2018: Global Insurer Mergers & Acquisitions in 2017 - Repositioning to Face the Future

Price : $1,750.00

Conning’s annual insurance M&A study examines insurer mergers & acquisitions — both U.S. and non-U.S. — for 2017 and historically. The study includes in-depth analysis of emerging or expected trends across three insurance sectors—property-casualty, life-annuity, and health/managed care. The study also explores the patterns of insurance M&A activity, the motivations behind key individual transactions, and their financial characteristics, yielding valuable insights into the direction of future M&A for market participants and investors. This comprehensive global insurance M&A analysis provides a listing of key transactions announced in 2017 and in early 2018.

1. Introduction 

2. Executive Summary 

3. Property-Casualty Overview 

  • Themes

  • Key Drivers

  • Subsectors

  • Outlook for 2018

4. Life-Annuity Overview 

  • Largest Life-Annuity M&A and Discrete Block Transactions

  • Life-Annuity M&A History

  • Themes

  • Outlook for 2018

5. Health Insurance/Managed Care Overview 

  • Overview

  • Themes—Three Themes Become Two

  • Outlook for 2018

6. Non-U.S. Insurance M&A 

  • Regulatory and Political Drivers

  • Rest of North America

  • Europe

  • Asia-Pacific

  • Latin America

  • Africa and Middle East


A. Methodology and Criteria for Inclusion in Mergers & Acquisitions Database

B. Series of Recurring Mergers & Acquisitions Studies

C. Historical Summary Data

D. 2017 Mergers & Acquisitions by Sector


Insurer M&A (merger and acquisition) activity in 2017 followed the moderate levels seen in 2016. In 2017, the number of transactions announced was approximately the same as 2016, and the aggregate value rose. The higher value in 2017 was mainly the result of the announced $69 billion acquisition of Aetna by CVS. Without this transaction, the aggregate value of activity was only slightly ahead of last year. Among the reasons 2017 M&A activity was more sluggish than otherwise would be expected in an environment of moderate economic growth was uncertainty prevailing throughout the year regarding the shape of tax reform, which finally unfolded in December with passage of the Tax Cuts and Jobs Act.

There was a shift in the character of insurer M&A from prior years. Whereas as recently as 2015, there were landmark transformative consolidation transactions among primary insurers and reinsurers, in 2017, most of the activity was tactical. It mainly featured bolt-on property-casualty specialty acquisitions, run-off dispositions in both the life and property-casualty sectors, and vertical integration in the health/managed care sector. Large-scale consolidations were conspicuously absent—the recurring theme seen in many transactions was tactically driven divestitures and acquisitions to reposition insurers to face the future. Building an “all things to all people” insurance supermarket was clearly out of vogue, and insurers actively exited underperforming lines and entered specialty segments offering healthier growth and margin prospects.

Factors hindering traditional consolidation activity in 2017 included uncertainty surrounding unfolding U.S. political and regulatory developments and some would-be property-casualty acquirers still preoccupied with integrating large acquisitions made in recent years. In the life sector, much of the activity included Asian buyers and targets. Life-annuity M&A activity in the U.S. and Europe was characterized by life insurers disposing of annuity units experiencing spread compression or banks offloading insurance operations. Many acquirers were financial buyers, attracted to the asset management business available via the life and annuity insurers. In the health/managed care sector, the headline transactions were insurers acquiring health care providers or being acquired by health care providers to expand from purely insurance to a broader range of services for customer health improvement.

In all sectors, both the U.S. and internationally, regulatory action played a stronger role stimulating some transactions and arresting others. Numerous attempted acquisitions by Chinese buyers were aborted following heightened scrutiny by regulators in the U.S., China, and Israel. More stringent solvency standards in Asia and in post-Solvency II Europe led insurers to shed capital-consuming, underperforming units.

In 2018, property-casualty insurer M&A activity targeting specialty insurers or niche business lines, as well as life insurers carving out or running off underperforming units, will remain strong themes. This trend creates insurers with sharper focus and is likely to continue and strengthen beyond 2018 as insurers avail themselves of richer data and analytics to provide products and services in line with customers’ rising expectations. However, the scarcity value of high-value specialty targets, reflected in rich multiples associated with acquiring such targets, will be a deterrent. Technology, already seen as a driver, also will spur M&A, as insurers seek to gain competitive advantage by acquiring insurers and InsurTech firms with advanced capabilities, rather than develop technology in-house.

In this study, Conning’s 28th annual in-depth listing and analysis of insurance mergers and acquisitions, we present data and analysis of merger activity in the property-casualty, life-annuity, and health insurance/managed care sectors announced in 2017 and early 2018. A separate Conning study focuses on insurance distribution and insurance service sector M&A. The appendices include the methodology and criteria for inclusion of transactions in our database, as well as a detailed listing of 2017 transactions by sector.