Guy Carpenter’s latest Global Specialties Market Update points to a shifting landscape in aviation insurance, where major airline losses and a rise in smaller-scale claims are reshaping risk appetite.
The global specialty insurance and reinsurance market is operating in a landscape marked by shifting geopolitics, persistent inflation, and increasingly complex claims patterns.
Losses continue to mount, yet market fundamentals remain strong.
Reinsurers broadly agree that pricing is still adequate. Retained earnings are improving, dedicated capital is expanding, and new players are introducing fresh sources of capacity.
That combination is keeping competition alive and the market healthy.
In the US, general aviation is seeing rating pressure after a relatively stable period, with some segments now posting only limited rate reductions, according to Aviation Insurance Market Report.
The sector continues to deal with uncertainties linked to aircraft losses in the Russia-Ukraine conflict, though a June ruling from the UK High Court has clarified parts of the dispute. Negotiations between reinsurers and their clients remain ongoing.
Reinsurers are working to deepen relationships with cedants to preserve or expand their market share. Specialty reinsurance markets, meanwhile, are showing renewed appetite for aviation risk.
Ceded reinsurance teams are scrutinising aviation placements more closely, reflecting the volatility that has defined the sector since 2019.
Still, Guy Carpenter stresses that capacity across the market is ample, setting the stage for orderly January 1 renewals. Dialogue between clients and reinsurers has become more engaged, with buyers increasingly focused on coverage detail and structuring (see How Global Aviation Re/Insurance Market Has Gone Through a Turbulence?).
“Despite the headline losses, plentiful supply is available, boding well for continuing market stability and orderly 1/1 renewals,” said Ian Wrigglesworth, Global Head of Aviation & Aerospace Specialty.
Managing Director Andy Edward added that buyers are now more particular about the coverage they want and more determined to understand the nuances of aviation reinsurance.
- A series of high-profile airline loss events in the first half of the year and ever-increasing attritional losses have changed the trajectory of aviation airline insurance pricing from the downward trend that had prevailed since the COVID-19 pandemic.
- The US general aviation market is increasingly under rating pressure after a period of stability, and Guy Carpenter has observed some rate reductions given in certain segments.
- Some of the uncertainties surrounding aircraft losses related to the Russia-Ukraine conflict were cleared up by a UK High Court ruling in June, but discussions with reinsurers will continue for some time.
- Guy Carpenter has seen reinsurers leveraging cedant relationships to maintain or expand their market share, while there is growing interest in aviation from some specialty reinsurance markets as well.
- Ceded reinsurance teams are paying rigorous attention to detail when buying aviation reinsurance, after the volatility the aviation insurance market has experienced since 2019.
- Despite the headline losses, plentiful supply is available, boding well for continuing market stability and orderly January 1 renewals.
- Guy Carpenter continues to focus on encouraging continuous dialogue between clients and reinsurers, which ensures a smoother renewal process and increases the ability to deliver better-priced and well-structured products.
Demand for capacity is expected to climb even as the reinsurance and retrocession markets soften. Clients will likely seek closer alignment with their partners, pushing for collaboration that sharpens risk transfer through improved pricing, terms, and conditions.
For reinsurers, the challenge is to recalibrate—holding discipline but responding with flexibility where needed.
Those able to offer differentiated products, pragmatic solutions, and innovative structures are the ones most likely to capture growth. Appetite for expansion remains high, and success will hinge on adaptability.
As the specialty reinsurance market evolves, agility becomes critical. Clients want tailored strategies and coverage structures that match their goals.
Guy Carpenter notes that its analytics and data capabilities give buyers the ability to identify the right partners, fine-tune programs, and tap into the abundant capacity now available.
