Rising cyber risks are testing the market’s pricing strategy.

Cyber insurers are expected to remain profitable despite falling premiums and rising cyber threats, but analysts said the market’s outlook depends on whether insurers resist further price cuts.

“Our stable outlook on the segment reflects solid demand for coverage, even as the market pricing softens, in addition to favorable profitability over the intermediate terms and the growing use of artificial intelligence (AI),” Cristian Sieira, a senior financial analyst at A.M. Best Company, Inc. said in a July report.

The credit rating company said demand continues to grow as businesses digitise operations, comply with stricter data protection rules, and become more aware of cyber risks.

It estimated global cyber insurance premiums exceeded $16b in 2025, although growth slowed as competition and ample underwriting capacity pushed prices lower.

S&P Global Ratings said the market is approaching an “inflection point,” warning that continued rate declines could eventually erode underwriting profits if they fail to keep pace with rising claims.

“The decline in cyber insurance rates is beginning to slow, with early signs of improving pricing discipline that may help stabilise underwriting profitability and preserve the current reinsurance-led market structure,” Manuel Adam, an analyst at S&P Global Ratings, said in a July report.

“However, adverse cyber loss trends and persistent competitive pressure could challenge pricing adequacy and increase the risk of market underpricing,” he added.

Both reports identified stronger competition as the key reason premiums have declined.

AM Best said the market has favoured buyers since 2023 as insurers competed more aggressively, but underwriting remained profitable despite modestly higher claim costs.

S&P said insurers must raise premiums to keep pace with claims costs or risk underwriting losses.

AM Best said ransomware, business email compromise, and fund transfer fraud remain the main drivers of cyber insurance claims.

It added that AI is making cyberattacks more sophisticated and easier to scale. The debt watcher estimated ransomware attacks increased 30% in 2025 to 7,419 incidents worldwide.

Questions to ponder:

• Can insurers maintain pricing discipline as competition for cyber insurance intensifies?
• How should insurers price cyber risks as AI makes attacks more frequent and sophisticated?
   

The Myanmar earthquake was the deadliest global event except for heatwaves.

Insurers are expected to face continued pressure from frequent, mid-sized catastrophe events, with severe convective storms (SCS) now seen as the main driver of future insured losses, according to Aon’s 2026 Climate and Catastrophe Insight report. 

Globally insured losses reached $127b last year, higher than the long-term average since 2000 of $99b and 47% more than the median of the same period ($86b).

“The Myanmar earthquake was the deadliest global event except for heatwaves, with $15.7b in economic losses. Flooding in China and cyclones in South and Southeast Asia also drove significant losses. Australia experienced two billion-dollar insured loss events,” the report said.

The firm said SCS have overtaken tropical cyclones as the costliest insured peril of the 21st century, and this pattern is likely to persist as high-frequency storms in the United States continue to generate large, recurring claims. 

In 2025 alone, SCS caused $61b in insured losses globally, the third-highest on record, signalling that loss volatility is becoming a structural issue for the insurance and reinsurance markets 

Aon said the industry should also expect insured losses to remain above $100b a year, even in years with lower overall disaster activity. 

Global economic losses from natural disasters totalled $260b in 2025. 

The gap between economic and insured losses narrowed to 51%, the lowest on record, mainly because of heavy loss concentration in highly insured markets such as the United States, which accounted for 81% of global insured losses. 

This suggests future growth in claims will continue to be driven by developed markets, whilst protection gaps in emerging economies remain wide 

Wildfire and heat-related risks are also expected to weigh more heavily on insurers’ portfolios. 

The Palisades and Eaton Fires in California produced $41b in insured losses in 2025, the highest ever for wildfires, reinforcing expectations that secondary perils will remain a key source of accumulation risk. 

Aon said climate trends point to more frequent medium-scale events rather than a small number of extreme catastrophes, with $30b insured loss events recorded in 2025, well above the long-term average of 17. 

This raises concerns about capital strain, pricing adequacy and reinsurance capacity going forward The report also expects wider use 

of alternative risk transfer and parametric insurance as insurers and governments look for faster liquidity and additional capital. 
 

It was driven by higher collections in health, motor own damage and fire insurance.

India’s non-life insurance market is expected to sustain double-digit growth in the near term, driven by health, motor and fire lines, although pricing discipline and distribution costs will be key, according to CareEdge Ratings.

Non-life premiums rose 13.7% year-on-year in December 2025 to $3.13b (₹28,446.8 crore), marking a second straight month of double-digit growth, partly supported by a favourable base after the 1/n rule affected December 2024.

Growth was led by higher collections in health, motor own damage and fire insurance, helped by festive vehicle sales, year-end renewals and steady commercial activity.

CareEdge said momentum should remain supported by regulatory initiatives, digital distribution, rising retail demand and the expansion of standalone health insurers, with year-to-date FY26 premiums already above $27.5b (₹2.50 lakh crore).
Motor insurance is expected to stay a key driver, backed by lower GST, stronger vehicle sales and the potential for higher third-party rates.
However, the agency cautioned that competition, regulatory changes, distributor commissions and the pace of recovery in government-backed schemes could affect how sustainable growth is in 2026.
($1.00 = ₹90.99)

Sandler has more than a decade of experience in insurance and finance.

Allianz Commercial Asia has named Casey Sandler as its Division Manager of Distribution Management at Allianz Fire and Marine Insurance Japan Ltd. (Allianz Commercial Japan).

Sandler will assume the role of director of Distribution Management on 11 March.

His role entails him to focus on strategic partnerships and expand the company’s presence in Japan.

Sandler has more than a decade of experience in insurance and finance. He served as Secretary for the Foreign Non-Life Insurance Association of Japan from 2019 to 2020.

He was most recently interim managing director and legal representative for HDI Global SE Japan Branch.

Before that role, he was general manager of Market Management. Sandler holds a Bachelor of Science in Accounting from the University of Maryland in the US.

The plan aims to help supervisors deal with structural changes in the industry.

The International Association of Insurance Supervisors (IAIS) has published its Roadmap 2026 to 2027, setting out its priorities and work programme for the next two years under its Strategic Plan 2025–2029.

The roadmap focuses on four areas: monitoring key risks and trends in the global insurance sector, setting and maintaining global supervisory standards, supporting supervisors through guidance and capacity building, and assessing how consistently global standards are being implemented.

IAIS Executive Committee Chair Toshiyuki Miyoshi said the plan aims to help supervisors deal with structural changes in the industry, climate and natural catastrophe protection gaps, digitalisation, and the rollout of global standards such as ComFrame and the Insurance Capital Standard (ICS).

One of the main priorities for 2026 is closer monitoring of structural shifts in the life insurance sector. 

Building on its 2025 issues paper, the IAIS will look more closely at rising investments in alternative assets and the growth of asset-intensive reinsurance, which it said could have systemic implications.

Climate risk and natural catastrophe protection gaps will also remain a core focus. 

The IAIS plans to provide supervisors with guidance on climate metrics, scenario analysis and tools to help narrow protection gaps.

On global standards, the IAIS will prioritise implementation assessments in 2026 to 2027, with a focus on ComFrame.

This includes starting assessments of the ICS and the qualitative elements of ComFrame, alongside other reviews covering its wider membership.
 

The outlook for India marks a sharp rebound from 2025, when growth slowed to 3.1%.

The insurance market in India is projected to grow 6.9% through 2030 in terms of premium, pushing the country to be the strongest growing major insurance market, Swiss Re said.

“India is a true bright spot for insurance growth in the mid-term as opportunities emerge, especially in health and motor insurance,” Amitabha Ray, Swiss Re Market head for India, said in a press release.

The country is likely to benefit from “forward-looking regulatory reform, digital innovation and a disciplined but attractive product mix for consumers.”  

“Insurance growth will benefit India, as it acts as a significant financial shock absorber for millions of Indian families and business as they face increased risk from natural catastrophes, increasing healthcare costs and the financial pressures of an ageing population,” Ray added.

The forecast puts India ahead of China, where growth is expected to be around 4%, and the United States, at about 2% over the same period. 

The outlook marks a sharp rebound from 2025, when growth slowed to 3.1% as the market adjusted to new regulations.

Swiss Re said recent reforms by the Insurance Regulatory and Development Authority of India (IRDAI), alongside broader government policy changes, are improving transparency and reshaping the industry. 

These include a higher foreign direct investment limit in insurance, modernisation of distribution channels, and goods and services tax reforms. The changes are expected to attract new capital, expand access to insurance, and support demand growth.

Life insurance is forecast to grow by 6.8% a year over the next five years. 

India is the second-largest life insurance market amongst emerging economies, with growth expected to be supported by wider distribution, rising demand for retirement products, and credit expansion.

In non-life insurance, near-term growth may be weighed down by regulatory changes and medical inflation, but Swiss Re expects a recovery in the medium term. 

Health insurance is projected to grow by an average of 7.2% a year from 2026 to 2030, whilst motor insurance is expected to expand by 7.5% annually, driven by higher vehicle ownership.

Swiss Re also flagged rising natural catastrophe risks as a key challenge. The reinsurer estimates that assets worth about $26t to $29t are exposed at the national level, with some concentrated in high-risk regions. 

Losses from major disasters in these areas could have a significant impact on economic growth.

Parvinder Singh, head of client underwriting for India at Swiss Re, said insurers will need to balance growth with risk discipline as exposures increase. 

He said prudent underwriting and a focus on sustainable solutions will be critical in narrowing India’s protection gap and supporting long-term stability.
 

This appointment aims to align regional priorities with local business requirements for clients.

Aon has appointed Neelay Patel as CEO for Malaysia.

He brings more than two decades of experience in risk management and insurance experience.

Patel will lead the Malaysia business across Commercial Risk Solutions, Health Solutions, Talent Solutions and Wealth Solutions.

Patel will also collaborate with regional solution line leaders to align priorities, fortify execution and deliver integrated solutions that help clients protect and grow their business. 

He will report to Andrew Minnitt, head of Southeast Asia and will relocate from Singapore to Kuala Lumpur in the coming months.

Patel joined Aon in 2014. Before that, he worked with Lockton in Australia and London, supporting large multinational clients across industries. His career spans senior roles in Singapore, Australia, London and Malaysia.
 

Major insurers report YoY earnings improvements despite ongoing tariff and trade tensions.

China’s non-life insurers will gradually improve operating margins and maintain strong capital positions to support premium growth, Fitch Ratings’ APAC Insurance Outlook 2026 said.

The agency said underwriting volatility in some non-motor lines should ease as regulators push ahead with “rate-policy alignment” rules, which aim to control acquisition costs and curb excessive competition. 

From 1 November 2025, insurers are required to ensure that the policy terms and rates they apply match those filed with regulators.

Fitch expects premium growth to remain moderate over the next year, citing ongoing tariff and trade tensions and the extension of commission controls to non-motor business. 

Capital adequacy is expected to stay sound, supported by measures such as equity injections, issuance of capital supplementary bonds and the use of reinsurance. 

Major insurers reported year-on-year improvement in operating earnings in the first nine months of 2025.

The rating agency said tighter commission rules should help stabilise margins by encouraging more disciplined pricing, better risk selection and improved efficiency. 

Smaller insurers are likely to move away from commission-driven growth towards risk-based pricing and product development, whilst larger players, supported by scale and resources, are better placed to upgrade pricing models and refile products under the new framework.

Despite moderate growth, Fitch expects the sector to maintain solid solvency to support underwriting and absorb asset volatility. 

The industry’s comprehensive solvency ratio stood at 240% at end-September 2025, even with a higher allocation to equities. 

Non-life insurers are expected to continue favouring short-maturity fixed-income investments due to short liability durations and liquidity needs, and are unlikely to raise equity exposure significantly despite lower equity capital charges.

Catastrophe losses remain a key risk. Aon estimated that seasonal flooding in the third quarter of 2025 led to about $0.5b in insured losses, whilst China’s Ministry of Emergency Management said direct economic losses from natural disasters exceeded $31.17b (CNY217b) in the first nine months of 2025. 

Fitch said insurers will continue to rely on reinsurance and improve catastrophe modelling to manage earnings volatility.
 

Asset managers are backing new entrants focused on legacy blocks

The global life reinsurance market may face uncertainty from the rapid growth of offshore annuity reinsurers, which have attracted new capital from asset managers and are focused on asset-intensive reinsurance and legacy annuity block transactions, AM Best warned.

The new players bring varying business models, capital strength and risk management practices, and have increased regulatory attention on these structures. 

The agency also pointed to the potential for economic disruption linked to the development of artificial intelligence as another emerging risk factor for the sector.

However, its overall outlook was pegged stable, citing the presence of highly rated, well-capitalised and diversified players, improving mortality trends, and strong liquidity and risk-adjusted capital positions across the segment.

The rating agency said the market remains dominated by a small number of large global reinsurers that control most of the business. 

These firms benefit from long-standing client relationships, scale, and established technical and risk management capabilities, which continue to create high barriers to entry. 

Life reinsurance accounts for a significant share of their gross premiums written, with the United States remaining the largest market. 

Most of these groups are also diversified into non-life reinsurance and maintain strong capital and liquidity profiles.

AM Best noted that excess mortality from COVID-19 has fallen close to pre-pandemic levels. 
 

eported COVID deaths are now less than one-tenth of one percent of the peak seen in 2021. 

The disease dropped out of the top ten causes of death in 2024, after ranking tenth in 2023 and fourth in 2022. 

Reinsurers have said they are comfortable again using mortality improvement assumptions in their pricing.

Direct origination platforms are being built in-house at some carriers.

Private credit is becoming a larger part of insurers’ investment portfolios as they look to raise yields and improve capital efficiency, according to a report by Conning.

The asset manager said insurers are increasingly turning to direct lending through rated structures and feeder funds to access higher returns whilst adding diversification. 

Some insurers have built their own direct origination platforms or partnered with asset managers to tap deal flow, whilst others are still assessing how private credit should fit within their portfolios.

Conning said corporate direct lending has grown into a core segment of private markets, driven in part by tighter bank capital rules under Basel III and liquidity coverage requirements. 

These regulations have limited banks’ ability to lend, allowing private credit funds and other non-bank lenders to expand. 

Banks have also entered into partnerships with private credit managers, further supporting the market’s growth.

Over the past five years, private debt and direct lending have grown faster than the broader private capital market. 

Conning estimates the direct lending market now exceeds $2t, including business development companies, separately managed accounts and middle-market collateralised loan obligations.

Borrowers are drawn to direct lending because of faster execution, privacy and more flexible deal structures, whilst  investors view it as a steady income source that can offer diversification from public markets. 

For insurers, Conning said private credit can help improve portfolio yields whilst remaining aligned with liability profiles and capital requirements, as asset managers continue to structure products suited to insurance balance sheets.