On the desk today · Marsh
The insurer pays them. The client pays them. Nobody asks why both sides write a check.
| NYSE · MRSH |
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The Middleman Who Collects
From Both Sides
In 1871, a man named Henry Marsh opened an insurance brokerage in Beloit, Wisconsin. His pitch was simple — he would help businesses find the right insurance company and negotiate the best terms. He didn't take risk. He didn't pay claims. He sat in the middle, matched the buyer with the seller, and collected a commission for arranging the deal.
One hundred and fifty-five years later, the company bearing his name does $27 billion a year — and the model has not changed. Marsh still sits in the middle. Marsh still arranges the deal. And Marsh still collects from both sides.
I renewed my business insurance last quarter. My broker walked me through the options — carriers, coverage levels, deductibles, premium structures. I signed. I paid. What I didn't think about until later is that the insurance company was also paying my broker — a placement fee for bringing them my business. The broker was compensated by me for his advice and by the insurer for the placement. Both sides of the transaction wrote a check to the same firm.
That firm, in this case, was a subsidiary of Marsh.
Most people think of insurance brokers as salespeople. Marsh is something else entirely. It is the world's largest professional services firm in the areas of risk, strategy, and people — a holding company that operates four businesses under one roof. Marsh Risk places insurance for corporations, governments, and institutions in 130 countries. Guy Carpenter arranges reinsurance — insurance for insurance companies. Mercer advises on human resources, retirement, and investments, managing approximately $692 billion in assets. And what was formerly Oliver Wyman provides management consulting. Together, they form the invisible infrastructure through which a vast portion of the world's risk gets priced, transferred, and managed.
The modern company was assembled through more than a century of mergers. The decisive period came in the late 1990s and early 2000s, when Marsh & McLennan consolidated its position as the largest insurance broker on earth. In 2024, under CEO John Doyle, the company completed its largest year of acquisitions ever — including McGriff Insurance Services. In January 2026, it rebranded from Marsh McLennan to simply Marsh, reflecting the dominance of its flagship brokerage.
In fiscal 2025, Marsh reported $27.0 billion in revenue — up 10% from the year before, or 4% on an underlying basis. Operating income reached $6.2 billion. Net income hit $4.2 billion. Risk and Insurance Services — the brokerage and reinsurance businesses — generated $17.3 billion, or 64% of total revenue. Consulting contributed $9.8 billion. The company employs over 95,000 people across 130 countries. It completed 20 acquisitions in 2025, returned $2.0 billion through buybacks and $1.7 billion in dividends, and expanded its adjusted operating margin for the 17th consecutive year.
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That 17-year streak of margin expansion is the number that tells you what kind of business this is. Margins expand when pricing grows faster than costs — year after year, through recessions, through pandemics, through every market cycle since 2008. Insurance premiums tend to rise over time. When premiums rise, the broker's commission — typically calculated as a percentage of the premium — rises automatically. Marsh doesn't need to sell more policies. It just needs the same policies to cost more. And they almost always do.
Here is where the toll-booth economics become most visible. Marsh Risk earns commissions and fees from the client for advisory work — structuring the program, analyzing the risk, managing the claims. Then it earns commissions from the insurer for placing the business — a percentage of the premium the insurer collects. In some cases, it also earns contingent commissions based on the profitability or volume of the book it places. Three revenue streams from a single transaction. The broker touches the money. The broker doesn't take the risk.
John Doyle — who became president and CEO in 2023 — said it plainly in the fourth-quarter 2025 earnings release: "We delivered another strong year of results in 2025, including solid underlying growth across all of our businesses. Adjusted EPS grew 9% for the full year. We remain focused on driving long-term value for our clients and shareholders."
The flywheel runs through two channels simultaneously. On the risk side, Marsh Risk places insurance for companies around the world — and as the economy grows, as regulations tighten, and as new risks emerge (cyber, climate, supply chain), demand for insurance grows. More insurance means more premiums. More premiums mean more brokerage fees. On the consulting side, Mercer manages $692 billion in retirement and investment assets — and as those assets grow with the market, Mercer's asset-based fees grow with them. When the S&P 500 rises 20%, Mercer's assets under management rise — and the fee it collects on those assets rises too. The company earns more simply because the world's capital pool gets bigger.
WHY THIS WORKS
Both sides of the transaction pay. Marsh collects advisory fees from the client and placement commissions from the insurer. The broker sits in the middle of every policy and collects from both directions.
Premiums rise, fees rise automatically. Brokerage commissions are a percentage of the premium. As insurance costs increase — driven by inflation, claims, and regulation — Marsh's revenue grows with no additional effort.
$692 billion in managed assets is the hidden engine. Most people see Marsh as an insurance broker. Inside it sits Mercer, one of the largest investment managers on earth. Asset-based fees compound with the market.
17 consecutive years of margin expansion. Since 2008, through every market cycle, Marsh has expanded its adjusted operating margin. The combination of pricing power and operational discipline creates a ratchet that only moves one direction.
Marsh's 10-K contains a line that most investors skim past: "In addition to compensation from its clients, Marsh Risk also receives other compensation, separate from retail fees and commissions, from insurance companies." That "other compensation" includes consulting fees paid by insurers, administrative service fees, contingent commissions based on profitability, and fees for underwriting services. The broker doesn't just arrange the policy. It gets paid by the insurer for helping the insurer manage the business the broker brought in. A company that started as a middleman in 1871 has spent 155 years making the middle wider — and taking a larger share from both sides with every passing year.
