Yes, according to Matthew Josefowicz, director of the insurance practice at research and advisory firm Novarica. “Although property/casualty insurers had their second strong year in 2007 in terms of underwriting results, achieving top-line growth has been elusive. We expect to see more acquisitions by growth-hungry insurers in 2008,” said Josefowicz.
Analysts say that property and casualty insurers in North America are likely to grow more acquisitive this year as the slowing economy makes other forms of growth more difficult, analysts said. Safeco, for example, has been facing increasing competition from rival car insurers such as Progressive Corp, which had been dropping prices to gain market share.
Cliff Gallant, an analyst at Keefe, Bruyette & Woods, agrees, saying he sees other small regional insurers as targets for bigger companies. Stay tuned for the latest developments.