According to the firm, the latest SCS outbreak impacted the central and eastern United States and was accompanied by historic late-season snowfall across the Northern Plains and Midwest.

As mentioned, Gallagher Re expects insured losses from the event to settle at a minimum of around $1 billion, with the potential to rise even higher, while the overall direct economic cost will be at least 25% greater once uninsured or underinsured assets and other losses are included.

“After a highly manageable and quiet start to the year for US SCS activity and subsequent losses, as the calendar turned to March, it initiated considerable storm genesis. There have now been notable outbreaks on March 4, March 5–7, and March 10–12,” the reinsurance broker’s report added.

Gallagher Re explained that this year is not unique in experiencing a highly active March, as the month has consistently featured widespread damaging activity since 2023.

The firm’s report went on to note that last year, the Mid-March Tornado Outbreak became the costliest event of the season with insured losses reaching $8.5 billion in today’s dollars. March 2025 also set a record for the most tornadoes in March, with at least 239.

Gallagher Re continued, “March is known as the historical start to “peak” SCS season in the United States. The peak months for overall SCS activity and observed losses are March, April, May, and June.

“Since 2010, those four months have accounted for at least 72% ($390 billion) of US SCS insured losses. On an annual basis, the US has now seen three consecutive years of minimal $50 billion in SCS-related insured losses.”

In related news, Swiss Re recently disclosed that although global insured losses in 2025, at $107 billion, fell below the long-term natural catastrophe trend, secondary perils, including wildfires, SCS and floods, accounted for a record 92% of the total.

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Contributing $40 billion to the 2025 total, the LA wildfires at the start of the year also represented the largest insured wildfire loss event on Swiss Re’s sigma records.

SCS also contributed significantly in 2025, ranking as the third-costliest year on record for the peril, after 2023 and 2024, and adding $51 billion to overall global insured losses.

By contrast, flood-related insured losses were well below average in 2025, at $3.4 billion compared to a previous five-year average of $15.4 billion.

The report also highlighted that 2025 was notable for the absence of a major US hurricane landfall.

Even so, long-term global insurance losses from natural catastrophes continue to grow at an annual rate of 5–7%, underscoring the need for sustained adaptation and risk mitigation to maintain insurability and reduce protection gaps.

Balz Grollimund, Head Catastrophe Perils, added, “The below-trend natural catastrophe losses seen in 2025 are the result of favourable variability rather than any easing of underlying risk.

“If losses return to normal long-term levels, they would total $148 billion in 2026. According to our modelled peak-loss scenario, insured losses could even climb to about $320 billion in 2026.

“As exposure keeps building, the upward trend in insured losses is structural and it is critical to identify the risk drivers behind this to manage and reduce risks before losses occur.”

Urs Baertschi, CEO Property & Casualty Reinsurance, commented, “A peak loss scenario year could be more than double the recent annual insured natural catastrophe losses and exceed $300 billion.

“Further risk awareness, adaptation and mitigation, alongside sufficient insurance and reinsurance, play vital roles in societal resilience. We protect against peak 2/3 risks by absorbing low-frequency, high-severity events that can quickly turn a quiet year into a record loss year.”

Jérôme Jean Haegeli, Head Swiss Re Institute and Group Chief Economist, said, “Most long-term loss growth comes from a simple reality: more valuable property is being built in harm’s way, and rebuilding costs have risen.

“At the same time, sigma analysis suggests that for some perils and regions, hazards and vulnerability are evolving faster than exposure alone would imply. As such, sustained and well-designed adaptation and risk mitigation measures are increasingly decisive to keep insurance viable and affordable – and to reduce the global protection gap represented by underinsurance.”

Total global economic losses from natural catastrophes were $220 billion in 2025, about 49% of which were insured, the highest share on sigma records and reportedly a “clear indication” that the insurance industry is playing its part in navigating global protection gaps.

Swiss Re’s report concluded, “However, protection gaps remain especially wide in emerging economies, where 80–90% of catastrophe losses are typically not covered by insurance, underscoring the need to pair stronger adaptation and risk management with broader, more accessible insurance coverage.”

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AM Best’s report noted that war risks are commonly excluded from policies but are offered as riders on certain risks, and that Iranian risks are largely uninsured by global reinsurers due to sanctions, meaning damage to infrastructure will have little impact on loss experience.

The rating agency continued, “However, if the conflict continues, there is scope for accumulations across countries and products.

“Reinsurers are monitoring the situation closely and adapting to the changing landscape. In the medium term, the global reinsurance community shares the concerns that the conflict has the potential to invigorate inflationary pressures, interest rates and bond yields if the conflict is not swiftly resolved.”

Elsewhere in the report, AM Best said that while many observers view the conflict as a regional one, its implications have the potential to be more pronounced globally, with economies likely to suffer stock market volatility, supply chain disruption and the reemergence of inflationary pressures.

“With the region producing approximately 20% of global energy resources, the disruption caused by the conflict has resulted in the countries of the Gulf Cooperation Council (GCC) halting or reducing production of oil and gas. Even if the conflict comes to a swift end, the infrastructure is not expected to be back running at full capacity any time soon,” the rating agency observed.

Meanwhile, as a consequence of the US/Israeli military action, the price of oil and gas on global markets has reportedly surged considerably and remains volatile.

As per AM Best, the Strait of Hormuz remains almost completely closed to shipping in and out of the Persian Gulf, with increasing concerns regarding the transportation and its impact on the pricing of commodities such as fertiliser and helium.

“With the consequent supply chain disruption and price increases in oil and gas, alongside stock market volatility, a resurgence in the rate of inflation cannot be ruled out in economies worldwide,” AM Best explained.

In related news, the U.S. International Development Finance Corporation (DFC) recently revealed that Chubb will serve as the lead partner for its $20 billion Maritime Reinsurance Plan, aimed at restoring commercial shipping in the Gulf and helping to restart energy and trade flows through the Strait of Hormuz.

DFC’s reinsurance facility, announced earlier this week, will insure losses up to approximately $20 billion on a rolling basis.

As we covered back then, this revolving insurance offering will apply only to vessels that meet eligibility criteria, with insurance focusing on Hull & Machinery and Cargo to start.

Leaders at global insurance and reinsurance broking group Aon have also shared their perspectives on a range of insurance lines as the conflict in the Middle East continues.

Joe Peiser, CEO of Risk Capital at Aon, noted that for many organisations the most significant exposure stems from disruption to supply chains, logistics routes and insurance coverage structures.

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This final figure compares to the previous loss estimates of AUD 2.568 billion, AUD 2.250 billion and AUD 1.922 billion issued by PERILS six weeks, three months and six months after the event, respectively.

In line with the PERILS coverage definition for Australia, this loss number covers the property and motor hull lines of business and is based on loss data collected from affected insurers.

Providing context on the event, PERILS noted that Cyclone Alfred impacted the Australian states of Queensland and New South Wales from 28 February to 12 March 2025.

After lingering for several days near the coast, the system made landfall on 7 March as a Category 1 cyclone near the Gold Coast in Southeast Queensland.

PERILS said that Cyclone Alfred is the largest insured cyclone loss on an as-if-today basis since Cyclone Debbie in March 2017.

Darryl Pidcock, Head of Asia Pacific & Cyber at PERILS, commented, “Tropical cyclones typically bring very strong winds and heavy rainfall. In the case of Cyclone Alfred, however, wind gusts were not particularly strong, and thus the wind alone was not the main loss-driver. Rather, it was the mix of prolonged windy weather and heavy precipitation which drove the losses.

“This unusual cyclone character made loss reserving challenging, and insurers chose a cautious approach in the early stages post-event, as evidenced by the material reduction from AUD 2,568m after six weeks to AUD 1,922m after six months of the event.

“Since then, loss development has become much more stable, and losses reduced by a mere 2.3% for our final loss number of AUD 1,877m.”

He continued: “Cyclone Alfred is a good example of our work motivation, namely, to increase data availability for natural catastrophe insurance for the better understanding of natural catastrophe risk.

“As such, we hope that our loss data for this event, including its development over time, will be of benefit to the insurance industry should a future cyclone event with similar characteristics strike.”

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This second estimate compares to the initial loss estimate of AUD 2.663 billion issued on January 8th, 2026, six weeks after the event end date.

Again, the loss estimate covers property and motor hull lines of business and is based on loss data collected from the affected insurers, in line with the PERILS coverage definition for Australia.

An updated estimate of the market loss, or the third industry loss from the event will be published on May 27th, 2026, six months after the event end date.

In late November 2025, SCS battered the east coast of Australia, impacting a large region, stretching from Brisbane in South East Queensland to Sydney in New South Wales.

The SCS outbreaks brought large hail, damaging winds, and intense localised rainfall as storm activity.

As per PERILS, the largest event occurred on November 24th in South East Queensland, an area that saw hailstones as large as 14cm in diameter and widespread damaging wind gusts. These caused damage to insured property and disrupted the power supply to 160,000 homes and businesses.

On November 25th, the Insurance Council of Australia (ICA) declared the South East Queensland event an Insurance Catastrophe, which was expanded on November 28th to all postcodes in both Queensland and New South Wales.

Darryl Pidcock, Head of Asia Pacific & Cyber, PERILS, commented, “Australia has so far experienced two impactful periods of severe convective storm activity in the 2025/26 SCS season. The first occurred in late October 2025, and we currently estimate its industry loss at AUD 1,512 million.

“The second occurred in late November, and at AUS 2,950 million was significantly larger. The combined loss total, three months after the respective event end dates, is AUD 4,462 million. It is possible that this amount will increase further. These events illustrate once again the significance of SCS as a major peril for the Australian insurance industry.”

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The ratings agency expects primary insurance companies to absorb much of the losses from these two events, with a less significant impact for reinsurers.

Winter Storm Hernando brought record snowfall and blizzard conditions to the northeastern US, causing widespread power outages in Massachusetts, New Jersey, Delaware, and Rhode Island.

States of emergency were declared, closing businesses and cancelling thousands of flights, with Newark Airport reporting over two feet of snow.

Hernando, combined with Winter Storm Fern’s estimated $4-7 billion in insured losses, suggests an above-average first quarter for insured losses, though less costly than the January 2025 California wildfires.

Fern impacted southern states, who were less prepared to weather winter storms, while Hernando impacted the northeastern US, where wintry conditions are more expected.

“Significantly more commercial and residential values are prevalent in the areas impacted by Hernando, which could cause a moderate impact to aggregate earnings,” analysts stated.

Noting: “As the two storms are separate and distinct events, each of these events may be contained within the primary carriers; AM Best believes reinsurers will face lesser impacts.”

Winter storms primarily affect Property/Casualty insurance lines such as homeowners, commercial property, and auto. Business interruption due to emergency closures and flight cancellations will add to the industry’s insured losses, according to the report.

State Farm has the highest market share for homeowners multi-peril in the northeastern United States, followed by auto lines. Progressive has the highest market share for auto lines; and Travelers has the highest market share in commercial multi-peril business.

AM Best stated: “Total insured losses are anticipated to be manageable for insurers and reinsurers in aggregate. As noted in our recent Review & Preview report, Rate Action and Investment Gains Drive US P/C Industry Results Despite Headwinds, P/C 2025 results are expected to be the strongest of the past decade despite the heavy first-quarter losses from the California wildfires and other weather events.”

Concluding: “While it remains to be seen how the rest of 2026 plays out in terms of catastrophe-related losses, AM Best views these two storms as earnings events for affected carriers. More effective enterprise risk management practices played a large role in the P/C industry’s resilience in 2025 and should serve the segment well in 2026.”

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The PERILS estimate of the insurance market loss for the event is based on loss data collected from the affected insurers. According to the PERILS coverage definition for Australia, this initial estimate covers the property and motor hull lines of business.

Following the PERILS reporting schedule, an updated estimate of the market loss for the event will be made available on 13 April 2026, three months after the event end date.

The events, which affected the state of Victoria in south-eastern Australia, were the most destructive bushfire outbreak since the Black Saturday bushfires of February 2009.

The bushfires were triggered by a heatwave and fueled by dry grassland, as multiple fires burned around 400,000 hectares of mostly rural land, causing one fatality and significant loss to property, livestock and infrastructure.

The Insurance Council of Australia (ICA) declared these bushfires an Insurance Catastrophe soon after the severity of the situation became clear.

Luzi Hitz, Product Manager, PERILS, commented, “Victoria has suffered two major wildfire disasters in recent years, the ‘Black Summer’ event of 2019/20 and the ‘Black Saturday’ event of 2009, the latter causing 173 fatalities.

“This time, the death toll was much lower, in part due to the bushfires impacting less populated areas, but also due to the rapid declaration of a state of emergency, early evacuations and extensive firefighting efforts, which undoubtedly helped to save lives.

“After six years of mainly ‘wet’ Cat events in Australia, including floods, cyclones and severe convective storms, the 2026 Victoria Bushfires serve as a reminder of the significant bushfire risk in Australia.”

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Net income for the full year 2025 (FY’25) was $127.2 million compared to $135.2 million in FY’24.

IGI’s combined ratio rose to 82% and 85.9% for Q4’25 and FY’25, respectively, compared to 77.8% and 79.9% for the respective time periods in 2024.

For Q4’25, IGI’s gross written premiums (GWP) went down to $141.2 million, compared to $174.6 million in Q4’24. FY’25 GWP dipped to $666.7 million, compared to $700.1 million for FY’24.

IGI explained that GWP in 2025 was impacted by the non-renewal of a professional indemnity binder in the specialty long-tail segment, which the re/insurer announced earlier in 2025.

Segment-wise, specialty short-tail segment represented 60% of the GWP, specialty long-tail segment contributed 25%, while the reinsurance unit contributed 15%.

IGI’s overall underwriting income for Q4’25 and FY’25 decreased to $46.9 million and $161.1 million, respectively, compared to $48.8 million and $187.5 million in Q4’24 and FY’24, respectively. IGI stated that this demonstrates its strong underwriting performance despite a higher level of catastrophe losses and a lower level of net premiums earned.

The insurer’s loss ratio improved to 42.1%, including cat losses of 11.7%, for Q4’25 from 43%, which included cat losses of 6% for Q4’24. For FY’25, the loss ratio was 47.6%, including cat losses of 13%, compared to 44.7% with cat losses of 9.2% for FY’24. The increase is primarily due to the lower level of net premiums earned.

The expense ratio (which includes net policy acquisition expenses, and general and administrative expenses) was 39.9% and 38.3% for Q4’25 and FY’25, respectively, compared to 34.8% and 35.2%, respectively, for the same periods in 2024.

By segment, IGI’s reinsurance unit reported GWP of $2.6 million for Q4’25, compared to $4.8 million in Q4’24. For FY’25, the same rose by 20.1% to $100.2 million, compared to $83.4 million for the full year 2024.

For Q4’25, reinsurance net premiums earned (NPE) were $21.5 million, compared to $22.4 million for the same quarter in 2024, while for FY’25 the same rose by $11.5 million or 14.2% to $92.3 million, compared to $80.8 million for FY’ 24.

The segment’s underwriting income was $12.9 million for Q4’25, compared to $13.5 million in Q4’24. However, the same increased by 28.5% to $46 million for FY’25, compared to $35.8 million for FY’24, due to a higher level of net premiums earned on a larger reinsurance portfolio.

The specialty long-tail segment saw a dip in GWP to $37 million for Q4’25, compared to $63.6 million in Q4’24, due to non-renewal of a professional indemnity binder. For FY’25, GWP were $167.1 million, compared to $204.4 million for FY’24.

In this segment, NPE for Q4’25 were $28.6 million compared to $35.8 million for Q4’24. For FY’25, NPE were $122.3 million compared to $146.3 million for the same period of 2024.

The segment’s underwriting income decreased to $10 million for Q4’25, compared to $14.3 million in Q4’24, largely due to the lower level of net premiums earned in the fourth quarter of 2025.

For 2025, the underwriting income was $10.9 million, compared to $39.5 million for FY’24, largely due to a higher level of net loss and loss adjustment expenses and a lower level of net premiums earned for the full year 2025, compared to the same period in 2024.

Lastly, IGI’s specialty short-tail segment generated GWP of $101.6 million for Q4’25, compared to $106.2 million in Q4’24. For FY’25, GWP were $399.4 million compared to $412.3 million for FY’24.

The segment’s NPE were $61.3 million for Q4’25, compared to $62.4 million in Q4’24. For 2025, NPE were $239.2 million compared to $256 million for FY’24.

This segment’s underwriting income rose to $24 million for Q4’25 compared to $21 million in Q4’24, driven by a lower level of net loss and loss adjustment expenses for Q4’25 compared to the same period in 2024.

But FY’25 underwriting income dipped to $104.2 million, compared to $112.2 million in FY’24, due to a lower level of net premiums earned, partially offset by a lower level of net loss and loss adjustment expenses for the full year 2025 compared to the same period in 2024.

Taking a look at the asset side, IGI’s overall investment income increased by 2.2% to $14.2 million in Q4’25, compared to $13.9 million in Q4’24. The net investment income for Q4’25 was $14.6 million, an increase of 7.4% compared to $13.6 million for the corresponding period of 2024.

Meanwhile, investment income increased by 5.4% to $54.7 million for FY’25, compared to $51.9 million for FY’24, driven by a larger fixed income portfolio. For FY’25, net investment income was $60.4 million, compared to $53.9 million for FY’24.

Waleed Jabsheh, President & CEO, IGI Group, said, “We produced another set of excellent financial results in 2025. This demonstrates the strong execution and cycle management culture we have at IGI, the benefits of our diversification strategy, and the value that we continue to deliver to our shareholders.

“Our combined ratio of 85.9% and net income of $127.2 million resulted in a return on average equity of 18.6% and a core operating return on average equity of 16.8% for the current year, well above our 10-year average. In addition, we grew our book value per share during the year to $16.91 at December 31, 2025, while returning over $108 million to shareholders in share repurchases and dividends.

“We have built a level of resilience across our Company with the right strategy, exceptional talent and strong execution and capital management capabilities, all of which we believe will continue to hold us in good stead for the years ahead.”

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The PERILS estimate of the insurance market loss from Windstorm Goretti, which is also known as Elli, is based on loss data collected from the affected insurers. According to the PERILS coverage definition for Europe, this initial estimate covers the property and motor line of business.

Luzi Hitz, Product Manager at PERILS, commented, “Windstorm Goretti was the first European windstorm event of the 2025/26 season to exceed our capturing threshold of €300 million for any one country or €500 million for a Europewide event.

“Its high-wind field covered practically the entire English Channel and affected the bordering regions. Except for Cornwall and the Channel Islands, the UK was largely spared from its impact. Had the storm track been further north, it would have been a much more impactful event with much higher losses.”

She continued, “France, however, was not as fortunate with damaging winds affecting practically the entire northern half of the country. This is why the vast majority of the Goretti losses – close to 75% – occurred in France. In comparison, Belgium was only marginally impacted.”

Goretti marks the biggest European windstorm event loss so far in the 2025/26 season. The vent was named Goretti by Météo France and Elli by the Free University of Berlin.

It was a multi-faceted European winter storm that generated record-breaking wind gusts, high waves, and a combination of rain, snow and ice.

A gust of 213 km/h was measured at the Gatteville lighthouse on the tip of the Cotentin Peninsula in the Manche department.

According to PERILS, Goretti’s impact was “exceptional” at a local level but not unusual from a Europe-wide perspective, where windstorm event losses of this size can be observed annually.

Meteorologically, the event was characterised by explosive cyclogenesis and an atmospheric phenomenon known as “sting jet”. The latter led to very high winds in a narrow corridor which affected Cornwall at the southwestern tip of England, the Channel Islands, and the Manche and Calvados departments in northwestern France.

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In a new report, the firm said that in recent days, Storm Nils has unleashed heavy rainfall, powerful winds, and severe flooding, resulting in at least two fatalities and dozens of injuries.

Saturated soils and overflowing rivers have reportedly intensified the damage, affecting multiple regions.

Citing Cotality Hazard HQ Command Central, Morningstar DBRS noted that preliminary insured losses related to wind damage alone are estimated between €800 million and €1.2 billion.

These figures exclude losses from flooding and other hazards, meaning total insured losses could more than double once damages to vehicles, property, and business operations are fully accounted for.

With this in mind, Morningstar DBRS explained that it is possible that total insured losses could exceed €3 billion.

The firm continued that in France, natural catastrophe losses are covered by the NatCat (Catastrophes Naturelles) insurance system, a nationwide public–private framework that provides automatic catastrophe coverage through all property insurance contracts.

“France’s NatCat insurance scheme is a state‑supported public–private mechanism designed to ensure nationwide protection against natural disasters by embedding mandatory catastrophe coverage into all property insurance contracts. Established in 1982, the system requires insurers to include NatCat coverage by default, financed through a premium surcharge,” Morningstar DBRS said.

According to the firm, this mechanism ensures widespread, affordable protection against events such as floods, droughts, earthquakes, and landslides, while shielding private insurers from the financial burden of large catastrophic events.

As we’ve extensively reported, insured losses from adverse weather events have increased significantly over the past decade, driven by more frequent and severe climate-related episodes.

In response, the French government raised NatCat surcharges effective 1 January 2025, property policies from 12% to 20% and motor insurance from 6% to 9%, to reinforce the financial sustainability of the scheme as climate pressures escalate.

Morningstar DBRS concluded, “While this adjustment ultimately increases costs for policyholders, the French NatCat re/insurance scheme remains one of Europe’s most comprehensive natural‑disaster insurance frameworks.

“Its structure underpins the financial stability of the private insurance sector by providing essential loss‑absorption capacity and shielding insurers from the financial impact of large‑scale catastrophic events.”

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