Marsh McLennan beats profit estimates

(Reuters) – Marsh & McLennan Cos. Inc. reported a better-than-expected profit for the third quarter on Thursday, bolstered by its risk and insurance services business.

Rising wages and growing expectations of a soft landing for the U.S. economy have prompted individuals and companies across various sectors to spend more on insurance policies despite higher costs.

That has boosted the commissions earned by brokerages, as their earnings are tied to the premiums charged by insurers.

On an adjusted basis, the New York-based firm earned $1.63 per share for the three months ended Sept. 30, beating analysts’ estimates of $1.61 per share, according to data compiled by LSEG.

It reported total revenue of $5.7 billion in the quarter, up 6% from last year.

Marsh McLennan’s risk and insurance services business posted revenue growth of 8%, while its consulting arm’s revenue climbed 3%.

Its fiduciary interest income – earnings on funds held on behalf of clients – jumped 5.34% to $138 million.

While its revenue streams are diversified across consulting, talent management and investment management services, Marsh McLennan’s risk and insurance services business accounts for the majority of its revenue.

In September, the company agreed to buy McGriff Insurance Services for $7.75 billion.

The deal is expected to enhance its capabilities across commercial property and casualty, employee benefits, management liability and personal insurance line