The 2026 El Niño could alter catastrophe risk across multiple regions and perils, creating implications for insurers and reinsurers as they assess potential changes in insured losses, portfolio accumulation and diversification, according to Moody’s, the global risk assessment firm that provides credit ratings, research, data, and analytical tools for financial markets.
The company’s latest assessment examines how El Niño, the warm phase of the El Niño-Southern Oscillation, can affect weather patterns well beyond the tropical Pacific by changing sea surface temperatures, trade winds and atmospheric circulation. These changes can influence regional temperatures, rainfall and storm activity through large-scale weather patterns.
For the insurance market, the significance is that the effects are not uniform. Moody’s says El Niño can increase the risk associated with one peril while reducing exposure to another, potentially changing the overall loss profile of an insurer or reinsurer’s portfolio.
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