As 2025 draws to a close, the insurance broking sector finds itself at a subtle but meaningful turning point. Merger and acquisition (M&A) deal activity remained solid, capital stayed available and investor appetite did not disappear. Yet beneath the surface, the growth dynamics that had supported the industry for much of the past decade began to change. This was the year in which insurance broking could no longer rely on favourable market conditions alone and was forced to confront more structural questions around growth, positioning and long-term value creation.
The end of easy organic growth
One of the defining shifts in 2025 was the move away from a prolonged hard market towards more mixed and gradually softer conditions across the insurance landscape. After many years of strong pricing, additional capacity and a more stable loss experience began to slow rate momentum in areas such as liability and property. Personal lines, particularly motor, continued to face pricing pressure, while specialty lines remained volatile.
This shift made growth more demanding. With pricing no longer lifting results across the board, revenue growth increasingly depended on winning new clients, deepening relationships and broadening service offerings. Firms with a clear sector focus, strong commercial discipline and active sales cultures were better equipped to adapt.
M&A remained active, but more deliberate
Despite broader market shifts, M&A activity in insurance broking remained resilient throughout 2025, especially across continental Europe. Deal volumes continued at a solid pace, supported by a broad base of strategic buyers and financial investors with capital to deploy. In contrast, the UK market saw noticeably fewer announced transactions than in recent years, with deal counts down substantially compared with 2023 and 2024 as the domestic consolidation wave matured and available targets thinned.
Buyer behaviour also evolved. Acquisitions were increasingly targeted at strengthening specialty capabilities, building regional density and underpinning defined platform strategies rather than simply accelerating scale. Greater weight was placed on earnings durability, client retention and integration readiness, leading to more selective processes and clearer differentiation between assets.
Valuations and a more differentiated market
Valuation dynamics in 2025 became more nuanced and more closely tied to consolidation cycles and exit realities. Many private equity-backed platforms are now operating under second-round ownership, having entered at historically high multiples. As expectations around achievable exit pricing became more realistic, this discipline filtered through the market. Buyers became more cautious on bolt-on pricing, placing greater emphasis on earnings quality, integration risk and the credibility of post-transaction value creation, rather than paying up simply to sustain growth momentum.
As a result, valuation outcomes increasingly depended on how well a business was positioned and how broadly it was marketed. In a market with a diverse buyer universe, spanning strategic acquirers and financial sponsors at different stages of their investment cycle, creating the right competitive tension mattered more than ever. Clear positioning, credible equity stories and disciplined M&A advisory proved critical in translating underlying quality into strong valuation outcomes.
Integration, talent and execution risk
Another important lesson of 2025 was the renewed emphasis on integration as a core driver of value creation. Experience from recent transactions reinforced that scale alone does not deliver results unless systems, data and governance evolve alongside it. Several acquisitive groups deliberately moderated their deal pace during the year to focus on operating model consistency, technology integration and decision-making structures, recognising that complexity compounds quickly once platforms reach a certain size.
At the same time, AI emerged as a clear upcoming trend rather than a distant ambition. Broking firms increasingly explored the use of AI and advanced analytics to streamline placement processes, improve data quality, support client servicing and reduce administrative burden. While adoption is still uneven, the direction of travel is clear: firms that combine AI initiatives with strong data foundations and integrated workflows are better positioned to translate technology into practical productivity gains rather than isolated pilots.
Talent remains a structural challenge. Years of sustained M&A activity have contributed to experienced professionals leaving the sector, while regeneration from younger talent has been inconsistent. This has sharpened the focus on execution capability: the ability to integrate acquisitions, deploy new tools and consistently win new business ultimately depends on people. Not all platforms are equally prepared, and the gap between those that invest in talent, skills and culture and those that do not is becoming increasingly visible.
Carriers and MGAs reshape the ecosystem
Insurers and reinsurers also adjusted their approach during 2025. Even as pricing softened in some lines, underwriting discipline remained firm. Capacity was available, but increasingly allocated to distribution firms that could demonstrate strong risk selection, data quality and claims performance. Distribution relationships became more selective and more evidence-driven.
Alongside this, the managing general agent (MGA) market continued to move into the mainstream. Capital-light underwriting models, fronting solutions and specialist capacity gained further traction. MGAs increasingly play a central role in the distribution ecosystem.
Looking ahead
In hindsight, 2025 will be remembered as a year of recalibration for insurance broking. Growth did not disappear, but it became harder, more uneven and more dependent on execution quality. Consolidation remains a powerful force, but its success increasingly hinges on integration, talent and genuine commercial capability. As the sector moves into 2026, the message from 2025 is clear: scale still matters, but sustainable growth now demands far more than simply doing the next deal.
