After nearly five years of volatility and structural upheaval, the US casualty insurance market heads into 2026 with something it hasn't experienced since before the pandemic: balance.

The difference this time is that stability isn't a return to the past. It's the result of a long, grinding correction that fundamentally reshaped underwriting discipline, capacity deployment and the way carriers think about risk.

The market hasn't softened; it has matured.

The past half-decade forced the industry to recalibrate everything from loss assumptions to program structures, replacing old habits with a deeper commitment to precision and selectivity. The new normal may be steadier, but it is also more demanding.

"When I think about the casualty marketplace, where we are and where we are heading into 2026, I would characterize it as resilient growth," says Ania Caruso, national casualty president and leader at RPS. "What I mean by it is that we've got some premium expansion that is slowing, some due to competition, but that's contributing to some easing on the upward rate pressure."

However, she also emphasizes that key lines — especially umbrella, excess and auto — remain challenging, with rate increases that still hover in the upper single- to double-digit range. The pressure hasn't disappeared; it has simply become more predictable.

One of the clearest signs of stabilization comes from the reinsurance community, which has spent the last several years imposing substantial discipline on the casualty market, according to Emily Apostolides, Gallagher Re's head of casualty for North America.

"This is the first year in maybe two or three years where reinsurers are starting to sound more cautiously optimistic," she says. "Not universally, but they are with the clients that have maintained discipline, with rates continuing to firm and discipline holding steady across both insurance and reinsurance. Limits are still compressed, attachments are still higher than they were six years ago and rates are still moving upwards. Although there are new entrants, their impact hasn't been disruptive because there's so much discipline in the market."

Still Tight Where It Matters Most

This underscores a central truth of today's casualty market: carriers and reinsurers are no longer willing to subsidize underpriced business and they are rewarding those who have stayed consistent throughout the correction.

However — even with this backdrop — the market remains tight in the layers where insureds most often need help. Many excess programs now require multiple carriers just to build a $5 million or $10 million limit, whereas just a few years ago, it was common to see one carrier leading at $10 million. Today, depending on the class of business, it might take up to four markets to create the same result. Capacity has returned, but not always in the segments where losses are most severe. Above $10 million, capacity is increasingly available; below it, scarcity persists.

New entrants and MGAs have appeared in recent years bringing fresh capacity, but they have remained cautious, tending to favor narrow classes, higher layers or clean portfolios rather than structurally challenged segments such as auto, construction, habitational or lead excess. This hasn't disrupted the market because they're avoiding the more difficult segments, resulting in a situation where the lower layers remain tight even with more names on the sheet.

In other words, underwriting discipline is holding, even as capacity grows.

The discipline shaping underwriting today is not a temporary reaction to the hard market. Apostolides describes it as a cultural shift that has taken hold across the industry. Carriers, she says, are "looking to grow more so with targeted clients, not universally," focusing their appetite on accounts that demonstrate underwriting rigor and strong in-house claims management. This has helped stabilize treaty terms and reinsurance pricing heading into 2026, further reinforcing the idea that the correction is complete, even if the industry has no intention of relaxing the lessons learned.

A Shift Toward Data, Technology and Risk Control

Another defining feature of the market's new equilibrium is the increasing sophistication of insureds themselves.

"Changing customer expectations are reshaping how we deliver our products," Caruso adds. "Our customers are becoming more sophisticated, so we're looking to utilize technology in new ways and come up with creative solutions to meet the needs of our clients."

Today's buyers are using technology, analytics and preventative programs to manage their own risk profiles. This evolution empowers risk managers and CFOs to influence their cost of risk proactively rather than reactively, giving them a seat at the table when negotiating capacity or pricing.

Data and transparency have become powerful tools in this environment. Insureds who can demonstrate diligence through telematics programs, safety protocols, training efforts or loss analytics are increasingly able to differentiate themselves in a crowded market. Carriers reward this level of insight because it helps them underwrite with greater confidence.

What Stability Means Going Forward

As 2026 unfolds, the tone of the market is increasingly characterized by sustainability rather than surge or retreat. Rates are stabilizing, with most expectations pointing to flat to modest increases on primary lines and measured, mid-single-digit to low-double-digit increases on excess. Some competition is gradually reemerging, particularly in the upper layers and less volatile classes, but competition remains measured.

In this balanced environment, the path to better pricing or more favorable terms is built on documentation, communication and proactive risk management. Insureds who can show what they've done to reduce exposures through training, analytics, fleet telematics or enhanced safety programs are the ones who will gain traction. The relationship between insureds and carriers is becoming more collaborative as data-sharing becomes a strategic advantage rather than a compliance exercise.

The industry, in short, is getting smarter about casualty. It has accepted that volatility, particularly legal volatility, may never fully disappear, but it has also learned to manage it through stronger underwriting, clearer communication and more integrated data use. The market may have plateaued at a higher baseline, but that baseline is more durable, predictable and transparent than anything the sector has seen in years.

"Innovation and technology remain critical in casualty, so that we can be proactive in the face of our fast-paced, global economy," Caruso says. "Knowing that, brokers need to be able to look at the market from a lot of different angles — taking in the interests of carriers, insureds, reinsurers and more — with an understanding that this industry is not transactional; it's consultative. Insurance is part of the backbone of the economy and we want to be able to continue supporting the businesses we work with for many years into the future."

Learn more about what's next for the Casualty insurance market in the 2026 Casualty Market Outlook

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