Broker M&A drops to lowest first-half level since 2016

The pace of mergers and acquisitions among North America’s insurance agents and brokers continued to slow in the first half of 2026, declining to levels not seen since 2016.

First-half 2026 deals were 15% lower than in the same period in the prior year and nearly 25% below the average over the previous five years.

The buyer universe continues to change. In the first half of 2026, six private equity-backed firms and nine privately owned agencies made their first acquisition. Yet 75% of the historically most active buyers have cut back on their deal volume over the past 12 months.

Broadstreet Partners continued to lead the pack in the first half of 2026, though deal volume declined 5%. Both Inszone Insurance Services and Alkeme followed, posting gains in deal count of 57% and 36%, respectively. Other leaders, such as World Insurance Associates, OneDigital, Hub International and Leavitt Group are still near the top, but only OneDigital’s pace has picked up.

The total number of U.S. and Canadian transactions involving property/casualty agents and brokers, benefits brokers, managing general agents and third-party administrators fell 15% to 292 in the first half of this year, down from 342 during the same period last year and 24% below the previous five-year average.

On a quarterly basis, there were 138 transactions in the second quarter, down 25% from the 185 reported in the same period in 2025. On a trailing 12-month basis, the latest deal count was 646, 7% lower than the 783 reported in the prior period.

Among the sellers in the first half, 67% were retail property/casualty agencies and 12% were employee benefits specialists, and 9% were classified as selling both. The remaining 12% of sellers comprised those on the wholesale side of distribution, third-party administrators, life insurance agencies, financial products sellers, and a variety of consulting businesses related to insurance distribution.

Private-equity-backed companies continue to dominate the deal-making landscape, and we do not expect this to change for many years ahead. These buyers accounted for 76% of the transactions so far this year, which is similar to past experience. Companies categorized as privately owned accounted for 15%.

BroadStreet Partners and Inszone Insurance Services closed the most transactions, reporting first-half deals of 37 and 33, respectively. Perennial frontrunner Hub International completed just 11 transactions, which was a 59% decline over the prior year and 61% below its previous five-year average.

Among the remaining top 10 most-active buyers, Alkeme OneDigital, Trucordia and Unison Risk Advisors did more deals than in the prior-year period while World Insurance Associates and Leavitt Group slowed slightly.

In total, the top 10 most-active buyers — and ties — booked 55% of announced transactions so far in 2026, and the top 25 buyers booked 76%. In total, 33 buyers made more than one transaction in the first half, and 14 reported making their first acquisition.

So far in 2026, large transactions include Willis Towers Watson’s purchase of Newfront and Third Wave’s purchase of Palmer & Cay.

A constant force driving M&A in the industry is the large amount of capital pursuing investment opportunities in this sector, reflected by the 153 unique buyers since the beginning of 2024. In the same period, there have been 57 different private equity investors doing a transaction in this sector, 35 of which have done four or more deals, while nine have done just one.  In the same period, there were 81 privately owned firms announcing transactions, 17 of which did four or more, and 49 having done just one.

The industry’s nearly four-year slide in deal volume likely hasn’t yet reached bottom. The supply of sellers is smaller both in quantity and quality, yet there are still a large number of firms that will need to sell over the next five to 10 years. Demand from buyers is shifting as some of the most active buyers over the past several years are slowing deal activity while the pace quickens for emerging firms and those anticipating a recapitalization or sale in the near future.

In this environment, we see valuations remaining high for larger, well-run firms and softening some for others, which could change with a significant slowdown in the economy or increased headwinds in the insurance market.

Steven E. Germundson and Timothy J. Cunningham are principals at Optis Partners, an investment banking and financial consulting firm in Chicago and Minneapolis that serves the insurance distribution sector. Mr. Germundson can be reached at 612-718-0598 or [email protected]; Mr. Cunningham can be reached at 312-235-0081 or [email protected]