FTI Consulting has published its European Insurance M&A Barometer Report for 2023, revealing that despite increasing interest rates, the year remained highly active for insurance mergers and acquisitions (M&A) throughout Europe.
FTI Consulting highlights a record volume of activity, with a total of 574 insurance M&A deals announced throughout 2023. This marks a significant increase of over 30% compared to the previous year, which saw 435 deals, as well as 2021 with 379 deals.
This surge in activity occurred despite ongoing uncertainty surrounding macroeconomic conditions and higher borrowing costs.
According to the report, The UK and Ireland continue to lead the European market for insurance M&A in 2023, witnessing a 31% increase with 232 announced transactions compared to 177 in 2022.
Attention is focused on the Germany, Austria, and Switzerland (DACH) region, which saw 81 deals announced in 2023 compared to 53 the previous year. Notably, 95% of these deals belonged to distribution and service providers. This area is known for being one of the most divided markets in Europe.
FTI Consulting highlights that 87% of the deals announced in 2023 were accounted for by the broking sector, totalling 502 deals.
For all private equity deals, 2023 saw a 39% rise, increasing from 263 announced transactions in 2022 to 366.
The report notes an increase in deal volumes for the carrier sector as well, rising from 58 in 2022 to 72 announced in 2023, primarily in the property and casualty sector.
FTI Consulting concludes, “2023 was another highly active year for insurance M&A across Europe. This was in the midst of continued uncertainty on macroeconomic conditions and much higher borrowing costs. The feeling that there was already an overheated level of activity and valuation also continued.”
“Although we are still not seeing any indicators that activity will decrease in 2024, it may be that as the longer-term impact becomes more apparent, we may begin to see some slowing of activity,” the company adds.
