2022 brokerage revenue: $3.62B
Percent increase: 28.5%

Acrisure LLC posted a healthy rise in revenue in 2022, helping it jump two spots in the ranking of the world’s largest brokers, but economic headwinds are making the acquisitions that traditionally have fueled the company’s expansion less attractive, which is expected to dampen growth this year. 

Higher interest rates and capital costs are likely to slow the pace of mergers and acquisitions, said Gregory L. Williams, CEO of the Grand Rapids, Michigan-based brokerage. “We’ll still do a number of deals and we’ll still have significant growth in 2023,” he said, but it isn’t expected to reach the level of previous years.

Meanwhile, other changes at the company have helped fuel speculation that it will go public, maybe as soon as next year. 

Acrisure made 116 deals last year, down from 155 in 2021. As of mid-June, the company had closed on or signed letters of intent on 40 acquisitions this year.

Organic growth reached nearly 10% last year, Mr. Williams said. That helped boost Acrisure’s 2022 gross revenue by more than $1 billion, to $4.12 billion. Brokerage revenue was up 28.5% to $3.62 billion, pushing Acrisure up two spots to No. 6 in Business Insurance’s ranking of the world’s largest brokerages.

Rising property/casualty rates helped grow Acrisure’s revenue but higher interest rates hurt its title and mortgage origination business, said Evelyn Ocas Salazar, assistant vice president-analyst at Moody’s Investor Service Inc. in New York.

The mortgage business, which is largely related to new construction, was not hit as hard as the title operations that suffered from a slowdown in refinancing, Mr. Williams said. “The increase in interest rates was the most rapid and pronounced in 30 years, so it kind of changed those businesses overnight,” he said.

“That clearly added some volatility and margin degradation to their results,” said Joseph Marinucci, senior director at Standard & Poor’s Global Ratings in Princeton, New Jersey. “Their core business performed well,” he said, “but those two lines are a bit more cyclical.”

Acrisure in May said it is reorganizing into a regional structure and rolling out a new brand strategy. The company has often allowed its acquisitions to operate under their own names, but the new strategy will see the Acrisure name applied to all of its units.

“We view this as credit positive,” Ms. Ocas Salazar said of the reorganization. “In the long run, it’s going to be cost-efficient for the company. We’ve seen other brokers go this way and they see it in their margins. It’s a short-term drag but a long-term benefit.”

The new approach could signal that Acrisure leadership is positioning the company to go public, a move that has long been discussed, said Joseph Marinucci, senior director at Standard & Poor’s Global Ratings in Princeton, N.J. “It’s what’s being talked about, obviously, because of their growth and where they’re intending to go in the next stage of development,” he said.

Recent press reports suggested that Acrisure would hold an initial public offering in 2024, but Mr. Williams was noncommittal. “This is probably a public company at some point in time. … Frankly, I don’t know that 2024 is the right time.” 

If Acrisure does go public, “it won’t be anytime soon,” Mr. Williams said. “I’m leaving all options open as it relates to timing, and, again, it’s not a foregone conclusion that that’s what we’ll do.”

Acrisure operates in 21 countries and is looking for opportunities to expand further outside the United States, Mr. Williams said. 

The brokerage's international footprint grew earlier this year with the acquisition of Warsaw, Poland-based Unilink SA, which distributes life and nonlife coverage in Eastern and Central Europe, he said.

Acrisure, which considers itself a fintech company, in 2020 purchased the artificial intelligence business of Tulco LLC and has since integrated AI throughout its operations, according to Mr. Williams. “It’s infused in and heavily transforming everything that we are doing,” he said.

Acrisure uses AI to handle a multitude of tasks, Mr. Williams said, with robotic processing work alone saving more than 5,000 hours a month. AI can predict products and services clients are likely to need and send those leads to sales personnel. The technology can also match those client needs with insurers’ appetite to provide coverage, he added.

AI has changed “every facet of the business,” Mr. Williams said.