The Property and Casualty Insurance Compensation Corporation (PACICC) has just published the fourth edition of its summary of insurance company failures around the world. Insurer failures occur worldwide, and 2025 was a “particularly challenging” year, according to Alister Campbell, CEO of PACICC.
The authors of the Global Failed Insurer Catalogue 2026 are Grant Kelly, chief economist at PACICC, and Judy (Zhe) Peng, research associate. In this research, the authors report 1,273 failures in 98 countries since 2000, in both property and casualty insurance and life insurance.
In the July 2026 issue of the quarterly Solvency Matters newsletter, Campbell noted that in 2025, some 40 insurance companies failed in 17 countries. “The large number of insolvencies last year represents both a sudden upward jump in an otherwise downward-sloping trend over the past five years, and a result even higher than the 25-year average of 35 insurer failures annually,” Campbell wrote.
PACICC made the catalogue public on September 9. According to Grant Kelly, the updated study data reveal a concentration of insurer failures in many jurisdictions following prolonged periods of relative market calm. “It would be very risky to assume that, because an insurer has not failed recently in a given jurisdiction, it never will,” Kelly says.
“Our research identifies clusters of insurer failures that occurred 118 times across 59 jurisdictions since 2000, often after sustained periods of relative calm. This should serve as a sobering reminder to all financial services sector stakeholders of the risk of complacency,” he adds. PACICC made the same recommendation when it published the third edition of the catalogue in 2025.
Alister Campbell noted that the catalogue identifies 34 countries where more than a decade elapsed between two failures. In property and casualty insurance, six Canadian insurers failed between 2000 and 2003, and none have failed since. “These clusters might occur precisely because there was such a large gap between occurrences. Maybe guardians of solvency can become complacent and then find themselves suddenly overwhelmed by events?” he wrote in PACICC’s latest quarterly newsletter.
Property and casualty insurance
The authors counted 843 property and casualty insurance company failures between 2000 and 2025, with significant year-to-year variations, as can be seen in the chart below.
PACICC also found that the average annual number of failures gradually declined during the period studied, from approximately 40 per year during the 2000-2009 decade to 31 during the following decade. Since 2020, the average has been approximately 22 failures per year.
Life insurance
Among life insurance companies, the authors counted 372 failures during the period analyzed, or just over 14 per year on average. As can be seen in the chart below, since the peak of 36 failures in 2000, there have been significant variations in the number of failures during the period studied.
Here too, the authors observed a downward trend in each decade, with an average of 18 failures between 2000 and 2009, approximately 13 failures per year between 2010 and 2019, and nearly 11 failures per year since 2020.
Other categories
The total number of failures also includes composite companies, meaning companies active in both life insurance and property and casualty insurance. Some 27 of these composite companies failed during the same period, with a peak of five reached in 2015. The authors point out that some countries do not allow the same company to operate in both markets. There was one failure per year from 2023 to 2025 in this class of companies.
In reinsurance, PACICC’s figures show 31 failures between 2000 and 2025. There were two in both 2023 and 2025 and only one in 2024.
The report also provides a breakdown by continent and country. North America accounted for nearly half of the total, with 612 failures (48 per cent), the largest number at. There were seven insolvencies in Canada, 522 in the United States, 35 in Mexico and another 48 in the Atlantic and Caribbean islands.
By country, after the United States, Russia (117) had the largest number of insolvencies, followed by Brazil (51), Argentina (48) and the Philippines (38). Of the 98 countries on the list, 28 experienced only one failure between 2000 and 2025.
One section of the failed insurer catalogue also breaks down failures by jurisdiction in the United States, where each state or territory is responsible for regulating insurers’ activities.
Four states stand out for the number of failures: Florida (58), New York State (51), Texas (46) and Illinois (32). If these jurisdictions were ranked alongside countries, U.S. states would occupy 10 of the top 20 positions in terms of the number of failures.
Frequency
The third part of the PACICC report seeks to determine the frequency of insurer insolvencies. The authors use the same definition as the Office of the Superintendent of Financial Institutions (OSFI), using an insolvency ratio per 1,000 companies. The comparison is made among member countries of the Organisation for Economic Co-operation and Development (OECD).
Of the 38 countries in the OECD Insurance database, 31 reported at least one failure during the period analyzed. The most recent figures are for 2024. Some 7,000 insurance companies are listed in these countries.
During the 25-year period from 2000 to 2024 analyzed, the average insolvency ratio was 3.72 failures per 1,000 insurance companies in OECD member states.
For all 98 countries and the separate U.S. state jurisdictions, or 146 jurisdictions in total, PACICC analyzes the frequency of failures and divides the results into four categories:
• The first tier includes countries or states where failures are an expected part of the market. Some 12 jurisdictions experienced at least one failure in more than 50 per cent of the years during the 2000-2025 period. The list includes the four U.S. states mentioned above, along with Pennsylvania.
• The second tier includes jurisdictions where failures are not expected. Some 23 countries or U.S. states experienced at least one failure in 25 to 49 per cent of the years during the period analyzed.
• The third tier consists of countries where failures are a rare phenomenon. PACICC counts 75 jurisdictions where a failure occurred in between 5 per cent and 24 per cent of the years during the period studied. Canada is part of this group.
• The final tier consists of the 36 countries or U.S. jurisdictions that went through the 26 years of the period studied with only one year in which one or more failures were reported.
Clusters of failures
In the fourth section of the document, the authors discuss trends related to the occurrence of insolvencies. “Once an insurer fails in a given jurisdiction, additional failures often follow quickly,” they write. The same observation was made in the second edition of the catalogue in 2023.
These clustered failures, defined as at least three failures over a period of no more than three years in the same jurisdiction, are common, according to PACICC researchers. They counted some 70 examples of clusters of failures in 38 countries other than the United States. South of the border, these clusters occurred on 48 occasions in 21 jurisdictions.
Canada experienced a series of six failures between 2000 and 2003. Some 67.6 per cent of all insolvency cases occurred as part of such clusters. “One possible explanation for the clustering of failures is that difficult market conditions, such as changes in the judicial climate or unexpected movements in interest rates, affect all companies competing in that market,” the authors explain.
“Most insurers, of course, manage these pressures successfully. However, insurers with weaker balance sheets often cannot withstand these conditions and therefore become insolvent. In this sense, insurers with weaker balance sheets fail individually, but often not alone,” they add.
Grant Kelly and Judy Peng also confirm that a very long period often passes before a country is hit by a series of insurer failures. This can be seen in Canada, where the most recent case dates back to 2012, with the failure of Union of Canada Life. In property and casualty insurance, the most recent failure occurred in 2003, when the Canadian subsidiary of Home Insurance Company was placed into liquidation.
The International Association of Insurance Supervisors (IAIS) recommends establishing a compensation system to keep policies in force and manage claims if an insurer becomes insolvent. PACICC’s catalogue lists the members of the International Forum of Insurance Guarantee Schemes (IFIGS), including the two Canadian members. PACICC has had such a compensation program since 1989. In life insurance, Assuris also established its program in 1990.
PACICC’s research shows a protection gap among policyholders depending on the continent where they live. Policyholders involved in 86.6 per cent of insurer failures in North America benefited from the additional protection provided by a compensation program. The proportion of policyholders with this additional protection in the event of a failure falls to 34 per cent for policyholders in Europe and 5.5 per cent in Africa.
Other expertise
In the July 2026 issue of the Solvency Matters newsletter, Stephen Mallory, director at Directors Global Risk Consulting, authored an article on insurer failures and the regulatory obligations applicable to insurance company directors. The author reviews the criteria set out by OSFI in its guidelines concerning the board of directors’ risk oversight functions, as well as recent developments in these rules.
Mallory cites a 2008 Supreme Court of Canada decision in litigation involving BCE, which prompted the Canadian government to review its corporate legislation. Since then, directors and officers must act “honestly and in good faith with a view to the best interests of the corporation.”
This involves considering the interests of stakeholders, such as shareholders, employees, retirees and pensioners, creditors, and others. Directors must “prevent collapses such as reputational damage and share price drops.”
The author cites several examples of declines in market value, such as those experienced by insurer AIG in 2005, Swiss Re as a result of its structured credit losses in 2008-2009, and the failed acquisition of AIG’s life insurance portfolio in Asia, which caused insurer Prudential’s shares to fall in 2010. In the latter case, the British regulator imposed fines of £30 million on the company for having undertaken “a high-risk and high-cost transaction without adequate scrutiny or shareholder alignment.”
Mallory also proposes eight measures to help boards of directors ensure effective risk oversight and governance. PACICC’s newsletter is available on the organization’s website.
