AM Best has forecast that Italy's non-life insurance sector will sustain premium growth in 2026, while noting that the momentum behind price increases is expected to ease. The ratings agency kept a stable outlook for the segment, saying gross written premiums should continue to rise across all lines of business this year, but at a slower clip than seen in recent periods as rate hikes moderate - notably in motor insurance.
The agency expects the sector to maintain solid profitability over the coming 12 months, supported by price increases agreed in prior years that are now being reflected in earned premiums. That earnings carry-forward is seen as a key factor underpinning near-term results.
Motor insurance remains the single largest component of the market, representing about 40% of total gross written premiums. However, non-motor lines have been growing faster, with premiums in that segment rising 7.1% in 2025 compared with motor growth of 5.6%, figures from insurer association Ania cited by AM Best show.
Demand for non-motor cover is expected to remain strong in 2026, in part because of a law that requires companies to purchase insurance for earthquakes, floods, inundations and landslides. That requirement became fully effective on March 31, and AM Best highlights it as a driver of stronger uptake outside the motor market.
On the policy and fiscal side, AM Best analysed elements of Italy's 2026 Budget Law - including suspensions related to deferred tax asset deductions, a 2% increase in the regional production tax, and adjustments to car-related insurance premium tax. The agency judged those measures unlikely to materially compress margins, arguing that insurers will probably pass most of the additional costs on to policyholders rather than absorb them.
Overall, AM Best's read is of a market that should continue to grow while shifting compositionally toward non-motor business and consolidating profitability gains from previous repricing. The agency's stable outlook reflects an expectation of ongoing premium increases, albeit at a tempered pace as rate momentum slows.