P&C Insurance How to play Hurricane Season 2026

Research evidence excerpt

P&C Insurance How to play Hurricane Season 2026

heading into 2025, with deductibles generally

stable to modestly higher. Even after stressing capital for a 1-in-100 year event, financial

and operational leverage appears manageable, with debt-plus-preferred-to-capital

ratios typically worsening by less than 2 points and remaining near or below 5-yr avgs.

Insurance Brokers historically big beneficiaries of heavy hurricane season

An index of the major insurance brokers (AJG, AON, BRO, MMC, and WTW) rose, on

average, 11% during heavy hurricane insured loss seasons versus up 4% during light

seasons. Brokers benefit from higher property re/insurance pricing post heavy hurricane

insured loss seasons and generally take no underwriting risk. AJG has historically risen

the most during heavy hurricane insured loss seasons, up more than 16%, on average.

BRO has historically been the most volatile of the major insurance brokers during

hurricane season.

Storm activity expected to be below normal this season

The Atlantic Hurricane season is projected to be below normal, primarily due to the

onset of El Niño. NOAA's outlook assigns a 55% probability of a below normal season,

with forecasts of 8–14 named storms, 3–6 hurricanes, and 1–3 major hurricanes. This is

lower than the long-term averages of 14 named storms, 7 hurricanes, and 3 major

hurricanes. Elevated wind shear associated with El Niño is anticipated to counteract the

impact of warmer Atlantic waters. This forecast contrasts with 2025, which recorded 13

named storms, 5 hurricanes, and 4 major hurricanes, with no major U.S. hurricane

landfalls. The relatively low loss activity in 2025 fell short of expectations for a more

active loss year, leading to capital accumulation and driving property catastrophe (cat)