Fitch: U.S. Insurance Broker Rating Outlook Stable; Sector Outlook Positive for 2014

NEW YORK--()--Link to Fitch Ratings' Report: 2014 Outlook: U.S. Insurance Broker Industry
http://www.fitchratings.com/creditdesk/reports/report_frame.cfm?rpt_id=724482

Revenue and earnings growth for U.S. insurance brokers in 2014 is expected to improve modestly upon levels ultimately reported in 2013, according to a new special report by Fitch Ratings.

In the report, Fitch discusses key factors supporting the Stable Rating Outlook and Positive Sector Outlook for the insurance broker market. The report includes an analysis of trends in operating performance and credit fundamentals, brief updates of recent events and the rating rationale for individual brokers in the rating universe.

The Stable Rating Outlook reflects Fitch's expectation that prospective operating performance and balance sheet strength will remain supportive of the existing ratings for the brokers in Fitch's ratings universe. Despite anticipating modest improvement in key credit fundamentals in 2014, Fitch sees limited potential for upgrades over the next 12 - 24 months.

The Positive Sector Outlook recognizes the continued but moderating trend of pricing improvement in many commercial insurance business classes should provide a tailwind for organic growth at least through the first half of 2014. Favorable operating fundamentals are anticipated to foster modest improvement in profit margins and interest coverage for the larger brokers going forward. New business opportunities should also benefit from continued economic improvement that will likely yield modest gains in insured exposures. The disruption caused by the rapidly evolving healthcare environment should be especially beneficial for the employee benefits and consulting businesses of the insurance brokers.

The full report '2014 Outlook: U.S. Insurance Broker Industry' is available at 'www.fitchratings.com.'

Additional information is available at 'www.fitchratings.com'.

Applicable Criteria and Related Research:

--2014 Outlook: U.S. Insurance Broker Industry

--U.S. Insurance Broker Industry Sector Credit Factors

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Contacts

Fitch Ratings
Greg Dickerson, +1 212-908-0220
Director
Fitch Ratings, Inc.
One State Street Plaza
New York, NY 10004
or
Gretchen Roetzer, +1 312-606-2327
Director
or
Jim Auden, +1 312-368-3146
Managing Director
or
Media Relations, New York
Brian Bertsch, +1 212-908-0549
brian.bertsch@fitchratings.com

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Contacts

Fitch Ratings
Greg Dickerson, +1 212-908-0220
Director
Fitch Ratings, Inc.
One State Street Plaza
New York, NY 10004
or
Gretchen Roetzer, +1 312-606-2327
Director
or
Jim Auden, +1 312-368-3146
Managing Director
or
Media Relations, New York
Brian Bertsch, +1 212-908-0549
brian.bertsch@fitchratings.com