M&A Deal Volume Declines but May Be ‘Bottoming Out’
The downward trend of M&A Activity appears to be bottoming out according to the latest quarterly report from OPTIS Partners. The pace of insurance agency mergers and acquisitions in the United States and Canada declined modestly in the first quarter of 2026, with 148 announced transactions in Q1 2026.
This amount represented a 6% decrease from the same period in 2025. The quarter marked the 10th consecutive period in which deal volume remained below the long-term trend line.
“The industry has ridden down a three-year slide in deal volume, which we believe is beginning to bottom out to about 650 deals per year,” said Steve Germundson, a partner at OPTIS.
Private Equity-Backed Buyers Continue to Dominate
Buyer activity remained concentrated among private-equity-backed firms. Of the 55 unique buyers active during the quarter, 29 were backed by private equity, including four making their first acquisition. Another 19 buyers were privately held, with five new entrants.
Private-equity-backed buyers accounted for 72% of all transactions in Q1. In addition to insurance brokers such as BroadStreet, this category now includes institutional capital sources such as family offices, pension funds, and sovereign wealth funds.
Inszone and BroadStreet Lead M&A Activity
Inszone Insurance Services and BroadStreet Partners were the most active acquirers in the quarter, completing 17 and 16 transactions, respectively. Inszone doubled its deal activity compared to the prior year, while BroadStreet’s volume remained consistent.
World Insurance Associates followed with nine deals, in line with its activity in Q1 2025, and ALKEME completed seven acquisitions. Six additional firms reported at least five transactions during the quarter.
OPTIS noted that several historically active buyers—including Hub International, Keystone Agency Partners, Highstreet Insurance Partners, and King Risk Partners—completed fewer deals in Q1.
P&C Agencies Account for Majority of Sellers
Property and casualty agencies continued to represent the largest share of sellers, accounting for 101 transactions, or 68% of total deal volume.
Combination P&C and employee benefits firms represented 15 deals (10%), while standalone employee benefits agencies accounted for 14 transactions (9%). The remaining 20 deals (13%) involved other types of firms, including third-party administrators, managing general agents, and businesses focused on life insurance, investment management, or consulting.
Supply of Smaller Firms Drives Long-Term Outlook
OPTIS Managing Partner Tim Cunningham said the current buyer landscape—comprising approximately 30 active private-equity-backed brokers along with private and public buyers—continues to support demand for acquisitions.
“The vast majority of the 25,000 to 30,000 firms nationally are very small and will have to be sold eventually,” Cunningham said. “We are seeing an emerging group of new ventures backed by private-equity and family-office capital pursuing this group because of the large supply of future sellers, enhancements in technology, and long-term changes in the way insurance at the smaller end will be sold and serviced.”
Cunningham added that somewhat larger firms are also drawing interest from buyers due to relative scarcity and operational improvements. “Many of these firms will also be sellers in the not-too-distant future,” he said.
He also noted continued formation of new firms by production teams leaving existing organizations, a trend expected to persist.
Report Availability
The full OPTIS Partners Q1 2026 Merger & Acquisition Update can be accessed here: Q1 2026 Merger & Acquisition Update » Optis Partners
