Consolidation in the broker market reached new levels in 2006 with firms being bought at a rate of more than one a week, research by consultancy firm JCL Hansen Young has revealed.
The research suggests that 80 takeovers were completed last year. Lockton's buy-out of Alexander Forbes Risk Services was the largest deal in brokerage terms with an £84m turnover.
The report names Equity, Towergate, Oval and Jelf as the biggest consolidators of the year.
Towergate completed 12 acquisitions, while Equity made 11 and was subsequently acquired by Insurance Australia Group (IAG).
IAG's entry into the UK motor market, with its acquisitions of Hastings Insurance Services and Equity, gave it access to £695m of GWP.
Douglas Young, consultant with JCL Hansen Young, said distribution had be-come the key focus in 2006.
"The original Cullum [Peter Cullum, chairman of Towergate] mantra of 'distribution, distribution, distribution' has taken hold of the market," he said.
Dave Smith, intermediary director for Zurich, said 2006 was a defining year for buy-outs.
He said: "Consolidation was not a 2006 phenomena. It has been developing over the last few years – 2003 to 2005 were positioning years, and 2006 was the year for realising that."
