The global insurance industry’s outlook is improving. The mature economies of Europe and North America are moving towards recovery, while the emerging markets of Asia and Latin America continue to grow. A pickup in global premiums is forecast, but the industry should not expect a return to the old ways. Insurers are operating in a world where the goal of long-term growth seems to be getting further away. Instead, insurers face a range of obstacles including persistently low investment yields, tightening regulation and overcapacity in many markets.
As insurers adapt their business models to this new environment, the strategic importance of M&A is again increasing. However, we do not expect transaction volumes to recover along the same lines as during the last decade. Instead, we predict the next few years will see a quiet revolution in global insurance M&A.
In this paper we make seven overarching predictions for the coming three to five years and we look at the economic, demographic, technological and regulatory factors driving change in insurance M&A.