AXA XL, one of the world’s largest commercial and specialty insurers, continued to shrink in the third quarter as it refused to follow prices down in softening markets, a stance that has direct implications for brokers placing large commercial risks and for New Zealand insurers buying reinsurance.
AXA’s group property and casualty premiums rose 3% to €48.1 billion in the first nine months of 2026, according to its nine-month activity indicators published on 29 October. That headline growth came from personal lines in France, the UK and elsewhere - markets where AXA operates retail insurance businesses. AXA has no personal lines operation in New Zealand, so the relevant story here is what its commercial arm is doing.
AXA XL’s insurance premiums fell 1% in the nine months. Prices dropped 1%, property volumes rose and casualty volumes fell - what AXA described as disciplined cycle management in a softening market. AXA XL Reinsurance contracted more sharply, with premiums down 9% to €2.2 billion. AXA attributed both moves to underwriting discipline in softer conditions.
That discipline matters for New Zealand. AXA XL writes commercial and specialty insurance through brokers here and provides reinsurance capacity to local insurers. As one of the larger players in that reinsurance market, its willingness - or otherwise - to grow its share at upcoming renewals affects the range of capacity available to New Zealand primary insurers seeking catastrophe protection.
AXA said natural catastrophe losses for the nine months were above its prorated annual budget of 4.5 points of combined ratio, driven by severe convective storms in France, Switzerland and Italy. Catastrophe data provider PERILS put insured losses from the late-August Raphaela hailstorms in France, Germany, Switzerland and Italy at €3.3 billion, following €2.2 billion from storms in the same countries in July.
New Zealand knows this exposure well. The Auckland Anniversary Weekend floods and Cyclone Gabrielle in early 2023 remain the two largest weather-related insurance events in the country’s history, with combined insured losses pushing toward NZ$3.56 billion. With Europe now recording multi-billion-euro hail seasons, reinsurers globally are reassessing how they price and aggregate secondary peril exposure - and New Zealand’s flood and storm risk sits squarely in that conversation.
AXA’s Solvency II ratio fell to 213% at the end of September from 218% at the end of June. Strong operating returns were more than offset by dividend accruals, share buybacks and unfavourable market movements. The group still expects full-year underlying earnings of around €8.6 billion, with earnings per share growth at the top end of its 6% to 8% target.
For brokers placing large commercial and specialty risks, AXA XL’s continued discipline - particularly in casualty - means it is unlikely to be the carrier offering the lowest price. In a soft market where some competitors are chasing volume, that creates a split between markets willing to compete on price and those holding firm on terms.
For New Zealand insurers buying reinsurance, AXA XL Re’s 9% contraction is a signal heading into the January 1 renewals. Combined with the secondary peril losses accumulating globally, brokers should expect reinsurers to look closely at New Zealand’s hail, flood and storm exposures, and at aggregate limits and retentions, when catastrophe programmes come up for renewal.
