Insurance Marketplace Realities 2025 Spring Update – Alternative Risk Transfer

Structured solutions continue to be deployed in distressed layers, typically primary property and casualty buffer layer, umbrella and/or low-excess layers

• Insureds focused on creating longer-term stability and savings, remain committed to this approach
• Market appetite remains strong with new capacity from traditional markets being made available via MGA/MGUs, with Lloyds markets are active through syndicated facilities
• Carriers are expanding interest into healthcare liability, wildfire, construction and other lines.

Parametric catastrophe (CAT) and weather solutions continue to be a valuable approach, complimenting property policies and adding vital protection for loss costs limited or excluded under a property policy.

• Capacity continues to increase and while established for large and complex insureds, is now actively targeting middle-market and smaller insureds.
• Established for hurricanes and earthquakes, interest is growing for wildfires, tornadoes, hail and general weather (rain, temperature, snow) perils that can impact physical assets but also cause financial loss.
• Parametric products continue to evolve, leveraging data sources and deploying multi-faceted indexes to ensure robust response during events. Hurricanes Helene and Milton highlighted deficiencies in single-peril cat-in-a-circle programs due to size of storm systems and loss driven by surge or excess rainfall versus windspeeds.

• Multiline/multiyear structured reinsurance or stop loss captive reinsurance programs
• Collateral-free “efficient” fronting for highly creditworthy insureds
• Capital-market-led solutions
• Integrated risk programs

While certain lines of insurance are showing rate improvement, alternative risk products remain a tried and tested valuable source of capacity for forward-thinking insureds.