Independent Insurance Agents & Brokers of America (the Big “I”) has released a new mergers and acquisitions handbook aimed at helping insurance agencies manage errors and omissions (E&O) risk during ownership transitions, against a backdrop of sustained deal activity across the broking sector.
Developed by the organization’s Virtual University in collaboration with its Professional Liability Risk Management team, the guide - titled The Handbook for Preventing Errors & Omissions Claims in Insurance Agency Mergers & Acquisitions - sets out practical considerations for agencies navigating operational and compliance challenges during transactions.
The handbook reflects a growing volume of E&O claims linked to M&A activity, particularly where agencies struggle to align processes, documentation and employee knowledge following a deal. As consolidation continues, integration timelines are often compressed, increasing the risk of gaps in coverage handling and internal controls.
According to the Big “I”, common exposures include failures to properly schedule insured assets, overlooking cover for certain property types such as vacant land, and inadequate documentation of policy recommendations. Risks can also arise where agencies step beyond their remit - for example by reviewing legal contracts outside an insurance context - or where communication with clients around coverage is unclear or incomplete.
A central theme of the guidance is employee integration. The handbook includes tools to assess staff competency, alongside structured training modules, individualized development plans and performance tracking mechanisms intended to support consistent service delivery during and after a transaction.
These measures are designed to address one of the more persistent challenges in agency M&A: ensuring that newly combined teams apply consistent standards when advising clients and administering policies.
The publication comes as consolidation across the insurance distribution sector shows little sign of slowing. Brokers including Arthur J. Gallagher, Marsh McLennan and Brown & Brown have all remained active acquirers, often targeting firms with specialist capabilities or strong regional presence.
While M&A can provide scale and access to new expertise, it also introduces operational risk, particularly in areas such as compliance, documentation and client servicing - factors that sit at the heart of E&O exposure.
