Press Release - JANUARY 31, 2019

Best’s Special Report: Consolidation Trends to Continue as Western European Insurers Seek Growth

 Greg Carter
Managing Director, Analytics
+44 20 7397 0288
Yvette Essen
Director, Research, Communications & Media – Europe, Middle East & Africa
+44 20 7397 0322

Edem Kuenyehia
Director, Market Development &
+44 20 7397 0280


Insurers operating in Western Europe are enjoying relatively stable economic conditions, although achieving growth remains challenging and is likely to fuel continued merger and acquisition (M&A) activity, according to a new special report by AM Best.

The Best’s Special Report, titled “Consolidation Trends to Continue as Western European Insurers Seek Growth,” notes conditions in Western Europe are challenging as many insurers vie for the same underlying business. Products are complex in certain markets, while distribution methods are extremely competitive and varied. AM Best does not envisage significant changes to pricing in the short term.

Companies rated by AM Best in the region are relatively diverse, including major global conglomerates, medium-sized companies (i.e., private insurers and mutuals), small and niche businesses, startup enterprises and subsidiaries of larger groups. It is common for (re)insurers in this region to have strong balance sheets and good ratings, as demonstrated by analysis of AM Best’s Long-Term Issuer Credit Ratings (Long-Term ICRs) on 31 December 2018. Almost all (91%) of Long-Term ICRs were in the “aa+” to “a-” range, with the remainder falling into the category of “bbb+” or below. In terms of AM Best’s outlook on the Western European market, 89% of the ratings in this region were stable, as of 31 December 2018.

Greg Carter, managing director, analytics, said: “Western European (re)insurers generally display strong balance sheets and operate in a mature and stable regulatory environment. These factors allow companies to withstand the competitive pressures, resulting in a stable outlook for most market participants.”

The report also comments on industry consolidation. Yvette Essen, director of research and report author, said: “One trend that has been apparent in recent years has been the ongoing M&A activity, particularly as larger participants strive to achieve economies of scale and drive efficiencies into their business as they lack major growth opportunities. AM Best expects industry consolidation to continue as growth prospects continue to be modest. Furthermore, M&A is driven largely by excess capacity and capital in the marketplace, which looks set to remain.”

To access a complimentary copy of this report, please visit .

AM Best is a global rating agency and information provider with a unique focus on the insurance industry.