The mergers and acquisitions (M&A) activity in North America’s insurance brokerage sector has significantly decelerated, with the first half of 2026 reporting transaction levels not witnessed since 2016. Overall, the total number of deals dropped by 15% compared to the previous year and is nearly 25% lower than the average for the past five years.
Amid all this, the composition of buyers has evolved. In this period, six private equity-backed firms and nine privately owned agencies made their debut acquisitions. However, 75% of historically proactive buyers reduced their deal counts over the last year, indicating a shift in the competitive dynamics.
Leading Firms and Transaction Trends
Broadstreet Partners remained the dominant player in the market, though it experienced a 5% decline in deal volume. Inszone Insurance Services recorded an impressive 57% increase in acquisitions, while Alkeme saw a 36% rise. However, other major firms such as World Insurance Associates, OneDigital, Hub International, and Leavitt Group reported mixed results, with only OneDigital showing an uptick in activity.
In total, the number of transactions involving various types of brokers—including property/casualty agents, benefit brokers, and managing general agents—fell to 292 from 342 year-over-year, marking a 15% decline. This trajectory reflects a 24% drop compared to the average transaction volume seen over the last five years. This ongoing reduction raises questions about the underlying factors affecting market confidence and transaction viability.
Quarterly analyses reveal a sharper reduction, with only 138 transactions occurring in the second quarter of 2026—down 25% from the 185 transactions noted in the same quarter of 2025. Looking back at the trailing 12 months, deal counts have decreased by 7%, from 783 to 646. Such figures illustrate a pivotal moment in the brokerage market, suggesting that firms may be reassessing their growth strategies amid changing economic conditions and uncertain market forecasts.
Profile of Sellers and Buyers
Breaking down the sellers in the first half of 2026, 67% were retail property/casualty agencies, followed by 12% employee benefits specialists. The remaining sales involved wholesale distributors, third-party administrators, life insurance agencies, and consulting firms within the insurance sector. This distribution highlights the diverse nature of sellers, which speaks to the varied interests and strengths within the insurance market.
Private equity remains the dominant force in this space, accounting for 76% of all transactions this year, a consistent trend from past years. Privately owned firms contributed 15% of the transaction activity. BroadStreet Partners and Inszone Insurance Services led the pack with 37 and 33 transactions, respectively, whereas Hub International reported a stark decline with only 11 transactions—59% lower than the prior year and 61% beneath its five-year average. The apparent struggle of once-active players like Hub can indicate broader market pressures impacting their businesses.
Among the top ten buyers, which collectively handled 55% of the announced transactions, Alkeme, OneDigital, Trucordia, and Unison Risk Advisors outperformed their previous year’s figures, while World Insurance Associates and Leavitt Group experienced a slight downturn. If you're working in this space, it's important to monitor which companies are gaining traction, as this could affect partnerships and strategic alliances in the future.
Future Market Outlook
We’ve seen notable deals this year, such as Willis Towers Watson acquiring Newfront and Third Wave’s purchase of Palmer & Cay. The persistent drive behind M&A activity is a considerable influx of capital seeking investment opportunities, evidenced by 153 unique buyers participating since the start of 2024, including 57 different private equity investors. This influx could suggest a waiting game—capital is looking for the right move when the environment stabilizes.
The current downturn in deal volume appears entrenched, exacerbated by a diminished pool of sellers, both in quality and capacity. Nonetheless, the market anticipates that a significant number of firms will need to exit over the next five to ten years. Meanwhile, buyer demand is shifting, with many traditional active firms slowing their acquisitions while new players are speeding up their activities ahead of anticipated recapitalizations. This shift might lead to unforeseen competitive pressures. And yet, the market could turn again if economic conditions around interest rates and inflation shift markedly.
Valuation trends are bifurcated: larger, well-managed firms continue to command high valuations, while others are likely to experience softening. This divergence could alter dynamically based on broader economic conditions, and indeed, if significant challenges arise within the insurance market. What this means for you is that strategic positioning will be crucial; buyers will have to scrutinize targets more closely than ever before.
Steven E. Germundson and Timothy J. Cunningham are principals at Optis Partners, an investment banking and financial consulting firm specializing in the insurance distribution sector. For inquiries, contact Steven at 612-718-0598 or germundson@optisins.com; Timothy can be reached at 312-235-0081 or cunningham@optisins.com.