PwC's H1 2026 run-off market review shows 13 disclosed deals versus 23 a year earlier. Captive insurers drove Q2 activity. The PRA and FCA consultation on a new UK captive regime could shift deal flow.
Alpha Score of 40 reflects weak overall profile with moderate momentum, poor value, moderate quality, moderate sentiment.
PwC has published its half-year review of the non-life insurance run-off market. Only two run-off transactions were made public during the second quarter, with combined gross liabilities of roughly $50 million changing hands. That is a noticeably quieter period than the first quarter, when PwC recorded 11 disclosed deals involving five different acquirers.
Over the first half of the year overall, the total of 13 disclosed deals falls short of the 23 seen across the same period in 2025. The estimated $780 million of gross liabilities transacted in H1 2026 also compares modestly with the $1.537 billion recorded in H1 2025.
PwC cautions against over-interpreting the decline. Strong appetite for legacy solutions persists, and significant liabilities remain under review. Public disclosures understate activity, with many deals private or still progressing. Longer timelines reflect complexity. PwC expects notable closes in the second half.
Both of the transactions publicly confirmed in the second quarter concerned captive insurers, PwC reports. Riverstone Group finalised its purchase of an undisclosed North American captive, made up largely of workers' compensation exposures. Swiss Re carried out a novation of a captive book in Continental Europe, adding to the four deals it had already announced in the first quarter.
The PRA and FCA are currently consulting on a new UK regime for captive insurers. PwC suggests it will be worth watching how much captive-related deal activity this generates within the UK, and what knock-on effect that might have on captive arrangements based elsewhere. The legacy market has long served as an exit route for captive insurers and their parent companies, PwC said. The new UK framework could bring fresh deal flow into this part of the market.
PwC says the first half of 2026 run-off activity was geographically diverse. Europe and other regions accounted for a larger share of liabilities transacted than North America. It also notes softer re/insurance market conditions, particularly in property lines.
Looking ahead, PwC points to three drivers of deal activity: Lloyd's syndicates taking action on underperforming portfolios, continued uncertainty around casualty reserves and long-tail exposures, and the rise of flexible structures such as forward flows and renewable covers. Providers able to address future reserve uncertainty could expand the legacy market, PwC said.
PwC concludes that the combination of a softening underwriting cycle, unresolved casualty reserve uncertainty, tightening reinsurance returns and broader structural change within the legacy market together point towards a sector well placed to sustain meaningful run-off deal activity through the remainder of 2026 and into 2027.
Technology and AI adoption is accelerating across the legacy sector, PwC noted. It is currently working with a number of insurers and legacy market participants on technology strategy, helping to embed AI into core processes and decision-making at scale.
PwC's figures show 13 deals disclosed across H1 2026 by six acquirers. Names include Compre Group, Fara Recovery Affiliate, Quest Group, Riverstone Group, RiverStone International and Swiss Re. Estimated gross liabilities transacted stand at approximately $780 million.
PwC notes that this total excludes around $4.8 billion of gross technical provisions which, based on AF Group's most recent public filings, are expected to transfer to Enstar once Enstar's acquisition of AF Group completes.
By region, PwC's data points to North America and Continental Europe as the most active territories by deal count. The rest of the world and North America are ahead on disclosed value. The UK and Ireland saw two deals with undisclosed liabilities and no further activity in Q2. Regarding the mix of deal types, PwC's breakdown shows re/insurer transactions making up the majority of H1 2026 activity, with captive, Lloyd's and corporate deals accounting for smaller shares.
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