Only about 50% of Americans have passports.\u202fIn a country that has everything, why go abroad?\u202fAmerica has a strong isolationist streak, in part because it can.\u202fCompared to Europe it is a closed economy.\u202fStill \u2013 with roughly half of Americans able to travel abroad it\u2019s no wonder that five of the top 10 UK brokers are U.S. headquartered. And that number will likely increase. <\/p>\n\n\n\n
In 2023, IMAS sold to the most active specialist advisor in the U.S. insurance distribution sector, MarshBerry.\u202fThe firm was looking to help support U.S. acquirers seeking to enter the UK market. And IMAS wanted access to their deep U.S. relationships, to provide UK clients with the widest range of buyers. IMAS is now MarshBerry Europe. <\/p>\n\n\n\n
So why are U.S. companies looking to come into Europe (while one notable British broker is actively looking to go into the U.S.)? <\/p>\n\n\n\n
In 2015, the top 10 UK brokers had combined brokerage income of \u00a35 billion. In 2024, this figure increased to \u00a312.0 billion, a 126% increase. The numbers in the U.S. are even more dramatic.\u202fAccording to the Top 100 Insurance Brokers in the U.S. list from Business Insurance, <\/em>there are currently 17 brokers with income over $1 billion and nine with a combined income of $35 billion. To enter the top 10 U.S. insurance brokers\u2019 bracket in 2024, a firm would need a staggering $2.7 billion in revenue. This is compared to just $769 million needed 10 years ago in 2013, a 245% increase in this revenue threshold. <\/p>\n\n\n\n The characteristics that have made UK brokers such attractive consolidation targets in the UK \u2013 high levels of renewal income and consistent demand for their product, across the business cycle and during good times and bad (remember Covid?) \u2013 are equally present in the U.S. The U.S. has the additional benefit of even greater loyalty, partly a function of the geographical spread (across six time zones) in a country that is carved up into 50 states that each regulate their local industry.\u202fThe industry is huge and consolidation has moved at tremendous pace, but in turn this has generated a huge appetite. <\/p>\n\n\n\n In exactly the same way that larger UK consolidators are being forced to look to Europe to generate an acquisition pipeline that is supportive of continued private equity (PE) interest (and cash), U.S. firms are reaching the realization that acquiring in the UK \u2013 and by extension \u2013 Europe, as part of an M&A-driven overseas growth strategy, will help sustain their own momentum.\u202f <\/p>\n\n\n\n MarshBerry Europe hosts meetings between various PE-backed consolidators in the UK and a steady stream of U.S. CEOs, on fact finding trips in London. Whilst many UK consolidators proclaim their determination to remain independent by doing a secondary PE deal or \u2018refinance\u2019 (i.e., selling to another PE firm) rather than a trade sale, they need little persuading to meet with visiting CEOs.\u202f <\/p>\n\n\n\n In the UK, the most far-sighted and ambitious PE-backed consolidators recognise that as the availability of UK assets dry up, they need to source deals in Continental Europe.\u202fBut this will be very tough for those who are late to the game. In the UK, these groups have a network of relationships they can work.\u202fIn Europe, most have almost no relationships at all and even less brand recognition amongst their natural broker targets. <\/p>\n\n\n\n Recognising the growing importance of Europe, MarshBerry launched its first European office in Amsterdam, now numbering 15 staff, in 2021.\u202fWhen UK brokers suggest they have a European strategy because they are in the Republic of Ireland, they conveniently ignore the fact Ireland has a population of just five million. By comparison, Germany has a population of 84 million. <\/p>\n\n\n\n Demand for UK brokers remains strong as it is far easier for consolidators to transact in the UK. But the fate of which consolidators will continue their independent journey will be determined by their ability to complete a continuing stream of significant deals in Europe.\u202fPE-backed consolidators, without demonstrable success in Europe, will themselves be consolidated, most likely by one of the \u2018Big Six\u2019 (Aon, Ardonagh, Gallagher, Howden, Marsh, Willis), or by the U.S. brokers looking to enter the UK and who are now spending time in the MarshBerry Europe offices, learning about the UK market from our research, and meeting with the PE-backed consolidators and the few larger UK firms who have remained independent. <\/p>\n\n\n\n For the latest insights and analysis into the UK insurance distribution landscape and industry trends \u2013 download MarshBerry’s I<\/a>nsurance Distribution Market Report – UK<\/a><\/em><\/p>\n","protected":false},"excerpt":{"rendered":" Only about 50% of Americans have passports.\u202fIn a country that has everything, why go abroad?\u202fAmerica has a strong isolationist streak, in part because it can.\u202fCompared to Europe it is a closed economy.\u202fStill \u2013 with roughly half of Americans able to travel abroad it\u2019s no wonder that five of the top 10 UK brokers are U.S. […]<\/p>\n","protected":false},"author":7,"featured_media":5747,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"_acf_changed":false,"footnotes":""},"categories":[20],"tags":[],"mu_industry":[],"class_list":["post-5746","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-m-a"],"yoast_head":"\n