After a prolonged lull in activity, consolidation in the insurance industry--marked by a new wave of proposed mergers and divestitures--appears to be gathering newfound momentum, with two major developments illustrating the potential changes that loom ahead.In late September, the board of directors of Boston-based John Hancock Financial Services Inc. and Manulife Financial Co., based in Toronto, unanimously approved a tax-free, stock-for-stock merger of the two financial services giants.

The proposed merger is expected to create the largest life insurance company in Canada and the second-largest in North America-valued at $25.6 billion. Once the companies obtain the necessary regulatory approvals, officials on both sides expect the merger to close the second quarter of 2004.

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