The largest publicly traded insurance brokers rode a slowly improving economy to single-digit organic growth during the first half of the year as foreign exchange rates and soft pricing headwinds swirled.

The brightest spot during the first half of 2015 was growing demand for consulting services on employee benefits, thanks to the health care reform law.

As a group, the five largest publicly traded brokers boosted first-half revenue 1.2% to $17.53 billion, but their collective profit fell 4.9% to $1.97 billion (see chart).

Arthur J. Gallagher & Co. had the largest increase in revenue, 24.3% — fueled by acquisitions — followed by Brown & Brown Inc., 8.3%. Marsh & McLennan Cos. Inc., Aon P.L.C. and Willis Group Holdings P.L.C. all reported slight declines in first-half revenue.

While all five were profitable, Aon and Willis reported a smaller profit for the first half of this year compared with last year.

“There was pretty consistent organic growth in the low single digits for the second quarter and for the first half of the year,” said Bruce Ballentine, vice president and senior credit officer at Moody's Investors Service Inc. in New York. “Organic growth was driven by economic growth in the low single digits, with insurance pricing that's around break-even.”

Although most insurance rates have flattened, “you're still getting a little lift because of the economy in certain pockets, where so much of premium is based on exposure,” said Tim Cunningham, managing director at Chicago-based investment banking and consulting firm Optis Partners L.L.C. “So you could have flat rate, but if exposure is up 2%, you can get 2% organic growth out of that.”

“Overall, we saw break-even pricing with declines in the property business offset by casualty lines that are still eking out price increases,” said Mr. Ballentine. Casualty business is still “slightly positive,” but less so than recent years, he said.

“Foreign exchange is the big one in terms of a headwind,” said Julie Herman, New York-based director of insurance rating at Standard & Poor's Corp. “Reinsurance continues to probably be the biggest headwind from a line-of-business perspective.”

“Marsh and Aon had some foreign exchange effects that dampened their profits,” said Gretchen Roetzer, director and group operations head at Fitch Ratings Inc. in Chicago. “I don't think it's an overall reflection of the strength of their business; I think it's an unfortunate effect of being a global company at this point in time.”

“Brokers are facing a negative impact of the strong dollar on revenues due to the impact on our exports and slowing global economic growth,” said John Wepler, chairman and CEO of Marsh, Berry & Co.

“We definitely still see pressure on the reinsurance side, so that's going to drag down earnings for those brokers which have more of a reinsurance group, like Aon, Marsh and Willis.” said Ms. Roetzer.

“Overall, the big five reported organic growth, which we like to see especially with certain markets like the commercial markets, which are still experiencing pretty soft rates, and that speaks to the brokers' diversity,” she said.

Employee benefits

That diversity includes employee benefits consulting.

“On the employee benefits side, rate is up there and the brokers are getting greater fees for an increasingly consultative role,” said Mr. Cunningham. “The Affordable Care Act accelerated the migration to a consultative business.”

“Employee benefits solutions remain in high demand as consultants continue to help clients navigate the Affordable Care Act and how it impacts their human resource needs,” said Mr. Wepler.

“Employee benefits and the private (health insurance) exchanges are still an opportunity that companies are getting traction on, but it's not a huge benefit on results right now,” S&P's Ms. Herman said. “This is going to take time before it's a huge impact on results.”

The brokers' nascent health exchanges are “an exciting area of investment for the largest firms and apt to grow over the next several years,” said Moody's Mr. Ballentine.

“The brokers that have the exchanges set up and the ability to do the benefits and consulting-type businesses. That's a great business to be in right now,” Fitch's Ms. Roetzer said.