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Reinsurers post near-record returns in H1 2026, boosted by fewer natcats
Gallagher Re said natcat losses contributed a 3.4 percentage point ROE benefit, and after stripping that out, the underlying ROE fell to 13.8%.
Reinsurance returns in the first half of 2026 were near the top of the cycle, but the improvement is tied closely to unusually low natural catastrophe losses, according to Insurance Business citing Gallagher Re data.
Gallagher Reinsurance Composite tracked large Bermudian and Big Four European reinsurers, posting 19.9% ROE for H1 2026. Insurance Business noted the result was materially helped by natcat losses, which contributed 3.4 percentage points to ROE, while the undiscounted combined ratio hit a record low of 85.8% for the period.
When Gallagher Re strips out the natcat tailwind, prior year reserve development, and investment gains, the underlying ROE drops to 13.8%, down from 15.3% in H1 2025 and 15.7% in H1 2024. Its underlying combined ratio also worsened to 84.7% after removing natcat losses and prior-year development, and rose to 94.2% after normalizing catastrophe losses, as softer rates worked through the book.
The insurer trade publication also pointed to weaker pricing and capital shifts across the sector. Global insured natural catastrophe losses were at least $46 billion in H1 2026, 28% below the 10-year average, and P and C reinsurance premiums fell 6.1% year on year, while total reinsurance dedicated capital reached $688 billion, up 5% from year end 2025.