Reinsurers might actually come out ahead if the 2025 Atlantic hurricane season stays quiet, according to analysts at J.P. Morgan. They argue that the profit lift from lower losses could outweigh any pricing pressure that follows a benign year.
Their report notes that feedback from Monte Carlo hinted at softer property catastrophe pricing if the season ends light. But they stress the earnings boost would be more than enough to offset it.
Under a scenario where catastrophe losses hit just 20% of normal Q3 budgets, J.P. Morgan projects reinsurer earnings could jump 6–13% for 2025.
Companies might also decide to strengthen reserves in that case, building extra cushion against the ongoing soft market.
At 20% budget utilisation, the scenario equates to about 2.5 percentage points of 2026E P&C reinsurance revenues. That, they say, shows how a gentle season could smooth the cycle further.
If the season turns out normal—over $30bn in losses—then pricing cuts would likely mirror 2025 levels. For now, the picture looks calm.
By early September, the statistical peak of the Atlantic hurricane season had already passed. Aside from Hurricane Erin, which avoided serious damage, no major events have formed.
Forecasters had expected an active season with three major hurricanes, but that’s actually aligned with long-term averages. Only 2022 saw fewer storms by this stage.
The cautionary note: that same year still produced Hurricane Ian in late September, one of the most expensive storms ever and a trigger for sharp reinsurance hardening.
So while reinsurers may see a temporary earnings windfall from 2025’s mild season, nobody’s declaring it safe yet. The Atlantic can still turn violent, fast.
