Insurance agency merger and acquisition activity in the US and Canada declined in the first half of 2025, with 319 deals announced, according to data from OPTIS Partners.
That marked an 8% drop from the 345 transactions recorded during the same period last year.
Despite the overall slowdown, activity picked up in the second quarter with 168 deals, an 11% increase compared to Q2 2024.
Most transactions involved US-based sellers (305), while Canadian brokerages accounted for 14.
“The M&A market is likely at a new normal. We expect about 750 to 800 deals annually going forward,” said Steve Germundson, partner at OPTIS Partners, an investment banking and financial consulting firm focused on the insurance distribution sector. “Larger firms will continue to look for bigger transactions to fuel needed growth, and the number of buyers will shrink as some of yesterday’s active buyers become tomorrow’s sellers.”
Private equity continues to drive consolidation in the insurance brokerage sector. OPTIS classified buyers into four groups: private equity-backed or hybrid brokers, privately held brokers, publicly traded brokers, and others.
Private equity-backed and hybrid firms led activity in the first half, accounting for 73% of all deals. These firms represented 32 of the total buyers tracked.
“Private-equity firms continue to invest,” said Timothy Cunningham, managing partner at OPTIS. “Since the start of the pandemic, they’ve done about 70% of the total number of deals in each quarter. They’ve got the money and are willing to spend it for the right acquisition.”
Privately held brokers completed 62 transactions, while publicly traded brokers were involved in 19.
BroadStreet Partners was the most active acquirer, closing 39 deals. Hub International followed with 27, and Inszone Insurance Services recorded 18. Keystone Agency Partners and World Insurance Associates each completed 17.
The top 11 buyers accounted for 59% of total deal volume. Most were backed by private equity. Leavitt Group, Arthur J. Gallagher, and Heffernan Insurance Brokers were among the few not backed by PE capital.
The bulk of activity remained concentrated in the property and casualty (P&C) segment. P&C agencies accounted for 209 of the 319 transactions, or 65% of all deals.
Agencies offering both P&C and employee benefits services were involved in 27 transactions (8%), while standalone benefits agencies represented 42 deals (13%). The remaining 43 deals (13%) involved other sellers such as life insurance firms, financial services providers, and insurance-related consulting businesses.
The figures point to sustained demand for distribution assets in the P&C market, with strategic buyers continuing to pursue acquisitions to expand geographic reach, access new clients, or gain scale, according to the report.
