Next phase will reward portfolio discipline over market tailwinds: Everest Re

How reinsurers manage portfolios and deploy capital will be crucial as the market becomes more competitive, Everest’s Sharry Tibbitt tells Monte Carlo Today. 

Key points:
Strategic decisions on programmes
Portfolio management is key
Everest anchored to risk‑adequate returns

The reinsurance market is entering 2027 from a position of strength, but abundant capacity means success will increasingly depend on disciplined portfolio management, capital efficiency and client relationships rather than the tailwinds of the market cycle, according to Everest.

Record capital, strong balance sheets and healthy profitability provide a solid foundation, but greater competition is moving the market quickly towards rate adequate thresholds, said Sharry Tibbitt, deputy chief underwriting officer and global head of portfolio management at Everest.

“This phase of the cycle is where discipline really matters,” Tibbitt told Monte Carlo Today. “Stable rates and a healthy market are where adequacy is maintained. 

That puts greater emphasis on how reinsurers manage portfolios and deploy capital as conditions become more competitive.

“Those who maintain underwriting standards, invest in analytics and use capital solutions thoughtfully will be best positioned to support clients through whatever comes next,” Tibbitt said.

For Everest, that starts with maintaining a clear view of risk-adjusted returns across segments and programmes and being prepared to move capital when the economics change.

“Discipline is the cornerstone of our portfolio management,” Tibbitt said. “We are deliberate about where we deploy capacity, and we are prepared to reduce or redeploy it when margins no longer meet our return objectives.”

Capital follows opportunity

Property provides one example of how that approach is being applied as market conditions change. Tibbitt noted that “we cannot talk about property without mentioning the series of South American earthquakes this year,” which have been a reminder of the underlying volatility even amid relatively benign conditions elsewhere.

After several years of significant correction, property pricing has moderated materially during 2026 and is approaching 2022 levels, although conditions remain above those seen during the soft market of 2017–2018.

“We’re clearly in the next phase of the cycle for property,” Tibbitt said. “The market is now well-capitalised and increasingly competitive.”

“We’re committed to deploying capacity where it delivers long‑term value for clients.”

“If the remainder of the year is relatively benign, we expect further rate reductions – which will make thoughtful client selection and disciplined underwriting execution even more important as opportunities shift in the next phase of the cycle.”

Everest has already refined its portfolio to focus on the strongest opportunities and is ready to adjust capacity to ensure returns remain risk-adequate. “We’re committed to deploying capacity where it delivers long‑term value for clients,” she said.

That does not mean retreating as competition increases. US property catastrophe remains technically sound, Tibbitt said, while Everest continues to see opportunities in well-run international programmes and markets such as Florida, where it has maintained its long-term commitments and underwriting discipline through decades.

Beyond headline rate

Maintaining discipline also requires looking beyond rate. Buyers can push on commissions, coverage and programme structures, meaning economics can deteriorate even when headline pricing appears adequate.

“The headline focus is often on price, but economics can deteriorate just as quickly through terms and conditions,” Tibbitt said.

Exposure information, transparent loss histories and contract clarity therefore become increasingly important. Everest is also taking a forward-looking approach to wildfire, flood and severe convective storms.

“Our approach is to price climate-related perils with a forward-looking view of volatility and to ensure that aggregates, occurrence limits and deductibles are calibrated to today’s risk, not yesterday’s assumptions,” she said. 

“Where structures don’t support that, we will either re-shape them or limit our capacity.”

That also means resisting the temptation to let a relatively quiet period reset assumptions about underlying risk.

“If we price only off recent benign experience, we risk underestimating volatility,” Tibbitt added. Discipline is therefore “as much about defining the risk correctly as it is about selecting it”.

Balancing risk and protection

The same emphasis on portfolio economics extends to how Everest approaches clients’ protection needs. Falling reinsurance prices have not led buyers to substantially increase protection after many raised retentions and restructured programmes during the hard market. 

Everest is seeing demand for top-layer limits, aggregate protection and earnings-stability solutions, particularly in US catastrophe business, but Tibbitt expects higher retentions to prove more persistent.

“Our role is to help clients optimise that balance rather than simply encouraging them to buy more for the sake of it,” she said.

That approach reflects a broader emphasis on long-term relationships as Everest determines where its capital can create the most value.

For Everest, the next phase will mean staying close to cedants, being clear about where it can add value and remaining willing to trade capacity for long-term value when economics demand it.

“We’re committed to providing clients with meaningful, reliable capacity, anchored in risk-adequate returns, clear contract terms and data-driven decision-making,” Tibbitt said.

“Our message is simple: we’re here to be a long-term partner, built for what comes next and positioning clients and Everest for opportunity regardless of the cycle.” 

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