Global M&A Resurgence in 2025 - Insurance Industry Insights
Global M&A Activity in 2025: Insurance Industry Dynamics
In 2025, global mergers and acquisitions (M&A) experienced a significant resurgence, particularly in the insurance sector. According to McKinsey's annual M&A report, the total value of global deals surged by 43% to $4.7 trillion, compared to $3.3 trillion in 2024. This reflects a 20% increase above the ten-year average, highlighting a shift towards technology-focused targets and strategic portfolio management within the industry.
Executives are increasingly leveraging M&A to adapt to geopolitical and macroeconomic challenges, prioritizing the acquisition of capabilities and strategic cost management. With only a third of executives confident in managing external challenges, strategic buyers are favoring M&A over solely relying on organic growth, amid rising regulatory compliance requirements.
Digital and tech-enabled sectors were key drivers of M&A value, constituting around 40% of 2025's deal value, up from just 7% two decades ago. The insurance industry, in particular, is focusing on acquiring assets in data and analytics, cyber and digital infrastructure, and health technology. This trend aims to enhance underwriting, pricing, fraud prevention, and claims processing capabilities.
In the financial services area, deal value rose by 43% to approximately $660 billion, driven by market consolidation in Europe and opportunities in the U.S. banking industry. The insurance sector continues to see consolidation and distribution expansions through broker and MGA acquisitions, despite specific insurance figures not being provided.
Portfolio optimization is another key trend, with life and annuity back-book disposals and divestitures reaching $1.6 trillion in 2025, a 30% increase since 2021. Private equity plays a vital role in transforming insurance operations, with investments in specialty carriers, underwriting, and claims and administration technology.
Regionally, the Americas led the M&A rebound, with the United States seeing a 64% increase in deal value to $2.9 trillion. Asia-Pacific experienced a 21% rise to $825 billion, while EMEA recorded a 16% increase to $998 billion. These trends were driven by cross-border M&A activities, larger transactions, and portfolio restructurings.
Technological advancements, including AI and generative AI, are streamlining deal cycles and lowering M&A costs. This technological shift intensifies competition for tech and data assets, maintaining high valuations for attractive opportunities. Insurance executives are advised to focus on portfolio optimization and data-driven assessments to navigate the evolving M&A landscape effectively as they approach 2026.