Africa (Ex South Africa):Property reinsurance market moves to softer phase driven by fiercer competition

The African property reinsurance market was clearly transitioning into a softer phase at the 1 January 2026 renewal season, particularly for programmes with strong historical performance and robust exposure data, Gallagher Re has noted.

In its “First View—Options and Opportunities — January 2026” report covering market conditions in the reinsurance industry during this key renewal period, Gallagher Re said that pricing pressure was evident, driven by increased competition among regional and selective international reinsurers, all of whom were seeking diversified growth.

Available capacity has improved materially, as reinsurers showed increased appetite for both risk and catastrophe excess of loss programmes when programmes covered only Africa without South African exposure.

Capacity was most readily available for well-structured programmes with adequate retentions and credible exposure reporting.

Risk excess of loss pricing softened for loss-free accounts, with reinsurers increasingly willing to concede rate reductions to maintain or grow market share. Catastrophe excess of loss pricing softened further, particularly on upper layers, where pricing levels became increasingly competitive.

Risk excess of loss programmes showed less competition, but pricing reductions were still achievable where loss experience was clean and attachment points were appropriate. New reinsurers remained very keen to support even loss-affected accounts.

Catastrophe excess of loss programmes experienced notable rate pressure, especially on higher layers. Top cat layers across Africa are now commonly priced between 1% and 1.5%, reflecting increased capacity.

A few reinsurers maintained their position of a minimum 1.8%-2% rate-on-line on top layers, which meant they could not support all programmes. For well-modeled catastrophe portfolios, some risk-adjusted rates fell by as much as 15%. • Pro rata programmes remained well supported, but reinsurers continued to focus on commission adequacy, underwriting discipline, and portfolio governance despite the softer market conditions.

At this renewal, the prevailing environment presented opportunities for cedants to secure more favourable pricing terms, if the structure was appropriate.

Softening market

The African market transitioned into a softer phase, driven by increased competition among regional and selective international reinsurers seeking diversified growth.