Category: Reinsurance brokers and structures · Reviewed by Tim Roche, Director · PI & Commercial · Last reviewed 2026-06-05
A multi-year reinsurance treaty extends cover and terms over more than one calendar year — typically two or three years. The structure provides predictability for both cedant and reinsurer in market conditions where this is valued, and reduces renewal frictional costs across the contract term.
Category: Reinsurance brokers and structures Also known as: multi-year reinsurance, MY treaty, long-term agreement Related concepts: reinsurance treaty, multi-line treaty
Multi-year treaties typically run for two to three years, with terms agreed at inception and applied uniformly across the contract term. Variations include: fixed-terms multi-year (no variation by year); annual rate-on-line resets within a multi-year framework; or ‘cancellable’ multi-year arrangements with annual review rights.
The structure is more common in soft markets, where reinsurers seek to lock in business at favourable rates and cedants prefer not to expose themselves to renewal volatility. In hard markets, multi-year treaties are less common because reinsurers prefer to retain flexibility to reprice annually.
Multi-year treaties are documented under the Market Reform Contract format with the term clearly specified. Specific provisions are typically included to address: pre-agreed termination rights (for material breach, change of control, regulatory events); annual reporting requirements; and treatment of new business or changes in the cedant’s portfolio during the term.
Multi-year treaties have become increasingly common in property catastrophe reinsurance and certain casualty classes during soft phases of the market. They were particularly common during the 2014–2017 soft period and have re-emerged selectively during 2024 softening.
The structure aligns cedant and reinsurer interests over a longer horizon: the reinsurer gains certainty of premium income; the cedant gains certainty of cover and price; and both parties save the costs of annual renegotiation.
An illustrative example: a UK property insurer enters into a three-year multi-year catastrophe XL treaty with a panel of four reinsurers, with fixed premium rates and uniform terms across 2025, 2026 and 2027. The treaty includes a profit commission calculated on the aggregate three-year result and a mid-term termination right for material breach.
This entry is part of the Apex Insurance Wiki. Last reviewed by Matt Bartlett on 2026-06-05. Next review: 2026-12-05.
Apex Insurance Brokers Limited. Authorised and regulated by the Financial Conduct Authority, FRN 724952. Registered in England and Wales, Companies House 07014570. This entry provides general information about UK insurance concepts and is not regulated advice. Consult your insurance broker on your specific position.
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