UK insurance M&A deals rose last year after slower 2023

A wave of banking and insurance deals pushed the volume of UK financial services M&A to its highest level in more than a decade last year, according to new data.

After a slowdown in 2023, M&A activity in the UK’s financial services industry rebounded in 2024, with a 26% year-on-year increase in the number of deals according to figures from Ernst and Young LLP’s (EY) latest financial services M&A analysis.

The number of deals registered rose from a value of £12.5bn in 2023 to £20.2bn in 2024.

The number of UK insurance deals rose from 112 in 2023 to 188 in 2024, with total publicly disclosed deal value increasing from £3.7bn to £4.6bn.

As for UK financial services firms acquiring overseas targets, this rose from 65 deals in 2023 to 97 deals in 2024. For example, in October 2024, Specialist Risk Group bought a business in Singapore.

Richard Battersby, UK insurance strategy and transactions leader at EY, said: “The focus on cost efficiencies, scale and simplification of operating models and product ranges is motivating both acquisitions and sales of insurance businesses.”

For example, in December 2024, Gallagher confirmed that it had agreed to buy AssuredPartners – which employs 10,900 staff across 400 offices – with the hope that its new purchase will help scale its UK and Ireland arm, as well as expand its retail middle market P&C proposition.

UK financial services

EY considered transactions that took place between 1 January 2024 to 31 December 2024 for the analysis.

Deals where it was disclosed that less than 20% of the company was acquired were excluded.

Overall, the UK financial services industry – including banking, insurance and asset management – reported that 380 M&A deals in 2024, the highest annual volume since 2012 – compared to 272 deals in 2023.

Damian Hourquebie, UK financial services strategy and transactions leader at EY, said: “UK financial services M&A activity reached its highest annual volume in more than a decade in 2024, as material signs of economic recovery lifted market confidence, valuations rose and inbound deals increased.

“While there are real signs for optimism, a sense of macroeconomic uncertainty and geopolitical tensions further abroad could create headwinds as we look to the year ahead.

“However, if the UK’s economic outlook continues to gradually improve as expected, we anticipate the focus on M&A activity will continue throughout 2025 as confidence grows and firms accelerate plans to transform.”