Marsh clients are exploring greater use of third-party capital solutions, including sidecars for liability portfolios, as abundant reinsurance capacity and relatively benign catastrophe losses keep market conditions competitive ahead of the January 1 renewals, according to John Doyle, the firm’s President and Chief Executive Officer.
Speaking on Marsh’s Q3 2026 earnings call today, Doyle said short-tail reinsurance lines remained soft, driven by “abundant capacity from both traditional reinsurers and alternative capital.”
Doyle commented, “Our clients continue to explore alternative options to complement traditional strategies, including greater use of third-party capital solutions such as sidecar vehicles for their liability portfolios.”
Casualty reinsurance insurance-linked securities structures are a flavour of the day, of course, with numerous carriers now exploring how vehicles such as sidecars can help them to share risks and optimise capital.
In property catastrophe reinsurance, he pointed to relatively benign losses this year and growing capital as factors adding to competition.
“We expect these conditions to persist through the January 1 renewal cycle,” Doyle added.
Marsh Re’s Q3 2026 revenue fell 6% to $374 million, from $398 million a year earlier, on both a GAAP and underlying basis.
Asked how the reinsurance business will fare given current headwinds, Doyle said, “We’re a bit overweight in property catastrophe relative to some others, and we’re a bit overweight in the U.S. as well.
“It was a noisy third quarter, which is seasonally a smaller quarter, with some non-recurring items.
“We’ve also been affected to some extent by the consolidation that’s taken place in the industry during the course of the year.
“But, again, no excuses. We’re well positioned, and we believe we have the best reinsurance team in the market. We feel we’re well positioned.
“The team sees good growth opportunities in facultative reinsurance, M&A advisory, alternative capital and alternative structures.
“We’re facing some market headwinds. We’ve seen them before, but we feel good about how we’re positioned over the medium to long term.”
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