The insurance industry is at a crossroads.

Higher investment returns, rising interest rates and premium increases have resulted in higher profitability in 2023. However, with these economic forces slowing, the insurance industry is faced with a new landscape of megatrends — specifically complex geopolitical risk, climate change, new and fast evolving technologies, enhanced cyber-security risk and urbanisation. Further, the pricing cycle across commercial insurance appears to have peaked. This together with social inflation challenge insurers' operational approach, and risk and profit models.

We offer five themes that promise significant changes to the insurance industry through 2024.

Theme 1: M&A Activity Expected to Rebound puts forward that 2024 will witness transactions across different segments and markets, specifically in Bulk Purchase Annuity (BPA) and the broking market. We also envisage private equity activity to drive M&A, predominantly in less capital intense businesses.

Theme 2: Business Model Innovation to Accelerate highlights how the insurance industry will evolve to provide services beyond 'risk transfer' and become a partner for the end customer.

Theme 3: Adopting 'Digital by Default' focuses on areas where we expect insurers to drive digital transformation. While core platform modernisation will be multi-year investments, we envisage significant focus on automation and digitalisation of front-end and self-service capabilities.

Theme 4: Data and Artificial Intelligence to increasingly enable personalisation of insurance products and business model innovation.

Theme 5: Operational Resilience to Become Centre-Stage highlights how insurers need to approach operational risks as they embark on building new business models and transform their operating models.


Following a decline in M&A activity since the second quarter of 2022, the declining inflation and interest rate environment is creating a favourable environment for deals in 2024. All lead indicators — an abundance of dry powder, convergence of price expectations and evolving regulations — point that M&A activity will likely surpass past year-on-year figures.

Life insurance and broker consolidation will be 'hot' areas for deals in mainland Europe, following the trend in the U.K. Across the U.K. and Europe, private equity will play a major role with a focus on technology and balance sheet light targets given market maturity.

Specifically in the U.K., the Bulk Purchase Annuity (BPA) market will remain buoyant following an estimated £50 billion deals volume in 2023. We also expect increased consolidation activity within the Master Trusts space, which will be a major trend over the next decade. Whilst this uptick in activity is widely seen as positive for the industry, regulatory expectations have also increased in relation to operational resilience and consumer duty.


  1. Consider M&A opportunities, which provide greater opportunities to accelerate growth, support capital diversification and add distinctive capabilities.
  2. Review existing business portfolios to identify core and non-core businesses and take decisive actions to invest in or exit a business — a decision to do nothing must be a justifiable action.


The role of insurance in securing the assets of individuals and entities is fast evolving. As the risk landscape continues to become complex, insurers are adapting their business models to offer products beyond traditional risk transfer.

The insurance industry will accelerate the provision of additional services such as risk assessment and prediction, risk prevention and mitigation and post-event support — thus becoming an end-to-end partner to the customer. Insurers will also embed ESG and sustainability in their propositions such as offering green products (e.g. electric vehicles), using recycled materials for claims, and developing more inclusive products. More insurers will offer embedded insurance products to enhance distribution. It will also mean evolving other capabilities such as claims management.


  1. Review products, channel mix and distribution models, considering the changing environment and customer needs, and assess product-market fit.
  2. Identify revenue and profit pools and make strategic decisions for pursuit or investments.
  3. Systematically review the emerging insurance ecosystems (e.g. savings and retirements, home, and energy) and identify potential partners and acquisition targets or enabling capability to accelerate growth.

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