.5% from $540 billion at the end of 2025 to $575 billion by year end. That would put total global reinsurance capital at about $705 billion at the end of 2026, up 6.3% from $663 billion at the end of the prior year.
AM Best said reinsurers are entering 2027 with a strong capital position, supported by improved underwriting conditions, elevated investment yields, disciplined capital deployment, and catastrophe experience that has been generally favorable relative to earlier pricing assumptions. The rating agency also warned that while the industry is awash in capital, the areas to deploy it profitably are shrinking as reinsurance pricing softens.