Broker M&A activity increases modestly in 2020
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Mergers and acquisitions in the insurance brokerage sector increased modestly to 754 deals announced in 2020, compared with 744 in 2019, according to a report Wednesday from S&P Inc.
Meanwhile, M&A activity decreased in the underwriting sector to 151 transactions announced in 2020, down from 165 in 2019, S&P said.
Underwriting sector deal activity slowed in the last three months of 2020 to 40 deals compared with 46 in the third quarter of 2020 and 47 in the fourth quarter of 2019. Fourth-quarter M&A activity in the property and casualty sector increased to 22 deals from 19 in the fourth-quarter 2019.
In a separate report, analysts MarshBerry said there were 676 brokerage M&A transactions announced in the United States, up 4.3% increase over 2019’s of 648 announced transactions. MarshBerry noted that “the announced 676 transactions de facto occurred in only 10 months, as M&A activity was at a virtual stand-still for April and May.”
Private capital-backed buyers completed 462, or 68.3%, of all announced transactions, MarshBerry said. Independent firms accounted for 90 of the 676 deals, 13.3%. The composition of the seller’s line of business remained “consistent” in 2020 with 50.3% property/casualty focused, 32.5% multiline and 17.2% in the employee benefits/consulting space.
Acrisure LLC, BroadStreet Partners Inc. and World Insurance Associates LLC were the top three most active buyers in 2020 based on reported deal count, completing a combined 25.4% of the 676 deals announced so far this year. The Top 10 most-active buyers completed 328 of the 676 total announced transactions, 48.5% of the total.
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