Business Analysis of Arthur J. Gallagher & Co

 Analyze Historical Performance, Strategic Priorities, And Business Improvement Opportunities of Arthur J. Gallagher & Co

ARTHUR J. GALLAGHER & CO

Business Overview

Arthur J. Gallagher & Co., together with its subsidiaries, provides insurance brokerage and risk management services in the United States and internationally. Its Brokerage segment consists of retail and wholesale insurance brokerage operations. The company's retail brokerage operations negotiate and place property/casualty, employer-provided health and welfare insurance, and healthcare exchange and retirement solutions primarily for middle-market commercial, industrial, public entity, religious, and not-for-profit entities. This segment's wholesale brokerage operations assist brokers and agents in the placement of specialized and hard-to-place insurance programs. It also acts as a brokerage wholesaler, and managing general agent or managing general underwriter distributing specialized insurance coverages for insurance carriers; and performs activities, including marketing, underwriting, issuing policies, collecting premiums, appointing and supervising other agents, paying claims, and negotiating reinsurance. The company's Risk Management segment offers contract claim settlement and administration services for enterprises that choose to self-insure their property/casualty coverages; and for insurance companies that choose to outsource their property/casualty claims departments. This segment also offers integrated disability management programs, as well as information, risk control consulting, and appraisal services. The company offers its services through a network of insurance brokers and consultants to various commercial, industrial, institutional, and governmental organizations. Arthur J. Gallagher & Co. was founded in 1927 and is headquartered in Itasca, Illinois.

Arthur J. Gallagher & Co

Arthur J. Gallagher & Co


R&P Rank: 470
Sector: Insurance
Industry:Insurance Brokerage
H.Q Location:Illinois
Website: www.ajg.com
Company Address:
TWO PIERCE PLACE, ITASCA IL 60143
Ph:630-773-3800

Business Analysis of Arthur J. Gallagher & Co

The Insurance Sector is witnessing a major shakeup, new age business models in the industry are transforming both customers and businesses. Faced with this uncertainity, companies are investing resources to transform their business. An in-depth business analysis is a valuable resource to identify and articulate the need for a business model change. At R&P Research we believe, the starting point for a business analysis is Benchmarking. Business benchmarking can be done at various levels: 1) Industry Benchmarking 2) Peer Benchmarking 3) Disruptors Benchmarking. In this report, we share the snapshot of how Arthur J. Gallagher & Co compares against the industry on the major performance indicators. This analysis, along with peer group/disruptors benchmarking and revenue model understanding can help identify growth and cost optimization opportunities to maximize the value delivered by Arthur J. Gallagher & Co to its stakeholders. R&P Research Industry Intelligence Platform provides historical data for last 15 years with an easy to use benchmarking interface for an in-depth comparative business analysis.

Here is the performance snapshot of Arthur J. Gallagher & Co with an interactive chart.

  1. Revenue Growth: Arthur J. Gallagher & Co reported a revenue growth of 3.8% year-on-year during 2016. Insurance Brokerage Industry grew at 2.3% in the same period
  2. COGS share of Revenues: As a percentage of revenue, Arthur J. Gallagher & Co spent 39.4% of its total revenues on COGS. Insurance Brokerage industry average (COGS share of revenue) in the same period was 9.1%
  3. R&D share of Revenues: Arthur J. Gallagher & Co R&D share of Revenues details are not available because either company does not share the data or we do not have it
  4. SG&A share of Revenues: As a percentage of revenue, Arthur J. Gallagher & Co spent 45.4% of its total revenues on Sales, Marketing, and General Administration (SG&A). Insurance Brokerage industry average SG&A spending in the same period was 69.0%
  5. Inventory share of Revenues: Arthur J. Gallagher & Co Inventory share of Revenues details are not available because either company does not share the data or we do not have it
  6. Accounts Payable share of Revenues: As a percentage of revenue, Arthur J. Gallagher & Co invested 53.6% of its total revenues on Accounts Payable (A/P) Insurance Brokerage industry average Accounts Payable investment in the same period was 22.3%
  7. Accounts Receivable share of Revenues: As a percentage of revenue, Arthur J. Gallagher & Co invested 33.0% of its total revenues on Accounts Receivable (A/R). Insurance Brokerage industry average Accounts Receivable investment in the same period was 27.4%
  8. PP&E share of Revenues: As a percentage of revenue, Arthur J. Gallagher & Co invested 6.7% of its total revenues on Property, Plants, and Equipments (PP&E). Insurance Brokerage industry average PPE investment in the same period was 6.6%
  9. Intangibles share of Revenues: As a percentage of revenue, Arthur J. Gallagher & Co invested 96.4% of its total revenues on Intangibles. Insurance Brokerage industry average Intangibles investment in the same period was 83.2%
  10. Net Margins: Arthur J. Gallagher & Co Net Margins in the year 2016 were 7.4%. Insurance Brokerage industry average Net Margins in the same period were 11.6%

Sector and Industry Association of Arthur J. Gallagher & Co

For the purpose of performance benchmarking of a company with a sector or industry average, R&P Research associates every company with one sector and one industry. An industry consists of companies with related/similar business models. A sector comprises of a group of related/similar industries. For high-level analysis purposes, related/similar sectors are grouped into sector groups.

Arthur J. Gallagher & Co is associated with Financials Sector Group, Insurance Sector, and Insurance Brokerage Industry.

Insurance sector is comprised of the following industries: Life Insurance; Property & Casualty Insurance; Surety & Title Insurance; Insurance Brokerage; Diversified Insurance. The definitions for each of the industries is as follows:

  • Life Insurance industry includes companies engaged principally in life insurance.
  • Property & Casualty Insurance industry includes companies engaged principally in accident, fire, automotive, marine, malpractice and other classes of non-life insurance.
  • Surety & Title Insurance industry includes companies providing title & surety insurance.
  • Insurance Brokerage industry includes insurance brokers and agencies.
  • Diversified Insurance industry includes companies with life, health, property & casualty, and reinsurance interests, none of which predominates.

Industry Ranking of Arthur J. Gallagher & Co

With $5.6 billion revenues, Arthur J. Gallagher & Co ranked number 3 of all the companies in the US Insurance Brokerage industry. There were a total of 8 public companies in the US Insurance Brokerage industry that had revenues greater than $50 million during 2016.

The top companies in the US Insurance Brokerage industry by revenues during 2016 were:

  1. Marsh & Mclennan Companies ($13.2 billion)
  2. Aon ($11.6 billion)
  3. Arthur J. Gallagher & Co ($5.6 billion)
  4. Brown & Brown ($1.8 billion)
  5. Erie Indemnity ($1.6 billion)
  6. Crawford ($1.2 billion)
  7. Tiptree ($567.2 million)
  8. Kinsale Capital Group ($141.6 million)

Business Model Analysis (BMA) Framework

We use the following framework to assess the business model of a company. Business Model Analysis framework can be used by organizations to articulate growth strategies and identify cost optimization opportunities. Technology and consulting companies can use this framework to identify the value drivers and pain points of their targeted customers. Entrepreneurs can use this framework to understand the language of business and identify promising business opportunities. This framework can be used by any professional aspiring to take up a leadership role to better understand the businesses challenges, articulate growth strategy, and monitor the business improvement requirements for the organization.

Next Steps

  • Conduct a holistic benchmarking; to identify and target additional sources of value
  • Get in touch with us to learn more about Business Model Analysis Framework
  • Get free data, charts, and analysis of Arthur J. Gallagher & Coand its peers on select key performance indicators by clicking the reports provided below

Industry Peers and Competitors of arthur-j-gallagher-co

Marsh & Mclennan Companies (MMC) Business Analysis – Analyze Historical Performance,...

Marsh & Mclennan Companies, Inc. with $13 billion revenues in the year 2016 was the number 1 Insurance Brokerage company. Read this report to know the top competitors of Marsh & Mclennan Companies and identify growth and cost optimization opportunities of Marsh & Mclennan Companies

Aon (AON) Business Analysis – Analyze Historical Performance, Strategic Priorities, And...

Aon Plc with $12 billion revenues in the year 2016 was the number 2 Insurance Brokerage company. Read this report to know the top competitors of Aon and identify growth and cost optimization opportunities of Aon

Brown & Brown (BRO) Business Analysis – Analyze Historical Performance, Strategic...

Brown & Brown Inc with $2 billion revenues in the year 2016 was the number 4 Insurance Brokerage company. Read this report to know the top competitors of Brown & Brown and identify growth and cost optimization opportunities of Brown & Brown

Erie Indemnity (ERIE) Business Analysis – Analyze Historical Performance, Strategic Priorities,...

Erie Indemnity Co with $2 billion revenues in the year 2016 was the number 5 Insurance Brokerage company. Read this report to know the top competitors of Erie Indemnity and identify growth and cost optimization opportunities of Erie Indemnity

Crawford (CRDA) Business Analysis – Analyze Historical Performance, Strategic Priorities, And...

Crawford & Co with $1 billion revenues in the year 2016 was the number 6 Insurance Brokerage company. Read this report to know the top competitors of Crawford and identify growth and cost optimization opportunities of Crawford

Tiptree (TIPT) Business Analysis – Analyze Historical Performance, Strategic Priorities, And...

Tiptree Inc. with $567 million revenues in the year 2016 was the number 7 Insurance Brokerage company. Read this report to know the top competitors of Tiptree and identify growth and cost optimization opportunities of Tiptree

Revenues Analysis

Arthur J. Gallagher & Co (AJG) Revenues And Revenue Growth From...

This report provides the last five years revenues and revenue growth of Arthur J. Gallagher & Co (AJG) from 2012 to 2016. Arthur J. Gallagher & Co generated a total of $5.6 billion revenues during 2016. Arthur J. Gallagher & Co reported a revenue growth of 3.8% year-over-year during 2016. The revenues and the revenue growth correspond to the fiscal year ending in December.

Arthur J. Gallagher & Co (AJG) Revenues And Revenue Growth From...

This report provides the last fifteen years revenues and revenue growth of Arthur J. Gallagher & Co (AJG) from 2002 to 2016. Arthur J. Gallagher & Co generated a total of $5.6 billion revenues during 2016. Arthur J. Gallagher & Co reported a revenue growth of 3.8% year-over-year during 2016. The revenues and the revenue growth correspond to the fiscal year ending in December.

Arthur J. Gallagher & Co (AJG) Revenue Growth Comparison With Industry...

This report provides a comparison of Arthur J. Gallagher & Co (AJG) revenue growth with Insurance Brokerage industry growth during the last five years from 2012 to 2016. Arthur J. Gallagher & Co reported a revenue growth of 3.8% year-over-year during 2016. The Insurance Brokerage industry growth was 2.3% year-over-year during 2016. Arthur J. Gallagher & Co growth was faster than the industry during 2016.

Profit Analysis