OPTIS: 2024 Insurance Agency M&A Decreases by 10%, Marked by 3 Major Transactions
OPTIS Partners reported that there was a 10% decrease in insurance agency mergers and acquisitions in 2024 compared to the previous year. A total of 750 deals were announced in 2024, down from 833 in 2023. Steve Germundson, a partner at OPTIS Partners, noted that many active buyers slowed down their acquisition pace. Despite the overall decrease, there were three major deals that took center stage in 2024.
One significant deal involved Arthur J. Gallagher acquiring AssuredPartners for $13.45 billion in cash to expand its presence in the U.S. middle-market. Another notable acquisition was Marsh McLennan purchasing McGriff Insurance Services for $7.75 billion. Additionally, Aon completed a $13 billion deal with NFP, a middle-market P/C broker. OPTIS Partners predicted that more large private equity-backed deals would materialize in 2025.
Compared to 2023, 2024 did not experience a rush of last-minute deals. While there was a 21% increase in deals in the second half of 2024 compared to the first half, the total count was down 8% from the second half of 2023. Notably, there were 199 deals in the fourth quarter, which was 16% lower than in Q4 2023. Over the last decade, eight key buyers were responsible for 42% of all deals, with BroadStreet Partners leading the pack with 90 transactions.
Looking forward, OPTIS Partners anticipated a trend of fewer buyers acquiring more sellers but at a slower rate. This reflects an industry that is consolidating, with inorganic growth requiring capital. As a result, the firm suggested that there may be an increase in recapitalizations, large transactions, and potentially IPOs within the next 12-24 months. In 2024, 72% of acquisitions were made by private equity-backed or hybrid buyers.
Overall, the insurance agency M&A landscape in 2024 showcased a mixture of decline and major deals. Despite the drop in total deals, the industry remained dynamic, with key players strategizing for the future and positioning themselves for continued growth and consolidation.
