Marsh is the flagship operation of Marsh & McLennan Companies (MMC), one of the world's largest insurance brokerages. The company brokers insurance and provides risk management and consulting services to corporate clients, government agencies, and other organizations big and small. Marsh has some 25,000 agents and hundreds of brokerage locations in more than 100 countries. Marsh also provides risk financing, insurance program design, and underwriting management, as well as claims administration and technological support services. MMC affiliate Guy Carpenter provides similar brokerage and risk management services to reinsurance companies; other MMC companies include consulting firms Mercer and Oliver Wyman.
Marsh accounts for about 45% of parent MMC's annual revenues, nearly half of which are derived from the US market. In response to global economic conditions and an increase in catastrophic events, Marsh has been promoting its image as an all-around risk adviser while maintaining its position as a top global brokerage firm. MMC has undergone restructuring measures in recent years to realign Marsh's organization around growing the risk management operations, as well as to control costs in the face of economic and competitive market pressures.
While the company has regularly expanded its core insurance operations through the purchase of small brokerages to add to its network, it has also completed some larger-than-usual transactions in recent years to grow in core markets. For instance, the company made a bold move to expand its non-US operations in 2010 when it completed a deal worth £135 million ($218 million) to acquire London-based HSBC Insurance Brokers (HIBL) from financial institution HSBC. The purchase of HIBL, which was integrated into the Marsh organization, increased the firm's presence in the UK, as well as in Asia and the Middle East. As part of the deal, Marsh also entered into a partnership with HSBC that gives the company preferred access to HSBC's corporate and private banking clients ahead of other brokers.
In 2012 the company moved to establish a leading presence in the African market by acquiring the brokerage operations of Alexander Forbes, including the Alexander Forbes Risk Services division and several regional offices, for an undisclosed price. The transaction gives Marsh a top spot in the South African insurance market, as well as an expanded presence in other neighboring countries (Botswana and Namibia). The company has also agreed to acquire other Alexander Forbes operations in Malawi, Mozambique, Nigeria, Uganda, and Zambia. AFRS will become Marsh Africa, and Marsh's existing South African operations will be combined into the new division.
While the company provides access to property/casualty insurance and employee benefits to businesses of all sizes, it has recently been focused on expanding the Marsh & McLennan Agency (MMA) unit, which caters specifically to small and midsized businesses in the US. The firm made about a dozen small brokerage acquisitions during 2010 and 2011 to expand the MMA operations in select regions (including the Southeast, Midwest, and New England), niche markets (such as construction bonds), and benefits management.
In another move to expand its benefits operations, this time in the international arena, in 2012 Marsh announced a new brand identity, Mercer Marsh Benefits. Through the new unit, Marsh will work with sister company Mercer to provide consulting and brokerage services on a combined basis to provide a one-stop-shop solution for clients looking to managing the risks and costs of their employee benefit programs.
Marsh's restructuring and expansion programs have paid off for its parent in recent years. In 2011 for instance the Risk and Insurance Services (RIS) segment, which consists of the Marsh and Guy Carpenter operations, experienced a 9% increase in revenues to some $5.3 billion, contributing strongly to an overall 9% increase in MMC's revenues (to $11.5 billion) that year. The rise in Marsh's sales reflected growth in all major geographic areas and was attributed to new business development, customer retention, and acquisition efforts.