Everest Holds Underwriting Line with 89% CR as European Cat Losses Top $4 Billion
By The Reinsurance Daily Editorial ·
Everest Holds Underwriting Line with 89% CR as European Cat Losses Top $4 Billion
Everest Rejects Third-Party Capital Influence on Underwriting Logic
Everest's leadership has asserted that its core underwriting strategy remains independent of the availability or cost of third-party capital. The carrier reported reinsurance GWP of $3.4 billion in Q2 2026, delivering a segment combined ratio of 89% despite absorbing approximately $200 million in catastrophe losses. This performance signals a continued focus on rate adequacy and portfolio construction based on proprietary risk appetite, rather than leveraging tactical inflows from capital market partners to chase top-line growth. The commentary from Everest's CEO suggests a clear separation between the firm's permanent balance sheet capacity and its managed capital vehicles like Mt. Logan Re. This disciplined stance provides a clear counterpoint to competitors who may be altering their risk-return hurdles based on the fluctuating cost of retrocession or ILS capacity.
We don’t change our underwriting logic based on availability of third-party capital.
European Wildfire Losses Exceeding $4 Billion Prompt Insurer Risk Review
Insurers are actively reassessing their exposure to European catastrophe risks, particularly wildfire, following a series of events that generated estimated insured losses between $4 billion and $5 billion. These figures, which eclipse many prior-year secondary peril loss totals for the region, are forcing a fundamental review of pricing, modeling, and capacity allocation. What was previously considered a secondary, attritional peril in many European territories is now being treated as a peak exposure. Recent events, including a single blaze resulting in a $60 million loss, demonstrate that the frequency and severity patterns have shifted. Carriers are now under pressure to update their view of risk for perils beyond traditional wind and flood, with direct implications for reinsurance purchasing and aggregate treaty structures ahead of the January 1 renewals.
GlobalData Flags Supply Chain Cover Growth as Risk Manager Demand Spikes
A recent GlobalData survey indicates a significant shift in corporate risk priorities, with 41.1% of risk managers now classifying supply chain insurance as a "must-have" coverage. This represents a near doubling from previous surveys, which placed the figure at 20.6%. The report connects this surge in demand directly to heightened geopolitical tensions and recent disruptions, elevating the product from a niche buy to a core component of risk management programs. The market for this cover, estimated at $56 million in one analysis, is poised for substantial growth. For reinsurers, this presents an opportunity in a high-margin specialty class, but also necessitates a deeper understanding of contingent business interruption (CBI) accumulations and non-physical damage triggers that are common in these policies.
Agent Fraud Case Results in Jail Time, Highlights $88,000 Commission Scheme
A former insurance agent was sentenced to jail for a second time for orchestrating a fraud scheme that generated over $88,000 in unearned commissions. The agent was found to have issued fraudulent policies and collected advance commissions from the carrier. The court also mandated restitution of $36,500. While the monetary value is minor from a reinsurance perspective, the case serves as a material example of operational risk at the primary level. The fact that this was a repeat offense highlights potential gaps in carrier oversight, background checks, and internal controls for agent onboarding and commission validation. For treaty underwriters, it is a reminder that attritional losses can be driven by internal control failures in addition to traditional claims activity, warranting due diligence on cedant operational risk management frameworks.
Key Takeaways
- Everest's reported 89% reinsurance combined ratio, achieved despite $200 million in cat losses, establishes a powerful performance benchmark for 1/1 renewal negotiations, rewarding cedants who can demonstrate similar underwriting discipline.
- The market is bifurcating between carriers like Everest, who are holding a hard line on underwriting, and European insurers who are being forced by $4 billion+ wildfire losses to rapidly innovate on pricing and modeling for previously secondary perils.
- GlobalData's finding that 41.1% of risk managers now view supply chain cover as essential provides a quantitative justification for allocating more capacity to specialty lines that respond to evolving geopolitical risks.
- European wildfire losses approaching $5 billion confirm a systemic modeling failure for secondary perils in the region. Reinsurers must scrutinize cedant aggregation methodologies for unpriced climate-driven risk, particularly on low-attaching aggregate treaties.
Sources
We don’t change our underwriting logic based on availability of third-party capital: Everest CEO — artemis.bm
Insurers Are ‘Actively Evaluating’ New Catastrophe Risks as Europe Burns — insurancejournal.com
Supply Chain Insurance Is ‘Must-Have’ Cover During Geopolitical Tensions: GlobalData — insurancejournal.com
Former Insurance Agent Sentenced to Jail for Fraud, Again — insurancejournal.com