Aon plc, the brokerage, consulting and analytics company, says the reinsurance renewals at January 1 represent a deeper shift into a buyers’ market.

The company’s January 2026 Reinsurance Renewal Report is among a number of assessments of the market for the traditional renewals period.

For now, the company’s review through September states that the opportunity for buyers is driven by strong capital growth and a benign hurricane season.

Key trends include the record-breaking capital (up $45 billion year-on-year) to $760 billion by the end of September because of reinsurers’ retained earnings.

But also in the mix are the strong reinsurer results — an average annualised return on equity of 16 per cent for the first nine months of 2025.

There was competitive tension with renewals in Europe and Latin America seeing double digit discounts, while the non-loss impacted accounts in the Asia Pacific saw rate reductions approaching 20 per cent.

Market dynamics included the record levels of capital and reinsurer returns.

Aon estimates that global reinsurance capital hit a new high of $735 billion at June 30, 2025, driven mainly by retained and redeployed earnings in both the traditional and alternative capital sectors.

Insurers, the report says, will gain leverage to restructure programmes and explore products lost during the hard market.

With catastrophe bond issuance also at record highs, demand for reinsurance protection is also strong.

The US and Europe are expected to be the leaders as property catastrophe reinsurance limits globally surge by about 5 per cent in 2026, following the 6 per cent rise in 2025.

Aon said: “High growth areas include casualty, climate, cyber and technology advancements [artificial intelligence], as well as notable opportunities in sectors like agriculture, energy and healthcare.

“While advancements in AI, cyber and data technology are helping companies gain a significant competitive edge, they also introduce new and evolving business risks.”

Some 40 per cent of global catastrophe losses were not insured in the first half of 2025, while the protection gap in some areas was closer to 90 per cent, according to Aon’s Climate and Catastrophe Insight report.

“A clear theme during this year’s renewal season will be how we unlock market potential and deploy capital profitably towards these growth areas.

“The outlook is broadly positive, yet the operating environment remains fragile. Insured losses are elevated — 2025 is already 75 per cent above the eight-year average — while geopolitical and economic volatility are creating uncertainty around inflation and interest rates.

“The industry demonstrated resilience in recent years and proven its ability to adapt, but sudden or unexpected events can quickly change market sentiment and conditions.”