The lingering soft market and the ongoing fallout of the financial crisis have combined to suppress merger and acquisition activity in the insurance industry, new studies find.

One report from New York-based PricewaterhouseCoopers predicts that deal activity in the U.S. insurance sector is likely to remain muted overall as there are fewer distressed sellers in the marketplace. Additionally, some insurers opted to issue new debt or avail themselves of bailout funds in order to rebuild balance sheets, rather than opting for M&A, the report states. The report, “On the Road Again—Transactions in an Opportunistic Market,” notes that deal volume in 2009 fell to $5.9 billion, down from $21.7 billion in 2008.

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