Shefi Ben-Hutta
Editor at Coverager

Familiar Attractions

Aon’s announcement of its megadeal to acquire USI for $17 billion has everyone looking at the middle. The fringes are also worth a look…

KKR originally invested in USI in 2017 alongside co-investors and USI’s management and employees. It increased its investment in 2020, 2023 and 2025 and is realizing a 6x multiple on its original 2017 investment—or a 3.4x multiple on all KKR balance-sheet capital invested over the life of the investment. As the saying goes, there’s no view without a point of view.

Aside from being a top-10 broker, USI nearly tripled its revenue through organic growth and more than 90 strategic acquisitions. It generated about $3 billion in revenue in 2025—45% from P&C, 32% from employee benefits and 23% from specialty—and placed $11 billion in P&C premiums. It has more than 10,500 employees, including 2,800 sales professionals, across more than 200 offices. It averaged 5% annual organic revenue growth from 2023 through 2025.

USI was part of what KKR calls Strategic Holdings. In late 2023, KKR co-CEO Scott Nuttall introduced Strategic Holdings: “We are creating a new segment, Strategic Holdings, to highlight these investments and the dividends we’re generating from this portfolio and will now report in three segments as a firm: Asset Management, Insurance, and Strategic Holdings.” The portfolio consisted of 19 businesses, including 1-800 Contacts, Heartland Dental and USI.

Chubb Was in on It

“They’ve been a great partner to us here. They’ve been with us really since day 1 of the strategy.”

Nuttall previously explained how the relationship began:

“Then we’re talking to a couple of friends, including Chubb, and we have a close relationship with Evan Greenberg and his senior team. And we’re just talking about this observation of what we’re doing. And they said, ‘Hey, can we do that with you?’ It’s like, great. So we worked with them, and they’ve been fantastic partners throughout, and we’ve been building this portfolio together with them and one other party. And so that’s the portfolio that’s now the 19 companies that we talk about as part of Strategic Holdings.”

In February 2025, KKR disclosed that it and Chubb would invest up to a combined $2.1 billion to increase their stakes in USI, 1-800 Contacts and Heartland Dental. KKR committed up to $1.1 billion, while Chubb committed up to approximately $1 billion.

“When you look at the last partnership that we created there, we had two partners. This incremental investment we’re making, one of our partners, Chubb—the large insurance company—is going to be investing alongside us. And so we’ll be half of the capital in this add-on.”

So it’s quite possible that Chubb will cash out the portion of its investment tied to USI before Aon begins seeing the deal lift earnings. KKR did not disclose how much of Chubb’s commitment went into USI.

Mighty (Messy) Middle

In December 2023, Aon announced plans to acquire middle-market insurance and benefits firm NFP from funds affiliated with Madison Dearborn Partners and HPS Investment Partners. The estimated purchase price was $13.4 billion, representing approximately 15x seller-adjusted EBITDA at closing.

“This morning, we announced that we signed a definitive agreement to acquire NFP, a leader in commercial risk, health and wealth for middle market clients with a very strong track record driving organic and inorganic revenue growth. This addition will expand Aon’s presence in a large, fast-growing middle market segment with substantial opportunity to enhance NFP’s offerings, analytics and products through our Aon Business Services operating platform.”

CEO Greg Case described the middle market as a segment Aon had not previously served in the same way. At the time, Aon estimated that the North American middle market represented an opportunity of more than $30 billion across commercial risk, health and wealth. It now puts the opportunity at $40 billion.

“This is the $31 billion North American market in which we’re vastly underweight.”

The middle market Aon is buying into isn’t one market. Competitors are crowding in from every edge—specialty programs, small-commercial carriers, wholesale MGAs and even digital-direct players moving up in complexity. The label spans industries, company sizes, distribution models and risk profiles. It certainly does not have a single face.

Origin Specialty Underwriters launched Origin Sentinel, an active-assailant, workplace-violence and crisis-response insurance program for small and middle-market businesses, backed by Lloyd’s coverholder Samphire Risk.

The Hanover focuses primarily on small commercial accounts and the lower end of the middle market, where management sees less pressure from the broader softening in commercial property.

CRC Group launched a Middle Market Property Program through its exclusive Insurisk platform, offering up to $50 million in capacity for non-catastrophe commercial property risks with up to $50 million in total insured value.

ANV Group (think of AmTrust) acquired workers’ compensation wholesale agency ASIA, expanding its platform following the acquisition of SCIS, an MGA specializing in hard-to-place middle-market risks.

Liberty Mutual launched Liberty Remedy for Life Sciences, a multiline insurance solution for middle-market life sciences companies covering products liability, clinical trials, errors and omissions, general liability and umbrella risks.

Even Next Insurance, the poster child for direct and digital small-business insurance, is moving toward more complex risks. In a recent job posting, the insurer said the role would help Next “expand its platform to serve more complex small businesses.”

History Rhymes

Aon expects the USI integration to cost $550 million, more than three times the $160 million originally projected for NFP. Including $160 million in transaction costs and up to $400 million in retention and performance incentives, total USI-related costs could reach approximately $1.1 billion.

NFP’s integration costs have reached ~$217 million—36% above the original estimate:

Aon said the NFP integration was “substantially” complete as of June 30, 2026. If history rhymes, the projected $550 million for USI may prove to be a floor rather than a ceiling.

The projected integration expense alone is roughly twice the estimated $250 million to $300 million Aon paid for CoverWallet (though Aon never officially disclosed the amount)—which brings us to another observation.

Change Is Hard

Nearly seven years ago, Aon bought CoverWallet to own small-business insurance the new way: digital, self-service, transactional and embedded at the point of sale. It eventually walked away from the direct-to-consumer part of that bet, although Aon would describe the change as a shift from a D2C model to a B2B2C model.

You can hear the excitement fade.

“We began our relationship with CoverWallet through a pilot program in the U.S. and Australia. During the pilot, we directed a portion of our net new small business leads to CoverWallet’s platform, which resulted in nearly doubling our new business growth through increased conversion, cross-sell and the sale of ancillary services. Penetration with existing clients increased by an impressive 20%. Recognizing the success, we are thrilled to welcome the CoverWallet team to Aon. CoverWallet is a great example of investment and differentiated capability that will serve as a building block to unlock net new opportunity in the fast-growing commercial insurance market for smaller businesses, a $200 billion global premium market with less than 5% served digitally today.” – January 2020.

“So we bought it as a D2C, and we’ve been able to expand it into the B2B2C arena and are having some good success with it.” – July 2022.

Back in 2020, Greg Case said that “80% of what Aon does around the globe is mid-market.” Seven years later, Aon is spending $17 billion to deepen its position through a traditional brokerage. If you hate surprises, you’ll love a deal this big. USI does not require Aon to reinvent itself; it simply allows Aon to become more Aon.