Reinsurer ROE to Slide to 16.6% by 2026, Guy Carpenter Says

Guy Carpenter, the reinsurance broking arm of Marsh, expects the industry to generate a 16.6% return on equity in 2026. That is down from 18.9% in 2025 and well below the hard-market peak of 21.9% in 2023, according to the broker's July 2026 Reinsurance Renewal Report.

The estimate still sits above Guy Carpenter's projected 10.5% cost of equity for the year, which ticked up from 9.7% in 2025. The broker sees ROE continuing to ease into 2027 and 2028, to 15.6% and 15.3% respectively.

Reinsurer capital has reached an all-time high, Guy Carpenter said. It forecasted capital to have grown 9% in 2025 to $663 billion, split between $540 billion of traditional capital and $123 billion of alternative capital. That compares with $607 billion in 2024, made up of $500 billion of traditional and $107 billion of alternative.

Total insured industry losses for the first half of 2026 are projected at roughly $35 billion, driven mainly by an active severe convective storm season. That is below the five-year inflation-adjusted average. For all of 2025, insured catastrophe losses totaled $109 billion, down from $147 billion in 2024 and up from $104 billion in 2023.

The reinsurance segment's share of global catastrophe losses continues to run below pre-2023 levels. Higher attachment points since Jan. 1, 2023 and a lower number of high-severity events have kept the share contained. For 2025, the reinsurance slice was 13% of the $109 billion total, or $14 billion, up slightly from 11% in 2024 but still trending down from the 2021–2023 range.