Insurance M&A Outlook for 2024

The first month of 2024 is behind us, and headlines are highlighting multiple indications of market trends. Unemployment is increasing, inflation is trending down, and the economy is cooling overall. With expected rate cuts, is a soft landing projected for the Insurance M&A market?

Let’s dive into the topic.

We have reason to predict that rate increases will be modest, mitigating the potential pressures on agencies to maintain their customer base. In fact, we may yet see carrier markets stabilize entirely.

Insurance as an industry is a non-negotiable commodity because there are legal requirements for individuals and companies to carry and/or offer insurance. As a direct consequence of this reality, our industry remains robust and stable overall.

GDP growth is predicted to rise only modestly, which has some of our clients feeling bearish regarding the insurance sector. We encourage owners to look for regional niches or products that are trending up.

Insurance M&A Outlook

We have the pleasure of confirming that Insurance M&A activity is going strong, with five-year trends showing that the average age of sellers continues to drop. Buyers, we urge you to work with us to refine your strategies for working with this new generation of agency sellers.

Insurance agency owners can still secure high valuations with strong, positive leadership and the promise of longer involvement after transition. Springtree Group urges buyers to invest in the successful integration of an agency and its employees.

Insurance agency buyers are looking for agencies with specific characteristics and a solid history of steady organic growth.

Sellers, we have released multiple guides on preparing your agency for sale and shall do so in 2024. We strongly encourage you to refer to these guides and take steps to position your business to attract the best possible offers.

“I want to sell my agency ASAP.”

We dissuade owners from attempting to sell their agencies without first striving to improve growth and overall regional presence. In doing so, you’ll meet savvy buyers who will offer scrutiny instead of a respectable offer.

Stay the course. Bring your agency up to a competitive level, and then we can subsequently position your business to snag top-dollar offers.

Slow and Steady Wins the Race.

Focus on your agency’s fundamentals. Buyers are looking for high-quality books, a niche position within the sector, and a robust financial history with evidence of regular, organic growth. Another must is tenured staff who are licensed, experienced, and have a history with your agency.

Reach Out to STG

Springtree Group wishes you a prosperous 2024! If you are in need of assistance, please contact us right away. We look forward to partnering with you to achieve your goals.