Global property and casualty insurers delivered their strongest average return on equity in years in 2025, but the latest industry analysis suggests that maintaining those gains will require more than favorable market conditions. Aon’s review of 120 global insurers found average RoAE reached 16.8%, the highest level recorded since the firm began tracking the group in 2009.
The result extended a five-year improvement in profitability following the 2020 downturn. Better underwriting income, firmer market conditions and relatively limited catastrophe losses helped support the stronger performance.
At the same time, signs of a more uneven market are emerging. The share of insurers reporting year-over-year RoAE improvement fell from 74% to 60%, while premium growth eased to 5.2%, marking its fourth consecutive annual slowdown. The average combined operating ratio improved to 91.1%, its lowest point of the decade.
“The hard market restored profitability for many insurers, but long-term performance will increasingly depend on differentiation,” said Paul Campbell, Global Growth Officer, Strategy and Technology Group, Aon. He said insurers will need to use stronger earnings to make disciplined decisions about growth, capital and capabilities.
Aon identified several areas requiring attention, including investment in technology and talent, smarter capital deployment and stronger portfolio decisions. The analysis also points to increasing differences between property-casualty and reinsurance markets, as well as between diversified and specialist carriers.
Campbell said the current market environment provides insurers with an opportunity to build capabilities that can support performance beyond the present cycle.
Source: AON
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