AbstractSocial insect colonies can be seen as a distinct form of biological organisation because they function as superorganisms. Understanding how natural selection acts on the emergence and maintenance of these colonies remains a major question in evolutionary biology and ecology. Here, we explore this by using multi‐type branching processes to calculate the basic reproductive ratios and the extinction probabilities for solitary vs. eusocial reproductive strategies. We find that eusociality, albeit being hugely successful once established, is generally less stable than solitary reproduction unless large demographic advantages of eusociality arise for small colony sizes. We also demonstrate how such demographic constraints can be overcome by the presence of ecological niches that strongly favour eusociality. Our results characterise the risk‐return trade‐offs between solitary and eusocial reproduction, and help to explain why eusociality is taxonomically rare: eusociality is a high‐risk, high‐reward strategy, whereas solitary reproduction is more conservative.