Posted on 30 Jul 2009
The world's biggest insurance brokerage, Aon Corp., reported that second-quarter profit fell 11 percent on higher costs related to job cuts and the acquisition of Benfield Group Ltd.
Earnings excluding the impact of unit sales declined to $147 million, or 51 cents a share, from $166 million, or 54 cents, a year earlier, the Chicago-based broker said today in a statement. Aon had $95 million in expenses linked to cutting jobs and the Benfield purchase, almost 80 percent more than a year earlier, the company said.
Aon and rivals Marsh & McLennan Cos. and Willis Group Holdings Ltd., which earn commissions by matching buyers and sellers of insurance, are under pressure as insurance prices decline and companies scale back coverage. Chief Executive Officer Gregory Case started lowering head count in a 2007 restructuring that the company said will trim expenses by as much as $265 million this year and $370 million next year.
“We continue to operate in a soft insurance pricing market as rates continue to decline, albeit at a somewhat slower pace,” Case said today in a conference call.