Brown & Brown anticipates that the cost of the Howden-driven talent war for the full-year 2026 could hit $60 million – an increase from the $31 million it estimated last quarter.
“Based on currently available information, we anticipate the full-year 2026 revenue impact, related to new and lost business as well as incentives, to be in the ran
ge of $50 million to $60 million,” said R. Andrew Watts, Brown & Brown’s chief financial officer and treasurer, who spoke during a recent analysts’ call to discuss Q2 2026 results.
Brown & Brown, headquartered in Daytona Beach, Florida, previously had estimated that Howden’s US startup had poached close to 300 of its employees. (Brown & Bro
wn in May was granted a temporary restraining order against 16 former employees, now working at Howden, who are barred from soliciting customers or recruiting staff).
Brown & Brown reported second quarter revenues of $1.7 billion, an increase of $391 million, or 30.4%, from Q2 2025. Q2 organic revenue decreased by 0.7% to $1.176 billion from $1.184 billion in Q2 2025.
CFO Andy Watts anticipated that organic growth for its Retail division would improve during the second half to 1.5%-2.5% and to 2%-4% for the broker’s Specialty Distribution business.
The broker reported net income of $288 million, an increase of $57 million, or 24.7%, from $231 million during Q2 2025.
CAT Property Rates
“We’re pleased with our financial performance for the quarter, which came in modestly ahead of our expectations even with continued pressure from declinin
g [property catastrophe] rates,” said J. Powell Brown, Brown & Brown’s CEO and president, during the analysts’ call.
In property, catastrophe (CAT) rates continued to decrease 15% to 35%, which is similar to the first quarter, CEO Brown said, noting that there continues “to be a sign
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ificant amount of capital seeking to underwrite risk with supply exceeding demand.”
When asked whether rates are getting close to a bottom, Brown said he didn’t want to speculate about how much more rates could drop.
However, he went on to cite the example of southeast Florida where many of the CAT property rates along the coast are currently at 2017 levels. “So they went up ve
ry quickly and then they’ve come down in a period of almost two years very quickly.”
What would it take to stabilize the market? Powell speculated that it would take a natural catastrophe with claims between $100 billion and $150 billion, “which is just staggering.”
“So I’m not calling the bottom [of the soft market], and I’m not going to speculate when we get to the bottom. I’m just kind of giving you parameters of what I think
it would take to change or stabilize that. And there’s going to continue to be a lot of competition with property in the near to intermediate term.”
CAT property is the excess and surplus lines space, Powell said, where there is “more competition today from admitted markets and programs than there has
been in the past, and that is exactly what you would expect in a transitioning market.”
Artificial Intelligence
Regarding artificial intelligence, Powell emphasized that “AI will be an enabler for our company and our teammates,” helping to transform sales and service process
es, optimize underwriting and placement processes while enhancing support functions.
“We do not believe technology will replace the need for risk advisers, brokers or delegated underwriters. Rather, we believe it will enhance our capabilities to make them more effective in their roles. Our technology strategy is align
ed with our goal to be the leading global provider of risk management solutions,” he continued.
