Insurance agency merger and acquisition activity remains red hot and at record levels. Total announced agency acquisitions exceeded 450 in both the last two years, and the 2015-16 total of more than 900 announced deals is easily the highest two-year total on record.
What's the driving force behind this blistering pace of activity? It's no mystery. Private equity investors — minor players in the marketplace a decade ago — accounted for more than half of all announced transactions over the past two years. In fact, nine of the top 10 buyers of agencies over this period are private equity backed. Well-capitalized and willing to price and structure deals aggressively, these private equity investors are fierce competitors with significant advantages over other buyers of insurance agencies, especially private brokers.
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