M&A activity increased in the first half of 2021 in most insurance sectors but not in the P&C sector.
According to Deloitte’s Midyear Insurance M&A Outlook, the number of mergers and acquisitions has increased 18% since the start of the year and the overall deal value is about four times higher than in 2020.
While the total volume of transactions is on track to overtake the calendar year 2020, activity in the property and casualty insurance sector is on the decline in 2021, with 18 transactions to date compared to 24 in the same period. ‘last year. Deloitte attributed this to the current environment of rate tightening more than any other factor, which may cause insurers to seek value in non-core legacy products and businesses.
Deloitte said companies are considering a broader definition of mergers and acquisitions to include acquisitions, divestitures, alliances, partnerships, ecosystems and investments that can help them improve their portfolios, enter more market segments. profitable and accelerate the digital switchover.
Insurtechs continue to be investment vehicles, partners and desirable acquisitions in 2021, Deloitte said, noting that the technology also continues to be a way for insurers to complement their existing product line, as well as to diversify to offer multiple services, as shown by the recent agreements concluded by Next, Porch Group and Hippo.
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