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Insurance brokers see growth in emerging markets: Study

Insurance brokers see growth in emerging markets: Study

The largest commercial insurance brokerages will derive an increasing share of their revenue from emerging markets, London-based financial services consultant Finaccord Ltd. concludes.

Finaccord estimates global commercial nonlife insurance broking revenue totaled $46.3 billion in 2012, up from $41.9 billion in 2008, according to the analysis released Monday.

While revenue from developed markets has increased only moderately or even declined, revenue from emerging markets has surged. Between 2008 and 2012, revenue from India, Argentina and China has grown 36.3%, 28.0% and 22.4%, respectively, according to the analysis.

Finaccord said the global scale of Aon P.L.C. and Marsh & McLennan Cos. Inc. is evident in emerging markets. Across the 30 countries surveyed by Finaccord, Aon was the leader in commercial lines broking in 16 countries — ahead of Marsh Inc., which was the largest in eight.

“Due to their frequent acquisitions, both Aon and Marsh tend to grow faster than the overall market in most countries,” Bernd Bergmann, a consultant at Finaccord, said in the statement. “However, outside of the major markets, the pool of viable acquisition targets can often be limited. In the future, it is reasonable to expect that Aon and Marsh will continue to grow their share of global commercial lines broking revenues, but that some of that growth will have to be achieved organically.”

According to the Finaccord analysis, Aon had 13% of the global commercial broking nonlife insurance market in 2012, Marsh had 11% and Willis Group Holdings P.L.C. had 3%