By Erin Ayers, Front Page News
Insurance agent and broker mergers and acquisitions (M&A) fell 19% year-over-year with 439 transactions announced in the first three quarters of 2026, with Q3 dropping 27% from the prior-year period, according to a new report from OPTIS Partners.
“Deal flow to date in 2026 is slower than we anticipated. Based on conversations we’ve had and historical trends, we expect Q4 to pick up somewhat but still at a slower pace than prior year-end quarters,” said Steve Germundson, partner at OPTIS.
The third quarter of 2026 did pick up pace slightly from Q2, per the report, with 144 deals announced over Q3 2025’s 140. However, third-quarter activity remains 40% below the five-year average and year-to-date M&A volume has fallen to levels not seen since 2018.
BroadStreet Partners led the field with 69 reported deals over the past four quarters, a 16% uptick from the firm’s five-year average. Inszone Insurance Services posted 59 reported deals, 53% above its previous 5-year average, while HUB International announced 33 deals, 46% below its previous five-year average.
PE-backed or hybrid buyers accounted for 76% of all acquisitions in both Q3 and year-to-date, according to the report.
The OPTIS team noted that Gallagher, Brown & Brown, and Aon made fewer acquisitions to date in 2026, but these firms also “strategically acquired” large private-equity-backed brokers to tap into the growing U.S. middle market business sector.
“Most of the private equity-backed platforms still want to make acquisitions but are facing pressure to prioritize deleveraging, integration, and exits over sheer volume. This pulls deal counts down even as capital commitments stay high,” said Tim Cunningham, OPTIS managing partner.
However, OPTIS predicted recapitalization and large transactions over the next few years, along the lines of WTW’s acquisition of Newfront, Aon’s purchase of USI, and The Baldwin Group’s recent move to become a privately held company.
Agencies looking to sell will also see plenty of competition.
“Valuations of agencies with producer-led organic growth, strong benefits books or specialty niches should continue to hold steady,” Cunningham said. “Agencies whose growth came mainly from rate increases will see lower multiples and larger earnouts. If public broker multiples stay depressed, deal pricing is likely to adjust downward.”
Germundson noted, “As buyers continue to scrutinize their acquisition targets more closely, it’s ever more important for agency owners who are planning to sell in the next few years to start taking concrete steps now to make their agency a more attractive target.”
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