May 1 (Reuters) - Arthur J. Gallagher AJG.N reported a rise in first-quarter profit on Thursday, as the insurance brokerage firm benefited from higher fees and commissions owing to clients' strong insurance spending.
Insurance brokerages act as intermediaries for customers and insurers, guiding the latter to choose the best plans for their requirements. Unlike insurers, they do not directly sell policies.
Spending on insurance policies remained robust in the quarter, helping insurance firms rake in profits. That translated to higher fees and commissions for brokerages such as Arthur J. Gallagher.
"Our core brokerage and risk management segments combined to deliver 14% revenue growth, including organic revenue growth of 9%," CEO J. Patrick Gallagher Jr. said in a statement.
The company reported a net profit of $816.1 million, or $3.13 per share, in the three months ended March 31. That compares with a profit of $652.6 million, or $2.92 per share, in the year-ago period.
On a reported basis, the company posted commissions and fees of $2.87 billion, up from $2.60 billion last year.
Shares of the company, which have gained nearly 12% in 2025, rose marginally in trading after the bell.
Brown & Brown BRO.N, another insurance brokerage firm, also reported a rise in quarterly profit earlier in the week due to a rise in commissions and fees.
Arthur J. Gallagher, which is known for tuck-in acquisitions, in March struck a $1.2 billion deal to acquire rival Woodruff Sawyer, its latest move to expand its business.
(Reporting by Pritam Biswas in Bengaluru; Editing by Alan Barona)
((Pritam.Biswas@thomsonreuters.com))
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