Key financial results
- Total revenue: Combined Brokerage and Risk Management segments posted total revenue growth of 18% in the third quarter.
total revenue growth of 18% in the third quarter
- Organic growth: Organic growth was 5% for the combined Brokerage and Risk Management segments.
Organic growth was also strong at 5%
- Earnings and EBITDAC: Net earnings grew 25%, and adjusted EBITDAC also grew 25%.
Net earnings grew 25%, and adjusted EBITDAC also grew 25%.
- Levelized results: Adjusted revenues were up 20%, adjusted EBITDA grew 34%, adjusted EPS grew 37%, and adjusted EBITDA per share grew 35% when levelized to remove $76 million of interest income earned in third quarter 2025 on funds held to buy AssuredPartners.
On that basis, adjusted revenues were up 20%. Adjusted EBITDA grew 34%, adjusted EPS grew 37% and adjusted EBITDA per share grew 35%.
- Brokerage margin: Brokerage adjusted EBITDAC margin was 35.3% in the third quarter.
Our adjusted EBITDAC margin was 35.3% in the third quarter.
- Risk Management margin: Risk Management adjusted EBITDAC grew 17% with a margin of 22.8%, up 90 basis points over last year.
Risk Management third quarter adjusted EBITDAC grew 17% with margin landing at 22.8%, up 90 basis points over last year
Business segment results
- Brokerage: Brokerage revenues were up 19%, of which organic growth was 5%.
brokerage revenues were up 19%, of which organic was 5%.
- Retail PC Property: Property renewal premiums in global retail property and casualty declined 6% compared to down 10% in the second quarter.
Property remains competitive with renewal premiums declining 6% compared with down 10% in the second quarter.
- Retail PC Casualty: Casualty renewal premiums were up 4% overall in the third quarter.
casualty renewal premiums, which includes general liability, commercial, auto and umbrella, were up 4% overall.
- Professional lines: Professional lines renewal premiums were up 2% in the third quarter.
Professional lines, including D&O and cyber were up 2%.
- Workers' comp: Workers' comp renewal premiums were up 1% in the third quarter.
Workers' comp was up 1%
- Personal lines and package: Personal lines renewal premiums were up 3% and package was up 3% in the third quarter.
personal Lines was up 3% and package was also up 3%.
- Reinsurance: Reinsurance organic growth was 7% in the third quarter.
Reinsurance growth was 7%
- Employee benefits: Employee benefits organic growth was impacted by a few larger consulting projects that were pushed out as clients focused on controlling rapidly rising medical and prescription costs.
in the third quarter, however, a few larger consulting projects were pushed out as clients focused on controlling rapidly rising medical and prescription costs.
- Gallagher Bassett: Risk Management segment Gallagher Bassett posted revenue growth of 14%, which includes organic growth of 10%.
Gallagher Bassett, posted revenue growth of 14%, which includes organic of 10%
- AssuredPartners: AssuredPartners delivered $285 million of adjusted EBITDAC in the quarter.
AP did deliver $285 million of adjusted EBITDAC in the quarter.
Capital allocation
- M&A completed: Completed 5 new tuck-in acquisitions in the third quarter representing approximately $100 million of estimated annualized revenue.
completed 5 new tuck-in acquisitions, representing approximately $100 million of estimated annualized revenue.
- Year-to-date M&A: Completed 21 acquisitions so far this year representing approximately $225 million of estimated annualized revenue.
brings us to 21 so far this year with approximately $225 million of estimated annualized revenue.
- M&A pipeline: M&A pipeline remains active with over 30 term sheets signed or being prepared representing around $300 million of annualized revenue.
pipeline remains active with over 30 term sheets signed or being prepared, representing around $300 million of annualized revenue.
- Share repurchases: Repurchased about 400,000 shares for approximately $100 million in the third quarter.
repurchased about 400,000 shares for approximately $100 million in the third quarter.
- Year-to-date repurchases: Brought total share repurchases to about $580 million through September 30.
brings repurchases to about $580 million through September 30.
- Acquisition capacity: Estimated more than $12 billion of acquisition capacity to deploy over the next 2 years from cash on hand, expected free cash flow, and future investment-grade borrowing.
estimate more than $12 billion of acquisition capacity to deploy over the next 2 years.
Industry trends and dynamics
- Rate impact: About 1 point of organic growth is tied to insurance rates currently.
about 1 point of organic growth today is tied to rates.
- P&C market: Property remains competitive while casualty varies considerably by line and account, and carriers want to write risks at the right returns.
- E&S market: In the U.S. excess and surplus property remains very competitive, particularly cat-exposed property, but lower pricing does not mean business leaves E&S.
In the U.S. excess and surplus property remains very competitive, particularly cat-exposed property. But lower pricing doesn't necessarily mean the business leaves E&S.
- Economic indicators: Daily revenue indications from underlying client insurance activity continue to be nicely positive, pointing to solid business activity and steady underlying exposure growth.
those indicators continue to be nicely positive, pointing to solid business activity and steady underlying exposure growth.
Competitive landscape
- Diversified model: Gallagher's diversified business model and breadth of capabilities position the company well as market conditions evolve.
we believe our diversified model and breadth of capabilities position us well to continue growing as the market conditions evolve.
- Gallagher Bassett position: Gallagher Bassett's competitive position is strengthened by investments in expanded capabilities, deeper data, and more robust technology.
Clients are benefiting from our expanded capabilities, deeper data and more robust technology.
- Hit ratios: Management noted that hit ratios move over 40% and up towards 50% when company tools are used.
those hit ratios are moving over 40% and up towards 50%.
Macroeconomic environment
- Global demand: The need for insurance is growing around the world and risks are becoming more complex, requiring broader capabilities and more sophisticated solutions.
The need for insurance is growing around the world and risks are becoming more complex, thus requiring broader capabilities and more sophisticated solutions.
- Emerging risks: Clients need advice and expertise for emerging risks in construction, infrastructure, energy, data centers, and artificial intelligence.
Think about construction, infrastructure, energy and data centers as well as the growing need for clients to understand, mitigate and ensure emerging risks from AI
Growth opportunities and strategies
- Strategic pillars: Growth is driven by four strategic pillars: growing organically, growing through M&A, improving productivity and quality, and maintaining culture.
growing organically, growing through M&A, improving our productivity and quality and maintaining our culture
- Centers of excellence: Centers of excellence are now 20,000 colleagues strong, aiming to reduce rework, improve quality, and give people more time to serve and advise clients.
- AssuredPartners synergies: AssuredPartners integration remains on track for $160 million of annualized run rate synergies by year-end 2026, increasing to $325 million by early 2028.
remain on track for $160 million of annualized run rate synergies by year-end '26 and that goes up to $325 million by early 2028.
Financial guidance and outlook
- 2026 organic outlook: Management reaffirmed the 2026 full-year organic growth outlook of approximately 6% for the combined Brokerage and Risk Management segments.
- Q4 brokerage organic: Fourth quarter and full-year 2026 brokerage organic growth is projected to be around 5%.
see fourth quarter and full year '26 brokerage organic growth of around 5%.
- Gallagher Bassett margin outlook: Fourth quarter and full-year 2026 adjusted EBITDAC margin for Gallagher Bassett is projected to be north of 22%.
fourth quarter and full year '26 adjusted EBITDAC margin again, north of 22%.
- 2027 outlook: For 2027, legacy brokerage organic growth is indicated to look similar to 2026, with an expected AssuredPartners headwind of about 40 to 50 basis points for the full year.
- Cash taxes: Cash taxes paid are set at about 10% of EBITDAC for modeling purposes.
set your cash taxes paid at about 10% of EBITDAC, and that should get you close.
Q3 2026 results
| Metric | Result | Change |
|---|---|---|
| Combined Brokerage and Risk Management Total Revenue Growth | 18% | Up 18% |
| Combined Brokerage and Risk Management Organic Growth | 5% | Up 5% |
| Net Earnings Growth | 25% | Up 25% |
| Adjusted EBITDAC Growth | 25% | Up 25% |
| Brokerage Organic Growth | 5% | Up 5% |
| Risk Management Organic Growth | 10% | Up 10% |
How management sounded
Positive (+45 on our -100 to +100 scale). Management expressed strong confidence in their diversified model, ongoing margin expansion, and successful integration of AssuredPartners. Management sounded more upbeat than on 62% of the 302 calls we cover; most companies sound positive on their own calls, so the comparison says more than the label.
Read the analyst Q&A summary and guidance and outlook for this call.
What to watch before the next call
- Progress on AssuredPartners system integration and realization of the $325 million run rate synergies by early 2028.
- Evolution of property and casualty pricing and its impact on organic growth rates.
- Timing of deferred employee benefit consulting projects as clients manage rising medical costs.
Earlier calls
- Q2 2026 (Jul 30, 2026), tone Balanced: Arthur J. Gallagher reported 24% total revenue growth and 6% organic growth, driven by strength in brokerage and risk management.
