The number of M&A deals involving insurance brokers in North America increased by 8% sequentially to 120 in Q2 2024, according to S&P Global Market Intelligence report.
The total value of insurance broker deals in the region dropped sharply to $37 mn from $13.22 bn in Q1 2024
This trend contrasts with the broader M&A insurance market in the US and Canada, which faced high interest rates and financing challenges.
However, the insurance broker deal count in the first quarter was still lower than most quarters since 2020.
Number of insurance brokers’ M&A deals in North America
According to MarshBerry, in 2024, M&A activity involving insurance brokers in North America has shown mixed trends.
M&A activity in 2024 has started off slow, with only 29 insurance brokerage transactions in the U.S. announced in January.
As January flew by, year-end merger and acquisition (M&A) deal data for 2023 continues to roll in. The current count shows that 2023 delivered a total of 807 insurance brokerage transactions – a 10.6% decline compared to 2022 – and the third highest year on record.
Private equity-backed buyers dominated these deals, accounting for 72.4% of the transactions. Specialty distributors also continued to play a significant role, representing 21% of the deals.
Transactions involving specialty distributors have been increasing at a compound annual growth rate (CAGR) of 18% since 2018, a trend that is anticipated to continue as traditional retail brokers expand into the wholesale and delegated authority space
Private capital-backed buyers have accounted for 21 of the 29 transactions (72.4%) through January. This represents a significant increase since 2019 when private capital-backed buyers accounted for 59% of all transactions.
The largest deal announced in the quarter was Marsh & McLennan Agency’s $345 mn purchase of Fisher Brown Bottrell Insurance
Headquartered in Jackson, Mississippi, FBBINSURANCE is one of the top five largest bank-affiliated insurance agencies in the country and one of the largest agencies in the Southeast.
The acquisition gave Marsh & McLennan a strong presence in Mississippi and strengthened its footprint in Alabama and Florida, the company said in a release following the sale’s closure in June.
Fisher Brown Bottrell Insurance’s strong regional presence, client-focused approach, and excellent leadership were very attractive as we looked for a high-quality agency to expand our presence in the Southeast
Peter Krause, president and CEO of Marsh McLennan Agency’s Southeast region
The second-largest broker deal of the quarter was Nathan Dagley’s $15 mn acquisition of Dagley Insurance Agency, followed by Reliance Global Group Inc.’s $13.7 mn acquisition of Spetner Associates.
Deal activity from the marketplace’s most active acquirers has remained strong in the beginning of 2024. Ten buyers have accounted for 75.9% of all announced transactions, while the top three (Inszone Insurance, Arthur J. Gallagher & Co., and Patriot Growth) account for 41.4% of the otal transactions.
