Echoes of 2008 market cycle peak as specialty market profitability falls

Signs of softening in the Lloyd’s and London market are becoming increasingly apparent, with plentiful capital, expanding broker facilities, new entrants and falling rates all pointing towards a “rockier ride in coming years”.

This is according to insurance advisory firm Oxbow Partners’ CEO Agenda 2026 report for the corporate and specialty market, released 11 November 2025, which suggested that such volatility could offer opportunities for nimble firms.

The report comes following a drop in profitability across the market. While data shows that 77% of Lloyd’s syndicates reported both profit and growth in 2024, firms delivered a net underwriting result of £4.8bn.

That result was 14% lower than 2023’s £5.5bn posting – the first time profitability has dropped in seven years.

Oxbow Partners drew comparisons to the 2001 to 2017 market cycle, which saw seven years of upwards trending underwriting results, before rates and ultimately profitability began falling in 2008.

Transformation topics

The report also highlighted that rate declines across products and classes have not been even and suggested a set of transformation topics for executives to consider in order to best position their firms.

Greg Brown, partner at Oxbow Partners and author of the report, told Insurance Times that those five topics were “strategic proposition clarity, effective executive decision making, differentiated leadership, inorganic growth strategy and an agile operating model”.

Concluding the report, he explained: “As 2026 dawns, the Lloyd’s and London market faces a reality check. The era of easy profits is fading – rates are softening and capital is not a constraint. Enhanced underwriting, broker facilities and digital platforms are reshaping competition, with undifferentiated capacity finding less room to hide.

“The key is to take a disciplined approach. Those who define their edge, whether through data-driven underwriting, considered M&A or agile operating models, will outpace the pack.

“The market will reward clarity, speed and resilience – hesitation and half-measures will be punished. Leadership is earned, not inherited.”