Agency M&A Drops 19% Through Third Quarter

• By: AnneMarie McPherson Spears
• October 21, 2026

Insurance agency mergers & acquisitions continue to decline in 2026, according to OPTIS Partners, a financial consulting and investment banking firm specializing in the insurance industry.

There have been 439 agency acquisitions from January through September 2026, down 19% from the same period in 2025. Third-quarter 2026 transactions totaled 144, down 27% from third quarter 2025, but up 3% from the second quarter, indicating a slight market rebound.

“Deal flow to date in 2026 is slower than we anticipated. Based on conversations we’ve had and historical trends, we expect Q4 to pick up somewhat but still at a slower pace than prior year-end quarters,” said Steve Germundson, a partner of the firm.

OPTIS Partners notes that industry consolidation continued to narrow, with 82 unique buyers over the past four quarters. The top 10% of buyers account for 55% of the deals completed, compared to 46% in 2021.

And for the first time, unique private equity (PE)-backed buyers outnumbered all other buyers combined, with 43 buyers compared to 39.

PE and hybrid buyers accounted for 3 in 4 of all acquisitions in the third quarter and in 2026 so far. The most active buyers over the past four quarters include BroadStreet Partners with 69 deals, 16% above the previous 5-year average; Inszone Insurance Services with 59 deals, 53% above the 5-year average; and Hub International with 33 deals, 46% below the 5-year average. Only eight firms completed 20 or more deals, the lowest number since 2020.

Although many historically active buyers made fewer acquisitions, OPTIS managing partner Tim Cunningham explained that some big names—Gallagher, Brown & Brown and Aon—have acquired very large PE-backed firms to improve their position in the middle market.

“Most of the private equity-backed platforms still want to make acquisitions but are facing pressure to prioritize deleveraging, integration, and exits over sheer volume,” Cunningham said. “This pulls deal counts down even as capital commitments stay high.”

Among sellers, property & casualty agencies accounted for 67% of this year’s deals. Agencies in both P&C and benefits represented 9%, benefits agencies were at 10%, and all other sellers accounted for the remaining 14%.

“Valuations of agencies with producer-led organic growth, strong benefits books or specialty niches should continue to hold steady,” Cunningham said. “Agencies whose growth came mainly from rate increases will see lower multiples and larger earnouts. If public broker multiples stay depressed, deal pricing is likely to adjust downward.”

“As buyers continue to scrutinize their acquisition targets more closely, it’s ever more important for agency owners who are planning to sell in the next few years to start taking concrete steps now to make their agency a more attractive target,” Germundson said.

Earlier this year, Aon, the third-largest insurance brokerage and professional services firm, announced the signing of a definitive agreement to acquire USI Insurance Services from KKR and other shareholders for $17 billion. The deal is expected to close in the fourth quarter of 2026.

USI, the 10th-largest U.S. insurance broker, provides property & casualty, employee benefits, personal risk and retirement solutions, with approximately $3 billion in annual revenue and more than 10,500 employees in nearly 200 offices nationwide.

The acquisition will substantially enhance Aon’s presence in the U.S. middle-market segment, building on its 2024 acquisition of NFP for $13.4 billion.

AnneMarie McPherson Spears is IA news editor.