The insurance industry saw significant increases in both insurance distribution and insurance services mergers and acquisitions globally in 2015, according to a new study.
Hartford-based Conning Inc., an insurance investment management company, found the distribution sector remains in a state of consolidation, with the number of global mergers and acquisitions increasing for a third consecutive year.
Jerry Theodorou, Conning’s vice president, insurance research, said deal volume in the aggregate reached a new high in 2015 at nearly $20 billion, driven by one significant transaction. He said in a statement, “Beyond the Willis/Towers Watson transaction, M&A activity in 2015 was highlighted by fewer transformational deals but a number of bolt-on transactions that help the buyers build out broader product offerings.”
The insurance services sector transactions increased more than 25 percent, driven by acquisitions of claims adjusters, health services firms and insurance technology providers.
“Facing a challenging business environment, strategic distribution buyers turned to transactions as an attractive way to grow and build out their platforms to serve clients,” added Steve Webersen, Conning’s head of insurance research.
Webersen added that the technological transformation occurring in the insurance industry is creating interest from buyers looking for big data and predictive analytic technologies as well as greater capabilities to meet the demands associated with a changing healthcare environment, such as the roll-out of the Affordable Care Act.
The Conning study, “Global Insurance Distribution & Services Sector Mergers & Acquisitions: Building for the Future” tracks and analyzes both U.S. and non-U.S. insurance industry M&A activity across distribution and services sectors.
