The report provides in-depth analysis on trends in reinsurance dedicated capital and on reinsurers' reported and underlying profitability.

Key findings from this report

  • 2025 has been an exceptionally strong year for reinsurers with a reported ROE for the Gallagher Reinsurance Composite (The Composite)1 of 19.3% (2024 FY: 16.7%).
  • Assuming a 'normal' level of natural catastrophe losses, the Composite reinsurers are well positioned to maintain strong profitability in 2026 with an estimated reported ROE of 14-15%2, above the industry's cost of equity.
  • Global reinsurance dedicated capital totaled USD648 billion at full-year 2025, an increase of 11% versus full-year 2024. Growth was driven by both traditional reinsurance capital and non-life alternative capital.
  • Supported by retained earnings, we expect traditional reinsurance capital to grow by around 4% in 2026. Although absolute capital growth is expected to slow, we expect excess capital to continue to build.
  • Non-life alternative capital3 increased from USD21B to USD135B at full-year 2025, which was one of the largest increases since we started this analysis. We continue to see elevated activity in that area so far in 2026.

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1 The Composite represents the large Bermudian and the Big 4 European reinsurers which provide the granular disclosure needed to analyze trends in the underlying combined ratio and ROE.

2 Reported ROE estimate also assumes support from reserves releases and realized investment gains in line with 10-year average.

3 Alternative capital excludes life, accident and health (LAH) ILS AuM and mortgage ILS AuM.