AJG Filings — Arthur J. Gallagher & Co. - FilingSpy
AJG
Arthur J. Gallagher & Co.
One of the world's largest insurance brokers, this company helps businesses and individuals buy insurance and manage risk, placing policies, providing claims administration, and offering benefits consulting under names like Gallagher Re. It was founded in Chicago in 1927 by Arthur J. Gallagher, who put his own name on the door and took personal responsibility for every policy sold. In 1938 it wrote Chicago's first large-deductible fire insurance policy, for a dairy company, pioneering the modern risk-management field.
Brokerage organic growth slowed to 3% and operating income fell 12.5% as the AssuredPartners deal closed, reshaping the balance sheet.
The AssuredPartners acquisition closed, and the interest income that had padded earnings for six quarters vanished. rose 24.2% to $4.0 billion but fell 12.5% to $414 million as the brokerage 's decelerated to 3% and its adjusted margin contracted sharply without the financing proceeds. Gallagher is now a larger company with $12 billion in and a brokerage engine growing at its slowest pace in years.
Key takeaways
The $13.45 billion AssuredPartners acquisition closed during the quarter, consolidating its operations and ending the quarterly interest income from the $13.5 billion in financing proceeds that had boosted brokerage in every period since Q4 2024.
Brokerage organic commissions and fees rose 3% in Q2 2026, down from 4.7% a year ago and 4% in Q1 2026, as the pace of new business and renewal premium gains continued to moderate.
Brokerage margin contracted to 31.8% from 36.4% a year ago, as the $144.2 million in quarterly interest income from the AssuredPartners financing proceeds ceased and the acquired operations were consolidated at a lower margin.
Section summaries
Quantitative and Qualitative Disclosures About Market Risk
Item 4. Controls and Procedures 59 Part II. Other Information Item 1. Legal Proceedings 60 Item 1A. Risk Factors 60 Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 60-61 Item 5. Other Information 61 Item 6. Exhibits 61 Signature 62 - 4 - Table of Contents Par…
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Item 4. Controls and Procedures 59
Part II. Other Information
Item 1. Legal Proceedings 60
Item 1A. Risk Factors 60
Item 2. Unregistered Sales of Equity Securities and Use of Proceeds 60-61
Item 5. Other Information 61
Item 6. Exhibits 61
Signature 62
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Table of Contents
Part I - Financial Information
Gallagher discloses no material pending legal proceedings, noting routine litigation and an ongoing IRS promoter investigation into its micro-captive advisory business.
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Risk management organic fee growth accelerated to 8% from 6.2% a year ago, with before reimbursements rising 12% on new client wins and higher claims volumes.
was $10 million, up from negative $424 million a year ago when a $750 million Willis Re payment drove the quarter deep into negative territory.
The company repurchased $170 million of its common stock in the quarter, bringing total repurchases to $480 million in the first half of 2026 under the $1.5 billion authorization.
What changed
The AssuredPartners acquisition, flagged as the dominant watch item in every prior filing, closed in Q2 2026. remained at $12.0 billion, essentially flat from $12.1 billion at Q1 2026 quarter-end, as the deal was funded with the $13.5 billion in financing proceeds raised in Q4 2024.
Brokerage of 3% continued the deceleration that prior filings tracked from 9.1% in Q1 2025 to 4.7% in Q2 2025, 4.5% in Q3 2025, and 4% in Q1 2026, settling at the lowest rate in the series.
The brokerage margin decline that prior filings warned would accompany the AssuredPartners close materialized, with the margin falling 4.6 points as the interest income ceased and the acquired operations were consolidated.
The $1.5 billion program, untouched since its 2021 authorization and flagged in every prior filing, saw its second consecutive quarter of use with $170 million in Q2 repurchases following $310 million in Q1 2026.
What to watch
Brokerage in Q3 2026 to see if the 3% rate represents a new post-AssuredPartners baseline or continues to decelerate.
Brokerage margin in Q3 2026, the first full quarter with AssuredPartners consolidated and no interest income from the financing proceeds, to establish the new run rate.
Whether share repurchases continue at the $150-300 million quarterly pace seen in H1 2026 or moderate as the company integrates AssuredPartners.
generation in Q3 2026, which is seasonally the strongest quarter, to assess the combined entity's cash conversion after the acquisition.
The company is involved in routine legal proceedings, including errors and omissions claims, arising in the ordinary course of business.
Gallagher's IRC 831(b) micro-captive advisory services business has been under an IRS promoter investigation since 2013 to determine if it acted as a tax shelter promoter.
The IRS is also conducting a criminal investigation related to IRC 831(b) micro-captive underwriting enterprises, but Gallagher has been advised it is not a target.
The company states it is fully cooperating with both IRS investigations.
Management believes the ultimate outcome of all proceedings, individually and in the aggregate, will not materially harm its financial position, results of operations, or cash flows.
No estimate of possible loss or range of losses is provided for the disclosed matters, as such an estimate is not possible or is immaterial.