M&A in Insurance Distribution Continues to Soar to Record Heights


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Welcome to iLeads Insurance Market Minute, where we bring you the latest, most relevant news regarding the insurance market. Last week you were reading COVID-19 Vaccine Administers A Big Dose Of Risk To The Insurance Industry. This week we’re bringing you: 


Liberty Mutual reports significant increase in Q4 net income*

Liberty Mutual Holdings Co. Inc. on Tuesday reported net income of $162 million for the fourth quarter of 2020, compared with a net loss of $301 million in the year-earlier period, due to favorable core underwriting results across the insurer’s Global Retail Markets and Global Risk Solutions businesses and strong investment returns.

In an earnings call Wednesday detailing the results, Liberty Mutual executives said the company had received more than 20,000 claims related to last week’s adverse weather events, primarily coming from policyholders in Texas and Oklahoma.

“It’s a little too early to frame what the total loss could be,” said David Long, Liberty Mutual’s chairman and CEO. “It’s going to be ugly, but not ugly enough to have reinsurance kick in.”

The Boston-based insurer’s net written premium for the quarter was $10.1 billion, a $344 million increase over the fourth quarter of 2019, and its combined ratio for the quarter was 101.9%, an improvement of 4.8 points from the same period in 2019.

Find out more in-depth here.


Private healthcare is increasingly attractive as COVID-19 overworks public systems: Medibank*

Craig Drummond, CEO of Medibank, talks about what COVID-19 means for health insurers, on the back of their H1 earnings report.

Watch the video here.


M&A in insurance distribution continues to soar to record heights*

RESILIENT. It’s a term often used to describe the insurance distribution market, and one that continues to attract the hungry eyes of the investment community. Despite the COVID-19 pandemic and resulting socio-economic challenges – a global recession and strained labor market, to name two – the insurance distribution sector has remained resilient. As such, it is no surprise that merger & acquisition (M&A) activity in insurance distribution soared to record heights in 2020.

Deal activity got off to a roaring start last year. Buzzing with energy after a record year of transactions in 2019, well-capitalized acquirers (both private equity-backed and public companies) continued to build on their momentum and snap up insurance distribution firms. Many of the completed deals in January and February were negotiated and agreed back in 2019, before the global coronavirus pandemic pressed pause on the world as we knew it.

In March 2020, when the World Health Organization (WHO) declared the COVID-19 outbreak a global pandemic, the economy screeched to a halt. Credit markets froze for several weeks and insurance distribution M&A activity petered off as buyers and sellers tried to assess the potential impacts of the pandemic and figure out all aspects of their businesses and financing for potential deals.

Find out more in-depth here.


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