While these drivers support a positive outlook for global insurance M&A in the coming months, time to market may extend the phase to execution, given higher deal values and potential deal complexity.

“We're seeing a much longer stretch of time from announcement to closing,” said Jack Gibson, managing director at Willis Towers Watson. “However, debt continues to be cheap, and following the recent tax reforms, U.S. companies have been given a steroid kick. We will continue to see an active M&A market, it's just a matter of paying the right price and overcoming the hurdles that have led to deals taking longer to consummate and are perhaps driving the lower number of deals this year.”

Key findings from the report include:

• Deal sector splits in H1 2018 reflected previous years. P&C led the way with 44 deals, followed by the life sector with 22 deals, while there were 11 in composite and seven in reinsurance.
• The insurance sector has been slower to adapt to new technologies than some other sectors. With investment in InsurTech falling behind its digital competitors, it will be important for businesses to engage with this in the future.
• There is a growing trend of foreign investment from Asian companies, looking to grow a geographical footprint and acquire capabilities. In particular, we will see tactical acquisitions by Asian players in more developed markets — a growing trend due to China's Belt and Road initiative.
• Political and economic uncertainty could affect global deal-making, with volatility surrounding Brexit and tensions between China and the U.S. potentially threatening deal acquisition — although the sector remains optimistic that the domestic focus of insurance M&A volume may protect it from cross-border tensions.