Geopolitical risks are set to dampen down global insurance M&A at a time when underwriters remain very selective on any deals.

International law firm Clyde & Co’s its annual Insurance Growth Update which reported globally 2025 saw 211 transactions completed, up from 202 last year, representing a halt to the rapid decline seen in 2024, but activity remained much lower than the peak of 346 deals in 2023. During 2025, there were also 15 deals completed with a value of at least $1 billion, and seven of these can be characterised as ‘mega deals’, where the total value exceeded $5 billion.

It added activity has been driven by portfolio optimisation and geographic refocussing, as carriers have shifted their focus from a ‘growth at all costs’ mindset to evaluating strategic fits. This has highlighted a clear divergence in the market, with steady and selective carrier activity sitting alongside strong, continued momentum among intermediaries, brokers, and MGA platforms.

The APAC region not only saw the strongest acceleration in dealmaking in 2025 at 59 transactions compared to 39 in 2024, the region also held the majority (four) of mega deals valued at over US$5 billion. Japanese insurers have been active acquirers and, following domestic portfolio adjustments, have significant capital available for overseas expansion. Amongst APAC’s major deals, two took place in Japan, and Clyde & Co expects Japanese groups’ appetite for strategic, cross-border acquisitions to continue in 2026.

“In 2025, acquisitions were partly driven by strategic considerations, such as the drive to diversify or as an opportunity to add new capabilities and deepen expertise in market segments, such as speciality,” Clyde explained. “We saw this begin in 2024 with Zurich Insurance Group’s acquisition of AIG’s travel business, which represented a move to cement its global position in business travel insurance. This trend in strategic moves to strengthen specialisations ramped up in 2025 and will continue to shape dealmaking in 2026.”

“This past year has almost been a ‘tale of two cities’, as activity has been selective and steady on the carrier side, but in the intermediary space, particularly with MGA’s and brokers, we’re seeing continued momentum and a real depth of interest in the sector,” explained Eva-Maria Barbosa, Partner at Clyde & Co. “Insurers have sharpened their focus on specialty lines resulting in a clear emergence of strategic opportunities across energy transition-related risks, cyber and AI exposures, and contingency business tied to large multinational events. We expect this to continue into 2026 resulting in steady deal flow and targets thoughtful M&A.”

Geopolitical instability, however, remains a risk to the trajectory of dealmaking, as it could disrupt sector confidence, and the prospect of rising interest rates could increase the cost of capital and dampen deal appetite.

In 2026, following on from the year’s first “mega deal” with Zurich’s acquisition of Beazley, there is expected to be strong activity rather than a dramatic acceleration. Clyde & Co said it expects firms to seek expansion into Africa and parts of APAC outside the established hubs of Hong Kong, Singapore, and China. With capital abundant, there will be continued momentum as insurers and brokers continue to pursue growth opportunities.

Whether the Beazley deal will be a taste of things to come or an outlier in a year when rising risks sees insurers and broker lose their appetite for expansion remains to be seen. However, the coming months will have many in the market wondering who is next.

Jon Guy, Editor,

Emerging Risks