Investment income, not premium growth, was the defining story of the Bermuda (re)insurance market in 2025. California wildfires pushed losses higher and property catastrophe rates began their steepest decline in 25 years. Yet Bermuda's leading reinsurers finished the year in strong financial shape, carried by a different earnings engine.
The Association of Bermuda Insurers and Reinsurers (ABIR) published its 2025 Global Underwriting Report, drawn from 27 member companies. Gross premiums written reached US$197.5 billion for the year, a 4.6% increase from the prior year, and total equity rose 16.6% to US$207.7 billion.
The premium figure, while a record, understates what the year actually tested. Growth was concentrated: five larger members each grew premiums by US$1 billion or more, while many others held flat. ABIR attributed that flatness to deliberate discipline, with insurers resisting market-share pursuit as rates declined.
Net investment income rose 34.8%, from US$17.4 billion to US$23.4 billion, the largest percentage increase of any principal income measure in the survey. That surge reflected both elevated interest rates on bond portfolios and expanded asset bases built during three years of record retained earnings.
Net income rose 22.4% to US$32.8 billion despite absorbing a material portion of the California wildfire losses from early 2025. The GAAP and IFRS 4 reporting group achieved an aggregate combined ratio of 84.2%. Investment income was not incidental to that result. In several cases it closed the gap between underwriting profit and total profitability.
Investment yields are now moderating as central banks have eased rates. Fitch Ratings expects Bermuda reinsurers to post a return on equity in the low-teens in 2026 and 2027, down from approximately 17% in 2025. That level remains above the estimated 8% to 9% cost of capital, but with a narrowing margin. A Fitch analysis of H1 2026 results found the sector's combined ratio already rising and premium volumes falling, with the margin for error narrowing as catastrophe luck from the first half becomes less likely to repeat.
Property catastrophe reinsurance rates fell 16% at mid-year 2026 renewals, the largest annual decline in 25 years based on Guy Carpenter's Global Property Catastrophe Rate-on-Line Index. That pricing environment was developing through 2025 and is relevant to how the ABIR premium figures should be read. The measured 4.6% growth, concentrated among a handful of large writers, reflects restraint rather than broad-based expansion.
"The Bermuda market remains extremely well-capitalised and continues to build on its historic global dominance in property coverage by growing a diverse array of specialty lines, including: cyber, mortgage, political and terrorism risk, credit, transactional liability and financial lines coverage,” said ABIR chair Mark Cloutier.
The 16% rate decline was described as the steepest annual fall in 25 years, underscoring why expansion into specialty lines has become a structural priority rather than an opportunistic one for the Bermuda market.
Total equity of US$207.7 billion positions Bermuda's major reinsurers entering a softening cycle from a point of substantial accumulated strength. The 16.6% equity growth reflects three consecutive years of strong earnings.
Two new survey participants contributed approximately US$3.9 billion of the increase. The underlying equity growth across existing members remained substantial after adjusting for their entry.
Four Bermuda reinsurers placed in AM Best's top 10 global reinsurers by premium for 2025: Everest Re, RenaissanceRe, Arch, and PartnerRe. ABIR president and chief executive John Huff noted 15 ABIR members appear across AM Best's World's 50 Largest Reinsurers list.
That scale carries practical implications as rates soften. Several Bermuda reinsurers have accelerated share buyback programmes in 2026 as organic growth opportunities narrow. They are deploying accumulated earnings rather than chasing volume.
For cedents, the equity position translates to capacity availability ahead of the Atlantic hurricane season. For the Bermuda market itself, the question is how quickly moderating investment yields erode the buffer that sustained 2025 results before the underwriting cycle turns. EY and Guy Carpenter have both noted that Bermuda reinsurers are expected to exceed their cost of capital in 2026, though EY flagged cedants using alternative risk transfer solutions as reinsurance demand softens in some segments.
