After a hot summer where sector mergers and acquisitions (M&A) activity has been muted (there have only been 18 announced deals between June and August, the lowest number since 2017), it is easy to tell ourselves that the summer is always a bit slow and that as the schools go back we might look forward to a pickup in deal activity. Alas, the statistics do not really bear that out. Of the 1,200+ sector deals since 2016, 24% have announced between June and August. There is no real summer slowdown in M&A.
There were seven new deals in August, the same number as last August. In only one month in 2026 (April) has the number of new deals reached double digits. This is the new normal, for the time being at least. But looking beyond the reduced volume of transactions, what deals are being done, and what (if anything) do they tell us about the direction of travel for sector M&A?
M&A Market Update
With only seven new deals in August, on a year-to-date (YTD) basis there have been 56 announced M&A transactions in UK insurance distribution, 16% lower than the 67 transactions announced at the same point in 2025. In both 2023 and 2024 there had been more than 100 sector deals by the end of August. M&A activity has been running at a similar level for more than 18 months now, which is too long to be passed off as a blip.
On the demand side it is difficult to conclude that there is any shortage of buyers. Several of the most voracious acquirers of recent years have either slowed down and become more selective or paused their UK buying. This will be temporary – in a mature sector where organic growth is so hard to come by, M&A is an almost universal strand of strategy for larger commercial brokers. And as some of these groups have slowed, newer buyers have stepped in or stepped up, including well-resourced overseas names (Odealim, AUB, DOXA and ANV) and domestic buyers seeking to deploy freshly raised capital (Jensten JMG Group and Seventeen, who have all recently refinanced). There have been 32 different buyers of UK targets in 2026 so far. Businesses coming to market find there is no lack of buyer interest, as good businesses (and frankly also some mediocre ones) are still seeing plenty of interest.
The picture on the supply side is more nuanced. There are fewer saleable brokers around than there used to be. Everyone knows the 3,500+ figure – the number of insurance intermediary firms in the UK – but not everyone properly understands it. It is a suitably large figure that it can be easy to assume a nearly unlimited supply of targets. However, the smallest 3,000 firms in the UK would collectively not be a top five player in the UK market in terms of total brokerage. They are in a market that has been very heavily picked over. Certainly there are some very well run, ambitious and exciting firms at this level, but they are the exception. The future Premiership star playing Sunday League football. Most of these firms are very small. Many are lifestyle businesses, and very few are growing. They are not always suitable or attractive for the main industry consolidators, for whom sourcing, acquiring and integrating them involves cost and risk.
Furthermore, the value of these businesses has in many cases decreased over the past two years. The soft market is impacting income and profits. At the same time, the tax payable by a seller following a disposal has increased. The owners of these businesses typically need the income they produce. There will always be a flow of retirement sales, but market conditions are reducing the impetus for many to consider exploring a sale in 2026, reducing the number of available and actionable targets for sale.
Continuing interest in specialty business – from overseas and domestic buyers
The biggest deal of the month was Tokio Marine HCC’s acquisition of Direct Commercial, the market-leading MGA (managing general agent) focusing on fleet and haulage. This was the second large MGA deal in as many months, following Optio’s refinancing last month. Tokio is obviously an overseas buyer, but what is more noteworthy is that it is a carrier. A major insurer buying an MGA on this scale is increasingly rare. Brokers and private equity (PE) have been by far the most active buyers of MGA business in recent years and while there are no immediate signs that this is likely to change, sellers of MGA businesses and their advisers will need to remain attuned to whether there is a carrier out there who might be relevant and competitive as a buyer.
The DCL deal also sees PE firm CBPE exiting. This is the sixth PE exit of 2026. And as with Prestige’s sale to AUB in January, it was a sale to an overseas-listed owner. New PE capital has come into the sector in 2026, both directly and to support portfolio company acquisitions, but it is not one-way traffic. A handful of large PE exits can result in a net outflow of PE capital over the course of a year. This may happen again in 2026. The same could also be true the U.S. this year – the announcement last week that Aon has agreed to acquire KKR-backed USI for $17bn is a massive flow of capital from the private to public markets. PE capital has been and remains a key driver of industry consolidation, and so these flows are an important part of understanding the direction of travel for sector M&A.
M&A involving a specialty target (MGA and wholesale business, including Lloyd’s broking) as a proportion of all sector M&A is running at the highest level ever (29% of all 2026 deals on a YTD basis). Three of August’s seven deals were for specialty businesses, with Clear Group announcing a deal for Lloyd’s broker Newman Pearce, which will further build out its London Market presence alongside Lilley Plummer Risks. Several other commercial-broking led groups are expected to add additional MGA and Lloyd’s capability in the coming months, as part of a trend we expect to continue through 2026 and 2027.
Notable transactions (August 2026):
- As noted above, Tokio Marine HCC, which is already active across multiple classes of business in the UK, announced a deal for Direct Commercial, the market leading fleet and haulage MGA based in Chelmsford and led by Phil Cunningham. Direct Commercial had taken investment from PE firm CBPE in 2022.
- In a deal that expands its footprint northwards and further reinforces its ambition as an acquirer in the sector, Adler Fairways announced a deal for Mason Owen Financial Services, a Chartered commercial broker based in Liverpool, with a further office in Norwich.
- Clear Group announced that it had acquired Newman Pearce & Partners, a Lloyd’s broker based in London and arranging mainly international business. The acquisition will combine with Lilley Plummer Risks to expand Clear’s existing London Market presence.
Other transactions (August 2026):
- The Broker Investment Group (TBIG) announced that it has acquired a 70pc stake in Magnet Insurance, a non-standard household specialist based in Newark that also operates a number of specialist schemes for hobbyists.
- Seventeen Group continued its recent strong run deals with the acquisition of Titan Insurance Services, a commercial broker in London.
- Jensten Group announced that it had acquired Coversure Midlands, the largest franchise in its Coversure network, with three offices and around 30 staff.
- In its third UK deal of the year ANV, the MGA platform spun out of US insurer AmTrust, announced a deal for Car Care Plan, a leading warranty MGA that serves OEMs and dealers in the UK and multiple overseas jurisdictions. Car Care Plan was sold by AmTrust Financial Services.
Note – not shown in August but now included in YTD deal statistics is the acquisition of Chase Side Insurance Solutions, a Chartered broker based in London, by Partners&. The transaction was completed in June but not previously identified.
