The insurance mergers and acquisitions (M&A) landscape is entering a new phase, reshaping strategies across carriers, brokers, and investors as the industry heads into 2026.
David Hitsky, former strategy lead at Oliver Wyman and now partner at L.E.K. Consulting heading the firm’s insurance practice, said today’s M&A environment reflects a combination of macroeconomic pressures, industry maturity, and structural change that will continue into next year.
“Rising interest rates, tighter private equity capital, and more expensive financing have altered the landscape,” Hitsky told Insurance Business. “Money is simply not as cheap as it used to be.”
Rebound That Never Came
At the start of 2025, analysts had anticipated an M&A rebound in the second half of the year, assuming greater clarity on inflation and U.S. trade policy. That recovery has yet to materialise. Hitsky commented: “Companies are becoming comfortable being uncomfortable, but that is not the same as confidently knowing where things are heading.”
Political and macroeconomic uncertainty has clearly weighed on deal-making. Conning’s 2024 global insurance M&A review showed a decline in overall deal volume year-on-year, despite total announced value rising, driven by a handful of large headline-grabbing transactions.
| Period | Number of Deals | Total Deal Value |
|---|---|---|
| Six months to 15 May 2025 | 209 | $30bn |
| Prior six months | 297 | $20bn |
Deloitte’s 2024 insurance M&A outlook also found fewer deals overall but higher aggregate deal value due to transformative transactions. Regionally, UK M&A volumes in 2025 are tracking 35% below 2024 levels, though Q3 saw renewed activity in France, Southern Europe, and the Nordics.
Fewer Mid-Sized Targets, More Transformative Deals
Hitsky predicts that fewer transactions and larger, transformative deals will dominate the M&A market in 2026. “Capital costs remain high, and many attractive mid-sized assets have already been acquired,” he said.
In the brokerage sector, consolidation has intensified. MarshBerry recorded 847 brokerage transactions in 2024, up 5% from 2023, making it the third-highest annual volume on record. Scarcity premiums for mid-sized platforms are now driving acquisition strategies.
Top players are increasingly focusing on scale, targeting managing general agents (MGAs), program administrators, and services businesses rather than traditional retail brokers. MGAs alone achieved global gross written premiums of around $150bn in 2024, with $115bn in the U.S. and $20bn in Europe.
Claims services and third-party administrators (TPAs), particularly in medical claims management, are also attracting attention as “asset-light, cash-generative” platforms. For example, the UK’s Davies Group recently acquired Canada’s largest claims processor, SCM Insurance Services, in its largest strategic deal to date.
AI and the Next Chapter of Distribution
Beyond deal metrics, Hitsky identifies artificial intelligence (AI) as a potential catalyst for the next phase of insurance M&A, especially in distribution. “If you were designing insurance from scratch, this isn’t the model you would create,” he said. With consumers increasingly comparing insurers to Amazon, Uber, and PayPal, AI could enable fundamentally different operating models, sparking new opportunities for transformational deals in an industry that has remained largely unchanged for decades.