Cedents buying credit, surety and political risk reinsurance at the January 1 renewals will find abundant capacity and an advantage in negotiations. But reinsurers will be selective about who gets the best terms, according to Willis Re.
In its October market view, Built for cycles: heading into 1/1 2027, the reinsurance broker said reinsurers enter the renewal with record capital and strong returns. With property catastrophe pricing softening, that spare capital is looking for a home in specialty lines including credit, surety and political risk.
Lloyd’s is a growing centre for the class. It removed its premium income limits on credit and financial guarantee business in July 2025. Direct credit insurance premium at Lloyd’s, reported under the credit and suretyship class, grew by about a quarter in 2025 to around £1.6 billion, Willis Re said, citing Lloyd’s Aggregate Accounts.
Major credit insurers now write in the market. Atradius operates through Syndicate 1864 and Coface through Syndicate 2546. Credeq’s Syndicate 1998 has in-principle approval to write credit insurance, including European trade credit, from 1 January. Convex and Atrium have also added credit and political risk capacity.
New reinsurance capacity is arriving too, including from Oak Re, a Lloyd’s platform. But Willis Re said most new entrants are following rather than leading. They add depth to panels, but established reinsurers still set the price.
For UK banks, Basel 3.1 takes effect on January 1, 2027. Credit insurance remains eligible as unfunded credit protection. Willis Re said the detail of how it is treated will shape bank demand and the terms reinsurers are asked to support.
Willis Re expects proportional ceding commissions to be broadly stable to modestly higher for clean, well-documented portfolios. It stressed that the softening reflects the supply of capital rather than better loss experience. Programmes with severity losses, or concentrations in data centres, Brazil or stressed sovereigns, should expect closer scrutiny.
Trade credit remains profitable, with loss ratios returning towards their long-term average after the record lows of the Covid years. Willis Re cited Atradius’s UK claims data, which showed August claims 8% higher than a year earlier, with financial-sector claims up 30% so far this year.
Reinsurers are expected to focus on data centre exposure, large-loss history (particularly fraud in receivables finance), concentrations in stressed sovereigns, and how portfolios are positioned for rising insolvencies in construction, chemicals, retail and transport.
For London brokers and cedents, the message is that conditions favour buyers, but only those with clean data. With capital chasing specialty lines and new syndicates arriving, the London credit market is becoming more competitive.
Cedents who can show clear exposure and aggregation data, particularly on data centres and stressed sovereigns, are best placed to secure improved terms.
