Sica Fletcher Index Reports 26% Decline in Total Agency-Broker M&A Revenue for 2024
The Sica Fletcher Index, a grouping of 22 acquirers in the insurance industry, engaged in 533 agent-broker transactions in 2024, which marked a 6% decline from the previous year. Specifically, the members completed 146 acquisitions in the fourth quarter of 2024, representing an 11% decrease compared to the same period in 2023. The total revenue from agency-broker deals in 2024 amounted to $1.6 billion, indicating a significant 26% drop when compared to the figures from 2023. On average, the size of agencies in terms of revenue was approximately $3.1 million, which marked a decline of about 21% from the previous year.
Sica Fletcher, a firm specializing in insurance industry advisories, noted that the decline in the market’s activities in 2024 reflects a strategic shift in buyer behavior. Buyers displayed a preference for smaller, more focused acquisitions while reevaluating valuations in response to changing financial circumstances. The prevalence of transactions involving sub-$1 million deals persisted throughout the year, outnumbering deals of larger scales.
The Agency & Broker Buyer Index, developed by the firm, captured approximately 65% of all agent-broker activities in 2024, which was slightly lower compared to the usual 70%. This decrease suggests a rise in market involvement by emerging players. BroadStreet Partners, supported by private equity, led the Sica Fletcher Index with an impressive 85 deals in 2024, representing an increase of 24 deals from the preceding year. Hub International and Inzone Insurance followed with 62 and 48 deals, respectively. Private equity-backed transactions accounted for over 88% of the Sica Fletcher Index transactions in 2024, with Gallagher, a public company, leading among public entities with 45 deals completed throughout the year.
2024 saw a notable adjustment in the insurance market landscape, with buyers focusing on more targeted approaches to acquisitions. The dynamics of the market evolved as financial conditions shifted, prompting a reassessment of valuation practices. Participants in the market, including private equity players and public corporations, adapted to these changes by engaging in deals that emphasized strategic importance and operational synergy. Moving forward, the industry is likely to witness continued adjustments in response to the evolving financial landscape and changing market dynamics.