Sunday Scoop: Tracy's Treasure Trove/Broker Commissions To Snap Back?

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Sunday Scoop: Tracy's Treasure Trove/Broker Commissions To Snap Back?

Nonlife Insurance

Sunday Scoop: Tracy's Treasure Trove/Broker July 5, 2026

Commissions To Snap Back?

AJG shared at its recent quarterly investor meeting that pricing is just 1% of its

current organic revenue outlook. This sounds asymmetrical given how much brokers

benefited during the hard cycle. AJG agrees that there is an asymmetrical dynamic by

offering client concessions on the way up and defending fees on the way down.

This conversation drove our interest to review statutory data. We found that tbenguigui@wolferesearch.comTracy Benguigui

commercial lines composite commissions are more pro-cyclical than counter-cyclical. (646) 419-2560

There is a nuance with commercial property commissions that run counter-cyclical View Tracy’s Research

View Comp Tableto pricing in the short term, before turning pro-cyclical roughly three years later.

AJG confirmed to us that this asymmetry dynamic they were inferring is far more Dean Criscitiello

dcriscitiello@wolferesearch.com

pronounced in property fee-based businesses than in traditional commissions. While 646-419-2562

the larger brokers typically see a greater proportion of fees than regional brokers, our

understanding is that MRSH's property placements lean heavily toward commissions

over fees.

We think brokers are over-earning on commissions and expect a reversion to the

mean as this soft market progresses.

What does the statutory data tells us?

●Commercial Lines Commission-to-DPW ratios currently ~1pt above 30-

year average seen across all LOBs except Commercial Auto.

●Wide dispersion by line: CMP command the highest commission rates -

highest and steadiest line - while workers compensation is a laggard (though

momentum picking up).