As the dust begins to settle on the news of the latest mega-merger, StrategicRISK asked our risk experts what their thoughts are on the deal and what the impact will be on you as risk managers. 

Patrick Smith

Patrick Smith, director, Acumen Advisory

Acumen Advisory director, Patrick Smith, said: ”This is obviously a major move for the two companies and time will tell whether the combination will yield tangible benefit to the customers and, if so, how quickly. Clearly, for multi-national organisations the choice of broker with requisite reach is, yet again, contracted but, perhaps the potential issue that this might create is mitigated by the merged broker having increased leverage amongst its insurer partners.

”The potential dovetail or overlap is yet to be seen and, of course, the efficiency with which the operations are integrated will be absolutely key to the continuity of customer-facing focus,” Smith added.



Danny Wong

Danny Wong, founder and chief executive officer, GOAT Risk Solutions

”When news broke that the big 3 insurance brokers will become the big 2, my reaction was obvious that a duopoly is not good for customers in terms of choice, price, or service quality.  With less competition, don’t expect extra mile service or innovation either.

During the integration phase, there will be disruption and change for existing clients, $800m synergies has been announced so this will mean job losses and fewer roles for risk professionals.  Unfortunately, the only upside I can see is for the shareholders.”

John Ludlow, chief executive officer, Airmic

“Clearly there is going to be a reduction in choice in the broker market which is disappointing for policyholders, and many of our members and the competition authority will have a strong view on this.”

“It is not yet clear at all what value this merger will bring to our members, and they will challenge the newly created broker to demonstrate, not just in words but in actions too, how they are going to offer increased value in exchange for more limited choice.


“If customer value fails to materialise, policyholders will undoubtedly find new ways of fulfilling their needs. We have already seen in our members’ response to the harsh market that when the market reduces its value and service, businesses are prepared to look at alternatives. Organisations have a much better understanding of their risk than in the past and have more options available to them.

“When handled well, there can be benefits to consolidation: for example when Willis Group merged with Towers Watson, businesses gained wider access to specialist risk management practices which was a real positive for our members. Given the current hardening market, there may also be some benefit to policyholders of having a large, strong broker. But for this merger to be successful, the broad spectrum of needs and wishes of policyholders must be at the heart of its strategy – they cannot be treated as the end point of a transaction. We look forward to seeing where the new sources of value will lie.

”Looking at the broader market as a whole, brokers are already increasingly homogenous in culture and constrained by regulation, both of which can lead to a reduction in service, creativity and diversity. As the big players consolidate, it leaves wide open the gap for new, more agile players to create a more diverse offering – this would be a welcome direction for the future of the market.”


Jan Mumenthaler, regional insurance lead, Asia, International Finance Corporation

Jan Mumenthaler

”The recent Marsh/JLT transaction has not yet been fully digested when the next mega deal is announced.

“For companies operating globally (like ours), a global footprint and understanding is critical. At the same time, we require a minimum number of competitors when we launch a RFP. Assuming Aon/WTW will proceed, we will soon drop below the requirement which will create a difficult situation from a procurement point of view. It may push us into considering direct buying for placements with limited value-add by the broker. Another possibility may be a push into using regional or local brokers rather than resorting to a global broker procurement; such move would come with multiple challenges.

“The distance between the mega brokers and other brokers operating in markets which are of relevance to the World Bank becomes bigger and bigger. I sense that it will become more difficult to show “local flavor” in the offering of these mega brokers.

”It would appear that these mergers are not in the customers’ best interest. The ’size matters’ argument has a certain value but I honestly speaking do not see a significant improvement in the new Marsh vs. the old Marsh. There appear to be limits in what clout is able to achieve.

”I certainly did not sense any need for the Aon/WTW transaction. The firms had their own strengths and weaknesses and it was good to be able to have that choice.

“The timing for the transaction is interesting given current challenges of a hard market (how does a bigger broker help in that situation?) and the added complication of COVID-19. There may be real logistical complications linked to the latter. This obviously besides the highly volatile economic environment.

”I feel that risk managers value insurance brokers for technical services beyond pure placement. I get the impression that the transaction income is highly driven by brokerage income and I would suspect that this will remain the focus of the new Aon. For Risk Managers who value the technical services (e.g. risk modelling, risk engineering etc.) there may be a flight to smaller, specialized firms who may then also pick up the resulting insurance placement because of their intimate knowledge of the business.”



Aon and WTW call off mega merger