The machine that spent a decade eating the independent agency market just downshifted, hard. North American insurance agency deal volume fell to its lowest first-half total in seven years, with 292 acquisitions recorded in H1 2026, down 15% from 342 a year earlier, according to OPTIS Partners, the investment bank that tracks distribution M&A more closely than anyone in the business. The trailing 12-month count of 646 deals is the weakest since Q1 2019. Q2 2026 alone came in at 138 transactions, down a full 25% year on year.
This isn't a blip. The market has been sliding for more than a year now, with 2025 closing at 695 deals, down 12% from 787 in 2024, marking a third straight year without the usual year-end rush to close transactions. Even before that, the buyer pool had already started thinning, with new investors entering the market even as the number of active buyers in both the private-equity and privately held categories shrank. OPTIS now says the four-year contraction may finally be finding a floor.
Private-equity-backed and hybrid buyers still dominate the numbers, accounting for 75% of all trailing-12-month deals and 80% of everything closed in Q2 2026 alone. But look past the aggregate share and the market is going through something closer to a changing of the guard. Of the 68 unique buyers active in H1 2026, 37 were private-equity-backed, and six of those were doing their first-ever agency deal. Twenty-one were privately held buyers, nine of them brand new to the table.
Meanwhile, the giants that built this consolidation wave are visibly running out of breath. Hub International's deal pace is down 47% over the trailing 12 months. Keystone Agency Partners is off 29%. BroadStreet Partners, still the single most active buyer in the country with 37 deals in H1, has still cut its own pace by 16%. Acrisure, Patriot Growth Insurance Services, Alera Group and HighStreet Partners all slowed between 31% and 69%. BroadStreet led all buyers with 37 H1 transactions, followed by Inszone Insurance Services at 33, with ALKEME and World Insurance Associates tied at 15 apiece. All four are private-equity-backed, and the top 10 acquirers together still swallowed 55% of first-half volume.
Steve Germundson, a partner at OPTIS, frames it as a structural handoff rather than a market simply cooling off: the biggest, most active buyers of the last several years have sharply cut back, he said, while smaller and emerging PE firms, plus owners eyeing a near-term recapitalization, have picked up the pace instead. The likely drivers, according to MarshBerry's own 2026 M&A analysis, are higher financing costs, integration fatigue after years of aggressive buying, and an industry-wide pivot toward organic growth and operational quality over sheer deal count. For a newer PE platform or a strategic buyer with fresh capital, that combination has opened a window: this is close to the least competition from the biggest checkbooks in the business has faced in years.
Property and casualty agencies remained the dominant sellers, accounting for 198 of the first half's transactions, or 68% of total volume. Employee benefits agencies added 31 deals (11%), P&C-and-benefits combination shops contributed another 25 (9%), and everything else, including MGAs, TPAs and life distributors, made up the remaining 38 deals (13%).
The marquee deals of H1 give a sense of where the real money is still moving: Willis Towers Watson's acquisition of San Francisco's Newfront in January, on estimated 2025 revenue of $250 million; Third Wave's purchase of Atlanta's Palmer & Cay in March; BayPine LP's acquisition of Relation Insurance Services from Aquiline Capital Partners in January; and fresh minority investments into Denver and Wichita-based IMA Financial Group from Oak Hill Capital and New Mountain Capital in May.
Tim Cunningham, managing partner at OPTIS, put his finger on the split that matters most for anyone actually thinking about selling: valuations are "remaining high for larger, well-run firms and softening some for others." In practice, agencies with clean books, strong organic growth and real management depth are still getting fought over, while everyone else is quietly watching their exit multiple shrink in real time.
Germundson's line about developing a plan now lands differently once you look at the demographics sitting behind it. The 2022 Agency Universe Study, the Big "I"'s biennial survey of the independent agency channel, put the average P&C agency principal at 54 years old, with 17% already 66 or older, well past the point most professions consider retirement. The 2024 edition of the same study found one in three agencies now expects an ownership change within the next five years. Set against that, an earlier Big "I" study from 2020 found roughly 83% of agencies had no written succession plan at all. That figure is now a few years old and may have moved since, but even a meaningfully improved number would still leave a large share of an aging ownership base without a plan.
A wave of owners old enough to retire is approaching an exit at almost exactly the same moment OPTIS is describing a buyer pool that's shrinking and getting choosier about who it will pay a premium for. Nationwide's own research suggests that gap isn't closing on its own: roughly a third of principal agents now expect to retire later than they did a year ago, and a third describe themselves as unprepared for the transition regardless. The reasons aren't always financial. Plenty of owners simply don't want to let go of what they built, or don't trust anyone else to run it.
Whatever the reason, the timing works against it. The kind of agency OPTIS says is still commanding a premium doesn't get built in the twelve months before a sale, it gets built over the five to ten years Germundson is talking about. One example of what that groundwork actually looks like: smaller agencies of 20 to 25 people, run by owners in their 60s and 70s, that had already identified and were actively grooming successors two decades younger, years before any sale was on the table. An owner who starts that process today has years to fix the things a buyer will actually pay up for. An owner who waits until they're ready to retire hands the buyer pool, an increasingly selective one, the leverage to decide what the business is worth instead.
This looks less like the end of the agency M&A boom and more like its maturation. The arithmetic that let aggressive aggregators pay up and still profit on entry gets harder to make work once financing costs rise and organic growth slows, which is exactly the combination MarshBerry and other advisors have pointed to behind this year's recalibration. Buyers are getting choosier about who they'll pay up for, and a new generation of PE-backed and privately held buyers is stepping into space the exhausted serial acquirers are vacating. For agency owners on the sell side, that means the next few years reward exactly the kind of firm OPTIS describes as still winning: well-run, well-documented, and not waiting until the last minute to find out what it's actually worth.
