How Brown & Brown's Wholesale Brokerage Fuels Growth Momentum?

Wholesale Brokerage is a cornerstone of Brown & Brown, Inc.’s BRO platform, providing earnings diversity and reinforcing the company’s resilience across insurance cycles. Its ability to generate consistent commissions while expanding into specialized markets strengthens the overall Brokerage business and positions BRO for sustainable growth.

The importance of Wholesale Brokerage lies in its role as both a stabilizer and a growth engine. It delivers recurring revenue through core and contingent commissions, while guaranteed supplemental commissions and investment income add further support. Acquisitions completed over the past year have driven incremental expansion, complementing organic growth from net new business, increased exposure, and solid retention. Rate improvements across property, general liability and professional liability lines are also expected to sustain momentum. It is evident that the insurance industry is going through hard market cycle that started in 2018. A hard market leads to higher pricing, which coupled with prudent underwriting standards should continue to drive premiums higher and ensure sustained profitability.   This combination shows why Wholesale Brokerage is not simply another line of business, but a strategic pillar that underwrites long-term performance.

Recent results validate its importance. In the second quarter of 2025, revenues increased 14.5% year over year to $182 million, with organic growth of 3.9%. EBITDAC rose 17% to $62 million, expanding margins to 34.1%. Management’s forecast of 8.4% organic growth in 2025 further highlights Wholesale Brokerage’s role as a key driver of profitability and durability for BRO.

How Does the Brokerage Segment Drive Growth of AJG and WTW?

Arthur J. Gallagher & Co.’s AJG Brokerage business anchors overall performance, generating the bulk of revenues and profits. With a wide global footprint and a balanced mix of retail and wholesale operations, it provides resilience across cycles. Consistent new business, acquisitions, and technology investments strengthen growth, efficiency, and client loyalty.

Willis Towers Watson Public Limited Company’s WTW Risk & Broking business is a central growth driver, connecting clients with insurers to create recurring, diversified revenue streams. By leveraging analytics and advisory expertise, it enhances outcomes while ensuring retention, business momentum, and operational improvements that support margins and long-term positioning.

BRO’s Price Performance, Valuation & Estimates

Shares of BRO have lost 6.4% in the year-to-date period compared with the industry’s decline of 14.2%.

BRO’s YTD Price Performance

From a valuation standpoint, shares of BRO trade at a price to forward 12-month earnings of 20.78, up from the industry average of 20.57.

The Zacks Consensus Estimate for Brown & Brown’s 2025 earnings implies 7.6% growth year over year, followed by a 16.5% increase next year.

BRO stock currently carries a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.

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This article originally published on Zacks Investment Research (zacks.com).

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