On Aon Podcast: From Risk to Resilience — What’s Driving the Re/insurance Market

On Aon Podcast: From Risk to Resilience — What’s Driving the Re/insurance Market
September 25, 2025 10 mins

On Aon Podcast: From Risk to Resilience — What’s Driving the Re/insurance Market

On Aon Podcast Hero Image

In the latest episode of On Aon, Emma Crookes and Dave Nicholson explore the latest trends in the insurance and reinsurance markets. The conversation covers key trends in Property and Casualty, including the evolving pricing environment, and the significance of natural catastrophe losses in 2025.

Key Takeaways
  1. Reinsurers are leveraging strong capital positions and disciplined management to offer clients effective protection against volatility and large losses.
  2. The industry is innovating to address emerging and uninsured risks, with substantial opportunities in areas like casualty, real estate and data centers.
  3. Transparent dialogue and differentiation are increasingly important for insurers and reinsurers as they navigate evolving market conditions and client needs.

Transcript: Intro (00:02)
Hello and welcome to this episode of On Aon where we dive into some of the most pressing risk capital and human capital issues businesses around the world are facing. Today we're looking at the latest trends in the global reinsurance and insurance markets and what insurers and their clients should be looking out for. We've got a couple of great experts joining us on this episode and the crooks whose Aon's insurance vertical leader and Aon's global client leader for reinsurance, Dave Nicholson.

Emma Crooks (00:34)
Hi everyone, my name is Emma Crooks and I'm the Insurance Industry Vertical Leader at Aon. That's everything we do with insurance and reinsurance companies as clients. And in today's episode of On Aon, we're taking a look at the latest trends in the insurance and reinsurance market and how they impact businesses all around the world. This time of year is an incredibly busy time for the insurance and reinsurance industry.

At the start of the September, Rendezvous, the global reinsurance industry event held in Monaco. where the world's leading reinsurance market participants meet to discuss the state of the market and enjoy an overpriced cappuccino. And the event also fires the starting gun on the all-important year-end reinsurance renewals, which have major impacts for both reinsurers and their clients. We've got a lot to discuss and examine in this episode, so I'm really glad to have Dave Nicholson, Aon's global client leader for reinsurance, with me today to help identify the key developments and give you some key takeaways.

Hello there Dave.

Dave Nicholson (01:32)
Hi Emma, and thanks for having me on today. It's great to be with you and looking forward to seeing a lot of our industry partners and friends at Monte Carlo in the next couple days.

Emma Crooks (01:42)
Absolutely. And Dave, let's maybe kick off with the two biggest and arguably most important categories, property and casualty. Specifically, one of the most important trends you're seeing in the proxy market.

Dave Nicholson (01:52)
That's a great question, Emma. And I think there are a number of trends, so it's hard to single out the single most important, but given your question, I'd say it's really the pricing environment for property insurance. You've seen over the course of the year, original insurance pricing and property come off and reduce. The nice thing for our clients is we are coming off very strong rating environment.

And we also have a favorable reinsurance environment to help them manage and mitigate that risk. That said, as we think about property, some other important trends to keep an eye on are the impact of tariffs and inflation as we're seeing a lot of significant movement around the globe, including the US's opposing tariffs, which is driving up the cost of goods and the property world potential cost of reconstruction. We also have the trend we're seeing around natural catastrophe losses.

If you think about the year to date, the first half of 2025, Aion estimates suffered roughly $100 billion of insured loss. Which is quite a significant figure, particularly when looking back at history, most of the insured loss, more than half, tends to come in the second half of the year. So it was quite an active first half. Again, go back to that first question around our challenge of the pricing environment.

While we've had a healthy 2025 to date, continued pricing declines risk the threat of impacting profitability more severely in future years.

Emma Crooks (03:30)
And in these soft market conditions, what do think insurers should be thinking about and how does that impact their clients as well?

Dave Nicholson (03:38)
It's a great question. I, with that environment on the original property market, the nice news here is it reinsurance capital is ample. Now we're seeing a significant appetite for firm reinsurers to continue to secure growth.

So we are talking with our clients around frequency protection, which reinsurers do have an appetite for and solutions that help the insureds manage the volatility that comes with this increase in that cat activity and the potential pressure on the original pricing. We're also seeing appetite from both buyers and sellers for top end tail limit. Then we think with the future potential of increased loss costs, it's a great time to add a little bit more limit on the top of your program to ensure that in the event of a large natural catastrophe, that your capital is well protected.

That protects both your insurance company balance sheet as well as the original insured your ability to follow through on that promise to pay claims so while there is pressure in the original property insurance market, we think it's a Very healthy time and a very time to be a reinsurance buyer.

Emma Crooks (04:51)
Yeah, and it’s a buyers’ market, right? Much like the general property market, real estate market at the moment, but returning to the casualty markets, what are the big trends reinsurers are seeing here? What are the big differences between the US and non-US markets?

Dave Nicholson (05:04)
I think it's a great question. mean, think casualties are very important part of the overall global marketplace. There's been a lot of talk over the past year about the impact of nuclear verdicts. The nice thing is that the, we believe the insurance marketplace as a whole has responded in a very professional manner and has pushed casualty rates on the original business up to levels that are much healthier today.

And the feedback we're getting from reinsurers tends to be that they are seeing that come through the system. So a healthier area of the market where the casualty line of business remains under a lot of scrutiny.

And the theme for renewals coming up in casualty is really about differentiation and having a good transparent dialogue about what you as an insurer are doing to demonstrate you have a handle on loss costs demonstrate your ability and focus on handling claims quickly, settling and avoiding runaway individual claims.

And we think there is still a lot of differentiation and we do expect to reinsurers will be very commercial in their consideration around casualty. We'll be looking for a lot of insight and dialogue and communication to be able to give credit where insurance companies are doing the right thing and being proactive.

Emma Crooks (06:31)
Yeah, US casualty was certainly quite a hot topic in Monte Carlo last year. So it seems to sort of remain one despite these efforts to mitigate this year. And what is, again, it's a similar question to the property side of things. What impact does all of that have on the insurers' clients? You mentioned about mitigating those costs, paying them as fast as possible. What does that imply with their clients?

Dave Nicholson (06:55)
Or the original insureds, it's a great question. think there's an increased awareness amongst risk managers that the environment in which they're operating their business day to day, particularly in the U S which has always been litigious has even greater risk today. We see a lot of activity at the state level around trying to address some of this through legal reforms, but it's slow to take hold.

Then so business leaders around the world, I think, need to be very aware of the exposure to their business from areas of liability and the potential for large claims against their firms in the casualty market and look to have the protection in place to ensure that their firm is well insulated against that. We think insurance companies are being really active to try and have those solutions, but they need to be at a reasonable and sustainable price.

Emma Crooks (07:49)
Yeah, so I think that brings us to the final day. We take a look into the future, so crystal ball time. How long do you think this current favorable market condition, these conditions can last? What might make the market harden and push prices higher?

Dave Nicholson (08:04)
Yeah, so take those two lines of business you described, Emma. If we take casualty first, the continued discipline and attention from our insurance company clients on what an appropriate level of rate is to manage the loss costs that is in the system and the uncertainty. We feel like as a broad stroke, the industry is doing a nice job and it's done a nice job. And that should continue.

On the property side, it will take a significant natural catastrophe or several significant net cuts to really move the needle, given the health of capital that is deployed in the reinsurance space today. We think that's that's a good thing, right? There is fiscal tightening that could happen or a shock to the financial markets. But generally I think the view of Aon is a healthy insurance and a healthy reinsurance market is good for our clients and good for the world because it creates resiliency.

Where I think we have the greatest opportunity is to think about how we can take this ample capital and ensure we continue to think about the emerging risks and the uninsured risks that exist in the marketplace. So two examples, we recently published a report in the casualty space that talks about what we view as a $5 billion opportunity for emerging casualty risks.

And that's a large of income that our industry should be thinking about how do we solve the problem and how do we address the risk. On the property side, there are things like real estate and the increase in real estate values, there are investment in data centers that have large values, and a lot of areas where the insurance industry can continue to play a meaningful role and grow into what is currently on or under insured risk.

Emma Crooks (09:58)
of that day, great insights and really looking forward to Monte Carlo. So please tell me, what are you most looking forward to other than the overpriced cappuccinos?

Dave Nicholson (10:08)
Really looking forward to seeing so many colleagues, trading partners, clients and friends in Monte Carlo. In addition to those high priced cappuccinos, can't help but notice the sports cars, the yachts and hopefully some beautiful sunshine.

It's also a really opportune time as Aon launches our new partnership with Ferrari's Formula One team as we're surrounded by both supercars and I think home to some of those Formula One drivers we've all learned to love from Drive to Survive. So look forward to seeing everyone and thank you for tuning into the On Aion podcast.

Emma Crooks (10:45)
Thank you very much, Dave. I think that's our show for today. Thank you all for listening. You'll find links to the articles and reports on the topics we've just been discussing in the show notes accompanying this episode. Plus there's more to explore on aon.com. In the coming weeks, we'll have more episodes on risk capital topics, including the year's Global Risk Management Survey.

So thank you very much for today, Dave, and until next time.

Outro (11:12)
Thanks for tuning in to the latest episode of On Aon. If you enjoyed this episode, don't forget to subscribe wherever you get your podcasts. And be sure to visit Aon.com to learn more about Aon.

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