The 1 January renewal season in the property reinsurance market witnessed a notable increase in capacity from existing and new local carriers, as well as MGAs, according to Gallagher Re.
In its “First View—Options and Opportunities — January 2026” report covering market conditions in the reinsurance industry, Gallagher Re said that there was also renewed interest from international markets, which increased competition in the market, and resulted in a more balanced dynamic between cedants and reinsurers.
There were signs of softening in pricing and improved financial conditions for cedants, allowing them to delay the signings and go through additional negotiation phases.
On pro rata programmes, which dominate the landscape in the region, the pressure on cedants to increase their “skin in the game” has eased compared to recent years. There was still a push to eliminate surplus lines and shift towards pure quota share or gross XL structures.
Following last year’s flood events in the UAE, there was still a focus on reducing excessively high event limits, which have been a notable feature in the region. There have been notable improvements to commission levels, particularly on loss-free accounts, which have not seen any improvements during the hard market cycle.
For risk and CAT business, there were meaningful improvements for loss-free accounts, particularly for CAT after a few years of rate increases driven by recent events. At the renewal, reinsurers were increasingly willing to concede rate reductions in order to maintain or grow market share. Some loss-affected accounts have managed to secure flat to reduced rates.
This race to gain, maintain or increase market share was reflected in considerably oversubscribed programmes, compared to previous years.
Casualty reinsurance
In the Middle East, casualty business is dominated by excess of loss programmes. Gallagher Re saw increasing appetite from reinsurers, with most programme structures unchanged, and pricing flat to -10% risk-adjusted. M