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4 Insurance Brokerage Stocks to Gain From Demand and M&A
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The Zacks Insurance Brokerage industry is expected to benefit from better pricing, prudent underwriting, rising demand for insurance products, and global expansion, which, in turn, have been driving revenues. The fast-paced consolidations in this traditionally fragmented industry are expected to benefit Arthur J. Gallagher & Co. (AJG - Free Report) , Aon plc (AON - Free Report) , Brown and Brown, Inc. (BRO - Free Report) , and Willis Towers Watson Public Limited Company (WTW - Free Report) .
Increased digitization should help the industry improve its basis points, scale, and efficiencies.
About the Insurance Brokerage Industry
The Zacks Brokerage Insurance industry comprises companies primarily offering insurance and reinsurance products and services. Insurance brokers serve as intermediaries between clients and insurance providers, act on behalf of their clients, and offer advice, keeping in mind clients' interests against brokerage fees. Their business is directly linked to clients’ level of business activity. Some of these companies also provide risk management, third-party administration, and managed healthcare services. Per a report by Mordor Intelligence, the insurance brokerage market is expected to reach $572.47 billion by 2031 from $359.27 billion in 2026 at a CAGR of 9.77% during the forecast period (2026-2031). Accelerated digitalization should help in the smooth functioning of the industry.
3 Trends Shaping the Future of the Insurance Brokerage Industry
Increased Demand for Products to Drive Revenues: Rising demand for insurance products is a key revenue driver for the brokerage insurance industry, supported by increasing awareness of risk protection, evolving regulatory requirements and growing economic activity. Businesses and individuals are seeking broader coverage across property, casualty, health, cyber, employee benefits and specialty insurance products to safeguard against financial uncertainties. Higher insurance penetration, rising commercial activity and increased demand for customized risk-management solutions are creating opportunities for brokers to expand their client base and policy volumes.
Brokers are also benefiting from cross-selling opportunities and growing demand for advisory services, positioning the industry for sustained revenue growth over the long term.
Mergers and Acquisitions: Mergers and acquisitions play a significant role in shaping the brokerage insurance industry, enabling companies to expand market presence, diversify product offerings, strengthen distribution capabilities and achieve operational efficiencies. Insurance brokers increasingly pursue acquisitions to broaden geographic reach, gain access to niche markets and enhance expertise across commercial, employee benefits, wealth management and specialty insurance lines. Consolidation also helps firms achieve economies of scale, improve bargaining power with insurers and deepen customer relationships through cross-selling opportunities.
In a fragmented brokerage landscape, strategic M&A remains a key growth driver, allowing companies to boost revenues, strengthen competitive positioning and create long-term shareholder value.
Increased Adoption of Technology: The brokerage insurance industry is increasingly adopting technology to streamline operations, improve customer engagement, enhance underwriting precision and drive profitability. Insurance brokers are leveraging artificial intelligence (AI), machine learning, predictive analytics, cloud computing and automation to optimize policy administration, claims processing and risk assessment. Digital platforms and self-service tools are improving customer experience by enabling faster quotes, seamless policy purchases and personalized insurance solutions. The integration of data analytics and telematics is aiding insurers in better evaluating risk and tailoring pricing strategies.
Moreover, technology-driven efficiencies are reducing operating costs and enabling brokers to strengthen cross-selling and client retention. As customer preferences shift toward digital interactions, brokerage insurers that invest in InsurTech partnerships, cybersecurity, and advanced analytics are better positioned to gain market share and sustain long-term growth.
Zacks Industry Rank Indicates Bleak Prospects
The Zacks Insurance - Brokerage industry is housed within the broader Zacks Finance sector. It carries a Zacks Industry Rank #170, which places it in the bottom 30% of more than 244 Zacks industries.
The group's Zacks Industry Rank, which is basically the average of the Zacks Rank of all the member stocks, reflects dull near-term prospects. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1.
The industry’s positioning in the bottom 50% of the Zacks-ranked industries is a result of a negative earnings outlook for the constituent companies in aggregate. Looking at the aggregate earnings estimate revisions, it appears that analysts have been losing confidence in this group’s earnings growth potential. The industry’s earnings estimate has declined 24% for 2026 in a year.
Before we present a few securities and exchange stocks worth considering for your portfolio, let’s take a look at the industry’s recent stock-market performance and valuation picture.
Industry Underperforms Sector and S&P 500
The Insurance Brokerage industry has underperformed its sector and the Zacks S&P 500 Composite over the past year. The stocks in this industry have lost 42.6% in a year against the Finance sector’s growth of 13.1% and the Zacks S&P 500 composite’s appreciation of 32.5% over the same period.
One Year Price Performance
Current Valuation
On the basis of a trailing 12-month price-to-book (P/B), commonly used for valuing insurance stocks, the industry is currently trading at 3X compared with the Zacks S&P 500 Composite’s 8.09X and the sector’s 4.33X.
Over the past five years, the industry has traded as high as 8.56X, as low as 2.86X, and at the median of 6.92X.
Arthur J. Gallagher: Headquartered in Itasca, IL, Arthur J. Gallagher, with a market capitalization of $53.29 billion, is the world’s largest property/casualty third-party claims administrator and the fourth largest among insurance brokers (based on revenues). AJG is poised to benefit from the growing contribution of its Brokerage and Risk Management segments. This, in turn, is driving organic revenues.
Given the number and size of its non-U.S. acquisitions, this insurer expects an increase in international contribution to total revenues. New business production and retention bode well for consistent growth. AJG expects 6% organic growth in 2026. The guidance suggests moderate acceleration in the second half of 2026, with management citing a strong new business pipeline and improved premiums in reinsurance, retail, bond and specialty businesses as drivers.
Earnings of Arthur J. Gallagher have grown 18.1% in the past five years, better than the industry average of 13.9%. The expected long-term earnings growth rate is 14.9%, better than the industry average of 12.9%. The Zacks Consensus Estimate for 2026 and 2027 earnings indicates an increase of 23.6% and 11.1% year over year, respectively. The consensus estimate for 2026 earnings has moved 0.2% north in the past 30 days. This insurance broker has beaten earnings estimates in two of the last four quarters, while missing in the other two. The stock has lost 38.6% over the past year.
Price and Consensus: AJG
Aon: Dublin, Ireland-based Aon, with a market capitalization of $69.24 billion, offers risk management services, insurance and reinsurance brokerage, human resource consulting and outsourcing services worldwide. Aon benefits from disciplined cost control, restructuring initiatives and focused capital deployment, which are improving efficiency and scalability. Strategic acquisitions, selective divestitures and partnerships have expanded its global footprint and lifted return on capital.
Earnings of Aon have grown 10.5% in the past five years, while the expected long-term earnings growth rate is 9.9%. The Zacks Consensus Estimate for 2026 and 2027 earnings indicates an 11.7% and 11% year-over-year increase, respectively. The consensus estimate for 2026 earnings has moved 0.4% north in the past 30 days. This insurance broker has a solid track record of beating earnings estimates in each of the last four quarters, with an average of 3.11%. The stock has lost 9% over the past year.
Price and Consensus: AON
Brown & Brown: BRO, with a market capitalization of $19.83 billion and headquartered in Daytona Beach, FL, markets and sells insurance products and services primarily in the United States, as well as in London, Bermuda, and the Cayman Islands. Brown & Brown’s impressive growth is driven by organic and inorganic means across its segments. Higher core commissions and fees, profit-sharing contingent commissions, guaranteed supplemental commissions, and investment income should continue to drive the revenues. Growth from all lines of business through a combination of improving new business, solid retention, rate increases, and modest exposure unit expansion will continue to drive the growth momentum going forward.
Earnings of Brown & Brown have grown 19.2% in the past five years, better than the industry average. The expected long-term earnings growth rate is 4.8%. The Zacks Consensus Estimate for 2026 and 2027 earnings indicates a 5.8% and 8.4% year-over-year increase, respectively. BRO has a solid track record of beating earnings estimates in each of the last four quarters, with an average being 6.28%. The stock has lost 47.2% over the past year.
Price and Consensus: BRO
Willis Towers Watson: Based in London, the United Kingdom, Willis Towers Watson, with a market capitalization of $24.38 billion, is a leading global advisory, broking and solutions company. New business wins and renewals, higher levels of retirement work, strong client retention, strong software sales, strategic buyouts and effective capital deployment bode well for growth. Willis Towers’ growth strategy remains centered on sustainable revenue growth, mix improvement and operating margin expansion. Management expects continued annual margin expansion, including about 100 basis points of average annual expansion over the next two years in Risk & Broking and incremental expansion in Health, Wealth & Career.
Earnings for this insurance broker have grown 8.3% in the past five years. The expected long-term earnings growth rate is 11.6%. The Zacks Consensus Estimate for 2026 earnings indicates a year-over-year increase of 14.3%. The consensus estimate for 2026 earnings has moved 0.1% north in the past 30 days. WTW has a solid track record of beating earnings estimates in each of the last four quarters, with an average being 4.10%. The stock has lost 16.4% over the past year.
Price and Consensus: WTW
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4 Insurance Brokerage Stocks to Gain From Demand and M&A
The Zacks Insurance Brokerage industry is expected to benefit from better pricing, prudent underwriting, rising demand for insurance products, and global expansion, which, in turn, have been driving revenues. The fast-paced consolidations in this traditionally fragmented industry are expected to benefit Arthur J. Gallagher & Co. (AJG - Free Report) , Aon plc (AON - Free Report) , Brown and Brown, Inc. (BRO - Free Report) , and Willis Towers Watson Public Limited Company (WTW - Free Report) .
Increased digitization should help the industry improve its basis points, scale, and efficiencies.
About the Insurance Brokerage Industry
The Zacks Brokerage Insurance industry comprises companies primarily offering insurance and reinsurance products and services. Insurance brokers serve as intermediaries between clients and insurance providers, act on behalf of their clients, and offer advice, keeping in mind clients' interests against brokerage fees. Their business is directly linked to clients’ level of business activity. Some of these companies also provide risk management, third-party administration, and managed healthcare services. Per a report by Mordor Intelligence, the insurance brokerage market is expected to reach $572.47 billion by 2031 from $359.27 billion in 2026 at a CAGR of 9.77% during the forecast period (2026-2031). Accelerated digitalization should help in the smooth functioning of the industry.
3 Trends Shaping the Future of the Insurance Brokerage Industry
Increased Demand for Products to Drive Revenues: Rising demand for insurance products is a key revenue driver for the brokerage insurance industry, supported by increasing awareness of risk protection, evolving regulatory requirements and growing economic activity. Businesses and individuals are seeking broader coverage across property, casualty, health, cyber, employee benefits and specialty insurance products to safeguard against financial uncertainties. Higher insurance penetration, rising commercial activity and increased demand for customized risk-management solutions are creating opportunities for brokers to expand their client base and policy volumes.
Brokers are also benefiting from cross-selling opportunities and growing demand for advisory services, positioning the industry for sustained revenue growth over the long term.
Mergers and Acquisitions: Mergers and acquisitions play a significant role in shaping the brokerage insurance industry, enabling companies to expand market presence, diversify product offerings, strengthen distribution capabilities and achieve operational efficiencies. Insurance brokers increasingly pursue acquisitions to broaden geographic reach, gain access to niche markets and enhance expertise across commercial, employee benefits, wealth management and specialty insurance lines. Consolidation also helps firms achieve economies of scale, improve bargaining power with insurers and deepen customer relationships through cross-selling opportunities.
In a fragmented brokerage landscape, strategic M&A remains a key growth driver, allowing companies to boost revenues, strengthen competitive positioning and create long-term shareholder value.
Increased Adoption of Technology: The brokerage insurance industry is increasingly adopting technology to streamline operations, improve customer engagement, enhance underwriting precision and drive profitability. Insurance brokers are leveraging artificial intelligence (AI), machine learning, predictive analytics, cloud computing and automation to optimize policy administration, claims processing and risk assessment. Digital platforms and self-service tools are improving customer experience by enabling faster quotes, seamless policy purchases and personalized insurance solutions. The integration of data analytics and telematics is aiding insurers in better evaluating risk and tailoring pricing strategies.
Moreover, technology-driven efficiencies are reducing operating costs and enabling brokers to strengthen cross-selling and client retention. As customer preferences shift toward digital interactions, brokerage insurers that invest in InsurTech partnerships, cybersecurity, and advanced analytics are better positioned to gain market share and sustain long-term growth.
Zacks Industry Rank Indicates Bleak Prospects
The Zacks Insurance - Brokerage industry is housed within the broader Zacks Finance sector. It carries a Zacks Industry Rank #170, which places it in the bottom 30% of more than 244 Zacks industries.
The group's Zacks Industry Rank, which is basically the average of the Zacks Rank of all the member stocks, reflects dull near-term prospects. Our research shows that the top 50% of the Zacks-ranked industries outperform the bottom 50% by a factor of more than 2 to 1.
The industry’s positioning in the bottom 50% of the Zacks-ranked industries is a result of a negative earnings outlook for the constituent companies in aggregate. Looking at the aggregate earnings estimate revisions, it appears that analysts have been losing confidence in this group’s earnings growth potential. The industry’s earnings estimate has declined 24% for 2026 in a year.
Before we present a few securities and exchange stocks worth considering for your portfolio, let’s take a look at the industry’s recent stock-market performance and valuation picture.
Industry Underperforms Sector and S&P 500
The Insurance Brokerage industry has underperformed its sector and the Zacks S&P 500 Composite over the past year. The stocks in this industry have lost 42.6% in a year against the Finance sector’s growth of 13.1% and the Zacks S&P 500 composite’s appreciation of 32.5% over the same period.
One Year Price Performance
Current Valuation
On the basis of a trailing 12-month price-to-book (P/B), commonly used for valuing insurance stocks, the industry is currently trading at 3X compared with the Zacks S&P 500 Composite’s 8.09X and the sector’s 4.33X.
Over the past five years, the industry has traded as high as 8.56X, as low as 2.86X, and at the median of 6.92X.
Trailing 12-Month Price-to-Book (P/B) Ratio
Trailing 12-Month Price-to-Book (P/B) Ratio
4 Insurance Brokerage Stocks in Focus
We are presenting four stocks currently carrying a Zacks Rank #3 (Hold). You can see the complete list of today’s Zacks #1 Rank (Strong Buy) stocks here.
Arthur J. Gallagher: Headquartered in Itasca, IL, Arthur J. Gallagher, with a market capitalization of $53.29 billion, is the world’s largest property/casualty third-party claims administrator and the fourth largest among insurance brokers (based on revenues). AJG is poised to benefit from the growing contribution of its Brokerage and Risk Management segments. This, in turn, is driving organic revenues.
Given the number and size of its non-U.S. acquisitions, this insurer expects an increase in international contribution to total revenues. New business production and retention bode well for consistent growth. AJG expects 6% organic growth in 2026. The guidance suggests moderate acceleration in the second half of 2026, with management citing a strong new business pipeline and improved premiums in reinsurance, retail, bond and specialty businesses as drivers.
Earnings of Arthur J. Gallagher have grown 18.1% in the past five years, better than the industry average of 13.9%. The expected long-term earnings growth rate is 14.9%, better than the industry average of 12.9%. The Zacks Consensus Estimate for 2026 and 2027 earnings indicates an increase of 23.6% and 11.1% year over year, respectively. The consensus estimate for 2026 earnings has moved 0.2% north in the past 30 days. This insurance broker has beaten earnings estimates in two of the last four quarters, while missing in the other two. The stock has lost 38.6% over the past year.
Price and Consensus: AJG
Aon: Dublin, Ireland-based Aon, with a market capitalization of $69.24 billion, offers risk management services, insurance and reinsurance brokerage, human resource consulting and outsourcing services worldwide. Aon benefits from disciplined cost control, restructuring initiatives and focused capital deployment, which are improving efficiency and scalability. Strategic acquisitions, selective divestitures and partnerships have expanded its global footprint and lifted return on capital.
Earnings of Aon have grown 10.5% in the past five years, while the expected long-term earnings growth rate is 9.9%. The Zacks Consensus Estimate for 2026 and 2027 earnings indicates an 11.7% and 11% year-over-year increase, respectively. The consensus estimate for 2026 earnings has moved 0.4% north in the past 30 days. This insurance broker has a solid track record of beating earnings estimates in each of the last four quarters, with an average of 3.11%. The stock has lost 9% over the past year.
Price and Consensus: AON
Brown & Brown: BRO, with a market capitalization of $19.83 billion and headquartered in Daytona Beach, FL, markets and sells insurance products and services primarily in the United States, as well as in London, Bermuda, and the Cayman Islands. Brown & Brown’s impressive growth is driven by organic and inorganic means across its segments. Higher core commissions and fees, profit-sharing contingent commissions, guaranteed supplemental commissions, and investment income should continue to drive the revenues. Growth from all lines of business through a combination of improving new business, solid retention, rate increases, and modest exposure unit expansion will continue to drive the growth momentum going forward.
Earnings of Brown & Brown have grown 19.2% in the past five years, better than the industry average. The expected long-term earnings growth rate is 4.8%. The Zacks Consensus Estimate for 2026 and 2027 earnings indicates a 5.8% and 8.4% year-over-year increase, respectively. BRO has a solid track record of beating earnings estimates in each of the last four quarters, with an average being 6.28%. The stock has lost 47.2% over the past year.
Price and Consensus: BRO
Willis Towers Watson: Based in London, the United Kingdom, Willis Towers Watson, with a market capitalization of $24.38 billion, is a leading global advisory, broking and solutions company. New business wins and renewals, higher levels of retirement work, strong client retention, strong software sales, strategic buyouts and effective capital deployment bode well for growth. Willis Towers’ growth strategy remains centered on sustainable revenue growth, mix improvement and operating margin expansion. Management expects continued annual margin expansion, including about 100 basis points of average annual expansion over the next two years in Risk & Broking and incremental expansion in Health, Wealth & Career.
Earnings for this insurance broker have grown 8.3% in the past five years. The expected long-term earnings growth rate is 11.6%. The Zacks Consensus Estimate for 2026 earnings indicates a year-over-year increase of 14.3%. The consensus estimate for 2026 earnings has moved 0.1% north in the past 30 days. WTW has a solid track record of beating earnings estimates in each of the last four quarters, with an average being 4.10%. The stock has lost 16.4% over the past year.
Price and Consensus: WTW