US property insurance rates extended their multi-year slide in the first months of 2026, according to Aon’s latest property market data, even as insured exposure values kept climbing and forecasters flagged a below-average but still unconfirmed Atlantic hurricane season ahead. The primary market’s continued softening sits uneasily alongside a sharp, geopolitically-driven jump in terrorism and political violence pricing, exposing a split-screen property market that is pricing catastrophe risk with more confidence than it is pricing conflict risk.
Aon Data Show Eighth Straight Quarter of Falling US Property Rates
Aon’s Q2 2026 property market dynamics report puts the average US property rate change at -15.1% in Q1 2026, an easing from -17.9% in Q4 2025 but still the eighth consecutive quarter of average negative rate change. The broker’s data split the market by structure: shared and layered property accounts saw rates decrease to -20% in Q1 2026, a steeper drop than the single-carrier segment, where program rates fell -8.8% quarter-over-quarter, the sixth straight quarter of negative rate change for that segment. The gap between the two structures suggests that accounts able to spread risk across multiple layers of capacity are capturing the bulk of the competitive pricing benefit, while single-carrier buyers are seeing a milder, if still negative, trend.
Looking ahead, Aon’s own outlook does not point to a reversal. The broker said it expects the rate trend to continue into the second quarter, with Q2 2026 shared and layered property renewals for desirable accounts seeing rate changes ranging from flat to -25% or more. That guidance, laid out in the same property market dynamics report landing page, signals that carriers are still competing hard for the best-performing risks even as the underlying exposure they are insuring keeps growing. Aon’s data show that overall Q1 2026 property insured exposure values rose 2.8%, up from 1.2% growth in Q4 2025 — a reminder that falling rates are not simply chasing a shrinking base of insured value, but are outpacing a base that is itself expanding.
Marsh’s Global and US Composite Data Confirm the Softening Is Broad-Based
The Aon figures are not an outlier. Marsh’s Global Insurance Market Index, covering the same window, found that global commercial insurance rates fell by an average of 5% in the first quarter of 2026, a decline the broker said marked the seventh consecutive quarter of global commercial insurance rate decreases. In its Q1 2026 press release on the five percent global rate decline, Marsh attributed the trend to structural oversupply rather than a one-off pricing correction, noting that the downward rate movement was fueled by abundant capacity and intense insurer competition across most major product lines.
In the United States specifically, Marsh’s US insurance rate insights page shows the composite rate move was more modest than the global figure but still negative, with the overall US composite rate, which was flat in Q4 2025, declining 1% in Q1 2026. Property was the clearest driver of that US softening: Marsh reported that US property insurance rates declined 10% in Q1 2026, compared to an 8% decline in the prior quarter, an acceleration of the downward trend rather than a plateau. Globally, Marsh’s property line told a similar story, with property rates declining 9% globally in Q1 2026, repeating the Q4 2025 trend, while the sharpest regional composite moves were recorded outside North America, where the Pacific region posted the largest composite rate decrease at 12%, alongside a 10% decline in India, Middle East and Africa.
It is worth being precise about what these numbers describe. Aon’s and Marsh’s figures reflect primary-market placements — the rates cedents and corporate buyers pay directly for property coverage — and are distinct from the reinsurance-level pricing that carriers themselves pay to transfer catastrophe risk off their own books. That distinction matters because the two markets have been moving in the same direction but from different starting points and at different magnitudes, as seen in the reinsurance renewals softening at July 1, where Guy Carpenter recorded a steeper decline than the primary market Aon and Marsh are describing.
Terrorism and Political Violence Rates Spike as Middle East Conflict Escalates
The softening property narrative breaks down entirely once the analysis turns to terrorism and political violence coverage. Aon’s report links a sharp repricing directly to the escalation between Iran, the United States and Israel, stating that since the outbreak of hostilities between Iran, the US and Israel, terrorism and political violence rates have risen 25% to more than 50%, depending on region and industry. That is an unusually wide and unusually fast repricing for a specialty line that had, until the escalation, been trading in a far more benign environment alongside the rest of the property market.
The loss activity behind that repricing is already measurable. Aon estimates that recent insured loss estimates from the political violence market linked to the Middle East escalation are approximately USD 2.5-3.0 billion, excluding potential contingent business interruption impact — a figure that excludes what could be a materially larger secondary impact if supply chains and business operations tied to the conflict zone are disrupted further. For underwriters and brokers, the juxtaposition is stark: a property market with ample capacity and falling prices sits next to a specialty line where capacity is tightening and prices are spiking in real time, driven by a live geopolitical event rather than a modeled catastrophe scenario.
Hurricane Forecasters Point to a Quieter 2026 Season, But With Caveats
The other live tail risk hanging over the softened property market is the 2026 Atlantic hurricane season, and the early academic forecasts point toward below-average activity rather than an above-average one. Colorado State University’s early-season outlook, cited in Aon’s report, called for 13 named storms, 6 hurricanes and 2 major hurricanes in its April 9, 2026 forecast. Tropical Storm Risk’s parallel outlook was even more conservative, projecting 12 named tropical storms, five hurricanes and only one major hurricane in its April 9 forecast, with overall activity running around 40% below the 1991-2020 climatological average.
Forecasts issued in April are, by definition, provisional, and both models will be revised as the season approaches its peak months. For a property market that has now priced in eight straight quarters of rate declines, a below-average forecast reinforces the current pricing trajectory rather than challenging it — but a below-average forecast is not a guarantee, and coastal property portfolios remain exposed to landfall risk that no seasonal outlook can rule out. That tension is especially acute in Florida, where the state’s insurance market remains untested by a major storm after a run of comparatively quiet seasons, even as Florida Citizens secured reinsurance pricing at materially lower rates than the prior year heading into 2026.
What the Split-Screen Market Means for Buyers and Brokers
For corporate risk managers, the practical takeaway is that favorable property terms are unlikely to disappear overnight, but they should not be extrapolated onto every line of coverage. Aon’s own guidance for the next renewal cycle points to further softening for the best-performing shared and layered accounts, while Marsh’s broader index confirms that the capacity glut driving US and global property pricing down is structural rather than incidental. At the same time, buyers with exposure tied to the Middle East, or with contingent business interruption exposure running through the region, are facing a market that is repricing in real time and offers none of the softening seen elsewhere in the property book. Brokers navigating both sides of that split screen will need to treat catastrophe-linked property risk and conflict-linked political violence risk as fundamentally different underwriting conversations, even when they sit on the same corporate insurance program.
