AXA is done fixing margins
AXA held its first-half 2026 earnings call on July 31. Here are the key takeaways.
AXA is done fixing P&C margins and wants growth
Management believes profitability in retail and commercial P&C, excluding AXA XL, is already at an excellent level. AXA intends to preserve those margins while using favorable pricing conditions to add business.
“With profitability at excellent level, we do not see the need to improve margins further. Instead, we intend to capitalize on the favorable pricing environment to grow.”
AXA added two million policies
The insurer added two million net new personal-lines contracts during the first half—more than the 1.7 million added during all of 2025. AXA says the growth demonstrates that it can gain customers while maintaining pricing discipline.
“We gained 2 million net new contracts in the half year, which was more than all of 2025.”
AXA isn’t hunting for volume
The UK is the first AXA market to show renewed softness, particularly in motor. Management said it will raise prices and accept lower growth if necessary to preserve profitability.
“We’re not hunting for volume. We are hunting for profitability.”
The next strategic plan won’t be a turnaround
AXA says the transformation initiatives under its current plan are largely complete. Its next plan, which will be presented in September, will focus on growing from an already strong position.
“The next plan will not be about catching up from a weak base. It will be about building further on already excellent levels of performance and resilience.”
AXA XL is managing the softening market
AXA XL’s insurance pricing declined by approximately 1% during the first half. Management says the unit maintained its underlying margins, excluding Middle East losses, and achieved better pricing than the broader market.
Property pricing declined 7%
Property pricing at AXA XL decreased 7% during the first half, including a 10% decline in North America. AXA says its limited exposure to coastal catastrophe business and focus on large primary accounts helped preserve profitability.
AXA sees opportunity despite the softer market
Management emphasized that AXA XL writes approximately 400 products across 26 countries, making broad descriptions of market conditions less useful. Cyber and professional lines may improve, while geopolitical risks are already commanding higher prices.
AXA is targeting autonomous vehicles and data centers
AXA plans to direct capital toward businesses it considers profitable, structurally growing and less exposed to insurance cycles. Its target areas include the US middle market, defense, energy-transition infrastructure, autonomous vehicles and data centers.
“We will continue to deploy capital in lines that are profitable, structurally growing and less cyclical such as U.S. midmarket, defense and infrastructure energy transition, autonomous vehicles and data centers.”
Lower reinsurance costs are helping AXA XL
Reduced reinsurance costs improved AXA XL’s first-half results by approximately 30 basis points. Management expects more of the benefit to emerge as annual treaties earn through the portfolio.
AXA will recapture 90% of Prima’s premium
AXA expects to bring approximately 90% of the Italian digital insurer’s premiums onto its own balance sheet by 2027. It expects to recapture approximately €900 million in premium by the end of 2026.
Prima grew premiums by 30%
Prima’s premiums increased 30% during the first half, and the business reported a technical combined ratio of 87.5%. AXA currently owns 53% of the MGA.
Health profitability improved sharply
Short-term Life & Health technical margins increased 53%, while the combined ratio improved by 130 basis points to 96%. Management said the result came from current-year underwriting rather than favorable prior-year development.
AI is beginning to contribute
AXA says its technology, automation and AI investments are starting to reduce expenses. The group expects its non-commission expense ratio to decline by approximately 30 basis points during 2026.
AXA considers anything above 200% solvency satisfactory
AXA ended June with a Solvency II ratio of 218%. Regulatory changes could potentially lift that figure to approximately 240%, which management acknowledged would be a very high level.
AXA expects to exceed €21 billion in cash remittances
The company expects to surpass the cash-remittance target established under its current strategic plan despite no longer receiving dividends from AXA Investment Managers following its sale.
AXA remains selective in private lending
AXA has approximately €10 billion invested in middle-market private loans. Management says it accepts only 15% to 25% of the deals presented by its asset managers and has not seen an increase in defaults.
Middle East losses reached €100 million
AXA XL recorded €100 million of losses related to the Middle East through June 30. Approximately one-third consisted of reported case reserves, while two-thirds represented incurred-but-not-reported claims.
Recent wildfires aren’t included in catastrophe losses
Natural catastrophes added 3.5 points to AXA’s first-half combined ratio, below its normalized 4.5-point assumption. France experienced elevated hailstorm losses, while estimates for more recent wildfires were not yet included.
