Offshore Energy Insurance Rates Fell 11% in 2025
Upstream operators benefited from softening premiums even as broader market loss activity began to tick upward.
Updated on Sept. 25, 2026 in Oil and Gas
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Global offshore energy insurance premiums reached USD 4.8 billion in 2025, a growth of only 0.1% as blended upstream rates declined by 11%. This shift occurred despite a record global energy investment of USD 3.3 trillion, two-thirds of which flowed into renewables.
Why it matters
The persistence of a six-to-seven-year soft market cycle has prioritized buyer leverage, keeping insurance costs low even as the complexity and volume of energy projects rise. However, increasing loss activity in 2026 suggests underwriting profitability is under pressure, potentially signaling a floor for these deep rate discounts.
Global offshore energy premiums totaled USD 4.8 billion in 2025, with the London market controlling 60% of that share. Renewable energy projects now account for 30% of London's total premiums.
The players
London Insurance Market
The global hub for specialty insurance that controls 60% of offshore energy premium share.
The details
Capacity currently exceeds market demand, a dynamic that has driven sustained rate cuts in the upstream sector. While operational risk has favored buyers, the market is seeing a rise in attrition claims that threaten underwriting margins. As investment shifts toward complex energy projects, insurers are facing renewed exposure to construction, testing, and commissioning risks that may soon outpace existing market capacity.
Timeline
Global offshore energy insurance premiums grew 0.1% throughout 2025.
Loss activity in 2026 is trending higher than levels seen in 2025.
Market Landscape
The offshore energy sector remains locked in a six-to-seven-year soft market cycle driven by an oversupply of underwriting capacity. This environment persists despite a massive USD 3.3 trillion global investment shift toward renewable energy infrastructure.
Operators in the upstream sector should prepare for the current rate benefits to potentially plateau as insurers respond to rising 2026 loss trends. Review insurance coverage terms now, as the shifting complexity of new energy projects may lead to more rigorous underwriting requirements in the next renewal cycle.
The takeaway
The multi-year streak of double-digit rate cuts in upstream insurance is increasingly challenged by rising loss activity in 2026. Review your upcoming policy renewals for signs of tightening, as the industry begins to grapple with higher commissioning and testing risks.
Further reading
For broader context on energy sector risks, explore the Oil and Gas section.
Source note: This article includes information reported by Insurance Business.
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