Reinsurance broker Gallagher Re has released the latest edition of its cyber rate index, indicating that an oversupply of capacity resulted in a cyber aggregate excess of loss (XOL) risk-adjusted rate (RAR) change of -32% at the January 1st, 2026 renewals.
The index is an updated version of the broker’s Cyber RAR index, which launched in 2025, and monitors reinsurance prices adjusted for expected changes to the underlying level of risk.
In contrast to property, where the limit is directly linked to risk, a cyber reinsurance rating index employs Gallagher Re’s proprietary view of risk (VoR), which encompasses factors such as underlying rate changes, loss trends, the selection of volatility parameters, and the choice of catastrophe models.
The broker explained that the index specifically considers changes in pricing for cyber aggregate stop-loss and XOL contracts at 1/1 2026.
Among the key reasons for this, Gallagher Re noted that since their introduction in 2015, aggregate stop-loss and aggregate XOL structures have become “the non-proportional solution of choice for the majority of cyber reinsurance buyers.”
The broker also stressed that the aggregate market continues to be the most well capitalised part of the non-proportional cyber reinsurance market, due to it experiencing the least variation in pricing views across quoting reinsurance market participants, ultimately making it the most appropriate basis for an industry wide pricing index.
In addition, Gallagher Re also explained that buyers of cyber aggregate XOL reinsurance have benefited from improvements in both structural terms and pricing.
“Many buyers saw reductions in attachment points at renewal, for example. This dynamic coincides with an expectation that underlying (primary) cyber rates are expected to continue to soften in 2026,” the broker said.
Ian Newman, Global Head of Cyber for Gallagher Re, commented: “Reinsurance buyers are constantly looking for suitable and effectively priced non-proportional cyber protection.
“Well-designed aggregate products provide the optimal solution for those cedants looking for asymmetric protection against either a highly adverse loss trend (such as that seen with the rise of ransomware 2018 — 2021), a frequency of event losses, and/or a single catastrophic or systemic event.”
He continued: “Gallagher Re therefore believes that over the long-term, an index of the cyber aggregate XOL market will provide a useful and insightful barometer as to the state of the cyber reinsurance rating environment.”
It’s also important to remember that the catastrophe bond market is open to well-structured cyber risks in excess of loss cat bond format, which is still a very small piece of the overall cat bond market but expected to expand further as momentum continues to build within the space.
You can read about every cyber cat bond transaction, including the first private cat bond deals and the more recent 144A cyber cat bonds, by filtering our Deal Directory by peril to view only cyber cat bond transactions.
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