Insurance distribution mergers and acquisitions slowed in the first quarter of 2025, with 141 announced transactions, a 15% decrease from 166 in Q1 2024, according to OPTIS Partners’ latest M&A database report.
This marks the ninth consecutive quarter of deal volume falling below the long-term trend line and the lowest quarterly total since Q2 2020, during the early stages of the COVID-19 pandemic.
The first quarter featured 46 distinct buyers. Of these, 25 were private equity-backed firms, one of which completed its first transaction. Seventeen were privately held buyers, with five making their initial acquisitions.
The data underscores a continued dominance of private equity-backed or hybrid buyers, which accounted for 73% of all transactions, slightly above the 72% share in Q1 2024.
Retail property and casualty, life and health, wholesale, and third-party administrator deals accounted for 131 of the Q1 2025 transactions, down from 154 in the same quarter last year.
“We think the pace will ultimately pick up this year because of the large number of active buyers in the market, although current economic uncertainties may cause a bit of a delay,” said Steve Germundson (pictured above), a partner at OPTIS Partners.
A previous report from WTW noted that companies involved in mergers and acquisitions outperformed the broader market by 1.5 percentage points in the first quarter of 2025, marking the first positive result since late 2022.
While regional performance varied widely, WTW noted that North American acquirers underperformed their regional index by 2.2 percentage points in the first quarter, completing 81 deals. This marked the ninth straight quarter of negative results in the region.
Among the most active buyers over the past four quarters, BroadStreet Partners led with 81 transactions, exceeding its five-year average of 58. Hub International followed with 61 deals, slightly below its five-year average of 65, while Inszone Insurance Services recorded 44 deals, above its average of 32.
These three firms combined for 25% of the deal volume over the last four quarters, consistent with their 23% share in the previous four-quarter period.
In Q1 2025 alone, BroadStreet again led with 18 transactions. Although that figure represents one-third of its Q1 2022 total, it is still 22% above the firm’s five-year average. World Insurance Associates followed with 10 deals, up from one in Q1 2024 and more than double its five-year average.
King Risk Partners also saw an increase in activity, completing seven deals compared to one in the same period last year. Eight additional firms completed at least five acquisitions during the quarter.
Other historically active acquirers, including Inszone Insurance Services, OneDigital, ALKEME, and Arthur J. Gallagher, completed fewer deals in Q1 2025 compared to the prior-year period.
Gallagher’s transaction count declined, but the firm has pursued two large pending acquisitions – AssuredPartners and Woodruff-Sawyer – both of which are ranked among the top 100 US agencies. These deals may offset the lower number of transactions recorded in the first quarter.
Private buyers announced 25 transactions in Q1 2025, a decrease from 39 in Q1 2024. Publicly traded brokers reported 13 transactions, slightly down from 15 in the same period last year.
Of the 156 buyers active over the last eight quarters, 54% completed one deal, 10% did two, and 5% completed three. The remaining 32% – a group of 50 firms – executed four or more acquisitions, classifying them as “active buyers.”
OPTIS noted that deal activity may continue to decline amid ongoing economic uncertainty, but the presence of 27 private equity-backed acquirers and other consistently active firms could sustain transaction levels above those seen before the pandemic.
The report also highlighted that several private equity-backed insurance distributors are currently seeking recapitalization or potential sale, which may influence future market dynamics. Additionally, an uptick in the sale of large privately held agencies is expected.
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