Climate and cyber top reinsurers' risk ranking: PwC
Reinsurers have ranked climate change as the most significant risk facing the sector for the third time running in PwC’s Reinsurance Banana Skins Survey, published on Monday.
The biennial research is carried out in collaboration with the Centre for the Study of Financial Innovation. The survey was conducted between June and August 2025, with 57 respondents from the reinsurance sector.
Launched this morning at the Rendez-Vous, PwC underlined that climate change has again topped reinsurers’ risk ranking, having taken the top spot in both the 2023 and 2021 surveys.
The report noted a “shift in tone” in the perception of climate change as a challenge that the (re)insurance industry is facing today, rather than purely a medium- to long-term risk. This has manifested in consistently high catastrophe losses from extreme weather events.
After climate change, the reinsurance cohort cited cybercrime and artificial intelligence as the next most pressing risks facing the industry. Cybercrime remained in second place from the prior survey, while AI climbed three spots from 2023.
Respondents underlined a “sense of inevitability” over cyberattacks amid increasing frequency, sophistication and impact from both private and state-sponsored actors. Some also noted that the pace of technological change makes the nature of cyber risk difficult to anticipate, let alone mitigate, particularly in the context of generative AI capabilities.
One reinsurer respondent commented: “AI is a huge opportunity, and as such, errors in the manner or timing of its implementation in the industry can be major risks.”
Reinsurers’ top five risk ranking was rounded out by concerns over barriers to trade and political risk.
The top 10 list of reinsurer’s concerns was completed with technology, human talent, macro-economy, regulatory change and change management.
AI also fed into some of these risk categories, with one respondent from the reinsurance sector observing that there is “a race to incorporate AI but a smaller talent base to properly deploy it”.
More broadly, the rapidly evolving technological landscape was top of the agenda for respondents across the P&C insurance industry. For the first time in the survey’s 14-year history, technology-related risks dominated the top three concerns facing the global insurance industry over the next two to three years, led by cybercrime, AI and technological change.
REINSURERS LAG IN PREPAREDNESS
As part of the survey, PwC asked respondents how well-prepared they thought the industry was to handle the risks that they identified.
On a scale of one (poor) to five (well), reinsurers gave an average response of 3.12, down from 3.41 in the prior survey. This was lower than the average of 3.24 for the entire insurance industry, as well as compared to P&C insurers, which reported an average preparedness of 3.25.
“While many insurers have made meaningful progress in strengthening risk management frameworks and digital capabilities, overall preparedness remains uneven. Larger firms tend to be more advanced, but industry-wide gaps persist in areas like AI governance, climate adaptation, and real-time cyber resilience,” said a reinsurance respondent from the U.S.