Gallagher says its diversification strategy contributed to higher third-quarter results.

Its brokerage division and risk management business Gallagher Bassett delivered a 25.4% rise in net earnings to $US576 million ($818 million) in the September quarter.

Revenue before reimbursements surged 18.2% to $US3.93 billion ($5.58 billion), including organic growth of 5%.

Brokerage revenue gained 19% to $US3.47 billion ($4.93 billion), with organic growth contributing 5%. Gallagher Bassett achieved a 14% rise in revenue to $US457 million ($649 million), including organic growth of 10%.

Chair and CEO J Patrick Gallagher says the brokerage unit “saw excellent growth across … retail [property and casualty], wholesale and reinsurance businesses. The business is living up to our high expectations. Client retentions remain strong and the teams are working very well together.”

He says Gallagher has a “diversified revenue model” that ensures the group is not reliant on rates to drive earnings.

“It is well known that insurance rates are currently contributing less to growth than they have over the past several years,” Mr Gallagher said.

“This reinforces that rates are just one part of the equation. The bigger drivers of organic growth continue to be new business, strong retention, exposure growth, as well as the diversity of our model across [P&C], benefits, reinsurance and claims.

“This shows our business performs well through a wide range of economic, interest rate and insurance pricing environments, and we believe our diversified model and breadth of capabilities position us well to continue growing as the market conditions evolve.”

Looking ahead to next year, he said: “We see many of the same drivers … strong new business, excellent client retention, positive exposure growth and our diversified business mix. Those support another year of strong organic growth.”

On acquisitions, Mr Gallagher added: “We continue to see good opportunities, and as always, we’re staying disciplined on strategic fit, culture, valuation and returns.”

During the third quarter, Gallagher completed five tuck-in acquisitions representing about $US100 million ($142 million) of estimated annualised revenue.

“That brings us to 21 so far this year … Our pipeline remains active, with over 30 term sheets signed or being prepared … and these mergers continue to add terrific people and capabilities across our businesses and geographies.”