Baden-Baden: E+S Rück expects stable German reinsurance market in 2026

E+S Rück, the subsidiary of reinsurer Hannover Re focused on Germany’s market, expects a stable reinsurance environment and continued demand growth through 2026 despite early signs of softening rates in some property and casualty lines.

Speaking at the Baden-Baden reinsurance meeting, E+S Rück chief executive Thorsten Steinmann said the firm’s “strong and enduring relationships” and “robust capital base” would underpin further profitable growth alongside clients.

“Our clients know we are always at their side as a reliable and consistent partner, even when the market environment is challenging,” Steinmann said.

“Thanks to our business model as a pure-play reinsurer, we offer the entire spectrum of reinsurance coverage and are keen to explore innovative concepts, including structured solutions for capital management.”

E+S Rück said demand for high-quality reinsurance protection had risen again in 2025, supporting premium growth and reflecting insurers’ need for stability amid continued geopolitical and inflationary uncertainty.

Losses from natural catastrophes have remained moderate this year, and the motor insurance line has experienced a marked recovery following corrective tariff measures by primary insurers.

German motor insurers are on course to post an underwriting profit in 2025 for the first time in two years, the reinsurer said.

“German motor insurers are well on track to reclaim their profitability,” Steinmann said. “But this does not mean that the journey towards a sustained return to the black is over.”

He added that claims inflation remained above general inflation, with spare parts and repair costs pushing up motor own damage claims, while bodily injury expenditures continued to rise in motor liability.

“Further targeted rate increases are necessary in motor business because insurers must price in these higher costs,” Steinmann said.

E+S Rück also reported stable results in natural catastrophe business, with low losses to date but a sustained need for “prudent underwriting and risk-adequate pricing”.

In industrial and commercial property, the company noted a mild softening trend amid fewer large fire losses and below-average claims from natural perils.

Liability lines, however, remain competitive, particularly in directors’ and officers’ insurance, while geopolitical risks and emerging exposures continue to shape underwriting strategy.

Marine and aviation reinsurance markets were described as stable but influenced by ongoing geopolitical tensions and surplus capacity.

E+S Rück added it also expects growing demand for cyber reinsurance, particularly for non-proportional covers, as both minor and large-scale cyber incidents reinforce awareness of the exposure.