Executive Summary
The insurance industry entered the second quarter of 2026 in a paradoxical position: profitable, well-capitalized, and increasingly competitive on price — yet facing some of the most consequential structural shifts in a generation. The first quarter delivered a relatively quiet catastrophe season, but the calm masked deepening currents in technology, regulation, and consumer affordability that will shape the year ahead.
- $20 billion — Q1 2026 global insured cat losses (26% below decadal average)
- $8.5 billion — Insured losses from March 10-12 severe storm outbreak
- 5% — Commercial rate decline (7th consecutive quarter of softening)
- 114% — Average ACA net-premium increase post-subsidy expiration
- 17,257 — Drop in Wisconsin ACA marketplace enrollment for 2026
- $461.3 billion — Record 2025 U.S. annuity sales (45% indexed)
- 6.6 inches — Largest hailstone ever recorded east of the Mississippi (Illinois)
A Quieter Quarter for Catastrophes — Until March
Below Average, but Not Quiet
Aon's April 16 Global Catastrophe Recap and Gallagher Re's Q1 report both pegged Q1 2026 global insured catastrophe losses at approximately $20 billion — 26% below the decadal average of $26 billion. Global economic losses reached roughly $37 billion, the lowest first-quarter total since 2015 and 43% below the long-term mean.
The United States accounted for approximately 79% of global insured losses, or about $16 billion. The largest single event was a late-January North American winter storm that brought freezing rain, heavy snowfall, and an arctic outbreak across more than two dozen states. Daytona Beach, Florida, recorded its lowest temperature on record — 19°F — on February 1.
The March 10-12 Severe Convective Storm Outbreak
The quiet ended in mid-March. The March 10-12 severe convective storm outbreak became the costliest peril event of the quarter, generating an estimated $10.5 billion in economic losses and $8.5 billion in insured losses across Texas, Oklahoma, the Kansas City area, Chicago, and Ohio. The outbreak produced multiple EF3+ tornadoes and the largest hailstone ever recorded east of the Mississippi River — measured at 6.6 inches in diameter in Illinois.
Aon noted that ground surveys conducted in the Chicago suburbs found notably less damage than initial hail reports had suggested — a reminder that alarming radar signatures do not always translate proportionally into insured losses.
Wisconsin Market Update
Two Major Insurance Laws Signed
On April 20, 2026, Commissioner Nathan Houdek issued an OCI bulletin summarizing two recently enacted laws affecting Wisconsin insurers.
2025 Wisconsin Act 103 (signed March 19) modifies the mammogram coverage benefit under Wis. Stat. § 632.895(8). The Act adds a definition of "supplemental breast screening examination" — a medically necessary examination using breast MRI or ultrasound to screen for breast cancer, even without a suspected abnormality, when warranted by personal or family history.
2025 Wisconsin Act 122 (signed March 27) is an insurance omnibus law containing several technical changes. Most consequentially, the Act removed the December 31, 2023 deadline that had prevented OCI from reapplying for the federal 1332 waiver underpinning the Wisconsin Healthcare Stability Plan. The current waiver runs through 2028, and Act 122 now allows OCI to seek future extensions from CMS.
The ACA Cliff Hits Wisconsin
Subsidies Expire, Enrollment Drops
The enhanced premium tax credits, which had been expanded through the American Rescue Plan and extended by the Inflation Reduction Act, expired on January 1, 2026, after Congress failed to reach agreement during a 43-day federal government shutdown — the longest in U.S. history.
Wisconsin marketplace enrollment fell from approximately 306,470 in 2025 to 289,213 for 2026 according to CMS data. KFF estimates that average net premium payments for those who kept their plans rose roughly 114%. Wisconsin's average gross rate increase across exchange plans approached 23%, with rate filings citing the subsidy expiration, deductible leveraging, and rising medical and pharmaceutical trend.
On January 8, the U.S. House passed a three-year extension by a discharge petition, with Wisconsin Republican Derrick Van Orden joining 16 colleagues to support the bill. The Senate has not advanced companion legislation. OCI public affairs director Sarah Smith warned in February that hospitals across the state will face higher uncompensated care costs as more residents drop coverage.
Auto, Workers' Comp, and the IPFCF
Wisconsin's auto insurance market continues to outperform national averages. Bankrate's April 2026 analysis placed average full-coverage premiums at $1,902 in Wisconsin versus $2,697 nationally, with minimum-coverage policies averaging $451 versus $820. Matt Banaszynski of the Independent Insurance Agents of Wisconsin told WKOW in February that rates began stabilizing in late 2025 and are running essentially flat into 2026.
Wisconsin's workers' compensation system continues to be one of the bright spots in the state's insurance landscape. The state has now strung together multiple consecutive years of premium-rate decreases, supported by a relatively stable claims environment and ongoing carrier competition. The next round of rate filings for the policy year beginning October 1, 2026 is expected later in the summer.
Commissioner Houdek confirmed that the Injured Patients and Families Compensation Fund (IPFCF) Board of Governors has held its annual assessment at current levels. Annual Medical Mediation Panel fees remain at $4.50 per physician (excluding residents) and $1.00 per occupied bed for hospitals.
Wisconsin's continuing education credit submission fee increased from $1.00 to $1.50 per credit hour effective February 1, 2026. The change has been reflected in course pricing throughout the industry. CEWisconsin's pricing structure already accounts for the new fee.
Commercial Rates Soften for the Seventh Straight Quarter
A Buyer's Market — With One Big Exception
Marsh's Q1 2026 Global Insurance Market Index, released April 22, found that global commercial insurance rates fell by an average of 5% during the quarter — the seventh consecutive quarter of decline after seven straight years of increases. Property rates dropped 9% globally and 10% in the United States, with catastrophe-exposed clients seeing decreases of as much as 16%.
The notable exception: U.S. casualty rates rose 9% for the second consecutive quarter, driven by persistent claims severity in excess layers. Cyber rates fell 5% globally and 2% in the U.S., financial and professional lines slipped 5%, and the overall U.S. composite rate declined 1%.
Marsh's John Donnelly told the market that competitive conditions are likely to persist as long as insurer profitability remains strong. For agents, that means renewals can be approached as a buyer's market — particularly outside U.S. casualty — but loss history and data quality continue to separate clients who capture the best terms from those who do not.
M&A Activity Bottoms Out
OPTIS Partners' April 27 report showed 148 announced insurance agency deals in Q1 2026, down 6% from a year earlier and the lowest first-quarter total since 2016 — the tenth consecutive quarter of deal volume below the long-term trend line. OPTIS partner Steve Germundson described the trend as "probably bottoming out" at roughly 650 transactions a year.
- Private-equity-backed and hybrid buyers accounted for 72% of Q1 transactions
- Inszone led all buyers with 17 deals
- BroadStreet Partners followed with 16 deals
- Historically active acquirers Hub International, Keystone, Highstreet, and King Risk all slowed considerably
- Production teams continue to leave existing firms to start new ventures — a trend OPTIS expects to continue
Distribution Disruption: ChatGPT Approves Its First Insurance App
Insurify Becomes the First Insurer-Built ChatGPT App
On February 9, 2026, OpenAI approved the first insurer-built application within ChatGPT, developed by online comparison platform Insurify. The announcement triggered an immediate sell-off in publicly traded insurance broker stocks and reignited a long-running debate about whether large language model interfaces will disintermediate traditional comparison and quoting channels.
The agentic AI insurance market is projected to grow from $5.76 billion in 2025 to $7.26 billion in 2026 — a 26% expansion — with adoption expected to climb from approximately 14% today to 70% by 2028.
Agentic AI Moves into Production
The first quarter of 2026 marked a transition point for AI in insurance. ScienceSoft's Q1 trends report described agentic AI as the most actively pursued AI category in the industry. The Evident AI Use Case Tracker found that insurance AI deployments grew 87% year-over-year, with agentic AI accounting for roughly one in five public deployments in Q4 2025. Celent reported that 22% of insurers plan to have an agentic AI solution in production by year-end 2026.
WTW's March 2026 Advanced Analytics & AI Survey provided early evidence of measurable returns: insurers using sophisticated analytics achieved combined ratios six percentage points lower and premium growth three percentage points higher than slower adopters between 2022 and 2024. McKinsey research found that AI leaders in insurance have generated 6.1 times the total shareholder return of AI laggards over five years.
Major Vendor Launches
- Duck Creek Technologies launched its insurance-native Agentic AI Platform on April 28, alongside an Agentic Underwriting Workbench and Agentic First Notice of Loss (developed with Google Cloud)
- John Hancock unveiled "Quick Quote," a generative-AI underwriting tool processing thousands of requests monthly without increasing workload
- FIS expanded its Insurance Risk Suite with a generative AI assistant allowing actuaries to navigate complex risk models in plain language
- Sedgwick's Microsoft-built "Sidekick Agent" reportedly enhanced claims processing efficiency by more than 30%
Cyber Insurance: Approaching an Inflection Point
Softening Tests the Cycle
Munich Re reported that global cyber insurance premiums grew 7% in 2025 to $15.3 billion, with growth expected to average more than 10% annually through 2030 — doubling the market by decade's end. S&P Global Ratings maintained its stable outlook on the segment heading into 2026.
Yet softening is testing the cycle. Beazley reported a 48.5% loss ratio for the first half of 2025 alongside a negative 6.8% rate change, capping more than 11 consecutive quarters of negative rate movement industrywide. Dual described the cyber market as approaching a turning point, and CFC reported some insurers are now introducing rate increases on renewal books, particularly in the U.S.
Three Practical Takeaways for Wisconsin Agents
- SME underpenetration is the growth opportunity. Small and mid-sized businesses remain significantly underpenetrated and represent the largest growth opportunity in the line.
- Limit adequacy still matters. Ransomware remains the dominant loss driver, with occasional catastrophic events exceeding $1 billion in single-incident losses. Limit conversations remain essential for any client with material data or operational exposure.
- Vendor concentration risk has emerged as a top concern. Most outages in 2025 were resolved within a day, but a multi-day disruption to a critical technology provider could produce systemic losses with exponentially higher impact.
Life & Annuity Markets
Annuity Sales Hit a New Record
LIMRA's preliminary 2025 annuity figures, released in February, showed total U.S. individual annuity sales of $461.3 billion, up 6% from 2024 and the fourth consecutive record year. Q4 2025 sales rose 12% to $114.4 billion — the ninth consecutive quarter above $100 billion.
The standout structural shift is product mix. Indexed products (RILAs and FIAs) accounted for 45% of total annuity sales in 2025, up from just 24% a decade earlier. Full-year fixed-rate deferred annuity sales rose 5% to $160.6 billion. Traditional variable annuities reached $65.2 billion, up 7%.
LIMRA's 2026 forecast calls for total annuity sales between $438 billion and $485 billion, with RILA sales projected to exceed $85 billion. Drivers include more than four million Americans turning 65 each year and IRI's Digital First initiative shortening annuity exchange times by as much as 94% — from an average of 18 days to as little as 24 hours.
Life Insurance: A Slower 2026 After a Banner 2025
LIMRA's January 2026 forecast acknowledged that 2025 was "a bit of an outlier" for life insurance and projected slower growth ahead. For 2026, LIMRA forecasts new premium growth of 2% to 4%, still above the 3.1% historical average but a clear deceleration.
Bryan Hodgens of LIMRA Research attributed the moderation to demographic headwinds: birth rates are down, traditional life-event triggers like marriage and home purchase are happening later or less often, and the over-60 segment has been heavily marketed to over the past decade. LIMRA is now focusing research on Gen X, whose oldest members are turning 60 and represent what Hodgens called the "sweet spot" for retirement-stage annuity purchases.
- Term: 0-4% growth (constrained by softer economic activity)
- Whole life: 1-5% growth
- Fixed UL: -3% to -7% (decline)
- Indexed UL: 8-12% growth (down from 21-25% in 2025 as premium-financing tailwinds fade)
Regulatory & Compliance Updates
The NAIC met in San Diego from March 22-25 for its Spring National Meeting. The new Natural Catastrophe Risk and Resilience (EX) Task Force — formed by consolidating the former Climate and Resiliency Task Force, the Catastrophe Insurance Working Group, and the FEMA Working Group — convened for substantive discussions on disaster preparedness, mitigation, and severe peril monitoring.
Key Regulatory Items
- NIPR Uniform Licensing Application went live April 10, 2026, replacing both former producer and adjuster applications. Revisions include clarified attestation language, more detailed criminal-history and financial-status questions, addition of a citizenship question on individual renewal applications, and a FINRA CRD number field.
- Homeowners Market Data Call — 50 jurisdictions have agreed to participate. Companies writing $50,000+ in homeowners premium in any year from 2018-2025 must report. Submissions due June 15, 2026. No extensions will be granted.
- NAIC AI Model Bulletin — 23 states + Washington, D.C. have now adopted, with a national AI evaluation tool being piloted across 12 states.
- NAIC Disaster Preparedness Guide — both regulator-facing and staff-facing versions being prepared for final review, with adoption targeted ahead of the Summer 2026 National Meeting.
Wisconsin agents working with multistate carriers should expect AI-related questions to surface increasingly in market conduct examinations through the balance of 2026.
Parametric Coverage Goes Mainstream
Aon's 2026 Climate and Catastrophe Insight report highlighted Hurricane Melissa as a case study: the Jamaican government secured more than $650 million in liquidity less than two months after landfall, including approximately $91 million from the Caribbean Catastrophe Risk Insurance Facility and $150 million from a World Bank-supported catastrophe bond — both triggered parametrically. For commercial agents working with municipalities, agribusiness operations, or property owners exposed to specific perils, parametric structures are increasingly part of the conversation alongside traditional indemnity coverage.
Odd Claims Corner: A Moose, a Passat, and a Disappearing Carcass
Each quarter we feature unusual insurance claims to remind ourselves that in this industry, truth is often stranger than fiction.
This quarter's contribution comes from Wyoming Highway 230, where a Volkswagen Passat, a yearling moose, and a stranger with sticky fingers combined to produce a story that could only be filed under "truth, stranger than."
At about 5:20 a.m. on Monday, April 13, 2026, Tim Wyland was driving his 2004 VW Passat from Laramie to a job in Saratoga when he saw three moose in the road ahead. He swerved — and a fourth moose he had not seen became, in his fiancée's words, an involuntary crash test dummy. The Passat was totaled. Wyland climbed out through the driver's window because the door would not open. He walked away with cuts and a story he later described as "a miracle of God," given that hitting a moose is reportedly thirteen times deadlier than hitting a deer.
A Wyoming Game and Fish warden identified the moose as a yearling and offered Wyland a familiar-to-Wyoming option: he could fill out a form through the state's 511 mobile app and legally claim the carcass for meat. After a quick conversation with his father — who pointed out that some moose steaks would at least take the edge off the totaled car — Wyland filed the paperwork. He and his fiancée Lindsey Williams returned to Laramie to grab a pickup and a trailer.
When they came back, the moose was gone. Most of the meat had been carved out and removed. What remained had been ruined. "Well, we lost our car, and then we lost the moose," Williams told Cowboy State Daily.
The episode is, among other things, a reminder of why insurance contracts have always cared so much about insurable interest, possession, and timing. Wyland had a totaled-vehicle claim ready to file. He had a state-issued certificate of authorization to claim the carcass. He did not yet have possession. In the gap between paperwork and pickup, somebody else assumed the risk — and the meat. The next time an underwriter asks why an effective date matters, this one is worth keeping in the file.
Key Dates for Wisconsin Professionals
- May 7-8, 2026: NAIC International Insurance Forum (Washington, DC)
- May 11, 2026: Public comment closes on NAIC Aggregation Method draft
- June 11, 2026: NAIC vote on Group Solvency Regulation review
- June 15, 2026: Homeowners Market Data Call submissions due (no extensions)
- Summer 2026: WI workers' comp rate filings expected for policy year beginning October 1, 2026
- Summer 2026: NAIC Summer National Meeting — first general findings from AG 53/55 reports expected
- 2028: Current 1332 waiver expires; OCI now permitted to seek extension under Act 122
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