1. Insurance broking
pulse check
January 2016 key findings
What’s the state of play in insurance broking today? Which firms are outperforming —
and why? And how does your business compare?
To answer these and other key questions, Macquarie Business Banking recently conducted
a short pulse check survey of insurance broking firms around the country. A unique snapshot
of a changing industry in a challenging market, our pulse check builds on the insights from
our benchmarking studies in 2011 and 2013 — and paves the way for our next in-depth
benchmarking survey in 2016.
The market
Revenues rise despite the challenges
Our latest pulse check confirms that the insurance broking market remains highly competitive, with softer premiums putting
revenues under pressure. Yet the research also shows that most firms have remained resilient, with the majority well positioned
to capitalise on better conditions over the next 12 months.
Revenue. 69% of firms achieved revenue growth in FY2015, down from 83% in FY2013. On the flipside, 18% saw revenues fall,
more than twice the proportion reported in our 2013 survey.
9%8%
33%
36%
6%7%
1%
6%
9%
25%
43%
9%
6%
2%
7%7%
21%
34%
13%
16%
2%
Increased
30% or more
Increased
20-29%
Increased
10-19%
Increased
1-9%
No changeDecreased
1-9%
Decreased
10-19%
Decreased
20-29%
2011
2013
2015
Revenue growth
2011 2013 2015
Increased 86% 83% 69%
No change 6% 9% 13%
Decreased 8% 8% 18%

2. 2
Insurance broking pulse check
Janurary 2016 key findings
Profit. 75% of firms posted EBITDA margins of 10% or more in FY2015, an impressive result in a tough operating environment.
Encouragingly, only 6% reported margins under 1%, suggesting that most firms remain profitable and well positioned to ride
out difficult market conditions.
Mergers and acquisitions. Industry consolidation is continuing, indicating that many firms see scale as a key driver in
achieving further growth and business efficiency.
Outlook. The vast majority of respondents expect conditions to improve next year, with 86% forecasting a profit increase, four
points higher than in 2013. New client growth is expected to be overwhelmingly the most important profit driver, while only one
in five forecast hardening premiums to positively impact profit.
Profit margins
Willing buyers have eased, while sellers have increased
Most expect profits to rise between 1% and 19%
2011
2013
2015
3%
14%
32%
23%
19%
9%
6%
10%
20%
30%
19%
15%
6%
19%
20%
23%
21%
11%
<1% 1-9% 10-19% 20-29% 30-39% ≥40%
28%
24%
31%
7%
6%
10%
14%
22%
16%
51%
48%
43%
Overall 2011
Overall 2013
Overall 2015
None of theseA willing seller A willing buyer or sellerA willing buyer
Increase
30% or more
Increase
20-29%
Increase
10-19%
Increase
1-9%
No changeDecrease
1-9%
2011
2013
2015
7%
10%
29%
38%
9%
3% 3%
8%
28%
43%
13%
2%
6%
9%
31%
40%
10%
3%
Decrease
10-19%
1% 1%
2011 2013 2015
Increase 84% 82% 86%
No change 9% 13% 10%
Decrease 4% 3% 4%
2011 2013 2015
<10% 17% 16% 25%
10-29% 55% 50% 43%
≥30% 28% 34% 32%

3. 3
Insurance broking pulse check
Janurary 2016 key findings
The outperformers
What were the two key characteristics of high performing firms in 2015?
Despite tightening conditions, around one in three firms achieved profit margins of 30% or more in FY 2015 — roughly the
same proportion as in our 2011 and 2013 surveys. While these firms are clearly doing many things well, our pulse check points
to a few key factors that set them apart. In particular, they are more likely to focus on business efficiency and staff development
measures to boost performance — enabling them to deliver a higher quality service at a competitive price point, while keeping
margins strong.
Searching for efficiencies. Asked which factors they expect to positively impact profit growth, high performing firms were
more likely to emphasise improved efficiency, while low profit firms were more likely to rely on client growth. High performers
also said they would benefit from improved economic conditions, suggesting many are well positioned to capitalise on
opportunities created by a future upturn in activity across the economy.
Finding and keeping talented people. Our pulse check confirms that high performing firms work harder than their peers
to attract, retain and develop talent. Among other incentives, they are more likely to offer training and development, flexible
working arrangements, career opportunities, and out-of-cycle salary rises.
High performing firms use a wider range of strategies to find and keep talented staff
What are the factors you expect will positively impact profit?
65%
50%
35%
25% 28%
18%
8% 5%
67% 64%
54%
46%
26%
17%
6% 7%
71%
79%
56%
50%
19%
31%
6%
Non-salary
benefits (i.e.
flexible working)
Training and
development
Offering
bonuses
Career
progression
Discounted
premiums
Out of cycle
salary reviews
None of the
above
Other
Low (<10% of revenue) Med (10-29% of revenue) High (≥30% of revenue)
63%
improved
efficiency
29%
improved economic
conditions
25%
Low
<10%
of revenue
43%
Medium
10-29%
of revenue
32%
High
≥30%
of revenue
Defining outperformance: 32% of businesses achieved margins of 30% or more

4. Insurance broking pulse check
Janurary 2016 key findings
For a closer look at how your business is performing against key industry benchmarks, please
contact your Macquarie Relationship Manager or call 1300 812 673.
The information in this summary has been prepared by Macquarie Bank Limited ABN 46 008 583 542 AFSL & Australian Credit Licence 237502 (‘Macquarie’) for general
information purposes only and is based on statistics and information collected by Macquarie from the 2015 Macquarie Business Banking Insurance Broking Pulse Check Survey (‘the
Survey’). This information does not constitute advice. Before acting on this information, you must consider its appropriateness having regard to your own objectives, financial situation
and needs. You should obtain financial, legal and taxation advice before making any decision regarding this information.
Macquarie does not warrant the accuracy of any information collected in the Survey. Forward looking forecasts are estimates only and are based on the Survey results. Macquarie
does not warrant the accuracy of these estimates and actual results may vary based on a number of market, regulatory, financial and environmental factors. Additionally, past
performance is not a reliable indicator of future performance.
© Copyright is reserved throughout. The information contained in this document must not be copied, either in whole or in part, or distributed to any other person without the express
permission of Macquarie.
Small
0–9 staff
66% increased revenues in FY15
28% had margins of 30% or more
57% forecast 10%+ profit growth
57% offer staff development
Medium
10–19 staff
72% increased revenues in FY15
36% had margins of 30% or more
36% forecast 10%+ profit growth
70% offer staff development
Large
20–29 staff
72% increased revenues in FY15
40% had margins of 30% or more
24% forecast 10%+ profit growth
84% offer staff development
Discover how we can keep your business in front
Snapshot by business size
How does your firm compare?
While our pulse check shows that businesses of every size can be highly profitable, it is also clear that business strategies
and performance will be affected by the size of your firm and the resources at hand. Here is a snapshot of some of the
key differences between large, medium and small firms in today’s market.