The global non-life run-off market has quietly become a trillion-dollar business, underpinning capital management strategies across the insurance industry. PwC’s Global Insurance Run-Off Survey 2025 estimates worldwide reserves in run-off at US$1.129 trillion, an increase of 11 per cent since the previous edition.
Run-off, the practice of managing insurance liabilities once an insurer has stopped writing new business in a particular class, is now seen as a central pillar of balance sheet management. For companies, transferring closed books or creating internal run-off vehicles can free capital, reduce volatility, and provide greater focus on profitable lines.
The survey highlights strong activity in North America, particularly in casualty reserves. “Casualty reserves have been strengthened across the market on account of adverse experience, especially from the 2013–2019 soft market underwriting years,” it reports. In the United States, reserve adjustments have been driven by litigation trends and “clear evidence of rising claim severity.”
Deal activity has continued at pace: 33 run-off transactions were completed globally in 2024, with a further 25 announced in the first eight months of 2025. Most transactions fall within the US$250 million to US$1 billion range, underlining the market’s maturity. Despite consolidation among major players, PwC concludes the sector remains well capitalised and competitive.
As Connie Tregidga of Compre Group put it: “Creating bespoke solutions that go beyond solving for the immediate capital need is key for our clients. Transaction structures are increasingly including an element of renewal or future exit as we become the trusted capital partner with appetite for long tail reserve risk.”
The survey devotes significant attention to Lloyd’s, where legacy syndicates are now subject to stricter oversight. Rachel Turk, Lloyd’s Chief of Market Performance, was clear: “Negative sentiment remains in some corners of the market that any form of legacy transaction results in poorer outcomes for the client. This isn’t backed up by the data that we have, or the experience that we see.”
She added: “The new rules are not intended to suggest Lloyd’s is anti-legacy deals. The driver behind the new rules was to provide Lloyd’s with the assurance and oversight of what liabilities are flowing around the market.”
The asbestos crisis once defined the run-off business. Today, new exposures are beginning to take shape. The survey points to PFAS chemicals and sports-related concussion litigation as potential long-tail liabilities. Robert Reville of Moody’s commented: “The increased exposure to complex multi-defendant litigation has significantly extended the long tail of liability. In this environment, a robust legacy market is an increasingly vital resource for insurer risk management.”
These issues have already reached the courts: the NFL has paid around US$1 billion to 4,500 former players, while rugby and football governing bodies in the UK now face similar claims.
Run-off, often seen as a conservative corner of the market, is also being reshaped by technology. More than 80 per cent of respondents expect generative AI to have a “moderate to significant impact” on due diligence and integration in the sector. At the same time, 32 per cent raised concerns about data privacy and 21 per cent pointed to the risk of hallucinations.
Canada has not been a major source of publicly disclosed run-off deals, with most North American activity focused in the United States. Still, the global trends resonate here. Canadian carriers face many of the same pressures: casualty reserve uncertainty, capital efficiency requirements under OSFI’s LICAT regime, and the need to optimise balance sheets for growth in core business.
Run-off transactions may offer an underused tool for Canadian insurers to address blocks of business that are no longer strategic. At a time when consolidation among brokers and MGAs is reshaping distribution, legacy solutions could be the next wave of structural change for the Canadian market.
PwC describes the legacy market’s outlook with words like “stability,” “evolution,” and “discipline.” As Andy Ward and Rebecca Wilkinson note in their foreword: “This edition seeks to provide not just an analysis of where we are, but a framework to consider how this evolving market continues its journey.”
For Canadian insurers, the lesson may be that while run-off has long been viewed as a European and American phenomenon, it is increasingly a global tool – one that could soon play a greater role in Canada’s own insurance landscape.
