Aviation prices stable but uncertainty ahead: Gallagher

Healthy levels of capacity in the aviation and aerospace lines of business is seeing pricing relatively stable across virtually all lines, according to Arthur J. Gallagher & Co.

The broker’s “Q3 2025 Plane Talking” says insurance buyers, who might have been expecting the market to have significantly hardened in response to catastrophes, claims and settlements and judgments earlier in the year, should be encouraged: “Absent any notable further shocks to the market, Gallagher sees no immediate indication that conditions will substantially change during the remainder of the year.”

However, Gallagher points to more uncertainty ahead, noting that certain parts of the aviation insurance market have been regularly underperforming, with premium volume not keeping pace with the level of claims growth, and the Jan. 1 reinsurance renewals will set or refine the tone for the forthcoming year.

“With a cursory look, aviation insurers have achieved good premium growth in recent years, with market premiums in 2024 exceeding $8 billion; however, a dive beneath the surface reveals a disparity between subclass performance,” says the report.

It adds: “In the airline sector, the 2024 market premium of circa $1.7 billion will be far surpassed by claims activity, with attritional claims, those under $10 million, accounting for around $900 million alone. This is before factoring in a sharp uptick in claims activity in the $10 million to $50 million range.”

Commercial Risk is a sister publication of Business Insurance. More stories here.