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M&A offers continue for brokers; on the horizon for insurers: Panel



Mergers and acquisitions of insurance brokers continue among the COVID-19 pandemic when private equity capital invests in the sector, says an expert panel.

Business between insurance companies can also pick up speed as low interest rates and pressures from losses can drive

"We continue to see high interest among private equity investors looking for platform investments in the insurance brokerage market," said John Hendrix, CEO, Piper Sandler Cos. In New York. [19659002] He spoke on Thursday during an online panel sponsored by S&P Global Market Intelligence, a division of S&P Global Ratings Inc.

Prices paid for brokers "are at an all – time high", and there is no shortage of buyers, Mr Hendrix sa.

Michael Goldman, senior vice president, business development at CopperPoint Insurance Cos. In Phoenix, said it was a "simple analysis" for investors to use capital rather than keep it at current low interest rates.

However, given the changing circumstances, brokers must be able to show that they can conduct business remotely, Hendrix said.

"The pandemic has indeed accelerated the importance of the technology platform and the ability to work with technology distribution channels," said Anne Ross, a partner at Foley & Lardner LLP law firms in Madison, Wisconsin.

Insurance companies face challenges that may mergers or acquisitions.

"What we are seeing are a number of companies that are exposed to some form of pressure and in some cases distress," driven by losses including accidents and property, Hendrix said.

Insurers are also facing declining investment income, and some are still dealing with business interruptions. insurance disputes, said Mrs. Ross.

A hardening insurance market interest rate could attract private equity buyers, Hendrix said.

Mr. Goldman said that in addition to a hardening landscape for many property / accident lines, the market also sees "the first signs that interest rate cuts are becoming less likely for workers' compensation line."


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