An S&P Global Ratings stress test of global insurers and reinsurers has found most could probably withstand a one in 250-year climate disaster.

The top 50 insurers collectively face about $US430 billion ($593 billion) gross exposure to natural catastrophe risk in such an event, or about 34% of capital.

But this drops to $US225 billion ($311 billion) or 15% after reinsurance and retrocession, and after catastrophe premiums, exposure halves again to about 8% capital loss, which “could largely be absorbed by annual earnings”, the ratings agency says.

“Our assessment highlights the strength of credit quality among most rated insurers, even when exposed to severe natural catastrophes.

“Resilience rests on the strength of their exposure management, the adequacy of their reinsurance programs and the level of capital headroom they maintain.”

Global insured losses in 2025 exceeded $US100 billion ($138 billion) for the sixth consecutive year.

“This dynamic does not appear to be going away – the industry is adjusting to a reality where extreme weather is increasingly common,” S&P said. “Our credit ratings appropriately incorporate exposure to natural catastrophes.”

Under the stress test scenario, about 10% of insurers’ capital adequacy fell below levels supporting current ratings.