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What changed in Brown & Brown's 10-K — 2024 vs 2025

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Paragraph-level year-over-year comparison of Brown & Brown's 2024 and 2025 10-K annual filings, covering the Business, Risk Factors, Legal Proceedings, Cybersecurity, MD&A and Market Risk sections. Every new, removed and edited paragraph is highlighted side-by-side so you can see exactly what management changed in the 2025 report.

+388 added−387 removedSource: 10-K (2025-02-13) vs 10-K (2024-02-22)

Top changes in Brown & Brown's 2025 10-K

388 paragraphs added · 387 removed · 294 edited across 9 sections

Item 1. Business

Business — how the company describes what it does

54 edited+10 added−40 removed42 unchanged
Biggest changeWe strive to have comprehensive benefit offerings, as we believe the overall well-being of our teammates and their families comes first, and having competitive benefits helps set us apart in recruiting and retaining high-quality talent. In 2023, there were no widespread layoffs or pay reductions as a result of external factors, such as the economy or natural disasters.
Biggest changeIn 2024, there were no widespread layoffs or pay cuts as a result of external factors, such as the economy or natural disasters. Flexible work arrangements, financial aid through the Disaster Relief Foundation and a focus on well-being exemplify our commitment to teammates and their families. Teammate Engagement To foster engagement, we gather anonymous feedback annually.
Fee revenues are generated by: (i) our Services segment, which provides insurance-related services, including third-party claims administration and comprehensive medical utilization management services in both the workers’ compensation and all-lines liability arenas, as well as Medicare Set-aside services, Social Security disability and Medicare benefits advocacy services, and other claims adjusting services, (ii) our National Programs and Wholesale Brokerage segments, which earn fees primarily for the issuing of insurance policies on behalf of insurance carriers, and (iii) our Retail segment for fees received in lieu of commissions or for other services provided.
Fee revenues are generated by: (i) our Services segment, which provides insurance-related services, including third-party claims administration and comprehensive medical utilization management services in both the workers’ compensation and all-lines liability arenas, as well as Medicare Set-aside services, Social Security disability and Medicare benefits advocacy services, and other claims adjusting services, (ii) our Programs and Wholesale Brokerage segments, which earn fees primarily for the issuing of insurance policies on behalf of insurance carriers, and (iii) our Retail segment for fees received in lieu of commissions or for other services provided.
The National Programs segment, which acts as an MGU, provides professional liability and related package products for certain professionals, a range of insurance products for individuals, flood coverage, and targeted products and services designated for specific industries, trade groups, governmental entities and market niches, all of which are delivered through a nationwide network of independent agents, including Brown & Brown retail agents, as well as affinity groups, wholesale entities and sold direct to consumers.
The Programs segment, which acts as an MGU, provides professional liability and related package products for certain professionals, a range of insurance products for individuals, flood coverage, and targeted products and services designated for specific industries, trade groups, governmental entities and market niches, all of which are delivered through a nationwide network of independent agents, including Brown & Brown retail agents, as well as affinity groups, wholesale entities and sold direct to consumers.
While it is difficult to quantify the impact on our business from individuals or small businesses purchasing insurance over the internet, we believe this risk would generally be isolated to personal lines customers with single-line coverage, or small businesses that do not have a complex insurance program, which represent a small portion of our overall Retail or National Programs segments.
While it is difficult to quantify the impact on our business from individuals or small businesses purchasing insurance over the internet, we believe this risk would generally be isolated to personal lines customers with single-line coverage, or small businesses that do not have a complex insurance program, which represent a small portion of our overall Retail or Programs segments.
In addition, the Company monitors the representation of women and underrepresented racial and ethnic minorities, because we believe diversity helps us build better teams, facilitate innovation and improve our customer experience. We discuss our gender and minority profile periodically with our board of directors and continue to strive to further diversify our workforce and strengthen our culture.
In addition, the Company monitors the representation of women and racial and ethnic minorities because we believe diversity helps us build better teams, facilitate innovation and improve our customer experience. We discuss our gender and minority profile periodically with our board of directors and continue to strive to further diversify our workforce and strengthen our culture.
Penny has been our chief acquisitions officer since 2011, and he serves as director and as an executive officer for several of our subsidiaries. He served as a regional president from 2010 to 2014 and regional executive vice president from 2002 to July 2010. From 1999 until January 2003, Mr.
Scott Penny. Mr. Penny has been our chief acquisitions officer since 2011, and he serves as director and as an executive officer for several of our subsidiaries. He served as a regional president from 2010 to 2014 and regional executive vice president from 2002 to July 2010. From 1999 until January 2003, Mr.
Outside of the United States we have retail operations based in Bermuda, Canada, Cayman Islands, Republic of Ireland and the United Kingdom, managing general underwriter operations in Canada, France, Germany, Hong Kong, Italy, Malaysia, the Netherlands, United Arab Emirates and the United Kingdom; and wholesale brokerage operations based in Belgium, Hong Kong, Italy and the United Kingdom.
Outside of the United States we have retail operations based in Bermuda, Canada, Cayman Islands, Republic of Ireland and the United Kingdom, managing general underwriter operations in Canada, France, Germany, Hong Kong, Italy, Malaysia, the Netherlands, United Arab Emirates and the United Kingdom; and wholesale brokerage operations based in Belgium, Hong Kong, Italy, Singapore and the United Kingdom.
Walker was appointed president of our National Programs segment in 2014. He served as regional executive vice president from 2012 to 2014. Mr. Walker is responsible for our National Programs segment. He has also served as chief executive officer of Arrowhead since 2012.
Walker was appointed president of our Programs segment in 2014. He served as regional executive vice president from 2012 to 2014. Mr. Walker is responsible for our Programs segment. He has also served as chief executive officer of Arrowhead since 2012.
Before joining Brown & Brown Absence Service Group in August 2012, Ms. Turpin served as the chief operating officer of GCG Risk Management Consultants LLC, an insurance brokerage firm she co-founded in Bannockburn, Illinois, from February 2009 until March 2012. She has previously held operational leadership positions with Marsh U.S.A., Inc., Forrest Company Realty, Inc., and NRG Energy, Inc. K.
Before joining Brown & Brown Absence Service Group in August 2012, Ms. Turpin served as the chief operating officer of GCG Risk Management Consultants LLC, an insurance brokerage firm she co-founded in Bannockburn, Illinois, from February 2009 until March 2012. She has previously held operational leadership positions with Marsh U.S.A., Inc., Forrest Company Realty, Inc., and NRG Energy, Inc. J.
Our Wholesale Brokerage segment has physical locations in 22 states plus Belgium, Hong Kong, Italy and the United Kingdom. Our Wholesale Brokerage segment markets and sells excess and surplus commercial insurance products and services to retail insurance agencies (including Brown & Brown retail offices). The Wholesale Brokerage segment represents various U.S., U.K., and European surplus lines insurance companies.
Our Wholesale Brokerage segment has physical locations in 24 states plus Belgium, Hong Kong, Italy and the United Kingdom. Our Wholesale Brokerage segment markets and sells excess and surplus commercial insurance products and services to retail insurance agencies (including Brown & Brown retail offices). The Wholesale Brokerage segment represents various U.S., U.K. and European surplus lines insurance companies.
He was previously the chairman of the board for Surflight Theatre and the Make-A-Wish Foundation of New Jersey. 12
He was previously the chairman of the board for Surflight Theatre and the Make-A-Wish Foundation of New Jersey.
As a way to offer teammates flexibility to observe any day during the year to recognize their culture or heritage, we offer an additional floating holiday known as Culture Day. Brown & Brown does not tolerate discrimination in any form concerning any aspect of employment.
To offer teammates flexibility to observe any day during the year to recognize their culture or heritage, we offer an additional floating holiday known as Culture Day. Brown & Brown does not tolerate discrimination in any form concerning any aspect of employment.
See Note 16 to the Consolidated Financial Statements and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for additional segment financial data relating to our business.
See Note 15 to the Consolidated Financial Statements and “Management’s Discussion and Analysis of Financial Condition and Results of Operations” for additional segment financial data relating to our business.
Requests for copies of any of these documents should be directed in writing to: Corporate Secretary, Brown & Brown, Inc., 300 North Beach Street, Daytona Beach, Florida 32114 or by telephone to (386)-252-9601. Information About Our Executive Officers Set forth below is certain information concerning our executive officers as of February 22, 2024.
Requests for copies of any of these documents should be directed in writing to: Corporate Secretary, Brown & Brown, Inc., 300 North Beach Street, Daytona Beach, Florida 32114 or by telephone to (386)-252-9601. Information About Our Executive Officers Set forth below is certain information concerning our executive officers as of February 11, 2025.
However, with the sold businesses representing, as a percentage of total Company, approximately 3% of the total revenue, 2% of the total assets and 2% of net income, the Company determined that treating the sale as discontinued operations was not appropriate. Claims Administration.
However, with the sold businesses 5 representing, as a percentage of total Company, approximately 3% of the total revenue, 2% of the total assets and 2% of net income, the Company determined that treating the sale as discontinued operations was not appropriate.
In 2021, we announced the creation of a Mental Health Allies group, which consists of a group of teammate volunteers that are ready to serve as points of contact for our mental health resources, as well as a support system for our teammates. Mental Health Allies complete mental health first aid training offered by the National Council for Behavioral Health.
In 2021, we announced the creation of a Mental Health Allies group, which consists of teammate volunteers ready to serve as points of contact for our mental health resources and a support system for our teammates. Mental Health Allies complete mental health first aid training offered by the National Council for Behavioral Health.
In connection with selling and marketing of insurance 6 coverages, we provide a broad range of related services to our customers, such as risk management strategies, loss control surveys and analysis, consultation in connection with placing insurance coverages and claims processing. National Programs segment As of December 31, 2023, our National Programs segment employed 3,743 employees.
In connection with selling and marketing of insurance coverages, we provide a broad range of related services to our customers, such as risk management strategies, loss control surveys and analysis, consultation in connection with placing insurance coverages and claims processing. 6 Programs segment As of December 31, 2024, our Programs segment employed 3,986 employees.
Brown was previously responsible for overseeing certain or all parts of all of our segments over the years, and worked in various capacities throughout the Company since joining us in 1995. Mr. Brown has served on the board of directors of WestRock Company (formerly RockTenn Company), a publicly held company, since January 2010.
Brown was previously responsible for overseeing certain or all parts of all of our segments over the years, and worked in various capacities throughout the Company since joining us in 1995. Mr. Brown served on the board of directors of WestRock Company (formerly RockTenn Company), a publicly held company, from 2010 until 2024.
Our National Programs segment has physical locations in 20 states plus Canada, France, Germany, Hong Kong, Italy, Malaysia, the Netherlands, United Arab Emirates and the United Kingdom.
Our Programs segment has physical locations in 16 states plus Canada, France, Germany, Hong Kong, Italy, Malaysia, the Netherlands, United Arab Emirates and the United Kingdom.
All officers hold office for one-year terms or until their successors are elected and qualified. J. Hyatt Brown Chairman of the board 86 J. Powell Brown President, chief executive officer 56 P. Barrett Brown Executive vice president; president - Retail segment 51 Stephen M. Boyd Executive vice president; president - Wholesale Brokerage segment 50 Julie L.
All officers hold office for one-year terms or until their successors are elected and qualified. J. Hyatt Brown Chairman of the board 87 J. Powell Brown President, chief executive officer 57 P. Barrett Brown Executive vice president; president - Retail segment 52 Stephen M. Boyd Executive vice president; president - Wholesale Brokerage segment 51 Julie L.
Specialty programs include flood insurance, commercial difference-in-conditions (earthquake), all-risk commercial property, limited exposure captives, coastal property programs including wind, lender-placed solutions, sovereign native-American nations and parcel insurance. Wholesale Brokerage segment As of December 31, 2023, our Wholesale Brokerage segment employed 1,918 employees.
Specialty programs include flood insurance, commercial difference-in-conditions (earthquake), all-risk commercial property, limited exposure captives, coastal property programs including wind, lender-placed solutions, sovereign native-American nations and parcel insurance. Wholesale Brokerage segment As of December 31, 2024, our Wholesale Brokerage segment employed 2,026 employees.
Segment Information Our business is divided into four reportable segments: (i) the Retail segment, (ii) the National Programs segment, (iii) the Wholesale Brokerage segment and (iv) the Services segment.
Segment Information Historically, our business was divided into four reportable segments: (i) the Retail segment, (ii) the Programs segment, (iii) the Wholesale Brokerage segment and (iv) the Services segment.
The applicable licensing laws and regulations in all states and international jurisdictions are subject to amendment or reinterpretation by regulatory authorities, which in most cases have broad discretion as to the granting, revocation, suspension and renewal of licenses.
Regulations and licensing laws vary by individual state and international location and are often complex. 7 The applicable licensing laws and regulations in all states and international jurisdictions are subject to amendment or reinterpretation by regulatory authorities, which in most cases have broad discretion as to the granting, revocation, suspension and renewal of licenses.
These operations generated $527.0 million, $240.6 million and $78.0 million of revenues for the years ended December 31, 2023, 2022 and 2021, respectively. We do not have any material foreign long-lived assets.
These operations generated $665 million, $527 million and $240 million of revenues for the years ended December 31, 2024, 2023 and 2022, respectively. We do not have any material foreign long-lived assets.
As of December 31, 2023, our activities were conducted in 322 domestic locations in 46 states, and 177 international locations in Belgium, Bermuda, Canada, Cayman Islands, France, Germany, Hong Kong Special Administrative Region of the People's Republic of China (“Hong Kong”), Republic of Ireland, Italy, Malaysia, the Netherlands, United Arab Emirates and the United Kingdom.
As of December 31, 2024, our activities were conducted in 315 domestic locations in 44 states, and 201 international locations in Belgium, Bermuda, Canada, Cayman Islands, France, Germany, Hong Kong Special Administrative Region of the People's Republic of China (“Hong Kong”), Republic of Ireland, Italy, Malaysia, the Netherlands, Singapore, United Arab Emirates and the United Kingdom.
Competition The insurance intermediary business is highly competitive, and numerous firms actively compete with us for customers and insurance markets. Competition in the insurance business is largely based upon innovation, knowledge, understanding of terms and conditions of coverage, quality of service and price. A number of firms with substantially greater resources and market presence compete with us.
Competition in the insurance business is largely based upon innovation, knowledge, understanding of terms and conditions of coverage, quality of service and price. A number of firms with substantially greater resources and market presence compete with us.
During 2023, commissions and fees from our largest single Retail segment customer represented 0.8% of the Retail segment’s total commissions and fees. As of December 31, 2023, our Retail segment employed 9,705 employees. Our Retail segment has physical locations in 42 states plus Bermuda, Canada, Cayman Islands, Republic of Ireland and the United Kingdom.
During 2024, commissions and fees from our largest single Retail segment customer represented 0.7% of the Retail segment’s total commissions and fees. As of December 31, 2024, our Retail segment employed 10,962 employees. Our Retail segment has physical locations in 44 states plus Bermuda, Canada, Cayman Islands, the Netherlands, Republic of Ireland and the United Kingdom.
Regulation, Licensing and Agency Contracts We and/or our designated employees must generally be licensed to act as agents, brokers, intermediaries or third-party administrators by regulatory authorities in the locations in which we conduct business. Regulations and licensing laws vary by individual state and international location and are often complex.
Regulation, Licensing and Agency Contracts We and/or our designated employees must generally be licensed to act as agents, brokers, intermediaries or third-party administrators by regulatory authorities in the locations in which we conduct business.
He has been our president since January 2007 and was appointed to be a director in October 2007. Prior to 2007, he served as one of our regional executive vice presidents since 2002. Mr.
Powell Brown, has served as a director since October 2007. 10 J. Powell Brown. Mr. Brown was named chief executive officer in July 2009. He has been our president since January 2007 and was appointed to be a director in October 2007. Prior to 2007, he served as one of our regional executive vice presidents since 2002. Mr.
The National Programs segment specializes in the development, underwriting and management of insurance program business, often designed for niche, underserved markets and distributes these coverages to retail agencies (including Brown & Brown retail offices), as well as affinity groups, wholesale entities and sold direct to consumers.
The Programs segment specializes in the development, underwriting and management of insurance program business, often designed for niche, underserved markets and distributes these coverages to retail agencies (including Brown & Brown retail offices), as well as affinity groups, wholesale entities and sold direct to consumers. Our largest Programs segment customer represented approximately 12.7% of the segment's total commissions and fees.
Personal lines programs offer a variety of insurance products to personal lines consumers including homeowners and personal property policies; residential earthquake; private passenger automobile and motorcycle coverage, which is currently in run-off. Commercial Lines programs.
Professional liability programs also offer supplementary insurance-related products to include weddings, events, medical facilities and cyber liability. Personal Lines programs. Personal lines programs offer a variety of insurance products to personal lines consumers including homeowners and personal property policies; residential earthquake; private passenger automobile and motorcycle coverage, which is currently in run-off. Commercial Lines programs.
We endeavor to monitor the licensing status of our employees, but the possibility exists that we and/or our employees could be excluded or temporarily suspended from carrying on some or all of our activities in a particular jurisdiction in addition to being subjected to fines. Human Capital At December 31, 2023, the Company had 16,152 employees globally.
We endeavor to monitor the licensing status of our employees, but the possibility exists that we and/or our employees could be excluded or temporarily suspended from carrying on some or all of our activities in a particular jurisdiction in addition to being subjected to fines. Human Capital As of December 31, 2024, Brown & Brown employed 17,403 individuals worldwide.
In 2022, we began establishing Teammate Resource Groups (each, a "TRG") that are each founded around one identity. We now have five TRGs, which meet internally, empower one another, host events and are expected to make recommendations on how our Company can improve policies, impact recruitment and continue to be a strong part of the community.
We now have 11 TRGs, which meet internally, empower one another, host events and are expected to make recommendations on how our Company can improve policies, impact recruitment and continue to be a strong part of the community.
As part of our strategy, we continue to evolve and augment our Diversity, Inclusion and Belonging ("DIB") advisory council, which is composed of numerous teammates and leaders with different backgrounds, work experiences and skill sets. The mission of the DIB advisory council is assist with recruiting and development of inclusive relationships.
An empowered team helps to positively impact our customer service and community involvement. As part of our strategy, we continue to evolve and augment our Diversity, Inclusion and Belonging ("DIB") advisory council, which is composed of numerous teammates and leaders with different backgrounds, work experiences and skill sets.
In 2023, the Company had no work-related fatalities and 27 injuries or occupational diseases, as determined based on the number of claims made under our workers’ compensation policy, excluding claims that were closed and for which no payment was made.
In 2024, there were no work-related fatalities and 17 injuries or occupational diseases, as determined based on the number of claims made under our workers’ compensation policy, excluding claims that were closed and for which no payment was made. By prioritizing safety and health, we ensure a secure and productive workplace for all teammates.
Turpin Executive vice president, chief people officer 53 K. Gray Nester II Executive vice president, chief information officer 48 J. Scott Penny Executive vice president; chief acquisitions officer 57 Chris L. Walker Executive vice president; president - National Programs segment 66 R. Andrew Watts Executive vice president; chief financial officer and treasurer 55 J. Hyatt Brown. Mr.
Turpin Executive vice president, chief people officer 54 J. Scott Penny Executive vice president; chief acquisitions officer 58 Chris L. Walker Executive vice president; president - Programs segment 67 R. Andrew Watts Executive vice president; chief financial officer and treasurer 56 J. Hyatt Brown. Mr.
Brown & Brown's top priority is the total well-being of our teammates, which means physical, emotional, social and financial health and wellness. We believe that healthy teammates provide better support to their families, their communities and our customers, which results in our continued success as a Company.
Teammate Health and Well-Being Our top priority is holistic well-being—physical, emotional, social and financial. We believe that healthy teammates provide better support to their families, communities and customers, which results in our continued success as a Company. We encourage teammates to stay active, maintain a healthy work-life balance, volunteer in their local communities and prioritize their mental and physical health.
The following table summarizes (i) the commissions and fees generated by each of our reportable operating segments for 2023, 2022, and 2021 and (ii) the percentage of our total commissions and fees represented by each segment for each such period: (in millions, except percentages) 2023 % 2022 % 2021 % Retail segment $ 2,434.7 58.0 % $ 2,081.6 58.4 % $ 1,766.6 58.0 % National Programs segment 1,064.3 25.3 % 858.1 24.1 % 701.1 23.0 % Wholesale Brokerage segment 539.0 12.8 % 452.8 12.7 % 402.6 13.2 % Services segment 163.1 3.9 % 171.9 4.8 % 178.9 5.9 % Other (1.7 ) (— )% (1.2 ) (— )% (1.7 ) (0.1 )% Total $ 4,199.4 100.0 % $ 3,563.2 100.0 % $ 3,047.5 100.0 % The majority of our operations are in the United States.
The following table summarizes (i) the commissions and fees generated by each of our reportable operating segments for 2024, 2023, and 2022 and (ii) the percentage of our total commissions and fees represented by each segment for each such period: (in millions, except percentages) 2024 % 2023 % 2022 % Retail segment $ 2,720 57.8 % $ 2,503 59.6 % $ 2,154 60.5 % Programs segment 1,375 29.2 % 1,160 27.6 % 957 26.9 % Wholesale Brokerage segment 610 13.0 % 539 12.8 % 453 12.7 % Other (2 ) (— )% (3 ) (— )% (1 ) (0.1 )% Total $ 4,703 100.0 % $ 4,199 100.0 % $ 3,563 100.0 % The majority of our operations are in the United States.
The DIB advisor council is overseen and guided by our chief people officer. Our DIB advisory council evaluates our Company's current strengths and opportunities for development by initiating teammate surveys, listening sessions, group focus sessions and training modalities, including a course for all teammates focused on understanding and managing unconscious bias.
Our DIB advisory council evaluates our Company's current strengths and opportunities for development by initiating teammate surveys, listening sessions, group focus sessions and training modalities, including a course for all teammates focused on understanding and managing unconscious bias. In 2022, we began establishing Teammate Resource Groups ("TRGs"), each founded around one identity.
In 2024 the historical results associated with these businesses will be included within the Programs (formerly National Programs) segment. The Company performed an evaluation to determine if the sold businesses should be reported as discontinued operations.
Historical results were recast to align with the three-segment structure with the remaining businesses to be included as part of the Retail segment. The Company performed an evaluation to determine if the sold businesses should be reported as discontinued operations.
These teammates are available to listen impartially and support teammates, while also raising awareness regarding the importance of mental health and wellness.
These teammates are available to listen impartially and support teammates while also 9 raising awareness regarding the importance of mental health and wellness. Mental Health Allies are not diagnosticians or emergency providers but conduits who may assist teammates in finding the appropriate resources in a time of need.
We have agreements with our sales employees and certain other employees that include provisions that (i) protect our confidential information and trade secrets, (ii) restrict their ability post-employment to solicit the business of our customers, and (iii) prevent them from hiring of our employees for a period of time after separation from employment with us.
We have agreements with our sales team and certain other employees to: • Safeguard our confidential information and trade secrets, • Restrict post-employment solicitation of our customers and • Prevent the hiring of our employees for a set period after separation. The enforceability of these agreements varies based on applicable laws and factual circumstances.
With more than 60% of our U.S. teammates owning stock in our Company, we operate with an ownership mindset that influences how we invest in our business and the work we do for our customers. Our Team Our goal is to provide our teammates with long-term careers, which is why a vast majority of our teammates are full-time teammates.
Approximately 56% of our U.S. teammates own stock in our Company, which drives an ownership mindset that influences how we invest and serve our customers. Our Team Our goal is to provide teammates with fulfilling, long-term careers. Most of our workforce consists of full-time employees, but we also employ part-time and seasonal teammates.
As announced on October 31, 2023 and completed in the fourth quarter of 2023, the Company sold certain third-party claims administration and adjusting services businesses representing approximately 50% of the total revenues of the Services segment to Davies Group Ltd.
In the fourth quarter of 2023, the Company sold certain third-party claims administration and adjusting services of the Services segment to Davies Group Ltd. Beginning in fiscal year 2024 the Company operated three segments: Retail, Programs and Wholesale.
Professional liability and related package insurance products are tailored to the needs of professionals in the following areas: dentistry, legal, eyecare, insurance, financial, physicians and real estate title professionals. Professional liability programs also offer supplementary insurance-related products to include weddings, events, medical facilities and cyber liability. Personal Lines programs.
We offer program management expertise for insurance carrier partners across numerous lines of business, which can be grouped into five broad categories as detailed below: Professional programs. Professional liability and related package insurance products are tailored to the needs of professionals in the following areas: dentistry, legal, eyecare, insurance, financial, physicians and real estate title professionals.
Brown served on the board of directors of International Speedway Corporation, a publicly held company, until 2019. Mr. Brown is a member of the board of trustees of Stetson University, of which he is a past chairman, and the Florida Council of 100. Mr. Hyatt Brown’s sons, J. Powell Brown and P.
Brown is a member of the board of trustees of Stetson University, of which he is a past chairman, and the Florida Council of 100. Mr. Hyatt Brown’s sons, J. Powell Brown and P. Barrett Brown, are employed by us as president and chief executive officer, and as executive vice president and president – Retail segment, respectively. His son, J.
In addition, our chief executive officer shares biweekly video updates to connect with our teammates and encourage the importance of health and well-being. Our Company encourages individuals to engage in activities that promote good mental health and, when needed, to seek out help from friends, teammates, family and medical professionals.
This includes regular communication with teammates about the importance of physical, mental and financial wellness. In addition, our chief executive officer shares biweekly video updates to connect with our teammates and encourage the importance of health and well-being.
The enforceability of such agreements varies from state to state depending upon applicable law and factual circumstances. The majority of our employment relationships are at-will and terminable by either party at any time; however, the covenants regarding confidential information and non-solicitation of our customers and employees generally extend for a period of at least two years after cessation of employment.
The majority of our employment relationships are at will and terminable by either party at any time; however, the confidentiality and non-solicitation covenants generally extend at least two years after employment ends. Apart from certain employees in Canada, none of our employees are subject to a collective bargaining agreement. We consider our employee relations to be strong.
Over 20% of our Company is owned by teammates, which we believe cultivates a unique ownership culture. We strive to provide multiple opportunities for teammates to share in the ownership of Brown & Brown and to help create personal wealth, including through our employee stock purchase program, our 401(k) plan, and long-term equity grants.
By empowering, challenging and rewarding our teammates, we cultivate extraordinary results. With approximately 20% of the Company owned by teammates, we foster a unique ownership culture. Programs like the Employee Stock Purchase Plan, our 2008 Sharesave Plan, 401(k) and long-term equity grants encourage teammates to share in Brown & Brown’s success.
Mental Health Allies are not diagnosticians or emergency providers, but rather conduits who may assist teammates find the appropriate resources in a time of need. 10 In addition, our campus in Daytona Beach, Florida was designed with teammates in mind. Open floorplans encourage regular movement and interaction among our teammates, promoting a productive, collaborative work environment.
In addition, our campus in Daytona Beach, Florida, was designed with teammates in mind. Open floorplans encourage regular movement and interaction among our teammates, promoting a productive, collaborative work environment. Offices and workstations are equipped with ergonomic furniture and sit-stand desks, intentionally selected to support teammates' physical health.
Diversity, Inclusion and Belonging We believe having a team that is diverse in thought, experience, skills and work ethic, results in teammate empowerment and high performance. An empowered team helps to positively impact our customer service and community involvement.
In 2024, 94% of teammates rated Brown & Brown a Great Place to Work®. Our meritocracy encourages teammates to rise based on their performance, supported by a culture that prioritizes health, well-being and inclusion. Diversity, Inclusion and Belonging We believe having a team that is diverse in thought, experience and skills results in teammate empowerment and high performance.
During 2023, commissions and fees from our largest Wholesale Brokerage segment customer represented approximately 1.3% of the Wholesale Brokerage segment’s total commissions and fees. Services segment As of December 31, 2023, our Services segment employed 398 employees and provided a variety of insurance-related services.
During 2024, commissions and fees from our largest Wholesale Brokerage segment customer represented approximately 1.3% of the Wholesale Brokerage segment’s total commissions and fees. Competition The insurance intermediary business is highly competitive, and numerous firms actively compete with us for customers and insurance markets.
Offices and workstations are equipped with ergonomic furniture and sit-stand desks, intentionally selected to support teammates' physical health. Many of our other offices are also embracing open floorplans as they enter into new leases or refresh their office space.
Many of our other offices are also embracing open floorplans as they enter into new leases or refresh their office space. To assist those who have found themselves in financial hardships, we offer discounted services and products to teammates and the public through our Brown & Brown Savings Center.
We are committed to investing heavily in our teammate education and development through Brown & Brown University ("BBU"), the Brown & Brown Education Assistance Program and our Peer Partnership Program. Teammate Benefits Brown & Brown offers a wide variety of benefits, including medical and dental coverage, short-term and long-term disability, life insurance and a 401(k) plan.
Our commitment to learning is reflected in programs like Brown & Brown University (BBU), the Education Assistance Program, our Women-Led Mentorship Program and the Peer Partnership Program. 8 Teammate Benefits We offer comprehensive benefits, including medical, dental, disability, life insurance and 401(k) plans. Annually, we refine these offerings based on teammate feedback to ensure we meet their needs.
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As a result, beginning in fiscal year 2024 the Company will operate three segments: Retail, Programs (formerly National Programs), and Wholesale. Historical results will be recast to align with the three-segment structure with the remaining businesses to be included as part of the Retail segment.
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Our Guiding Principles Our foundation is built on four pillars: people, performance, service and innovation. Our employees, whom we call “teammates,” form a cohesive team bound by shared behaviors and values—our cultural DNA. We are committed to serving our customers, communities, teammates, carrier partners and shareholders by embracing diversity of talent, experience and thought.
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The Company performed an evaluation to determine if the sold businesses should be reported as 5 discontinued operations. However, with the sold businesses representing, as a percentage of total Company, approximately 3% of the total revenue, 2% of the total assets and 2% of net income, the Company determined that treating the sale as discontinued operations was not appropriate.
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As a meritocracy, we provide opportunities for teammates to grow based on their performance and initiative with the goal of ensuring every teammate has a path to success. Culture Integrity, innovation, discipline and meritocracy define our culture. Our customer-first approach drives a high-performing, decentralized organization focused on growth and service.
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Our largest National Programs segment customer represented approximately 8.1% of the segment's total commissions and fees. We offer program management expertise for insurance carrier partners across numerous lines of business, which can be grouped into five broad categories as detailed below: Professional programs.
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Full-time teammates: Work 30+ hours weekly and are eligible for full benefits. Part-time teammates: Work under 30 hours weekly and may qualify for limited benefits based on hours worked. Seasonal/temporary teammates: Join for specific projects or interim needs, with limited durations. Teammate Recruitment, Education and Development We prioritize attracting and developing talented individuals with diverse backgrounds.
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The two businesses listed below were not part of the sale of certain businesses to Davies Group Ltd. in the fourth quarter of 2023. In 2024, the financial results of these businesses, along with their historical financial results, will be included in the Retail segment. Social Security Advocacy and Advisory.
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Recruitment spans all levels, and our internal recruiting teams are vital in onboarding top talent. We have seen success hiring recent graduates, mid-level professionals and experienced industry leaders. In 2024, we expanded our team by nearly 1,000 teammates through 32 acquisitions. Additionally, partnerships with colleges and a robust internship program enable us to cultivate new talent.
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Social Security advocacy assists individuals throughout the United States who are seeking to establish eligibility for coverage under the federal Social Security Disability program and provides health plan selection and enrollment assistance for Medicare beneficiaries.
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The mission of the DIB advisory council is to assist with recruiting and the development of inclusive relationships. The DIB advisory council is overseen and guided by our chief people officer.
Removed
We work closely with employer sponsored group life, disability and health plan participants to assist disabled individuals in receiving the education, advocacy and benefit coordination assistance necessary to achieve the fastest possible benefit approvals. In addition, we provide second injury fund recovery services to the workers’ compensation insurance market. Medicare Secondary Payer compliance and Medicare Set-Aside.
Added
Our Company encourages individuals to engage in activities that promote good mental health and, when needed, to seek out help from friends, teammates, family and medical professionals. Brown & Brown teammates have access to coaching, therapy, and work-life services through a teammate assistance program.
Removed
Medicare secondary payer compliance and Medicare Set-aside provides statutory compliance services, conditional payment negotiation and resolution, structured settlements/annuity funding, professional administration and a post-settlement durable medical equipment and pharmacy program administration. 7 The following businesses were sold to Davies Group Ltd. in the fourth quarter of 2023.
Added
The program allows teammates to find confidential care for their emotional and mental health, how, when, and where they need it.
Removed
Claims administration provides third-party administration (“TPA”) services for commercial and personal property and casualty, medical, vocational, and professional liability insurance markets on a nationwide basis, providing claims adjusting, administration, subrogation, litigation and data management, claims investigations services, claim investigations, and audit services to insurance companies, self-insureds, public municipalities, insurance brokers and corporate entities.
Added
The benefit includes a fixed number of no-cost sessions of coaching or therapy per person per year, access to a deep repository of resources, videos, and articles on mental and physical health, as well as a suite of work-life services that provide advice on legal and financial issues, identity theft, and dependent care services.
Removed
We source claims activity from various Arrowhead programs in our National Programs segment, as well as from third parties. Self-Insured Trust Administration. Self-insured trust administration provides TPA services for government entities and self-funded or fully-insured workers’ compensation and liability plans and trusts including claims administration and a dedicated subrogation recovery department. Workers’ Compensation and Liability Plan Administration.
Added
Further, we recognize a growing need in our organization for teammates who also play the role of caregiver. We are piloting a program with robust, personalized caregiving services to relieve some of the burden and stress of this role. If the pilot proves successful, we anticipate a global rollout in 2026.
Removed
Workers’ compensation and liability plan administration provides claims administration, cost containment consulting services for secondary disability and subrogation recoveries, certified and non-certified medical management programs, access to medical networks, case management, utilization review services and risk management services such as loss control. In 2023, our five largest contracts represented approximately 38.8% of fee revenues in our Services segment.
Added
Workplace Safety Providing a safe environment is a core responsibility we take seriously. Comprehensive formal safety policies address hazardous conditions, emergencies and violence prevention.
Removed
Except for certain of our employees in Canada, none of our employees are subject to a collective bargaining agreement and we consider our relations with our employees to be good. 8 Our Guiding Principles The cornerstones of our organization's guiding principles are people, performance, service and innovation.
Removed
We view ourselves as a team and refer to our employees as “teammates,” and our team is characterized by a common framework of behaviors, skills, and characteristics that create a link between what we do and how we do it – our cultural DNA.
Removed
We believe in always doing what is best for our customers, communities, teammates, carrier partners and shareholders. We understand that every successful team thrives on the diversity of talent, thought, experience, character and work ethic. Our ability to continue to serve our customers and communities is dependent on the effective recruitment and enhancement of the most qualified teammates.
Removed
We are an equal opportunity employer built on meritocracy, meaning our teammates have the opportunity to rise according to their merits and individual initiative. Culture At Brown & Brown, we have a culture built on integrity, innovation, superior capabilities, discipline and meritocracy.
Removed
Our commitment to doing what is best for our customers drives our sales culture and is a crucial component in our Company's strategy. We operate as a lean, highly competitive, decentralized growth and profit-oriented sales and service organization. Our teammates are our greatest resource, and by challenging, empowering and rewarding them, our teams are driven to achieve extraordinary results.
Removed
In addition, we also employ regular part-time teammates and seasonal/temporary teammates. Full-time teammates work at least a 30 hours per week for an indefinite period of time and are generally eligible for all employment benefits provided by the Company.

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Item 1A. Risk Factors

Risk Factors — what could go wrong, per management

96 edited+54 added−8 removed81 unchanged
Biggest changeCybersecurity breaches of any of the systems we rely on may result from circumvention of security systems, denial-of-service attacks or other cyber-attacks, hacking, “phishing” attacks, computer viruses, ransomware, malware, employee or insider error, malfeasance, social engineering, physical breaches or other actions, any of which could expose us to data loss, monetary and reputational damages and significant increases in compliance costs.
Biggest changeCybersecurity breaches of any of the systems we rely on may result from circumvention of security systems, denial-of-service attacks or other cyber-attacks, software bugs, malicious or destructive code, hacking, social engineering attacks (including “phishing” attacks and digital or telephonic impersonation), computer viruses, ransomware, malware, employee or insider error or threats, malfeasance, social engineering, physical breaches or other actions, any of which could expose us to unauthorized access, exfiltration, manipulation, corruption, loss or disclosure of proprietary, customer, employee or other data, the inability to render services due to system outages or other business disruptions, regulatory action and scrutiny, monetary and reputational damages and significant increases in compliance costs.
The risk of such cybersecurity breaches may be increased by our increased reliance on work-from-home or other remote work technologies. An interruption of our access to, or an inability to access, our information technology, telecommunications or other systems could significantly impair our ability to perform such functions on a timely basis.
The risk of such cybersecurity breaches may be increased by our reliance on work-from-home or other remote work technologies. An interruption of our access to, or an inability to access, our information technology, telecommunications or other systems could significantly impair our ability to perform such functions on a timely basis.
Our international operations may be subject to a number of risks, including: • Difficulties in staffing and managing international operations; • Less flexible employee relationships, which may make it difficult and expensive to terminate employees and which limits our ability to prohibit employees from competing with us after their employment ceases; • Difficulties in maintaining, or resistance to, our corporate culture; • Political and economic instability (including acts of terrorism and outbreaks of war) either in the United States or globally; • Coordinating our communications and logistics across geographic distances and multiple time zones; • Unexpected changes in regulatory requirements and laws; • Adverse trade policies, and adverse changes to any of the policies of either the U.S. or any of the international jurisdictions in which we operate; • Adverse changes in tax rates; • Variations in foreign currency exchange rates; • Legal or political constraints on our ability to maintain or increase prices; • Governmental restrictions on the transfer of funds to or from us, including to or from our operations outside the United States; • Burdens of complying with, and the risk of employees or third parties acting on our behalf violating, anti-corruption laws in foreign countries; and • Burdens of complying with a wide variety of labor practices and international laws, including those relating to export and import duties, environmental policies and privacy issues.
Our international operations may be subject to a number of risks, including: • Difficulties in staffing and managing international operations; • Less flexible employee relationships, which may make it difficult and expensive to terminate employees and which limits our ability to prohibit employees from competing with us after their employment ceases; • Difficulties in maintaining, or resistance to, our corporate culture; • Political and economic instability (including acts of terrorism and outbreaks of war) either in the United States or globally; • Coordinating our communications and logistics across geographic distances and multiple time zones; • Unexpected changes in regulatory requirements and laws; • Adverse trade policies, and adverse changes to any of the policies of either the U.S. or any of the international jurisdictions in which we operate; • Adverse changes in tax rates; • Variations in foreign currency exchange rates; • Legal or political constraints on our ability to maintain or increase prices; • Governmental restrictions on the transfer of funds to or from us, including to or from our operations outside the United States; • Burdens of complying with, and the risk of employees or third parties acting on our behalf violating, anti-corruption laws in foreign countries; and • Burdens of complying with a wide variety of labor practices and international laws and or disclosure requirements, including those relating to export and import duties, environmental policies and privacy issues.
If there were a slowdown in vehicle 16 sales in the United States or regulatory changes, including tax-related changes, affecting the sale of non-insurance warranty services and products by vehicle dealers, our F&I businesses may be negatively impacted, which may impact our results of operation. changes in, or the termination of, certain programs administered by the U.s. federal government from which we derive revenues could adversely impact our results of operations.
If there were a slowdown in vehicle sales in the United States or regulatory changes, including tax-related changes, affecting the sale of non-insurance warranty services and products by vehicle dealers, our F&I businesses may be negatively impacted, which may impact our results of operation. changes in, or the termination of, certain programs administered by the U.s. federal government from which we derive revenues could adversely impact our results of operations.
In addition, regardless of monetary costs, these matters could have a material adverse effect on our reputation and cause harm to our carrier, customer or employee relationships, or divert employees and management resources. 18 OUR BUSINESS PRACTICES AND COMPENSATION ARRANGEMENTS WITH INSURANCE CARRIERS ARE SUBJECT TO UNCERTAINTY DUE TO POTENTIAL CHANGES IN REGULATIONS.
In addition, regardless of monetary costs, these matters could have a material adverse effect on our reputation and cause harm to our carrier, customer or employee relationships, or divert employees and management resources. OUR BUSINESS PRACTICES AND COMPENSATION ARRANGEMENTS WITH INSURANCE CARRIERS ARE SUBJECT TO UNCERTAINTY DUE TO POTENTIAL CHANGES IN REGULATIONS.
These programs include the National Flood Insurance Program, the Social Security disability benefits program or the federal crop insurance program, from which in the aggregate we derive less than 5% of our annual total revenues. If any of these risks materialize, our results of operations and financial condition could be adversely affected.
These programs include the National Flood Insurance Program (NFIP), the Social Security disability benefits program or the federal crop insurance program, from which in the aggregate we derive less than 5% of our annual total revenues. If any of these risks materialize, our results of operations and financial condition could be adversely affected.
These and other industry standards may legally or contractually apply to us, or we may elect to comply with such standards. We expect that there will 17 continue to be new proposed laws and regulations concerning data privacy and security, and we cannot yet determine the impact such future laws, regulations and standards may have on our business.
These and other industry standards may legally or contractually apply to us, or we may elect to comply with such standards. We expect that there will continue to be new proposed laws and regulations concerning data privacy and security, and we cannot yet determine the impact such future laws, regulations and standards may have on our business.
Our F&I businesses may be negatively impacted by a slowdown in vehicles sales in the united states or by regulatory changes, including tax-related changes, affecting the sale of f&I products by vehicle dealers Our F&I businesses earn commissions and fees from the sale of non-insurance warranty services and products by vehicle dealers.
Our F&I businesses may be negatively impacted by a slowdown in vehicles sales in the united states or by regulatory changes, including tax-related changes, affecting the sale of f&I products by vehicle dealers. 16 Our F&I businesses earn commissions and fees from the sale of non-insurance warranty services and products by vehicle dealers.
In the event of certain defaults, the lenders thereunder would not be required to lend any additional amounts to or purchase any additional notes from us and could elect to declare all borrowings outstanding, together with accrued and unpaid interest and fees, to be due and payable.
In the event of certain defaults, the lenders thereunder would not 20 be required to lend any additional amounts to or purchase any additional notes from us and could elect to declare all borrowings outstanding, together with accrued and unpaid interest and fees, to be due and payable.
Our commission income (including profit-sharing contingent commissions and supplemental commissions) can vary quarterly or annually due to the timing of policy renewals and the net effect of new and lost business production. We do not control the factors that cause these variations.
Our commission income (including profit-sharing contingent commissions, incentives and supplemental commissions) can vary quarterly or annually due to the timing of policy renewals and the net effect of new and lost business production. We do not control the factors that cause these variations.
In addition, insurance carriers may seek to reduce their expenses by reducing the commission rates payable to insurance agents or brokers such as us. The reduction of these commission rates, along with general volatility and/or declines in premiums, may significantly undermine our profitability.
In addition, insurance carriers may seek to reduce their expenses by reducing the commission rates payable to insurance agents, brokers or intermediaries such as us. The reduction of these commission rates, along with general volatility and/or declines in premiums, may significantly undermine our profitability.
The occurrence of any of these events may cause a decrease to our profit-sharing contingent commissions, which are special revenue-sharing commissions paid by insurance companies based primarily upon the profitability placed with such companies generally during the prior year.
The occurrence of any of these events may cause a decrease to our profit-sharing contingent commissions, which are special revenue-sharing commissions paid by insurance companies based primarily upon the profitability of policies placed with such companies, generally during the prior year.
We are subject to a variety of continuously evolving and developing laws and regulations globally regarding privacy, data protection and data security, including those related to the collection, storage, retention, handling, use, processing, disclosure, transfer and security of personal data.
We are subject to a variety of continuously evolving and developing laws and regulations globally regarding privacy, data protection and data security, including those related to the collection, storage, retention, handling, use, processing, disclosure, transfer, destruction and security of personal data.
Any decrease in their payment to us could adversely affect our results of operations, profitability and our financial condition. WE ARE EXPOSED TO INTANGIBLE ASSET RISK; SPECIFICALLY, OUR GOODWILL MAY BECOME IMPAIRED IN THE FUTURE.
Any decrease in their payment to us could adversely affect our results of operations, profitability and our financial condition. 22 WE ARE EXPOSED TO INTANGIBLE ASSET RISK; SPECIFICALLY, OUR GOODWILL MAY BECOME IMPAIRED IN THE FUTURE.
If determined that a future write-down of our goodwill is necessary, the appropriate adjustment would be recorded which could result in material charges that are adverse to our operating results and financial position.
If determined that a future write-down of our goodwill is necessary, the appropriate adjustment would be recorded and could result in material charges that are adverse to our operating results and financial position.
See Note 1-“Summary of Significant Accounting Policies” and Note 4-“Goodwill” to the Consolidated Financial Statements and “Management’s Report on Internal Control Over Financial Reporting.” Additionally, the carrying value of amortizable intangible assets attributable to each business or asset group comprising the Company is periodically reviewed by management to determine if there are events or changes in circumstances that would indicate that its carrying amount may not be recoverable.
See Note 1-“Summary of Significant Accounting Policies” and Note 4-“Goodwill” to the Consolidated Financial Statements and “Management’s Report on Internal Control Over Financial Reporting.” Additionally, the carrying value of amortizable intangible assets attributable to each business or asset group comprising our business is periodically reviewed by management to determine if there are events or changes in circumstances that would indicate that its carrying amount may not be recoverable.
Our ability to obtain professional indemnity insurance in the amounts and with the deductibles we desire in the future may be adversely impacted by general developments in the market for such insurance or our own claims experience.
Our ability to obtain professional indemnity insurance in the amounts and with the deductibles we desire in the future may be adversely impacted by developments in the market for such insurance or our own claims experience.
Other legislative developments that could adversely affect us include: changes in our business compensation model as a result of regulatory developments (for example, the Affordable Care Act); and federal and state governments establishing programs to provide health insurance or, in certain cases, property insurance in catastrophe-prone areas or other alternative market types of coverage that compete with or completely replace, insurance products offered by insurance carriers.
Other legislative developments that 19 could adversely affect us include: changes in our business compensation model as a result of regulatory developments (for example, potential changes to the Affordable Care Act); and federal and state governments establishing programs to provide health insurance or, in certain cases, property insurance in catastrophe-prone areas or other alternative market types of coverage that compete with or completely replace, insurance products offered by insurance carriers.
Additionally, any potential effects of pandemics, epidemics or outbreaks of infectious disease may lag behind the developments related to such events. ITEM 1B. Unresolve d Staff Comments. None.
Additionally, any potential effects of pandemics, epidemics or outbreaks of infectious disease may lag behind the developments related to such events. 23 ITEM 1B. Unresolve d Staff Comments. None.
A period of low or declining premium rates, generally known as a “soft” or “softening” market, generally leads to downward pressure on commission revenue and can have a material adverse impact on our commission revenue and operating margins. We could be negatively impacted by soft market conditions across certain sectors and geographic regions.
An extended period of low or declining premium rates, generally known as a “soft” or “softening” market, generally leads to downward pressure on commission revenue and can have a material adverse impact on our commission revenue and operating margins. We could be negatively impacted by soft market conditions across certain sectors and geographic regions.
Acquisitions also involve a number of risks, such as diversion of management’s attention; difficulties in the integration of acquired operations and retention of employees; increase in expenses and working capital requirements, which could reduce our return on invested capital; entry into unfamiliar markets or lines of business; unanticipated problems or legal liabilities; estimation of the acquisition earn-out payables; and tax and accounting issues, some or all of which could have a material adverse effect on our results of operations, financial condition and cash flows.
Acquisitions also involve a number of risks, such as diversion of management’s attention; difficulties in the integration of acquired operations and retention of employees; increase in expenses and working capital requirements, which could reduce our return on invested capital; entry into unfamiliar markets or lines of business; unanticipated problems or legal liabilities; estimation of acquisition earn-outs; and tax and accounting issues, some or all of which could have a material adverse effect on our results of operations, financial condition and cash flows.
While the Company’s underwriting risk through its participation in these facilities is limited, we may be subject to claims expenses associated with catastrophic weather events, such as those in the third quarter of 2022 associated with Hurricane Ian. Our results of operations may be negatively impacted if any of the facilities incur claims expenses.
While our underwriting risk through our participation in these facilities is limited, we may be subject to claims expenses associated with catastrophic weather events, such as those in the third quarter of 2022 associated with Hurricane Ian. Our results of operations may be negatively impacted if any of the facilities incur claims expenses.
Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, within the Company have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur simply because of error or mistake.
Because of the inherent limitations in all control systems, no evaluation of controls can provide absolute assurance that all control issues and instances of fraud, if any, have been detected. These inherent limitations include the realities that judgments in decision-making can be faulty and that breakdowns can occur simply because of error or mistake.
Should any insurance company seek to terminate its arrangements with us or to otherwise decrease the number of insurance policies underwritten for us, we believe that other insurance companies are available to underwrite the business, although some additional expense and loss of market share could result.
Should any insurance company or intermediary seek to terminate its arrangements with us or to otherwise decrease the number of insurance policies underwritten for us, we believe that other insurance companies or intermediaries are available to underwrite the business, although some additional expense and loss of market share could result.
Significant uncertainty exists as privacy and data protection laws evolve and may be interpreted and applied differently from country to country and may create inconsistent or conflicting requirements. These laws apply to transfers of information among our affiliates, as well as to transactions we enter into with third-party vendors.
Significant uncertainty exists as privacy and data protection laws evolve and may be interpreted and applied differently from jurisdiction to jurisdiction may create inconsistent or conflicting requirements. These laws apply to transfers of information among our affiliates, as well as to transactions we enter into with third-party vendors.
Further, we have no control over the ability of insurance companies to estimate loss reserves, which affects our ability to make profit-sharing calculations. 21 Supplemental commissions are paid by insurance companies based upon the volume of business that we place with them and are generally paid over the course of the year.
Further, we have no control over the ability of insurance companies to estimate loss reserves, which affects our ability to make profit-sharing calculations. Incentives and supplemental commissions are paid by insurance companies based upon the volume of business that we place with them and are generally paid over the course of the year.
Also, organizations that provide ratings information to certain investors on ESG matters may assign unfavorable ratings to the Company, which may lead to negative investor sentiment and the diversion of investment capital to other companies or industries, which could have a negative impact on our stock price and our costs of capital.
Also, organizations that provide ratings information to certain investors on ESG matters may assign unfavorable ratings to us, which may lead to negative investor sentiment and the diversion of investment capital to other companies or industries, which could have a negative impact on our stock price and our costs of capital.
In particular, heightened demand for, and scrutiny of, ESG and sustainable-related strategies and advice has increased the risk that we could be perceived as, or accused of, making inaccurate or misleading statements, commonly referred to as “greenwashing” or that 19 we have otherwise run afoul of regulation.
In particular, heightened demand for, and scrutiny of, ESG-related strategies and advice has increased the risk that we could be perceived as, or accused of, making inaccurate or misleading statements, commonly referred to as “greenwashing” or that we have otherwise run afoul of regulation.
The insurance business in the U.S. is primarily a state-regulated industry, and therefore, state legislatures may enact laws that adversely affect the insurance industry. We also derived approximately 10% of our annual revenue from our businesses located in the United Kingdom.
The insurance business in the U.S. is primarily a state-regulated industry, and therefore, state legislatures may enact laws that adversely affect the insurance industry. We also derived approximately 11% of our annual revenue from our businesses located in the United Kingdom.
WE ARE SUBJECT TO LIMITED UNDERWRITING RISK THROUGH OUR PARTICIPATION IN CAPITALIZED CAPTIVE INSURANCE FACILITIES, WHICH MAY SUBJECT US TO LIMITED CLAIMS EXPENSES From time to time, the Company participates in capitalized captive insurance facilities for the purpose of facilitating additional underwriting capacity for our customers and to participate in underwriting results.
WE ARE SUBJECT TO LIMITED UNDERWRITING RISK THROUGH OUR PARTICIPATION IN CAPITALIZED CAPTIVE INSURANCE FACILITIES, WHICH MAY SUBJECT US TO LIMITED CLAIMS EXPENSES. From time to time, we participate in captive insurance facilities for the purpose of facilitating additional underwriting capacity for our customers and to participate in underwriting results.
We act as agents and brokers for such state insurance funds and assigned risk pools in California and New York as well as certain other states. These state funds and pools could choose to reduce the sales or brokerage commissions we receive.
We act as agents and brokers for such state insurance funds and assigned risk pools in California, Florida, New York, Washington as well as certain other states. These state funds and pools could choose to reduce the sales or brokerage commissions we receive.
In addition to movements in premium rates, our ability to generate premium-based commission revenue may be challenged by disintermediation and the growing availability of alternative methods for clients to meet their risk-protection needs.
In addition to movements in premium rates, our ability to generate premium-based commission revenue may be challenged by disintermediation and the growing availability of alternative methods for customers to meet their risk-protection needs.
INCREASING SCRUTINY AND CHANGING LAWS AND EXPECTATIONS FROM REGULATORS, INVESTORS AND CUSTOMERS WITH RESPECT TO OUR ENVIRONMENTAL, SOCIAL AND GOVERNANCE (“ESG”) PRACTICES AND DISCLOSURE MAY IMPOSE ADDITIONAL COSTS ON US OR EXPOSE US TO REPUTATIONAL OR OTHER RISKS.
INCREASING SCRUTINY AND CHANGING LAWS AND EXPECTATIONS FROM REGULATORS, INVESTORS AND CUSTOMERS WITH RESPECT TO OUR ENVIRONMENTAL, SOCIAL AND GOVERNANCE (“ESG”) PRACTICES AND DISCLOSURE CAN IMPOSE ADDITIONAL COSTS ON US OR EXPOSE US TO REPUTATIONAL OR OTHER RISKS.
Certain investors have developed their own ESG ratings while others use third-party benchmarks or scores to measure a company’s ESG practices and make investment decisions or otherwise engage with the company to influence its practices in these areas. Additionally, our customers may evaluate our ESG practices and/or request that we adopt certain ESG policies in order to work with us.
Certain investors have developed their own ESG ratings while others use third-party benchmarks or scores to measure a company’s ESG practices and make investment decisions or otherwise engage with us to influence our practices in these areas. Additionally, our customers may evaluate our ESG practices and/or request that we adopt certain ESG policies in order to work with us.
In the future, any material breaches of cybersecurity, or media reports of the same, even if untrue, could cause us to experience reputational harm, loss of customers and revenue, loss of proprietary data, regulatory actions and scrutiny, sanctions or other statutory penalties, litigation, liability for failure to safeguard customers’ information or financial losses.
In the future, any material breaches of cybersecurity, or media reports of the same, even if untrue, could cause us to experience reputational harm, loss of customers and revenue, loss of proprietary data, regulatory actions and scrutiny, sanctions or other statutory penalties, litigation, liability for failure to safeguard customers’ information, impairment of invested capital or financial losses.
Additionally, some of our offices are parties to supplemental commission agreements with certain insurance companies, which provide for commission rates in excess of standard commission rates to be applied to specific lines of business, such as group health business, and which are based primarily on the overall volume of business that such office or offices placed with those insurance companies.
Additionally, many of our offices are parties to incentive and/or supplemental commission agreements with certain insurance companies, which provide for commission rates in excess of standard commission rates to be applied to specific lines of business, such as group health business, and which are based primarily on the overall volume of business that such office or offices placed with those insurance companies.
Fluctuations in the premiums charged by the insurance carriers can therefore have a direct and potentially material impact on our results of operations. Due to the cyclical nature of the insurance market and the impact of other market conditions on insurance premiums, commission levels may vary widely between accounting periods.
Fluctuations in the premiums charged by the insurance carriers can therefore have a direct and potentially material impact on our results of operations. Due to the cyclical nature of the insurance market and the impact of other market conditions on insurance premiums, commission levels may vary widely between financial reporting periods.
WE COMPETE IN A HIGHLY REGULATED INDUSTRY, WHICH MAY RESULT IN INCREASED EXPENSES OR RESTRICTIONS ON OUR OPERATIONS. We conduct business in each of the 50 states of the United States of America and are subject to comprehensive regulation and supervision by government agencies in each of those states.
WE COMPETE IN A HIGHLY REGULATED INDUSTRY, WHICH MAY RESULT IN INCREASED EXPENSES OR RESTRICTIONS ON OUR OPERATIONS. We conduct business throughout all of the United States of America and are subject to comprehensive regulation and supervision by government agencies in each of those states.
At December 31, 2023, we believe we were in compliance with the financial covenants and other limitations contained in each of the credit agreements that govern out debt.
At December 31, 2024, we believe we were in compliance with the financial covenants and other limitations contained in each of the credit agreements that govern out debt.
Such perceptions or accusations could damage our reputation, result in litigation or regulatory enforcement actions, and adversely affect our business. Furthermore, perceptions of our efforts to achieve ESG goals or advance ESG and sustainable-related strategies may differ widely among stakeholders and could present risks to our reputation and business.
Such perceptions or accusations could damage our reputation, result in litigation or regulatory enforcement actions, and adversely affect our business. Furthermore, perceptions of our efforts to achieve ESG goals or advance ESG-related strategies may differ widely among stakeholders and could present risks to our reputation and business, including litigation risk.
If the information we rely upon to run our businesses was found to be inaccurate or unreliable or if we fail to effectively maintain our information systems and data integrity, we could experience operational disruptions, regulatory or other legal problems, increases in operating expenses, loss of existing customers, difficulty in attracting new customers, or suffer other adverse consequences.
If the information we rely upon to run our businesses was found to be inaccurate or unreliable or if we fail to effectively maintain our information systems and data integrity, we could experience operational disruptions, regulatory or other legal problems, increases in operating expenses, loss of existing customers, difficulty in attracting new customers and/or maintaining third-party relationships or suffer other adverse consequences.
Certain of our offices are parties to profit-sharing contingent commission agreements with certain insurance companies, including agreements providing for potential payment of revenue-sharing commissions by insurance companies based primarily on the overall profitability of the aggregate business written with those insurance companies and/or additional factors such as retention ratios and the overall volume of business that an office or offices place with those insurance companies.
Many of our offices are parties to agreements with certain insurance companies, including agreements providing for potential payment of revenue-sharing commissions by insurance companies based primarily on the overall profitability of the aggregate business written with those insurance companies and/or additional factors such as retention ratios and the overall volume of business that an office or offices place with those insurance companies.
WE DERIVE A SIGNIFICANT PORTION OF OUR COMMISSION REVENUES FROM A LIMITED NUMBER OF INSURANCE COMPANIES, THE LOSS OF WHICH COULD RESULT IN LOSS OF CAPACITY TO WRITE BUSINESS, ADDITIONAL EXPENSE AND LOSS OF MARKET SHARE OR A MATERIAL DECREASE IN OUR COMMISSIONS.
WE DERIVE OUR COMMISSION REVENUES FROM A LIMITED NUMBER OF INSURANCE COMPANIES AND INTERMEDIARIES, THE LOSS OF WHICH COULD RESULT IN LOSS OF CAPACITY TO WRITE BUSINESS, ADDITIONAL EXPENSE AND LOSS OF MARKET SHARE OR A MATERIAL DECREASE IN OUR COMMISSIONS.
For the year ended December 31, 2023, we derived less than 4% of our annual total revenues from our F&I businesses.
For the year ended December 31, 2024, we derived less than 4% of our annual total revenues from our F&I businesses.
Further, the profitability of our risk and broking businesses depends in part on our ability to be compensated for the analytical services and other advice that we provide, including the consulting and analytics services that we provide to insurers.
Further, the profitability of our risk and broking businesses depends in part on our ability to be compensated for the analytical service, underwriting and other advice that we provide, including the consulting and analytics services that we provide to insurers and customers.
There is increased focus, including from governmental organizations, regulators (including the SEC), investors and customers, on ESG issues such as environmental stewardship, climate change, greenhouse gas emissions, diversity and inclusion, human rights, racial justice and workplace conduct.
There is increased and sometimes conflicting focus, including from governments, non-governmental organizations, regulators (including the SEC), investors and customers, on ESG issues such as environmental stewardship, climate change, greenhouse gas emissions, diversity and inclusion, human rights, racial justice and workplace conduct.
Over the last three years our profit-sharing contingent commissions generally have been in the range of 3.0% to 3.6% of our previous year’s total core commissions and fees.
Over the last three years our profit-sharing contingent commissions generally have been in the range of 3.0% to 4.1% of our previous year’s total core commissions and fees.
Our technological development projects may not deliver the benefits we expect once they are completed or may be replaced or become obsolete more quickly than expected, which could result in the accelerated recognition of expenses.
Our technological development projects may not deliver the benefits we expect once they are completed or may need to be replaced or become obsolete more quickly than expected, which could result in the accelerated recognition of expenses or write-offs.
A significant portion of our businesses are concentrated in Florida, California, Massachusetts, Georgia, Michigan, and New York, where for the year ended December 31, 2023, we derived approximately 20%, 8%, 8%, 7%, 7%, and 5% of our annual revenue, respectively. We believe the current regulatory environment for insurance intermediaries in these states is no more restrictive than in other states.
A significant portion of our businesses are concentrated in Florida, Michigan, California, Massachusetts, Georgia, and New York, where for the year ended December 31, 2024, we derived approximately 20%, 9%, 7%, 7%, 6%, and 5% of our annual revenue, respectively. We believe the current regulatory environment for insurance intermediaries in these states is no more restrictive than in other jurisdictions.
If we are unable to achieve and maintain adequate billing rates for all of our services, our margins and profitability could decline. SIGNIFICANT OR SUSTAINED INFLATION COULD ADVERSELY AFFECT OUR BUSINESS, RESULTS OF OPERATIONS AND FINANCIAL CONDITION. Inflation can adversely affect us by increasing our costs, including salary costs. Significant inflation is often accompanied by higher interest rates.
If we are unable to achieve and maintain adequate billing rates for all of our services, our margins and profitability could decline. SIGNIFICANT OR SUSTAINED INFLATION COULD ADVERSELY AFFECT OUR BUSINESS, RESULTS OF OPERATIONS AND FINANCIAL CONDITION. Inflation can adversely affect us by increasing our costs, including salary costs.
We are susceptible to losses and interruptions caused by hurricanes (particularly in Florida, where we have 54 offices and our headquarters, as well as in Texas, where we have 17 offices), earthquakes (including in California, where we have 23 offices), power shortages, telecommunications failures, water shortages, floods, fire, extreme weather conditions, geopolitical events such as terrorist acts and other natural or human-made disasters.
We are susceptible to losses and interruptions caused by hurricanes (particularly in Florida, where we have 52 offices and our headquarters, as well as in Texas, where we have 19 offices), earthquakes (including in California, where we have 20 offices), power shortages, telecommunications failures, water shortages, floods, fire, extreme weather conditions, geopolitical events such as terrorist acts and other natural or human-made disasters.
Natural disasters may also subject our insurance company subsidiary operations, including the capitalized captive insurance facilities in which we participate, to claims expenses.
Natural disasters may also subject our insurance company subsidiary operations, including the captive insurance facilities in which we participate, to claims expenses, which may be volatile.
These and similar initiatives around the world could increase the cost of developing, implementing or securing our servers and require us to allocate more resources to improved technologies, adding to our technology and compliance costs. In addition, enforcement actions and investigations by regulatory authorities related to data security incidents and privacy violations continue to increase.
These and similar initiatives around the world could increase the cost of developing, implementing or securing our servers and require us to allocate more resources towards enhanced technologies, further contributing to our technology and compliance costs. In addition, enforcement actions and investigations by regulatory authorities related to data security incidents and privacy violations continue to increase.
We completed our most recent evaluation of impairment for goodwill as of November 30, 2023 and determined that the fair value of goodwill exceeded the carrying value of each reporting unit.
We completed our most recent evaluation of impairment for goodwill as of November 30, 2024 and determined that the fair value of goodwill exceeded the carrying value of goodwill allocated to each reporting unit.
If access to underwriting markets for certain lines of coverage becomes unavailable or difficult due to the impact of natural disasters, this may have a negative impact on our customers’ access to coverage, which could in turn reduce our ability to place certain lines of coverage and negatively impact our business.
If access to underwriting markets for certain lines of coverage becomes unavailable or difficult due to the impact of natural disasters, this may have a negative impact on our customers’ access to coverage and our ability to issue policies, which could negatively impact our business.
CERTAIN OF OUR SHAREHOLDERS HAVE SIGNIFICANT CONTROL OF THE COMPANY. At December 31, 2023, our executive officers, directors and certain of their family members collectively beneficially owned approximately 16.3% of our outstanding common stock, of which J. Hyatt Brown, our chairman of the board, and his sons, J. Powell Brown, our president and chief executive officer, and P.
CERTAIN OF OUR SHAREHOLDERS HAVE SIGNIFICANT CONTROL. At December 31, 2024, our executive officers, directors and certain of their family members collectively beneficially owned approximately 15.6% of our outstanding common stock, of which J. Hyatt Brown, our chairman of the board, and his sons, J. Powell Brown, our president and chief executive officer, and P.
In addition, legislators and regulators in the U.S. have enacted and are proposing new and more robust privacy and cybersecurity laws and regulations in light of the recent broad-based cyber-attacks at a number of companies, including but not limited to the New York State Department of Financial Services Cybersecurity Requirements for Financial Services Companies, the California Consumer Privacy Act of 2018 and the California Privacy Rights Act.
In addition, legislators and regulators in the U.S. have enacted and are proposing new and more robust privacy and cybersecurity laws and regulations in light of the broad-based cyber-attacks at a number of companies, including the New York State Department of Financial Services Cybersecurity Requirements for Financial Services Companies and the California Consumer Privacy Act of 2018, as amended by the California Privacy Rights Act.
For the year ended December 31, 2023, 2022 and 2021, no more than 5.0% of our total core commissions was derived from insurance policies underwritten by one insurance company.
For the years ended December 31, 2024, 2023 and 2022, no more than 5% of our total core commissions was derived from insurance policies underwritten by one insurance company.
The internet, for example, is increasingly used to securely transmit benefits and related information to customers and to facilitate business-to-business information exchange and transactions. 14 We are continuously taking steps to upgrade and expand our information systems capabilities, including how we electronically interact with our customers and insurance carriers.
The internet, for example, is increasingly used to securely transmit benefits and related information to customers, operate our day-to-day activities, and to facilitate business-to-business information exchange and transactions. We are continuously taking steps to upgrade and expand our information systems capabilities, including how we electronically interact with our customers, vendors, insurance carriers and other intermediaries.
As of the date of the filing of our Annual Report on Form 10-K for the 2023 fiscal year, we have $7.3 billion of goodwill recorded on our Consolidated Balance Sheet.
As of the date of the filing of our Annual Report on Form 10-K for the 2024 fiscal year, we have $8 billion of goodwill recorded on our Consolidated Balance Sheet.
We rely on information technology and third-party vendors to provide effective and efficient service to our customers, process claims, and timely and accurately report information to carriers and which often involves secure processing of confidential sensitive, proprietary and other types of information.
We rely on information technology and third-party vendors to provide effective and efficient service to our customers, process claims, and timely and accurately report information to carriers, which often involves secure processing of confidential, sensitive, proprietary and other types of information. We face potential threats due to new and increasingly sophisticated methods of attack.
Various state legislatures may adopt new laws addressing contingent commission arrangements, including laws prohibiting such arrangements, and addressing disclosure of such arrangements to insureds. Various state departments of insurance may also adopt new regulations addressing these matters which could adversely affect our results of operations.
Various state legislatures or legislatures in the international jurisdictions in which we operate may adopt new laws addressing contingent commission arrangements, including laws prohibiting such arrangements, and addressing disclosure of such arrangements to insureds. Various state departments of insurance or other international regulators may also adopt new regulations addressing these matters which could adversely affect our results of operations.
If we are unable to identify appropriate acquisition targets, or if our competitors are more successful in identifying acquisition targets at favorable valuations, we may fail to achieve desired strategic goals and capabilities, and our results of operations may be adversely affected.
If we are unable to identify appropriate acquisition targets, or if our competitors are more successful in identifying acquisition targets at favorable valuations, we may fail to achieve desired strategic goals and capabilities, and our results of operations may be adversely affected. Additionally, failure to successfully identify and complete acquisitions would likely result in slower growth.
Actual or alleged violations could result in substantial fines, sanctions, civil or criminal penalties, curtailment of operations in certain jurisdictions, competitive or reputational harm, litigation or regulatory action and other consequences that might adversely affect our results of operations, financial condition or strategic objectives.
Actual or alleged violations could result in substantial fines, sanctions, civil or criminal penalties, curtailment of operations in certain jurisdictions, competitive or reputational harm, litigation or regulatory action and other consequences that might adversely affect our results of operations, financial condition or strategic objectives. 18 OUR BUSINESS, RESULTS OF OPERATIONS, FINANCIAL CONDITION AND LIQUIDITY MAY BE MATERIALLY ADVERSELY AFFECTED BY CERTAIN ACTUAL AND POTENTIAL CLAIMS, REGULATORY ACTIONS AND PROCEEDINGS.
RAPID TECHNOLOGICAL CHANGE MAY REQUIRE ADDITIONAL RESOURCES AND TIME TO ADEQUATELY RESPOND TO DYNAMICS, WHICH MAY ADVERSELY AFFECT OUR BUSINESS AND OPERATING RESULTS. Frequent technological changes, new products and services and evolving industry standards are influencing the insurance business.
The occurrence of one or more of these risks may impact our business, results of operations, or financial condition. RAPID TECHNOLOGICAL CHANGE MAY REQUIRE ADDITIONAL RESOURCES AND TIME TO ADEQUATELY RESPOND TO DYNAMICS, WHICH MAY ADVERSELY AFFECT OUR BUSINESS AND OPERATING RESULTS. Frequent technological changes, new products and services and evolving industry standards are influencing the insurance business.
If economic conditions were to worsen, a number of negative effects on our business could result, including declines in insurable exposure units, declines in insurance premium rates, the financial insolvency of insurance companies, or the reduced ability of customers to pay.
OR GLOBAL ECONOMIC CONDITIONS, INCLUDING AN EXTENDED SLOWDOWN IN THE MARKETS IN WHICH WE OPERATE, MAY ADVERSELY AFFECT OUR BUSINESS. 21 If economic conditions were to worsen, a number of negative effects on our business could result, including declines in insurable exposure units, declines in insurance premium rates, the financial insolvency of insurance companies, or the reduced ability of customers to pay.
Additionally, there has been increased regulatory focus on ESG and sustainability. For example, laws and regulations related to ESG issues continue to evolve, including in the U.S., the U.K. and the EU. New regulations may impose additional compliance or disclosure obligations on us.
Laws and regulations related to ESG issues continue to evolve, including in the U.S., the U.K. and the EU. New regulations may impose additional compliance or disclosure obligations on us.
Negative public perception, adverse publicity or negative comments in social media and other forums could damage our reputation if we do not, or are not perceived to, adequately address any one or more of these issues. Any harm to our reputation could impact employee engagement and retention and the willingness of customers and others to do business with us.
Negative public perception, adverse publicity or negative comments in social media and other forums could damage our reputation if we do not, or are not perceived to, adequately or appropriately address any one or more of these issues.
Such coverage may not be adequate or may not continue to be available at commercially reasonable rates and terms. 15 OUR CORPORATE CULTURE HAS CONTRIBUTED TO OUR SUCCESS, AND IF WE CANNOT MAINTAIN THIS CULTURE, OR IF WE EXPERIENCE A SIGNIFICANT CHANGE IN MANAGEMENT, MANAGEMENT PHILOSOPHY, OR BUSINESS STRATEGY, OUR BUSINESS MAY BE HARMED.
OUR CORPORATE CULTURE HAS CONTRIBUTED TO OUR SUCCESS, AND IF WE CANNOT MAINTAIN THIS CULTURE, OR IF WE EXPERIENCE A SIGNIFICANT CHANGE IN MANAGEMENT, MANAGEMENT PHILOSOPHY, OR BUSINESS STRATEGY, OUR BUSINESS MAY BE HARMED.
If those insurance companies were to experience liquidity problems or other financial difficulties, we could encounter delays or defaults in payments owed to us, which could have a significant adverse impact on our financial condition and results of operations. 20 Risks Related to Our Industry CHANGES IN CURRENT U.S.
If those insurance companies were to experience liquidity problems or other financial difficulties, we could encounter delays or defaults in payments owed to us, which could have a significant adverse impact on our financial condition and results of operations. FLUCTUATIONS IN FOREIGN CURRENCY EXCHANGE RATES MAY ADVERSELY AFFECT OUR FINANCIAL PERFORMANCE AND OUR RESULTS OF OPERATIONS.
Among the provisions considered in such legislation have been limitations on damage awards, including punitive damages, and various restrictions applicable to class action lawsuits.
Legislation concerning tort reform has been considered, from time to time, in the United States Congress and in several state legislatures. Among the provisions considered in such legislation have been limitations on damage awards, including punitive damages, and various restrictions applicable to class action lawsuits.
Additionally, a judgement by the Court of Justice of the European Union on Schrems II has made cross border data transfers to organizations outside of the European Economic Area more onerous and uncertain.
Failure to comply with GDPR requirements could result in penalties of up to 4% of worldwide revenue. Additionally, a judgement by the Court of Justice of the European Union on Schrems II made cross border data transfers to organizations outside of the European Economic Area more onerous and uncertain.
Our failure to meet expectations, whether the expectations are set by us or by investors or other stakeholders, or to any other failure to make progress in this area on a timely basis, or at all, may negatively impact our reputation and our business.
Our failure to meet expectations, whether the expectations are set by us, by investors or by other stakeholders, or any other failure to make progress in this area on a timely basis, or at all, could negatively impact our reputation and our business. PROPOSED TORT REFORM LEGISLATION, IF ENACTED, COULD DECREASE DEMAND FOR LIABILITY INSURANCE, THEREBY REDUCING OUR COMMISSION REVENUES.
THE OCCURRENCE OF NATURAL DISASTERS COULD RESULT IN DECLINES IN PROFIT-SHARING CONTINGENT COMMISSIONS OR REDUCED INSURER CAPACITY, AND MAY ALSO SUBJECT OUR CAPITALIZED CAPTIVE INSURANCE FACILITIES TO CLAIMS EXPENSES, WHICH COULD ADVERSELY AFFECT OUR FINANCIAL CONDITION AND RESULTS OF OPERATIONS Our business is exposed to various risks arising out of natural disasters, including earthquakes, hurricanes, fires, floods, tornadoes, extreme weather or other climate events.
THE OCCURRENCE OF NATURAL DISASTERS COULD RESULT IN DECLINES IN PROFIT-SHARING CONTINGENT COMMISSIONS OR REDUCED INSURER CAPACITY, AND MAY ALSO SUBJECT OUR CAPTIVE INSURANCE FACILITIES TO CLAIMS EXPENSES, WHICH COULD ADVERSELY AFFECT OUR FINANCIAL CONDITION AND RESULTS OF OPERATIONS.
The GDPR became fully effective in May 2018 and requires companies to satisfy new requirements regarding the handling of personal and sensitive data, including its processing, protection and the ability of persons whose data is stored to correct or delete such data about themselves.
For example, the European Union’s General Data Privacy Regulation (“GDPR”) requires companies to satisfy requirements regarding the handling of personal and sensitive data, including its processing, protection and the ability of persons whose data is stored to correct or delete such data about themselves.
OUR GROWTH STRATEGY DEPENDS, IN PART, ON THE ACQUISITION OF OTHER INSURANCE INTERMEDIARIES, WHICH MAY NOT BE AVAILABLE ON ACCEPTABLE TERMS IN THE FUTURE OR WHICH, IF CONSUMMATED, MAY NOT BE ADVANTAGEOUS TO US. Our growth strategy partially includes the acquisition of other insurance intermediaries.
Any of the foregoing may have a material adverse effect on our business, financial condition and reputation. OUR GROWTH STRATEGY DEPENDS, IN PART, ON THE ACQUISITION OF OTHER INSURANCE INTERMEDIARIES AND RELATED BUSINESSES, WHICH MAY NOT BE AVAILABLE ON ACCEPTABLE TERMS IN THE FUTURE OR WHICH, IF CONSUMMATED, MAY NOT BE ADVANTAGEOUS TO US.
Disclosure of this information could harm our reputation and subject us to liability under our contracts and laws that protect personal data, resulting in increased costs or loss of revenues. THE RISK OF NON-COMPLIANCE WITH NON-U.S. LAWS, REGULATIONS AND POLICIES COULD ADVERSELY AFFECT OUR RESULTS OF OPERATIONS, FINANCIAL CONDITION OR STRATEGIC OBJECTIVES.
Disclosure of this information, or other security breach of our information systems, or those of third-party vendors we rely on, could harm our reputation and subject us to liability under our contracts and laws that protect personal data, resulting in increased costs or loss of revenues. THE RISK OF NON-COMPLIANCE WITH NON-U.S.
Some investors have increased their emphasis on the ESG practices of companies across all industries, including with respect to climate and human capital management.
For example, in the U.S. there has been increased legal scrutiny on inclusion and diversity-related programs and initiatives. Some investors have increased their emphasis on the ESG practices of companies across all industries, including with respect to climate and human capital management.
Additionally, we are an acquisitive organization and the process of integrating the information systems of the businesses we acquire is complex and exposes us to additional risk as we might not adequately identify weaknesses in the targets’ information systems, which could expose us to unexpected liabilities or make our own systems more vulnerable to attack.
We have from time to time experienced cybersecurity incidents, such as malware infections, phishing campaigns, ransomware and vulnerability exploit attempts, which to date have not had a material impact on our business. 12 We are an acquisitive organization, and the process of integrating the information systems of the businesses we acquire is complex and exposes us to additional risks as we might not adequately identify weaknesses in the acquired company’s information systems, which could expose us to unexpected liabilities or make our own systems more vulnerable to attack.
Such losses may not be insured against or not fully covered through insurance we maintain. We cannot entirely eliminate all risk of improper access to private information, and the cost and operational consequences of implementing, maintaining and enhancing further system protections measures could increase significantly as cybersecurity threats increase.
Such losses may not be insured against or not fully covered through insurance we maintain. Despite our efforts to mitigate cybersecurity threats, we cannot guarantee our measures will prevent, contain, detect, or remediate all incidents. The costs and operational consequences of enhancing system protections could rise significantly as threats increase.

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Item 1C. Cybersecurity

Cybersecurity — threats and controls disclosure

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Biggest changeIn addition, external partners and products are submitted through a security risk assessment process facilitated through our security scorecard tool for data security risk and vulnerability maturity rating, and our teammates undertake a yearly security and compliance online training with test certification. Our teammates are also subject to security awareness communications and random simulated phishing campaigns.
Biggest changeAdditionally, external partners and products undergo a comprehensive security risk assessment process using our security scorecard tool, which evaluates data security risks and vulnerability maturity. Our teammates participate in an annual online security and compliance training program that includes testing. They are also subject to security awareness communications and random simulated phishing campaigns.
The program is composed of the following: • Internal persistent scans and external monthly scans; • Static and dynamic software custom code to develop scans for secure code development; • Periodic third-party executed penetration tests and risk assessments; and • A model to comply with SOC 2 Type II standards or other industry certifications at certain offices based on an office’s contractual agreements with carrier partners or other third parties.
The program is composed of the following: Internal persistent scans and external monthly scans; • Internal persistent scans and external monthly scans; • Static and dynamic software custom code to develop scans for secure code development; • Periodic third-party executed penetration tests and risk assessments; and • A model to comply with SOC 2 Type II standards or other industry certifications at certain offices based on an office’s contractual agreements with carrier partners or other third parties.
We have also established a structured incident response process driven by the severity and type of issue. This process, which engages our Security Operations Center (SOC) for incident identification, our internal security team for incident analysis and assignment, our Technology Solutions teams for isolation/remediation and our third-party business partner for continuity awareness and escalations.
We have also established a structured incident response process driven by the severity and type of issue. This process, which engages our security operations center (SOC) for incident identification, our internal security team for incident analysis and assignment, our Technology Solutions team for isolation/remediation and our third-party business partner for continuity awareness and escalations.
We face a number of cybersecurity risks in connection with our business and have from time-to-time experienced cybersecurity incidents, such as malware infections, phishing campaigns and vulnerability exploit attempts, which to date have not had a material impact on our business strategy, results of operations, or financial condition.
We face a number of cybersecurity risks in connection with our business and have from time-to-time experienced cybersecurity incidents, such as malware infections, phishing campaigns, ransomware and vulnerability exploit attempts, which to date have not had a material impact on our business strategy, results of operations, or financial condition.
The Audit Committee, composed entirely of independent directors, is responsible for organization-wide oversight regarding information security and reports to the full Board. All directors typically attend our committee meetings, which we believe creates transparency and a more 22 collaborative and informed Board.
The Audit Committee, composed entirely of independent directors, is responsible for organization-wide oversight regarding information security and reports to the full board of directors. All directors typically attend our committee meetings, which we believe creates transparency and a more collaborative and informed Board.
For more information about the cybersecurity risks we face, see the risk factor entitled “A cybersecurity attack, or any other interruption in information technology and/or data security that may impact our operations or the operations of third parties that support us, could adversely affect our business, financial condition and reputation” in Item 1A - Risk Factors. 23
For more information about the cybersecurity risks we face, see the risk factor entitled “A cybersecurity attack, or any other interruption in information technology and/or data security that may impact our operations 24 or the operations of third parties that support us, could adversely affect our business, financial condition and reputation” in Item 1A - Risk Factors.
As part of the Company’s ERM program, the Board receives a report at least annually from the Company’s chief executive officer and chief legal officer concerning the Company’s risks, which include cybersecurity risks. The Company’s chief information security officer, under the direction of our chief security officer, is responsible for developing and implementing our information security program.
As part of the Company’s ERM program, the Board receives a report at least annually from the Company’s chief executive officer and chief legal officer concerning the Company’s risks, which include cybersecurity risks. The Company’s chief security officer is responsible for developing and implementing our information security program.
Our chief security officer brings extensive experience in both the military and the private sector and is a specialist in attack surface reduction, incident response and recovery, targeted threat hunting, forensics/malware analysis and threat group analysis. Our Information Security team has deployed a structured and measured vulnerability management program that proactively identifies vulnerabilities across our platforms and processes.
He also brings extensive experience in both the military and the private sector and is a specialist in attack surface reduction, incident response and recovery, targeted threat hunting, forensics/malware analysis and threat group analysis. Our information security team deployed a structured and measured vulnerability management program that proactively identifies vulnerabilities across our platforms and processes.
Teammates are also required to complete Health Insurance Portability and Accountability Act of 1996 (HIPAA) training every one or two years, depending on location.
Moreover, teammates are required to complete Health Insurance Portability and Accountability Act of 1996 (HIPAA) training every one or two years, depending on their location.
The Audit Committee receives reports on at least a quarterly basis from the Company’s chief information security officer, who is typically accompanied by the Company’s chief security officer and chief information officer, on the Company’s latest information security risks and mitigation strategies. Assessing, identifying and managing cybersecurity related risks are integrated into our overall enterprise risk management (ERM) program.
The Audit Committee receives reports on at least a quarterly basis from the Company’s chief security officer on the Company’s latest information security risks and mitigation strategies. Assessing, identifying and managing cybersecurity related risks are integrated into our overall enterprise risk management (ERM) program.
In 2023, substantially all Brown & Brown teammates completed ethical conduct training; cybersecurity awareness training; the California Consumer Privacy Act (CCPA) Survey; and the Annual Certification for Insurance Licensees training as a reminder of the regulatory obligation to report certain changes to the jurisdictions in which they are licensed.
In 2024, nearly all Brown & Brown teammates completed ethical conduct training, cybersecurity awareness training, the California Consumer Privacy Act (CCPA) Survey, and the Annual Certification for Insurance Licensees training, which serves as a reminder of the regulatory obligation to report certain changes to the jurisdictions where they are licensed.
Our chief information security officer and our chief security officer each has more than 35 years of experience in technology, operations, information risk and security. Our chief information security officer has deep experience developing comprehensive information security programs for large and complex financial services and insurance organizations.
Our chief security officer has more than 35 years of experience in technology, operations, information risk and security. Our chief security officer has deep experience developing comprehensive information security programs for large and complex organizations.
ITEM 1C. Cybersecurity. The Company relies on our internal Technology Solutions team and third-party vendors to provide effective and efficient service to our customers, process claims and timely and accurately report information to carriers, which often involves secure processing of confidential, sensitive, proprietary and other types of information.
ITEM 1C. Cybersecurity. The Company relies on our internal Technology Solutions team and third-party vendors to deliver effective and efficient services to our customers, process claims, and report information accurately and promptly to carriers. This often requires the secure handling of confidential, sensitive, proprietary, and other types of information.
We monitor the risks presented by the possibility of cybersecurity breaches of any of these systems. Accordingly, we have significantly invested, and will continue to invest, in technology security initiatives, information technology policies and resources, and teammate training to mitigate the risk of improper access to private information.
We actively monitor the risks associated with potential cybersecurity breaches of any of these systems. Therefore, we have made investments, and will continue to invest, in technology security initiatives, information technology policies, resources, and teammate training to mitigate the risk of unauthorized access to sensitive or personally identifiable information.

Item 2. Properties

Properties — owned and leased real estate

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Biggest changeITEM 2. Pr operties. We own our executive offices, which are located at 300 North Beach Street, Daytona Beach, Florida 32114, as well as certain other vacant land and office buildings in the Daytona Beach area. We lease offices at each of our other 499 locations.
Biggest changeITEM 2. Pr operties. We own our executive offices, which are located at 300 North Beach Street, Daytona Beach, Florida 32114, as well as certain other vacant land and office buildings in the Daytona Beach area. We lease offices at each of our other 514 locations.
In the future, we may need to purchase, build or lease additional facilities to meet the requirements projected in our long-term business plan. See Note 15 to the Consolidated Financial Statements for additional information on our lease commitments.
In the future, we may need to purchase, build or lease additional facilities to meet the requirements projected in our long-term business plan. See Note 14 to the Consolidated Financial Statements for additional information on our lease commitments.

Item 3. Legal Proceedings

Legal Proceedings — active lawsuits and investigations

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Biggest changeITEM 3. Legal Proceedings. We are subject to numerous litigation claims that arise in the ordinary course of business. We do not believe any of these are, or are likely to become, material to our business. ITEM 4. Mine Saf ety Disclosures. Not applicable. 24 PAR T II
Biggest changeITEM 3. Legal Proceedings. We are subject to numerous litigation claims that arise in the ordinary course of business. We do not believe any of these claims are, or are likely to become, material to our business. ITEM 4. Mine Saf ety Disclosures. Not applicable. 25 PAR T II

Item 4. Mine Safety Disclosures

Mine Safety Disclosures — required of mining issuers

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Biggest changeItem 4. Mine Safety Disclosures 24 Part II 25 Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 25 Item 6. Reserved 27 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 28 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 45 Item 8.
Biggest changeItem 4. Mine Safety Disclosures 25 Part II 26 Item 5. Market for Registrant’s Common Equity, Related Stockholder Matters and Issuer Purchases of Equity Securities 26 Item 6. Reserved 28 Item 7. Management’s Discussion and Analysis of Financial Condition and Results of Operations 29 Item 7A. Quantitative and Qualitative Disclosures About Market Risk 45 Item 8.

Item 5. Market for Registrant's Common Equity

Market for Common Equity — stock, dividends, buybacks

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Biggest changePeriod Total number of shares purchased Average price paid per share Total number of shares purchased as part of publicly announced plans or programs Approximate dollar value of shares that may yet be purchased under the plans or programs October 1, 2023 to October 31, 2023 — $ — — $ 249.5 November 1, 2023 to November 30, 2023 — — — 249.5 December 1, 2023 to December 31, 2023 — — — 249.5 Total — $ — — $ 249.5 Performance Graph The following graph is a comparison of five-year cumulative total shareholder returns for our common stock as compared with the cumulative total shareholder return for the S&P 500 Composite Index, and a group of peer insurance broker and agency companies (Aon plc, Arthur J.
Biggest changePerformance Graph The following graph is a comparison of five-year cumulative total shareholder returns for our common stock as compared with the cumulative total shareholder return for the S&P 500 Composite Index and a group of peer insurance broker and agency companies (Aon plc, Arthur J. Gallagher & Co, Marsh & McLennan Companies, and Willis Towers Watson Public Limited Company).
These purchases may be carried out through open market purchases, block trades, accelerated share repurchase plans of up to $100.0 million each (unless otherwise approved by the board of directors), negotiated private transactions or pursuant to any trading plan that may be adopted in accordance with Rule 10b5-1 of the Exchange Act.
These purchases may be carried out through open market purchases, block trades, accelerated share repurchase plans of up to $100 million each (unless otherwise approved by the board of directors), negotiated private transactions or pursuant to any trading plan that may be adopted in accordance with Rule 10b5-1 of the Exchange Act.
On July 18, 2014, the Company’s board of directors authorized the repurchase of up to $200.0 million of its shares of common stock, and on July 20, 2015, the Company’s board of directors authorized the repurchase of up to an additional $400.0 million of the Company’s outstanding common stock.
On July 18, 2014, the Company’s board of directors authorized the repurchase of up to $200 million of its shares of common stock, and on July 20, 2015, the Company’s board of directors authorized the repurchase of up to an additional $400 million of the Company’s outstanding common stock.
The following table presents information with respect to our purchases of our common stock during the three months ended December 31, 2023.
The following table presents information with respect to our purchases of our common stock during the three months ended December 31, 2024.
At December 31, 2023, the remaining amount authorized by our board of directors for share repurchases was $249.5 million. Under the authorized repurchase programs, the Company has repurchased approximately 19.7 million shares for an aggregate cost of approximately $748.1 million between 2014 and 2023.
At December 31, 2024, the remaining amount authorized by our board of directors for share repurchases was $249 million. Under the authorized repurchase programs, the Company has repurchased approximately 20 million shares for an aggregate cost of approximately $748 million between 2014 and 2024.
ITEM 5. Market for Registrant’s Common Equity, Related Stoc kholder Matters and Issuer Purchases of Equity Securities. Our common stock is listed on the New York Stock Exchange (“NYSE”) under the symbol “BRO”. On February 19, 2024, there were 285,801,863 shares of our common stock outstanding, held by approximately 1,564 shareholders of record.
ITEM 5. Market for Registrant’s Common Equity, Related Stoc kholder Matters and Issuer Purchases of Equity Securities. Our common stock is listed on the New York Stock Exchange (“NYSE”) under the symbol “BRO”. On February 10, 2025, there were 285,931,978 shares of our common stock outstanding, held by approximately 1,616 shareholders of record.
Gallagher & Co, Marsh & McLennan Companies, and Willis Towers Watson Public Limited Company). The returns of each company have been weighted according to such companies’ respective stock market capitalizations as of December 31, 2018 for the purposes of arriving at a peer group average.
The returns of each company have been weighted according to such companies’ respective stock market capitalizations as of December 31, 2019 for the purposes of arriving at a peer group average.
On May 1, 2019, the board of directors approved an additional repurchase authorization amount of $372.5 million to bring the total available share repurchase authorization at that time to approximately $500.0 million. During 2023, the Company repurchased 2,100 shares at an average price of $53.84 for a total cost of $0.1 million under the current share repurchase authorization.
On May 1, 2019, the board of directors approved an additional repurchase authorization amount of $373 million to bring the total available share repurchase authorization at that time to approximately $500 million. During 2024, the Company did not repurchase any of its shares.
The total return calculations are based upon an assumed $100.00 investment on December 31, 2018, with all dividends reinvested. 12/18 12/19 12/20 12/21 12/22 12/23 Brown & Brown, Inc. 100.00 144.66 175.13 261.47 213.40 268.29 S&P 500 Composite 100.00 131.47 155.65 200.29 163.98 207.04 Peer Group 100.00 140.40 151.85 213.43 216.03 234.74 25 26
The total return calculations are based upon an assumed $100.00 investment on December 31, 2019, with all dividends reinvested. 12/19 12/20 12/21 12/22 12/23 12/24 Brown & Brown, Inc. 100.00 121.06 180.74 147.51 185.46 267.65 S&P 500 Composite 100.00 116.26 147.52 118.84 147.64 182.05 Peer Group 100.00 111.92 158.48 163.08 182.06 222.31 26 27
Removed
Sales of Unregistered Securities During 2023, the Company issued 261,614 shares of the Company's common stock to the owners of the businesses acquired in connection with the acquisition of Kentro Capital Limited.
Added
Period Total number of shares purchased (1) Average price paid per share Total number of shares purchased as part of publicly announced plans or programs Approximate dollar value of shares that may yet be purchased under the plans or programs October 1, 2024 to October 31, 2024 3,027 $ 106.33 — $ 249 November 1, 2024 to November 30, 2024 — — — 249 December 1, 2024 to December 31, 2024 — — — 249 Total 3,027 $ 106.33 — $ 249 (1) All shares reported in this column are attributable to shares withheld for taxes in connection with vesting of restricted shares awarded under our 2010 Stock Incentive Plan and 2019 Stock Incentive Plan.
Removed
The issuances were made in reliance upon the following exemptions or exclusions from the registration requirements of the Securities Act of 1933, as amended (the “Securities Act”): Section 4(a)(2) of the Securities Act, Regulation D promulgated under the Securities Act and Regulation S promulgated under the Securities Act.

Item 7. Management's Discussion & Analysis

Management's Discussion & Analysis (MD&A) — revenue / margin commentary

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Biggest changeNon-GAAP Earnings Measures • EBITDAC is defined as income before interest, income taxes, depreciation, amortization and the change in estimated acquisition earn-out payables. • EBITDAC Margin is defined as EBITDAC divided by total revenues. • EBITDAC - Adjusted is defined as EBITDAC, excluding (i) (gain)/loss on disposal, (ii) Acquisition/Integration Costs (as defined below), (iii) for 2023, the 1Q23 Nonrecurring Cost (as defined below) and (iv) Foreign Currency Translation (as defined below). • EBITDAC Margin - Adjusted is defined as EBITDAC - Adjusted divided by Total Revenues - Adjusted. 29 Definitions Related to Certain Components of Non-GAAP Measures • “Acquisition/Integration Costs” means the acquisition and integration costs (e.g., costs associated with regulatory filings, legal/accounting services, due diligence and the costs of integrating our information technology systems) arising out of our acquisitions of GRP (Jersey) Holdco Limited and its business ("GRP"), Orchid Underwriters Agency and CrossCover Insurance Services ("Orchid"), and BdB Limited companies ("BdB"), which are not considered to be normal, recurring or part of the ongoing operations. • “Foreign Currency Translation” means the period-over-period impact of foreign currency translation, which is calculated by applying current-year foreign exchange rates to the various functional currencies in our business to our reporting currency of U.S. dollars for the same period in the prior year. • “1Q23 Nonrecurring Cost” means approximately $11.0 million expensed and substantially paid in the first quarter of 2023 to resolve a business matter, which is not considered to be normal, recurring or part of the ongoing operations.
Biggest changeDefinitions Related to Certain Components of Non-GAAP Measures • “Acquisition/Integration Costs” means the acquisition and integration costs (e.g., costs associated with regulatory filings, legal/accounting services, due diligence and the costs of integrating our information technology systems) arising out of our acquisitions of GRP (Jersey) Holdco Limited and its business, Orchid Underwriters Agency and CrossCover Insurance Services, and BdB Limited companies, which are not considered to be normal, recurring or part of the ongoing operations. 30 • “Foreign Currency Translation” means the period-over-period impact of foreign currency translation, which is calculated by applying current-year foreign exchange rates to the various functional currencies in our business to our reporting currency of U.S. dollars for the same period in the prior year. • “1Q23 Nonrecurring Cost” means approximately $11.0 million expensed and substantially paid in the first quarter of 2023 to resolve a business matter, which is not considered to be normal, recurring or part of the ongoing operations. • “(Gain)/loss on disposal” is a caption on our consolidated statements of income which reflects net proceeds received as compared to net book value related to sales of books of business and other divestiture transactions, such as the disposal of a business through sale or closure.
During the first quarter of 2023, the performance conditions for approximately 970,000 shares of the Company’s common stock granted under the under the Company’s 2019 SIP were determined by the Compensation Committee to have been satisfied relative to the performance-based grants issued in 2020 and 2022. These grants had a performance measurement period that concluded on December 31, 2022.
During the first quarter of 2023, the performance conditions for approximately 970,000 shares of the Company’s common stock granted under the Company’s 2019 SIP were determined by the Compensation Committee to have been satisfied relative to the performance-based grants issued in 2020 and 2022. These grants had a performance measurement period that concluded on December 31, 2022.
Historically, investment income has consisted primarily of interest earnings on operating cash and where permitted, on premiums and advance premiums collected and held in a fiduciary capacity before being remitted to insurance companies. Our policy as it relates to the Company’s capital is to invest available funds in high-quality, short-term money-market funds and fixed income investment securities.
Historically, investment income has consisted primarily of interest earnings on operating cash and where permitted, on premiums collected and held in a fiduciary capacity before being remitted to insurance companies. Our policy as it relates to the Company’s capital is to invest available funds in high-quality, short-term money-market funds and fixed income investment securities.
The Company believes that its existing cash, cash equivalents, short-term investment portfolio and funds generated from operations, together with the funds available under the Revolving Credit Facility and the Loan Agreement (the “Loan Agreement"), will be sufficient to satisfy its normal liquidity needs, including principal payments on our long-term debt, for the next 12 months and the long term.
The Company believes that its existing cash, cash equivalents, short-term investment portfolio and funds generated from operations, together with the funds available under the Revolving Credit Facility and the Loan Agreement (the “Loan Agreement"), will be sufficient to satisfy its normal liquidity needs, including principal payments on our long-term debt, for the next 12 months and in the long term.
Change in Estimated Acquisition Earn-Out Payables Accounting Standards Codification (“ASC”) Topic 805-Business Combinations is the authoritative guidance requiring an acquirer to recognize 100% of the fair value of acquired assets, including goodwill and assumed liabilities (with only limited exceptions) upon initially obtaining control of an acquired entity.
Change in Estimated Acquisition Earn-Out Payables Accounting Standards Codification (“ASC”) 805 - Business Combinations is the authoritative guidance requiring an acquirer to recognize 100% of the fair value of acquired assets, including goodwill, and assumed liabilities (with only limited exceptions) upon initially obtaining control of an acquired entity.
Additionally, the Company may, subject to satisfaction of certain conditions, including receipt of additional term loan commitments by new or existing lenders, increase either Term Loan Commitment under the existing Loan Agreement or the term loans issued thereunder or issue new tranches of term loans in an aggregate additional amount of up to $400.0 million.
Additionally, the Company may, subject to satisfaction of certain conditions, including receipt of additional term loan commitments by new or existing lenders, increase either Term Loan Commitment under the existing Loan Agreement or the term loans issued thereunder or issue new tranches of term loans in an aggregate additional amount of up to $400 million.
As a result of the awarding of these shares, the grantees will be eligible to receive payments of dividends and exercise voting privileges. The awarded shares will be included as issued and outstanding common stock shares and included in the calculation of basic and diluted net income per share.
As a result of the awarding of these shares, the 32 grantees will be eligible to receive payments of dividends and exercise voting privileges. The awarded shares will be included as issued and outstanding common stock shares and included in the calculation of basic and diluted net income per share.
In addition, see “Information Regarding Non-GAAP Financial Measures” below regarding important information on non-GAAP financial measures contained in our discussion and analysis. We are a diversified insurance agency, wholesale brokerage, insurance programs and services organization headquartered in Daytona Beach, Florida.
In addition, see “Information Regarding Non-GAAP Financial Measures” below regarding important information on non-GAAP financial measures contained in our discussion and analysis. We are a diversified insurance agency, wholesale brokerage, insurance programs and services headquartered in Daytona Beach, Florida.
If it is probable that a liability has been incurred at the date of the financial statements and the amount of the loss is estimable, an accrual for the costs to resolve these claims is recorded in accrued expenses in the accompanying Consolidated Financial Statements.
If it is probable that a liability has been incurred at the date of the financial statements and the amount of the loss is estimable, an accrual for the costs to resolve these claims is recorded in accrued expenses in the accompanying financial statements.
Additionally, there have been no impairments recorded for amortizable intangible assets for the years ended December 31, 2023 and 2022. Non-Cash Stock-Based Compensation We grant non-vested stock awards to our employees, with the related compensation expense recognized in the financial statements over the associated service period based upon the grant-date fair value of those awards, subject to any performance modification.
Additionally, there have been no impairments recorded for amortizable intangible assets for the years ended December 31, 2024 and 2023. Non-Cash Stock-Based Compensation We grant non-vested stock awards to our employees, with the related compensation expense recognized in the financial statements over the associated service period based upon the grant-date fair value of those awards, subject to any performance modification.
The term “core commissions and fees” excludes profit-sharing contingent commissions, and therefore represents the revenues earned directly from specific insurance policies sold, and specific fee-based services rendered.
The term “core commissions and fees” excludes profit-sharing contingent commissions, and therefore, it represents the revenues earned directly from specific insurance policies sold, and specific fee-based services rendered.
In most cases, the insurance carriers that support these programs have delegated underwriting and, in many instances, claims-handling authority to our programs operations. These programs are generally distributed through a nationwide network of independent agents and Brown & Brown retail agents, and offer targeted products and services designed for specific industries, trade groups, professions, public entities and market niches.
In most cases, the insurance carriers that support these programs have delegated underwriting and, in many instances, claims-handling authority to our programs operations. These programs are generally distributed through a global network of independent agents and Brown & Brown retail agents, and offer targeted products and services designed for specific industries, trade groups, professions, public entities and market niches.
The Captives focus on property insurance for earthquake and wind exposed properties underwritten by certain of our MGUs and limit the Company's exposure to claims expenses through reinsurance or by only participating in certain tranches of the underwriting. We have increased revenues every year from 1993 to 2023, with the exception of 2009, when our revenues declined 1.0%.
The Captives focus on property insurance for earthquake and wind exposed properties underwritten by certain of our MGUs and limit the Company's exposure to claims expenses through reinsurance or by only participating in certain tranches of the underwriting. We have increased revenues every year from 1993 to 2024, with the exception of 2009, when our revenues declined 1.0%.
If these estimates or related assumptions change in the future, we may be required to revise the assessment and, if appropriate, record an impairment charge. We completed our most recent evaluation of impairment for goodwill as of November 30, 2023 and determined that the fair value of goodwill exceeded the carrying value of such assets.
If these estimates or related assumptions change in the future, we may be required to revise the assessment and, if appropriate, record an impairment charge. We completed our most recent evaluation of impairment for goodwill as of November 30, 2024 and determined that the fair value of goodwill exceeded the carrying value of such assets.
During the performance measurement period, we review the probable outcome of the performance conditions associated with our performance awards quarterly and adjust the expense recognition accruals with the expected performance outcome.
During the performance measurement period, we review the probable outcome of the performance conditions associated with our performance awards and adjust the expense recognition accruals with the expected performance outcome.
Information Regarding Non-GAAP Financial Measures In the discussion and analysis of our results of operations, in addition to reporting financial results in accordance with generally accepted accounting principles (“GAAP”), we provide references to the following non-GAAP financial measures as defined in Regulation G of the SEC rules: Total Revenues - Adjusted, Organic Revenue, EBITDAC, EBITDAC Margin, EBITDAC - Adjusted and EBITDAC Margin - Adjusted.
Information Regarding Non-GAAP Financial Measures In the discussion and analysis of our results of operations, in addition to reporting financial results in accordance with generally accepted accounting principles (“GAAP”), we provide references to the following non-GAAP financial measures as defined in Regulation G of the SEC rules: Organic Revenue, EBITDAC, EBITDAC Margin, EBITDAC - Adjusted and EBITDAC Margin - Adjusted.
Other fees are typically recognized upon the completion of the delivery of the agreed-upon services to the customer. To a much lesser extent, the Company earns revenues in the form of net retained earned premiums in connection with the Captives. These premiums are reported net of the ceded premiums for reinsurance and recognized evenly over the associated policy periods.
Other fees are typically recognized upon the completion of the delivery of the agreed-upon services to the customer. To a much lesser extent, the Company earns revenues in the form of net retained earned premiums in connection with the Captives. These premiums are reported net of the ceded premiums for reinsurance and recognized ratably over the associated policy periods.
This segment also operates our write-your-own flood insurance carrier, WNFIC and participates in two Captives. WNFIC’s underwriting business consists of policies written on behalf of and fully ceded to the NFIP, as well as excess flood policies, which are fully reinsured in the private market.
This segment also operates a write-your-own flood insurance carrier, WNFIC and participates in two Captives. WNFIC’s underwriting business consists of policies written on behalf of and fully ceded to the NFIP, as well as excess flood policies, which are fully reinsured in the private market.
As of December 31, 2023, the fair values of the estimated acquisition earn-out payables were reevaluated and measured at fair value on a recurring basis using unobservable inputs (Level 3) as defined in ASC 820-Fair Value Measurement.
As of December 31, 2024, the fair values of the estimated acquisition earn-out payables were reevaluated and measured at fair value on a recurring basis using unobservable inputs (Level 3) as defined in ASC 820 - Fair Value Measurement .
Management determines a policy cancellation reserve based upon historical cancellation experience adjusted in accordance with known circumstances. See Note 2 to our Consolidated Financial Statements for additional information regarding the nature and timing of our revenues. 30 Business Combinations and Purchase Price Allocations We have acquired significant intangible assets through acquisitions of businesses.
Management determines a cancellation reserve based upon historical cancellation experience adjusted in accordance with known circumstances. See Note 2 to our Consolidated Financial Statements for additional information regarding the nature and timing of our revenues. 31 Business Combinations and Purchase Price Allocations We have acquired significant intangible assets through acquisitions of businesses.
Likewise, other income consists primarily of miscellaneous income and therefore can fluctuate between comparable periods. As such, in evaluating the operational efficiency of a segment, management focuses on the Organic Revenue growth rate and EBITDAC margin.
Likewise, other income consists primarily of miscellaneous income and therefore can fluctuate between comparable periods. As such, management primarily focuses on the Organic Revenue growth rate and EBITDAC Margin when evaluating the operational efficiency of a segment.
Wholesale Brokerage Segment The Wholesale Brokerage segment markets and sells excess and surplus commercial and personal lines insurance, primarily through independent agents and brokers, including Brown & Brown retail agents. Approximately 86% of the Wholesale Brokerage segment’s commissions and fees revenue is commission based.
Wholesale Brokerage Segment The Wholesale Brokerage segment markets and sells excess and surplus commercial and personal lines insurance, primarily through independent agents and brokers, including Brown & Brown retail agents. Approximately 85% of the Wholesale Brokerage segment’s commissions and fees revenue is commission based.
We also view Total Revenues - Adjusted, EBITDAC, EBITDAC - Adjusted, EBITDAC Margin and EBITDAC Margin - Adjusted as important indicators when assessing and evaluating our performance, as they present more comparable measurements of our operating margins in a meaningful and consistent manner.
We also view EBITDAC, EBITDAC - Adjusted, EBITDAC Margin and EBITDAC Margin - Adjusted as important indicators when assessing and evaluating our performance, as they present more comparable measurements of our operating margins in a meaningful and consistent manner.
The decrease includes: the scheduled principal payments related to our various existing floating-rate debt term notes in total of $250.6 million; offset by the amortization of discounted debt related to our various unsecured Senior Notes, and debt issuance cost amortization of $4.1 million and the net increase of $100.0 million balance on the Revolving Credit Facility.
The decrease includes: the scheduled principal payments related to our various existing floating-rate debt term notes in total of $250 million; offset by the amortization of discounted debt related to our various unsecured Senior Notes, and debt issuance cost amortization of $4 million and the net increase of $100 million balance on the Revolving Credit Facility.
New developments or changes in settlement strategy in dealing with these matters may significantly affect the required reserves and affect our net income. 32 RESULTS OF OPERATIONS FOR THE YEARS ENDED DECEMBER 31, 2023 AND 2022 The following discussion and analysis regarding results of operations and liquidity and capital resources should be considered in conjunction with the accompanying Consolidated Financial Statements and related Notes.
New developments or changes in settlement strategy in dealing with these matters may significantly affect the required reserves and affect our net income. 33 RESULTS OF OPERATIONS FOR THE YEARS ENDED DECEMBER 31, 2024 AND 2023 The following discussion and analysis regarding results of operations and liquidity and capital resources should be considered in conjunction with the accompanying Consolidated Financial Statements and related Notes.
During the first quarter of 2024, the performance conditions for approximately 1,200,000 shares of the Company’s common stock granted under the under the Company’s 2019 SIP were determined by the Compensation Committee to have been satisfied relative to the performance-based grants issued in 2021 and 2023. These grants had a performance measurement period that concluded on December 31, 2023.
During the first quarter of 2024, the performance conditions for approximately 1.2 million shares of the Company’s common stock granted under the Company’s 2019 SIP were determined by the Compensation Committee to have been satisfied relative to the performance-based grants issued in 2021 and 2023. These grants had a performance measurement period that concluded on December 31, 2023.
Historically, we have grown our revenues as a result of our focus on net new business and acquisitions. We foster a strong, decentralized sales and service culture, which enables responsiveness to changing business conditions and drives accountability for results.
Historically, we have grown our revenues as a result of our focus on new business, customer retention and acquisitions. We foster a strong, decentralized sales and service culture, which enables responsiveness to changing business conditions and drives accountability for results.
The National Programs segment operations can be grouped into five broad categories: Professional Programs, Personal Lines Programs, Commercial Programs, Public Entity-Related Programs and Specialty Programs. Approximately 76% of the National Programs segment’s commissions and fees revenue is commission based.
The Programs segment operations can be grouped into five broad categories: Professional Programs, Personal Lines Programs, Commercial Programs, Public Entity-Related Programs and Specialty Programs. Approximately 79% of the Programs segment’s commissions and fees revenue is commission based.
Other As discussed in Note 16 of the Notes to Consolidated Financial Statements, the “Other” column in the Segment Information table includes any income and expenses not allocated to reportable segments, and corporate-related items, including the intercompany interest expense charges to reporting segments. LIQUIDITY AND CAPITAL RESOURCES The Company seeks to maintain a conservative balance sheet and strong liquidity profile.
Other As discussed in Note 15 of the Notes to Consolidated Financial Statements, in the Segment Information tables “Other” includes any income and expenses not allocated to reportable segments, and corporate-related items, including the intercompany interest expense charges to reporting segments. LIQUIDITY AND CAPITAL RESOURCES The Company seeks to maintain a conservative balance sheet and strong liquidity profile.
We have the ability to utilize our Revolving Credit Facility, which as of December 31, 2023 provided capacity for up to $700.0 million in additional available cash. We believe that we have access to additional funds, if needed, through the capital markets or private placements to obtain further debt financing under the current market conditions.
We have the ability to utilize our Revolving Credit Facility, which as of December 31, 2024 provided capacity for up to $550 million in additional available cash. We believe that we have access to additional funds, if needed, through the capital markets or private placements to obtain further debt financing under the current market conditions.
For a comparison of our results of operations and liquidity and capital resources for the years ended December 31, 2022 and 2021, see Part II, Item 7 of our Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 27, 2023.
For a comparison of our results of operations and liquidity and capital resources for the years ended December 31, 2023 and 2022, see Part II, Item 7 of our Annual Report on Form 10-K filed with the Securities and Exchange Commission on February 22, 2024.
On October 27, 2021, the Company entered into an amended and restated credit agreement (the “Second Amended and Restated Credit Agreement”) with the lenders named therein, JPMorgan Chase Bank, N.A. as administrative agent, Bank of America, N.A., Truist Bank and BMO Harris Bank N.A. as co-syndication agents, and U.S.
The Company entered into an amended and restated credit agreement (the “Second Amended and Restated Credit Agreement”) with the lenders named therein, JPMorgan Chase Bank, N.A. as administrative agent, Bank of America, N.A., Truist Bank and BMO Harris Bank N.A. as co-syndication agents, and U.S.
During the 12 months ended December 31, 2023, the Company repaid $15.6 million of principal related to the Second Amended and Restated Credit Agreement term loan through the quarterly scheduled principal payments. The Second Amended and Restated Credit Agreement term loan had an outstanding balance of $218.7 million as of December 31, 2023.
During the 12 months ended December 31, 2023, the Company repaid $15 million of principal related to the Second Amended and Restated Credit Agreement term loan through the quarterly scheduled principal payments. The Second Amended and Restated Credit Agreement term loan had an outstanding balance of $219 million as of December 31, 2023.
These assets generally consist of purchased customer accounts, non-compete agreements, and the excess of purchase prices over the fair value of identifiable net assets acquired (goodwill). The determination of estimated useful lives and the allocation of purchase price to intangible assets requires significant judgment and affects the amount of future amortization and possible impairment charges.
These assets primarily consist of purchased customer accounts and the excess of purchase prices over the fair value of identifiable net assets acquired (goodwill). The determination of estimated useful lives and the allocation of purchase price to intangible assets requires significant judgment and affects the amount of future amortization and possible impairment charges.
Non-GAAP Revenue Measures • Total Revenues - Adjusted is our total revenues, excluding Foreign Currency Translation (as defined below). • Organic Revenue is our core commissions and fees less: (i) the core commissions and fees earned for the first 12 months by newly acquired operations; (ii) divested business (core commissions and fees generated from offices, books of business or niches sold or terminated during the comparable period); and (iii) Foreign Currency Translation (as defined below).
Non-GAAP Revenue Measures • Organic Revenue is our core commissions and fees less: (i) the core commissions and fees earned for the first twelve months by newly acquired operations; (ii) divested business (core commissions and fees generated from offices, books of business or niches sold or terminated during the comparable period) and (iii) Foreign Currency Translation (as defined below).
RESULTS OF OPERATIONS — SEGMENT INFORMATION As discussed in Note 16 “Segment Information” of the Notes to Consolidated Financial Statements, we operate four reportable segments: Retail, National Programs, Wholesale Brokerage and Services. On a segmented basis, changes in amortization, depreciation and interest expenses generally result from activity associated with acquisitions.
RESULTS OF OPERATIONS — SEGMENT INFORMATION As discussed in Note 15 “Segment Information” of the Notes to Consolidated Financial Statements, we operate three reportable segments: Retail, Programs and Wholesale Brokerage. On a segmented basis, changes in amortization, depreciation and interest expenses generally result from activity associated with acquisitions.
Changes in depreciation expense reflect net additions of fixed assets resulting from businesses acquired in the past 12 months and the addition of fixed assets resulting from business initiatives, net of the impact of fixed assets that became fully depreciated or written off in the gain or loss on disposal.
Changes in depreciation expense reflect net additions of fixed assets resulting from businesses acquired in the past twelve months and the addition of fixed assets resulting from business initiatives, partially offset by the impact of fixed assets that became fully depreciated or written off in the gain or loss on disposal.
The Term Loan was terminated early due to the agreement's benchmark reference rate to the London Interbank Offered Rate (“LIBOR”) which was due to cease on June 30, 2023. Any proceeds related to this terminated note on the Revolving Credit Facility were repaid by the end of the third quarter of 2023.
The Term Loan was terminated early due to the agreement's benchmark reference rate to the LIBOR which was due to cease on June 30, 2023. Any proceeds related to this terminated note on the Revolving Credit Facility were repaid by the end of the third quarter of 2023.
During the 12 months ended December 31, 2023, the Company repaid $25.0 million of principal related to the Term Loans issued under the Term A-2 Loan Commitment (“Term A-2 Loans”) through quarterly scheduled principal payments. The Term A-2 Loans had an outstanding balance of $456.2 million as of December 31, 2023.
During the 12 months ended December 31, 2023, the Company repaid $25 million of principal related to the Term Loans issued under the Term A-2 Loans through quarterly scheduled principal payments. The Term A-2 Loans had an outstanding balance of $456 million as of December 31, 2023.
Approximately 78% of the Retail segment’s commissions and fees revenue is commission based.
Approximately 77% of the Retail segment’s commissions and fees revenue is commission based.
The Company may redeem the Notes in whole or in part at any time and from time to time, at the “make whole” redemption prices specified in the Prospectus Supplement for the Notes being redeemed, plus accrued and unpaid interest thereon to, but excluding the redemption date.
The Company may redeem the 2034 Senior Notes in whole or in part at any time and from time to time, at the “make whole” redemption prices specified in the prospectus supplement for the 2034 Senior Notes being redeemed, plus accrued and unpaid interest thereon.
This supplemental non-GAAP financial information should be considered in addition to, and not in lieu of, the Company's Consolidated Financial Statements. Acquisitions Part of our business strategy is to attract high-quality insurance intermediaries and service organizations to join our operations. From 1993 through the fourth quarter of 2023, we acquired 644 insurance intermediary operations.
This supplemental non-GAAP financial information should be considered in addition to, and not in lieu of, the Company ' s Consolidated Financial Statements. Acquisitions Part of our business strategy is to attract high-quality insurance intermediaries and service organizations to join our operations. From 1993 through the fourth quarter of 2024, we acquired 676 insurance intermediary operations.
The resulting net changes, as well as the interest expense accretion on the estimated acquisition earn-out payables, for the years ended December 31, 2023 and 2022 were as follows: (in millions) 2023 2022 Change in fair value of estimated acquisition earn-out payables $ 14.1 $ (45.9 ) Interest expense accretion 7.7 7.0 Net change in earnings from estimated acquisition earn-out payables $ 21.8 $ (38.9 ) For the years ended December 31, 2023 and 2022, the fair value of estimated earn-out payables was reevaluated and increased by $14.1 million for 2023 and decreased by $45.9 million for 2022, which are charges and credits respectively, exclusive of interest expense accretion, to the Consolidated Statements of Income for 2023 and 2022.
The resulting net changes, as well as the interest expense accretion on the estimated acquisition earn-out payables, for the years ended December 31, 2024 and 2023 were as follows: (in millions) 2024 2023 Change in fair value of estimated acquisition earn-out payables $ (6 ) $ 14 Interest expense accretion 8 7 Net change in earnings from estimated acquisition earn-out payables $ 2 $ 21 For the years ended December 31, 2024 and 2023, the fair value of estimated earn-out payables was reevaluated and decreased by $6 million for 2024 and increased by $14 million for 2023, which are credits and charges, exclusive of interest expense accretion, to the Consolidated Statements of Income for 2024 and 2023.
On May 31, 2023, the Company repaid the outstanding balance of $202.5 million on the term loan (the “Term Loan”) associated with the Term Loan Credit Agreement (the “Term Loan Credit Agreement”) which was entered into on December 21, 2018 with cash proceeds of $32.5 million and $170.0 million with proceeds from the Revolving Credit Facility.
By May 31, 2023, the Company repaid the outstanding balance of $210 million on the term loan (the “Term Loan”) associated with the Term Loan Credit Agreement (the “Term Loan Credit Agreement”), which was entered into on December 21, 2018, with cash on hand of $40 million and $170 million of proceeds from the Revolving Credit Facility.
In connection with acquisitions, we record the estimated value of the net tangible assets purchased and the value of the identifiable intangible assets purchased, which typically consist of purchased customer accounts and non-compete agreements.
In connection with acquisitions, we record the estimated value of the net tangible assets purchased and the value of the identifiable intangible assets purchased, which primarily consist of purchased customer accounts.
Our revenues grew from $95.6 million in 1993 to $4.3 billion in 2023, reflecting a compound annual growth rate of 13.5%. In the same 30-year period, we increased net income from $8.1 million to $870.5 million in 2023, a 16.9% compound annual growth rate.
Our revenues grew from $95.6 million in 1993 to $4.8 billion in 2024, reflecting a compound annual growth rate of 13.5%. In the same 31-year period, we increased net income from $8.1 million to $1.0 billion in 2024, a 16.8% compound annual growth rate.
This increase included $158.8 million of compensation costs related to stand-alone acquisitions that had no comparable costs in the same period of 2022. Therefore, employee compensation and benefits expense attributable to those offices that existed in the same time periods of 2023 and 2022 increased by $210.9 million or 12.3%.
This increase included $69 million of compensation costs related to stand-alone acquisitions that had no comparable costs in the same period of 2023. Therefore, employee compensation and benefits expense attributable to those offices that existed in the same time periods of 2024 and 2023 increased by $150 million, or 6.9%.
During the first quarter of 2022, the performance conditions for approximately 1.3 million shares of the Company’s common stock granted under the Company’s 2010 SIP and approximately 22,000 shares of the Company’s common stock granted under the Company’s 2019 SIP were determined by the Compensation Committee to have been satisfied relative to the performance-based grants issued in 2019 and 2021. 31 These grants had a performance measurement period that concluded on December 31, 2021.
During the first quarter of 2025, the performance conditions for approximately 1 million shares of the Company’s common stock granted under the Company’s 2019 SIP are expected to be determined by the Compensation Committee to have been satisfied relative to the performance-based grants issued in 2022. These grants had a performance measurement period that concluded on December 31, 2024.
The $352.0 million increase in core commissions and fees was driven by the following: (i) approximately $203.5 million related to the core commissions and fees revenue from acquisitions that had no comparable revenues in the same period of 2022; (ii) an increase of $159.4 million related to net new and renewal business; (iii) an increase from the impact of Foreign Currency Translation of $8.8 million; and (iv) an offsetting decrease of $20.2 million related to commissions and fees recorded in 2022 from businesses since divested.
The $223 million increase in core commissions and fees was driven by the following: (i) approximately $81 million related to the core commissions and fees revenue from acquisitions that had no comparable revenues in the same period of 2023; (ii) an increase of $143 million related to net new and renewal business; (iii) an increase from the impact of Foreign Currency Translation of $8 million; and (iv) an offsetting decrease of $6 million related to commissions and fees recorded in 2023 from businesses since divested.
Amortization Amortization expense for 2023 increased $19.4 million to $166.0 million, or 13.2% over 2022. This increase reflects the amortization of new intangibles from businesses acquired within the past 12 months, net of certain intangible assets becoming fully amortized or written off in the gain or loss on disposal.
Amortization Amortization expense for 2024 increased $12 million to $178 million, or 7.2% over 2023. This change reflects the amortization of new intangibles from businesses acquired within the past twelve months, net of certain intangible assets becoming fully amortized or written off in the (Gain)/Loss on disposal.
Other Operating Expenses Other operating expenses represented 15.3% of total revenues for 2023 as compared to 16.7% for the year ended December 31, 2022. Other operating expenses for 2023 increased $53.1 million, or 8.9%, from the same period of 2022.
Other Operating Expenses Other operating expenses represented 14.8% of total revenues for 2024 as compared to 15.3% for the year ended December 31, 2023. Other operating expenses for 2024 increased $60 million, or 9.2%, from the same period of 2023.
Fee revenues as a percentage of our total commissions and fees, represented 23.9% in 2023 and 25.8% in 2022. For the year ended December 31, 2023, our commissions and fees growth rate was 17.9% and our consolidated Organic Revenue growth rate was 10.2%.
Fee revenues as a percentage of our total commissions and fees, represented 21.1% in 2024 and 23.9% in 2023. For the year ended December 31, 2024, our commissions and fees growth rate was 12.1% and our consolidated Organic Revenue growth rate was 10.4%.
As of December 31, 2022, the estimated acquisition earn-out payables equaled $251.6 million, of which $119.3 million was recorded as accounts payable and $132.3 million was recorded as other non-current liabilities. Income Taxes The effective tax rate on income from operations was 24.0% in 2023 and 23.3% in 2022.
As of December 31, 2023, the estimated acquisition earn-out payables equaled $249 million, of which $146 million was recorded as accounts payable and $103 million was recorded as other non-current liabilities. Income Taxes The effective tax rate on income from operations was 23.1% in 2024 and 24.1% in 2023.
During the 12 months ended December 31, 2022, the Company repaid $12.5 million of principal related to the Second Amended and Restated Credit Agreement term loan through the quarterly scheduled amortized principal payments. The Second Amended and Restated Credit Agreement term loan had an outstanding balance of $234.4 million as of December 31, 2022.
During the twelve months ended December 31, 2024, the Company repaid $25 million of principal related to the Second Amended and Restated Credit Agreement term loan through the quarterly scheduled principal payments. The Second Amended and Restated Credit 43 Agreement term loan had an outstanding balance of $194 million as of December 31, 2024.
Other income consists primarily of miscellaneous income and therefore can fluctuate between comparable periods. 33 Employee Compensation and Benefits Employee compensation and benefits expense as a percentage of total revenues was 51.4% for the year ended December 31, 2023 as compared to 50.8% for the year ended December 31, 2022, and increased 20.3%, or $369.7 million.
Other income consists of miscellaneous income and therefore, it can fluctuate between comparable periods. Employee Compensation and Benefits Employee compensation and benefits expense as a percentage of total revenues was 50.1% for the year ended December 31, 2024 as compared to 51.4% for the year ended December 31, 2023, and increased 10.0%, or $219 million.
Investment income also includes gains and losses realized from the sale of investments. Other income primarily reflects other miscellaneous revenues.
Investment income also includes gains and losses realized from the sale of investments.
This underlying employee compensation and benefits expense increase was primarily related to: (i) an increase in staff salaries and bonuses attributable to new hires; (ii) an increase in producer compensation associated with revenue growth; (iii) an increase in non-cash stock-based compensation driven by the strong financial performance of the Company and (iv) the year-over-year increase of approximately $46.5 million in the value of deferred compensation liabilities driven by changes in the market prices of our employees' investment elections associated with our deferred compensation plan, with such amount substantially offset within other operating expenses as we hold assets to fund these liabilities that closely match the investment elections of our employees.
This underlying employee compensation and benefits expense increase was primarily related to: (i) an increase in staff costs attributable to new hires; (ii) an increase in producer compensation associated with revenue growth; (iii) an increase in non-cash stock-based compensation driven by the strong financial performance of the Company and (iv) the year-over-year increase of approximately $21 million in the value of deferred compensation liabilities driven by changes in the market prices of our deferred compensation plan, with such amount substantially offset within other operating expenses as we hold assets to fund these liabilities, partially offset by (v) employee compensation and benefits associated with certain third-party claims administration and adjusting services businesses divested in the fourth quarter of 2023.
Investment Income Investment income for 2023 was $52.4 million, compared with $6.5 million in 2022. The increase was primarily driven by higher average interest rates compared to 2022. Other Income, Net Other income for 2023 was $5.3 million, compared with $3.7 million in 2022.
Investment Income Investment income for 2024 was $93 million, compared with $52 million in 2023. The increase was primarily driven by higher average interest rates and cash balances compared to 2023. 34 Other Income, Net Other income for 2024 was $7 million, compared with $6 million in 2023.
We present these measures because we believe such information is of interest to the investment community and because we believe it provides additional meaningful methods to evaluate the Company’s operating performance from period to period on a basis that may not be otherwise apparent on a GAAP basis due to the impact of certain items that have a high degree of variability, that we believe are not indicative of ongoing performance and that are not easily comparable from period to period.
These measures of operating performance may not be otherwise apparent on a GAAP basis due to the impact of certain items that have a high degree of variability, that we believe are not indicative of ongoing performance and that are not easily comparable from period to period.
Financial information relating to our Wholesale Brokerage segment for the 12 months ended December 31, 2023 and 2022 is as follows: (in millions, except percentages) 2023 % Change 2022 REVENUES Core commissions and fees $ 524.2 19.0 % $ 440.5 Profit-sharing contingent commissions 14.8 20.3 % 12.3 Investment income 1.5 (NMF 0.3 Other income, net 0.2 (33.3 )% 0.3 Total revenues 540.7 19.3 % 453.4 EXPENSES Employee compensation and benefits 284.3 18.8 % 239.3 Other operating expenses 84.5 20.7 % 70.0 (Gain)/loss on disposal — (100.0 )% 3.1 Amortization 11.2 19.1 % 9.4 Depreciation 2.6 (3.7 )% 2.7 Interest 11.9 (7.8 )% 12.9 Change in estimated acquisition earn-out payables 20.4 NMF (1.7 ) Total expenses 414.9 23.6 % 335.7 Income before income taxes $ 125.8 6.9 % $ 117.7 Income Before Income Taxes Margin (1) 23.3 % 26.0 % EBITDAC - Adjusted (2) $ 172.4 18.3 % $ 145.7 EBITDAC Margin - Adjusted (2) 31.9 % 32.0 % Organic Revenue growth rate (2) 12.2 % 7.6 % Employee compensation and benefits relative to total revenues 52.6 % 52.8 % Other operating expenses relative to total revenues 15.6 % 15.4 % Capital expenditures $ 3.0 7.1 % $ 2.8 Total assets at December 31 $ 1,558.9 11.2 % $ 1,401.6 (1) “Income Before Income Taxes Margin” is defined as income before income taxes divided by total revenues (2) A non-GAAP financial measure NMF = Not a meaningful figure The Wholesale Brokerage segment’s total revenues for 2023 increased 19.3%, or $87.3 million, over 2022, to $540.7 million.
Financial information relating to our Wholesale Brokerage segment for the 12 months ended December 31, 2024 and 2023 is as follows: (in millions, except percentages) 2024 % Change 2023 REVENUES Core commissions and fees $ 583 11.3 % $ 524 Profit-sharing contingent commissions 27 80.0 % 15 Investment income 6 200.0 % 2 Other income, net — — % — Total revenues 616 13.9 % 541 EXPENSES Employee compensation and benefits 322 13.4 % 284 Other operating expenses 92 8.2 % 85 (Gain)/loss on disposal — — % — Amortization 12 9.1 % 11 Depreciation 3 — % 3 Interest 11 (8.3 )% 12 Change in estimated acquisition earn-out payables 1 (95.0 )% 20 Total expenses 441 6.3 % 415 Income before income taxes $ 175 38.9 % $ 126 Income Before Income Taxes Margin (1) 28.4 % 23.3 % EBITDAC - Adjusted (2) $ 202 16.8 % $ 173 EBITDAC Margin - Adjusted (2) 32.8 % 32.0 % Organic Revenue growth rate (2) 9.1 % 12.1 % Employee compensation and benefits relative to total revenues 52.3 % 52.5 % Other operating expenses relative to total revenues 14.9 % 15.7 % Capital expenditures $ 3 0.0 % $ 3 Total assets at December 31 $ 1,607 3.1 % $ 1,559 (1) “Income Before Income Taxes Margin” is defined as income before income taxes divided by total revenues (2) A non-GAAP financial measure NMF = Not a meaningful figure The Wholesale Brokerage segment’s total revenues for 2024 increased 13.9%, or $75 million, over 2023, to $616 million.
Core commissions and fees in 2023 increased $595.0 million, composed of (i) $351.1 million of net new and renewal business, which reflects an Organic Revenue growth rate of 10.2%; (ii) $285.0 million from acquisitions that had no comparable revenues in the same period of 2022; (iii) an increase from the impact from Foreign Currency Translation of $9.9 million; and (iv) an offsetting decrease of $51.0 million related to commissions and fees revenue from business divested in the preceding 12 months.
Core commissions and fees in 2024 increased $470 million, composed of (i) approximately $415 million of net new and renewal business, which reflects an Organic Revenue growth rate of 10.4%; (ii) $146 million from acquisitions that had no comparable revenues in the same period of 2023; (iii) an increase from the impact of Foreign Currency Translation of $10 million and (iv) an offsetting decrease of $101 million related to commissions and fees revenue from businesses or books of business divested in the preceding twelve months.
The $168.6 million increase in core commissions and fees revenue was driven by: (i) approximately $139.5 million of net new and renewal business; (ii) $47.1 million from acquisitions that had no comparable revenues in the same period of 2022; and (iii) an offsetting decrease of $18.0 million related to commissions and fees revenue from business divested in the preceding 12 months.
The $185 million increase in core commissions and fees revenue was driven by: (i) approximately $224 million of net new renewal business and fee revenues; (ii) an offsetting decrease of $97 million related to commissions and fees revenue from business divested in the preceding twelve months and (iii) $57 million from acquisitions that had no comparable revenues in the same period of 2023.
As disclosed in our most recent proxy statement, we use Organic Revenue growth, and EBITDAC Margin - Adjusted as key performance metrics for our short-term and long-term incentive compensation plans for executive officers and other key employees.
As disclosed in our most recent proxy statement, we use Organic Revenue growth, and EBITDAC Margin - Adjusted as key performance metrics for our short-term and long-term incentive compensation plans for executive officers and other key employees. Beginning January 1, 2024, we no longer exclude Foreign Currency Translation from the calculation of EBITDAC - Adjusted and EBITDAC Margin - Adjusted.
The 2052 Notes bear interest at the rate of 4.950% per year and will mature on March 17, 2052. Interest on the Notes is payable semi-annually in arrears. The Notes are senior unsecured obligations of the Company and rank equal in right of payment to all of the Company’s existing and future senior unsecured indebtedness.
Interest on the 2034 Senior Notes is payable semi-annually in arrears. The 2034 Senior Notes are senior unsecured obligations of the Company and rank equal in right of payment to all of the Company’s existing and future senior unsecured indebtedness.
As of December 31, 2023, the estimated acquisition earn-out payables equaled $249.2 million, of which $145.9 million was recorded as accounts payable and $103.3 million was recorded as other non-current liabilities.
As of December 31, 2024, the estimated acquisition earn-out payables equaled $167 million, of which $75 million was recorded as accounts payable and $92 million was recorded as other non-current liabilities.
Payments are primarily received in the first and second quarters of each subsequent year, based upon the aforementioned considerations for the prior year(s), but may differ from the amount estimated and accrued due to the lack of complete loss information until paid. Over the last three years, profit-sharing contingent commissions have averaged approximately 3.3% of commissions and fees revenue.
Payments are primarily received in the first and second quarters of each subsequent year, based upon the aforementioned considerations for the prior year(s), but may differ from the amount estimated and accrued due to the lack of complete visibility regarding loss information until they are received.
We view Organic Revenue and Organic Revenue growth as important indicators when assessing and evaluating our performance on a consolidated basis and for each of our four segments, because they allow us to determine a comparable, but non-GAAP, measurement of revenue growth that is associated with the revenue sources that were a part of our business in both the current and prior year and that are expected to continue in the future.
Consistent with Regulation G, a description of such information is provided below and tabular reconciliations of this supplemental non-GAAP financial information to our most comparable GAAP information are contained in this Annual Report on Form 10-K under “Results of Operations - Segment Information.” We view Organic Revenue and Organic Revenue growth as important indicators when assessing and evaluating our performance on a consolidated basis and for each of our three segments, because they allow us to determine a comparable, but non-GAAP, measurement of revenue growth that is associated with the revenue sources that were a part of our business in both the current and prior year, and that are expected to continue in the future.
(4) Does not include approximately $121.0 million reflected in accounts payable related to federal income tax payments due to Hurricane Idalia tax relief, which was announced by the Internal Revenue Service on August 30, 2023. These deferred income tax payments were paid by the deadline of February 15, 2024.
(4) Does not include approximately $90 million reflected in accounts payable related to federal income tax payments due to Hurricane Milton tax relief, which was announced by the Internal Revenue Service on October 11, 2024. These deferred income tax payments will be paid by the deadline of May 1, 2025.
The primary factors driving this increase were: (i) the profit associated with the net increase in revenue as described above; (ii) the drivers of EBITDAC - Adjusted described below; (iii) the decrease in intercompany interest expense; and partially offset by (iv) an increase in the change in estimated acquisition earn-out payables; and (v) depreciation growing faster than total revenues.
The primary factors driving this increase were: (i) a decrease in allocated interest expense, (ii) the profit associated with the net increase in revenue as described above and partially offset by, (iii) the increase in the change in estimated acquisition earn-out payables.
The excess of the purchase price of an acquisition over the fair value of the identifiable tangible and intangible assets is assigned to goodwill and is not amortized. The recorded purchase prices for all acquisitions include an estimation of the fair value of liabilities associated with any potential earn-out provisions, where an earn-out is part of the negotiated transaction.
The recorded purchase prices for all acquisitions include an estimation of the fair value of liabilities associated with any potential earn-out provisions, where an earn-out is part of the negotiated transaction.
The Second Amended and Restated Credit Agreement, among other certain terms, extended the maturity of the Revolving Credit Facility of $800.0 million and unsecured term loans associated with the agreement of $250.0 million to October 27, 2026. At the time of the renewal, the Company added an additional $2.7 million in debt issuance costs related to the transaction.
The Second Amended and Restated Credit Agreement, among other certain terms, extended the maturity of the Revolving Credit Facility of $800 million and unsecured term loans associated with the agreement of $250 million to October 27, 2026.
The Company is currently evaluating a refinancing strategy before the notes mature in September 2024. On October 2, 2023, the Company obtained $250.0 million from the Revolving Credit Facility in connection with the acquisition of Kentro Capital Limited.
On October 2, 2023, the Company obtained $250 million from the Revolving Credit Facility in connection with the acquisition of Kentro Capital Limited.
The $83.7 million increase in core commissions and fees was driven by the following: (i) $53.2 million related to net new and renewal business; and (ii) $34.4 million related to core commissions and fees revenue from acquisitions that had no comparable revenues in the same period of 2022; and (iii) an increase from the impact of Foreign Currency Translation of $1.1 million and partially offset by (iv) a decrease of $5.0 million related to commissions and fees recorded in 2022 from a business since divested.
The $59 million increase in core commissions and fees was driven by the following: (i) $48 million related to net new and renewal business; (ii) $10 million related to core commissions and fees revenue from acquisitions and dispositions that had no comparable revenues in the same period of 2023; and (iii) an increase from the impact of Foreign Currency Translation of $1 million.
Financial information relating to our Services segment for the 12 months ended December 31, 2023 and 2022 is as follows: (in millions, except percentages) 2023 % Change 2022 REVENUES Core commissions and fees $ 163.1 (5.1 )% $ 171.9 Profit-sharing contingent commissions — — — Investment income — — — Other income, net — — — Total revenues 163.1 (5.1 )% 171.9 EXPENSES Employee compensation and benefits 91.3 0.8 % 90.6 Other operating expenses 44.8 (7.4 )% 48.4 (Gain)/loss on disposal (134.6 ) — — Amortization 5.1 — 5.1 Depreciation 1.4 (12.5 )% 1.6 Interest 1.3 (38.1 )% 2.1 Change in estimated acquisition earn-out payables — — — Total expenses 9.3 (93.7 )% 147.8 Income before income taxes $ 153.8 NMF $ 24.1 Income Before Income Taxes Margin (1) 94.3 % 14.0 % EBITDAC - Adjusted (2) $ 27.0 (17.9 )% $ 32.9 EBITDAC Margin - Adjusted (2) 16.6 % 19.1 % Organic Revenue growth rate (2) (0.6 )% (2.9 )% Employee compensation and benefits relative to total revenues 56.0 % 52.7 % Other operating expenses relative to total revenues 27.5 % 28.2 % Capital expenditures $ 1.1 10.0 % $ 1.0 Total assets at December 31 $ 209.0 (29.2 )% $ 295.0 (1) “Income Before Income Taxes Margin” is defined as income before income taxes divided by total revenues (2) A non-GAAP financial measure NMF = Not a meaningful figure The Services segment’s total revenues for 2023 decreased 5.1%, or $8.8 million, from 2022, to $163.1 million.
Financial information relating to our Retail segment for the 12 months ended December 31, 2024 and 2023 is as follows: (in millions, except percentages) 2024 % Change 2023 REVENUES Core commissions and fees $ 2,676 9.1 % $ 2,453 Profit-sharing contingent commissions 44 (12.0 )% 50 Investment income 6 NMF 1 Other income, net 3 (25.0 )% 4 Total revenues 2,729 8.8 % 2,508 EXPENSES Employee compensation and benefits 1,462 9.4 % 1,336 Other operating expenses 449 6.7 % 421 (Gain)/loss on disposal (3 ) — (3 ) Amortization 119 6.3 % 112 Depreciation 21 10.5 % 19 Interest 71 (16.5 )% 85 Change in estimated acquisition earn-out payables 8 NMF 1 Total expenses 2,127 7.9 % 1,971 Income before income taxes $ 602 12.1 % $ 537 Income Before Income Taxes Margin (1) 22.1 % 21.4 % EBITDAC - Adjusted (2) $ 818 7.5 % $ 761 EBITDAC Margin - Adjusted (2) 30.0 % 30.3 % Organic Revenue growth rate (2) 5.8 % 7.4 % Employee compensation and benefits relative to total revenues 53.6 % 53.3 % Other operating expenses relative to total revenues 16.5 % 16.8 % Capital expenditures $ 48 4.3 % $ 46 Total assets at December 31 $ 9,389 8.4 % $ 8,658 (1) “Income Before Income Taxes Margin” is defined as income before income taxes divided by total revenues (2) A non-GAAP financial measure NMF = Not a meaningful figure The Retail segment’s total revenues in 2024 increased 8.8%, or $221 million, over 2023, to $2,729 million.
The amount recorded for these acquisitions as of December 31, 2023, is $4.7 million. The Company deems a significant increase to this amount to be unlikely. (3) Does not include approximately $37.0 million of current liability for a dividend of $0.1300 per share approved by the board of directors on January 17, 2024 and paid on February 14, 2024.
The Company deems a significant increase to this amount to be unlikely. (3) Does not include approximately $43 million of current liability for a dividend of $0.1500 per share approved by the board of directors on January 22, 2025 and paid on February 12, 2025.
(2) Includes $249.2 million of current and non-current estimated earn-out payables. Earn-out payables for acquisitions not denominated in U.S. dollars are measured at the current foreign exchange rate. Six of the estimated acquisition earn-out payables assumed in connection with the acquisition of GRP and Kentro Capital Limited included provisions with no maximum potential earn-out amount.
(2) Includes $167 million of current and non-current estimated earn-out payables. Earn-out payables for acquisitions not denominated in U.S. dollars are measured at the current foreign exchange rate. Five of the estimated acquisition earn-out payables include provisions with no maximum potential earn-out amount. The amount recorded for these acquisitions as of December 31, 2024, is $4 million.
The vesting condition for these grants requires continuous employment for a period of up to five years from the 2019 grant date and four years from the 2021 grant date in order for the awarded shares to become fully vested and nonforfeitable.
The vesting condition for these grants requires continuous employment for a period of up to five years from the 2022 grant date in order for the awarded shares to become fully vested and nonforfeitable. As a result of the awarding of these shares, the grantees will be eligible to receive payments of dividends and exercise voting privileges.
Financial information relating to our Consolidated Financial Results is as follows: (in millions, except percentages) 2023 % Change 2022 REVENUES Core commissions and fees $ 4,069.5 17.1 % $ 3,474.5 Profit-sharing contingent commissions 129.9 46.4 % 88.7 Investment income 52.4 NMF 6.5 Other income, net 5.3 43.2 % 3.7 Total revenues 4,257.1 19.1 % 3,573.4 EXPENSES Employee compensation and benefits 2,186.6 20.3 % 1,816.9 Other operating expenses 649.9 8.9 % 596.8 (Gain)/loss on disposal (143.3 ) NMF (4.5 ) Amortization 166.0 13.2 % 146.6 Depreciation 40.0 2.0 % 39.2 Interest 190.0 34.6 % 141.2 Change in estimated acquisition earn-out payables 21.8 (156.0 )% (38.9 ) Total expenses 3,111.0 15.3 % 2,697.3 Income before income taxes 1,146.1 30.8 % 876.1 Income taxes 275.6 34.9 % 204.3 NET INCOME $ 870.5 29.6 % $ 671.8 Income Before Income Taxes Margin (1) 26.9 % 24.5 % EBITDAC - Adjusted (2) $ 1,444.7 23.1 % $ 1,173.8 EBITDAC Margin - Adjusted (2) 33.9 % 32.7 % Organic Revenue growth rate (2) 10.2 % 8.1 % Employee compensation and benefits relative to total revenues 51.4 % 50.8 % Other operating expenses relative to total revenues 15.3 % 16.7 % Capital expenditures $ 68.9 31.0 % $ 52.6 Total assets at December 31, $ 14,883.4 6.5 % $ 13,973.5 (1) “Income Before Income Taxes Margin” is defined as income before income taxes divided by total revenues (2) A non-GAAP financial measure NMF = Not a meaningful figure Commissions and Fees Commissions and fees, including profit-sharing contingent commissions and earned premiums for 2023, increased $636.2 million to $4,199.4 million, or 17.9% over 2022.
Financial information relating to our Consolidated Financial Results is as follows: (in millions, except percentages) 2024 % Change 2023 REVENUES Core commissions and fees $ 4,539 11.6 % $ 4,069 Profit-sharing contingent commissions 166 27.7 % 130 Investment income 93 78.8 % 52 Other income, net 7 16.7 % 6 Total revenues 4,805 12.9 % 4,257 EXPENSES Employee compensation and benefits 2,406 10.0 % 2,187 Other operating expenses 710 9.2 % 650 Gain on disposal (31 ) (78.3 )% (143 ) Amortization 178 7.2 % 166 Depreciation 44 10.0 % 40 Interest 193 1.6 % 190 Change in estimated acquisition earn-out payables 2 (90.5 )% 21 Total expenses 3,502 12.6 % 3,111 Income before income taxes 1,303 13.7 % 1,146 Income taxes 301 9.5 % 275 Net income before non-controlling interests 1,002 15.0 % 871 Less: Net income attributable to non-controlling interests 9 NMF — Net income attributable to the Company $ 993 14.0 % $ 871 Income Before Income Taxes Margin (1) 27.1 % 26.9 % EBITDAC - Adjusted (2) $ 1,689 17.0 % $ 1,444 EBITDAC Margin - Adjusted (2) 35.2 % 33.9 % Organic Revenue growth rate (2) 10.4 % 10.3 % Employee compensation and benefits relative to total revenues 50.1 % 51.4 % Other operating expenses relative to total revenues 14.8 % 15.3 % Capital expenditures $ 82 18.8 % $ 69 Total assets at December 31, $ 17,612 18.3 % $ 14,883 (2) “Income Before Income Taxes Margin” is defined as income before income taxes divided by total revenues (3) A non-GAAP financial measure NMF = Not a meaningful figure Commissions and Fees Commissions and fees, including profit-sharing contingent commissions and earned premiums for 2024, increased $506.0 million to $4,705 million, or 12.1% over 2023.
Although we do not routinely sell businesses or customer accounts, we periodically sell an office or a book of business (one or more customer accounts) that we believe does not produce reasonable margins or demonstrate a potential for growth, or because doing so is in the Company’s best interest. in 2023 we recorded a gain on disposal of $134.6 million in our Services segment associated with the sale of certain third-party claims administration and adjusting services businesses in the fourth quarter of 2023.
Although we do not routinely sell businesses or customer accounts, we periodically sell an office or a book of business (one or more customer accounts) that we believe does not produce reasonable margins or demonstrate a potential for adequate growth, or because doing so is in the Company’s best interest.
Debt Total debt at December 31, 2023 was $3,795.6 million net of unamortized discount and debt issuance costs, which was a decrease of $146.5 million compared to December 31, 2022.
Total debt at December 31, 2024 was $3,824 million net of unamortized discount and debt issuance costs, which was an increase of $28 million compared to December 31, 2023.

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Item 7A. Quantitative and Qualitative Disclosures About Market Risk

Market Risk — interest-rate, FX, commodity exposure

4 edited+0 added−0 removed4 unchanged
Biggest changeIn addition, we generally dispose of any equity securities received in conjunction with an acquisition shortly after the acquisition date. As of December 31, 2023, we had $1,075.0 million outstanding under the Second Amended and Restated Credit Agreement and the Loan Agreement tied to SOFR.
Biggest changeIn addition, we generally dispose of any equity securities received in conjunction with an acquisition shortly after the acquisition date. As of December 31, 2024, we had $1,006 million outstanding under the Second Amended and Restated Credit Agreement and the Loan Agreement tied to the Secured Overnight Financing Rate (“SOFR”).
The fair value of our invested assets at December 31, 2023 and December 31, 2022, approximated their respective carrying values due to their short-term duration and therefore, such market risk is not considered to be material. We do not actively invest or trade in equity securities.
The fair value of our invested assets at December 31, 2024 and December 31, 2023, approximated their respective carrying values due to their short-term duration and therefore, such market risk is not considered to be material. We do not actively invest or trade in equity securities.
Based upon our foreign currency rate exposure as of December 31, 2023, an immediate 10% hypothetical change of foreign currency exchange rates would not have a material effect on our Consolidated Financial Statements. 45
Based upon our foreign currency rate exposure as of December 31, 2024, an immediate 10% hypothetical change of foreign currency exchange rates would not have a material effect on our Consolidated Financial Statements. 45
These aforementioned notes bear interest on a floating basis and are therefore subject to changes in the associated interest expense. The effect of an immediate hypothetical 10% change in interest rates would not have a material effect on our Consolidated Financial Statements.
These agreements bear interest on a floating basis and are therefore subject to changes in the associated interest expense. The effect of an immediate hypothetical 10% change in interest rates would not have a material effect on our Consolidated Financial Statements.

Other BRO 10-K year-over-year comparisons