J.P. Morgan expects property catastrophe reinsurance rates to fall 10-20% at 1 January, less than in previous years

Reinsurers should expect another round of property catastrophe price cuts at 1 January 2027, but a smaller one. J.P. Morgan analysts put the likely fall at 10-20%, Reinsurance News reported on 9 October, and the bank describes this as less than the reductions of previous years and a sign of some stabilisation.

The forecast is conditional. J.P. Morgan expects the decline unless a large enough catastrophe late in the year occurs together with meaningful volatility in capital markets. For reference, major broker indices show global property catastrophe rates fell about 12-15% at 1 January 2026, and the decline then sped up at the mid-year renewals. The report says terms and conditions are broadly holding, with some signs of loosening.

For primary insurers, the bank's main concern is casualty. US commercial lines pricing has slowed since 2023, and casualty pricing has followed, though more gradually. Surveys show casualty price increases of only low-to-mid single digits, while J.P. Morgan estimates that claim costs rise at a mid-single-digit rate or faster, which it says points to likely margin deterioration.