$7.75B Acquisition, AI Takes Over, and Agri-Insurance’s $83B Surge

Buy The Full Report | Go Pro | Advertise With Insurance 150 | Other Issues

Happy Monday , 

This week we explore how agriculture insurance is going from niche to necessity, with projections putting its market value at $83 billion by 2036. 🌾  

Whether it's extreme weather or high premiums, insurance is now the backbone of food security.

Meanwhile, Marsh McLennan makes waves with its $7.75B acquisition of McGriff Insurance Services, signaling big moves in the mid-market sector. 

Plus, we’ll talk about why 79% of insurance CEOs believe generative AI is the game-changer their industry can’t ignore. 

Here’s to navigating another week of disruption and opportunity!

— Gaston Brizuela, Senior Insurance and PE Analyst 

In this Issue:

• A Growing Market: Agri-Insurance Goes Big

• Insurance vs. Car Prices: A Tale of Two Trends

• Generative AI: The CEO’s New Playbook for Insurance Innovation

• Marsh McLennan Bags McGriff for $7.75 Billion

• Harley-Davidson’s Comeback Ride

• ITC Vegas 2024: Big Names, Bigger Ideas

📚 Data Dive

A Growing Market: Agri-Insurance Goes Big 💼 

As global food production grows, so do the risks. By 2036, the agricultural insurance market is projected to double in size. Natural disasters are a massive driver, with farmers increasingly needing protection for crops, livestock, and assets. Governments and private insurers are stepping in, but high premiums remain a challenge. As the sector evolves, government subsidies and the rise of contract farming could bridge the gap, making insurance indispensable for modern agriculture.

Become a Premium Subscriber

Interested in all the hard data behind our weekly Deep Dives?
Consider becoming a Premium Subscriber.

📈 Trend of the week

Insurance Vs. Car Prices: A Tale of Two Trends 🚗📉

Motor insurance inflation is running wild, far outpacing vehicle prices. In the US, insurance inflation jumped from 7.9% in 2022 to a jaw-dropping 21% in early 2024, while car prices actually fell by 2.1%. Over in the UK, it’s even more extreme—insurance inflation soared to 25.5%, while motor prices slipped by 3.3%. The takeaway? Risk management is more critical than ever in navigating these turbulent waters.

💻 Insurtech Insight

Generative AI: The CEO’s New Playbook for Insurance Innovation

In an industry where disruption is the new normal, insurance CEOs are under pressure to innovate—and generative AI (GenAI) is becoming their go-to strategy. With InsurTechs reshaping the market and customer expectations shifting faster than ever, GenAI offers insurers a lifeline.

According to Deloitte, 79% of CEOs believe that GenAI will revolutionize their operations within the next three years. From automating claims processing to transforming customer service and underwriting, GenAI’s potential spans the entire value chain.

But the real challenge? CEOs must embrace GenAI, invest in the right talent, and cultivate a culture that prioritizes forward-thinking innovation to stay competitive.

🤝 Deal of the Week

Marsh McLennan Bags McGriff for $7.75 Billion

In a bid to expand its middle-market insurance services, Marsh McLennan just inked a $7.75 billion deal to acquire McGriff Insurance Services. Expected to close by year’s end, McGriff’s 3,500-strong team and its $1.3 billion in annual revenue will now operate under the Marsh McLennan Agency. With the deal funded through a mix of cash and debt, Marsh McLennan is banking on increased business spending to drive demand for its expanded insurance offerings, which now include everything from commercial property to cyber insurance.

⌚ This Day In History

Harley-Davidson’s Comeback Ride

Back in 1981, Harley-Davidson was cornered by Japanese competitors with sleeker, cheaper bikes. So, what did they do? Borrowed from the enemy’s playbook. The American icon embraced Japanese lean manufacturing techniques like Just-In-Time (JIT) production, prioritizing efficiency and cutting down waste. It was like a mechanic tossing out the rusted parts and tuning up the engine for maximum performance. The result? Better quality, more productivity, and ultimately, a much-needed boost in market share.

Not bad for a company with its back against the wall. 

🎧 Podcast of the week

ITC Vegas 2024: Big Names, Bigger Ideas 💡 

On FNO Insuretech, Bill Harris shares a sneak preview of ITC Vegas 2024, and it’s shaping up to be an unmissable event. Expect fresh startup spaces, big names like Salesforce, and a crowd that’s increasingly diverse and dynamic. Harris talks about balancing tech innovation with the human side of the industry, making this conference a must for anyone aiming to stay at the forefront of insurance. Tune in for a sneak peek at the future of the industry.

📰 Interesting Stuff

🐣 Tweet of the week

"Here is a simple but powerful rule … always give people more than they expect to get."

Nelson Boswell