Insurance agency M&A volume fell to 292 deals in the first half of 2026, the weakest half-year tally since 2016, according to OPTIS Partners’ latest North American broker M&A tracker. The headline number is down 15% from 342 deals in H1 2025 and 24% below the previous five-year average. The more revealing shift, though, is in how OPTIS itself now explains the slide: not as buyers pulling back, but as sellers drying up.
The story shifts from tired buyers to thin sellers
OPTIS Partners counted 292 acquisitions in the first half of 2026, a pace the firm says is the weakest for a first half since 2016. But the framing has moved. OPTIS now describes the drought as a slide stretching back nearly four years that may be nearing its floor — a materially different diagnosis than the one it offered three months earlier. In its Q1 2026 update, covering 148 deals (16% below the previous five-year Q1 average and the lowest first-quarter volume since 2016), OPTIS measured the same downturn as a three-year slide in deal volume it expected to settle around a mid-600s annual pace. Read literally, OPTIS revised how long agencies have been retreating from the market — from three years to nearly four — inside a single quarter.
The pivot matters for anyone reading the market. If the slowdown were a demand problem, it should ease as buyers’ capital gets deployed. If it is a supply problem — fewer owners ready to sell, and the ones who are willing bringing weaker books — the constraint could persist no matter how much dry powder is stacked up on the buy side. OPTIS’s own commentary points toward the supply reading: the firm notes that valuations are holding up for larger, well-run firms while softening for others, a divergence it warns could widen further if the economy slows or insurance-market headwinds increase. That is not a description of buyers losing interest. It is a description of a shrinking pool of sellers worth paying full price for.
Private equity keeps the market’s floor in place
Whatever is constraining supply, it has not dented private capital’s appetite. Private-equity-backed and hybrid buyers accounted for nearly 75% of all transactions over the trailing 12 months, and 80% in the most recent quarter alone. That is not a new development: in its year-end 2025 report, OPTIS found the same buyer group closed 73% of 2025 transactions, consistent with the 69%-75% share it has held every quarter for the past seven years. Roll-up buyers built on that capital have not slowed either — BroadStreet Partners was the most active acquirer over the trailing 12 months, with 67 deals versus its previous five-year average of 60, and BroadStreet also led all buyers in H1 2026 with 37 transactions, just below its 39 in H1 2025.
The pullback is concentrated among smaller, non-PE-backed acquirers instead. Privately-owned buyers completed 106 deals over the trailing 12 months, down 28% from 147 a year earlier — a far steeper drop than the market overall, and the clearest evidence that it is deal flow at the margins, not appetite among scaled consolidators, that has thinned. That divergence sits alongside broader questions about how PE-backed brokers scale: S&P has already flagged integration disputes as a signal of execution risk in broker roll-ups at one major consolidator, a reminder that the buyer side of this market carries its own strains even while it keeps closing deals.
Marquee deals still close while the pipeline thins
The largest deals of the cycle have kept closing on schedule even as the overall count shrinks. AssuredPartners, with $2.9 billion in revenue, was acquired by Arthur J. Gallagher & Co. in January 2025, the biggest transaction of last year by OPTIS’s count. More recently, Willis Towers Watson completed its acquisition of Newfront on January 27, 2026, a deal WTW said “expands its U.S. middle market capabilities and enhances its position in high-growth sectors including technology, fintech and life sciences.” And in July, Arthur J. Gallagher & Co. acquired Med James, a managing general agency and wholesale broker serving retail agents, folding the firm into its Risk Placement Services unit under its existing regional leadership.
None of that reads like a buyers’ strike. It reads like a market where the largest, best-run targets still command full attention and full price, while the volume of everything else keeps sliding — a dynamic that also shows up in how brokers are choosing to grow at all: AI and technology investment is increasingly framed as the next lever for broker growth, an alternative to buying scale when there simply aren’t enough sellers to buy.
OPTIS keeps declaring the bottom — and keeps revising it
Zoom out to the trailing-12-month window and the plateau looks even flatter. Trailing-12-month deal volume stands at 646 transactions, the lowest since Q1 2019, down 17% from 783 in the 12 months ended June 2025. Full-year 2025 closed at 695 total deals, down 12% from 787 in 2024 and 24% below the five-year average, with Q4 2025 alone falling to 157 deals — the lowest quarterly count since 2019, and 47% below the five-year average.
OPTIS has now pointed to something close to a bottom twice within six months — first a mid-600s annual run rate in its Q1 2026 report, then a revised timeline stretching the “slide” itself from three years to nearly four in its H1 2026 update. Both calls could still prove directionally right. But the shift from a demand story to a supply story changes what a genuine turn would look like: not a rebound in buyer interest, which by the private-equity numbers never actually left, but a return of sellers — including the smaller, non-PE-backed owners whose ranks have thinned fastest. Until that happens, 292 deals may be less a floor than a snapshot of how few agencies are currently for sale.
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