New research says that although the United States experienced a considerable decline in the reported value of insurance industry M&A transactions, the non-U.S. transaction value decline was even more dramatic, according Conning Research and Consulting.
In the U.S., the value of insurance industry transactions, at about $31 billion, was the third-lowest value we have tracked since 1995, said Stephan Christiansen, director of research at Conning Research & Consulting. While the property/casualty sector actually saw growth in M&A values of about 20% to $16.3 billion after a strong start in the first quarter, life and managed care company values and transactions were down significantly.
The Conning Research study, Global Insurance Mergers & Acquisitions in 2008, tracks and analyzes both U.S. and non-U.S. insurance industry M&A activity across property/casualty, life, health and distribution and services sectors.
This is clearly a global phenomenon, reflecting uncertainty in conditions and a general lack of currency with which to execute transactions, Christiansen said. Non-U.S. M&A transaction values also were well below the previous year. Non-U.S. property-casualty came in at $14 billion, less than half of what was reported in 2007. Non-U.S. life and health, at $5.1 billion and $580 million, respectively, were both a fraction of the prior year transaction values. In both U.S. and non-U.S. regions, we have seen some activity emerging in 2009, but transactions are expected to continue at low levels until economic conditions stabilize.
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