The global insurance industry is slowing from cyclical highs into a softer market this year and next. Yet the industry is more relevant than ever in a world of recurring shocks and deepening fragmentation. We forecast total real premium growth (life and non-life) to ease to 1.3% in 2026 and 1.6% in 2027 (2025: 3.9%).

The slowdown is uneven: global non-life real premium growth is softening to 0.6% in 2026 due to competitive pricing and slowing economic momentum, while life insurance growth will stay robust at 2.3% in real terms, supported by higher yields. The US and China remain the world’s largest insurance markets by nominal premium volume, while India is the fastest-growing of the world’s top 20 (7.1% in real terms in 2026).

We expect global commercial and personal lines prices to remain soft through 2026–2027, supported by robust profitability, abundant capital and easing reinsurance costs. We forecast global non-life premium growth to reach a cyclical low of 0.6% in 2026, before recovering modestly to 1% in 2027. The softening is broad but not uniform. Casualty pricing held firm in the first quarter of 2026, supported by a resilient US market, though early signs of liability excess inflation, particularly in continental Europe, suggest those pricing pressures could become more geographically broad based.

The Middle East conflict could yet temper the decline. By 2027, property rebuilding will cost 7% more in the US and 11% more in Germany as second-round inflationary effects feed through into repair, replacement and liability costs. This may offset some of the downward pressure on pricing. It points to a shallower cycle than past soft markets, with insurers likely to reprice more sharply if large losses, inflation or capital signals deteriorate.

Profitability tells a similar story, robust but past its peak. Return on equity (ROE) is forecast to ease to 11.4% in 2026, from a 14% peak in 2025, and to 7.7% in 2028. The main cushion is investment income, still elevated thanks to higher yields. With capacity ample and competition intensifying, we expect prices to stay soft through 2026–27, underpinned by strong profitability, abundant capital and easing reinsurance costs.

Non-life insurance real premium growth hits a cyclical bottom in 2026

Summary of global non-life (real) premium growth by line of business

For life insurers, the higher interest rate environment is a near term tailwind lifting both demand for savings products and investment returns. We forecast solid global life insurance premium growth of 2.3% in real terms in 2026, above the long-term trend (2015-2024: 1.9%). though this is a moderation from 4.0% in 2025.

The picture varies by market. In advanced markets, annuity momentum has slowed and affordability pressures are likely to weigh on demand for protection, while emerging markets still see robust structural growth due to favourable demographics and supportive regulation.

Higher reinvestment yields should support investment income and profit margins, underpinning a solid medium-term profitability outlook. The savings business is meanwhile shifting towards capital-light, unit-linked (UL) products and higher-yielding private assets. Private credit exposure is also growing with life insurers among the fastest growing investors.

Life insurance real premium growth to remain robust and above long-term trend