Insurance companies starting to wise up to cyber risk in M&A deals

Mergers and acquisitions in the insurance brokerage space hit record highs in 2018. And, if the first six months of 2019 is anything to go by, this M&A trend is not showing any signs of changing in the near term. As insurance brokers and agents consider selling, there’s a lot of pre-transaction due diligence to consider. They’ll want to get their books in order, tidy their data up, and reassure accounts about coverage contingency. One thing that the entire market – sellers, buyers, brokers and carriers – are all starting to understand is that their cybersecurity is nearly as important as the overall financial impact of the deal. “Insurance brokerages and agencies, as well as sellers of any type of business, can help secure and enhance the value of their entities prior to a sale by ensuring their cyber security risks are properly addressed,” said James Arnold, principal, cyber security, KPMG (US). “A well developed and implemented cybersecurity program will help ensure there are no surprises during the deal period and after closing. It will also help put buyers at ease knowing the target cyber security issues have been addressed.”

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